making money at woodworking

[Ray Schafer]

Just for clarity on my particular desires -- I am not looking to make a living, just make some money. If I could make about $10,000 to $20,000 a year in profit (in today's dollars), that would give me some walking around money.

[Terry Teadtke]

And a discussion I have thought seriously about over the past 18 months or so. People are making money woodworking. Not a lot of people mind you but those that build something unique for a targeted market do make money. I know this because I know the people making money in the business. Now if you’re planning on making bird houses, wishing wells out of 2 x 4’s, and other assorted pieces like a bazillion other hobbyist’s do, you’re swimming upstream I my opinion. If you’re thinking about building cabinets to compete with the big box stores you’re going to go out of business in a heartbeat. One needs to think about the upper end of the market.

I don’t know about your Real Estate market but in my area many good cabinet makers have made a very good living over the past decade making high end cabinets for people redoing older homes. I’ve seen kitchens with furniture quality cabinetry homeowners don’t blink an eye in spending up to $100 k for. Unfortunately since the Real Estate down turn a lot of the custom cabinetry shops have gone out of business or have downsized considerably because they were unable to adapt to the changing market or are unable to branch out into other areas.

What one needs to do is create unique product and market that product to a section of the population that is looking for such a product. The higher the average household income the less these people are affected by a downturn in the economy which is already happening. And it costs money to market your products so be ready for that.

As I mentioned above and without going into too much detail, I’ve given this subject a great deal of thought and have decided to take the plunge opening a custom woodworking shop by the end of the year. I’ve spent the last several months creating, designing, and engineering a line of furniture that’s a mix of traditional styles. I have also targeted my market and have a marketing program ready to go as soon as I’m ready.

So far to date I figure it’s going to cost somewhere in the neighborhood of $35,000 to set up a complete one man woodworking shop with better than average equipment, I need a space of 1000-1500 square feet of shop area, and it will take about a year to build up any inventory to actually market. I don’t plan on selling a single item during this time; I will be just spending money on material and producing inventory. When I do have inventory ready to go I will then consider a combination workshop and showroom located near a good part of my customer base. Approximately 3 months before I’m ready to market my products I will have a web site on line and start additional advertising about a month before I’m ready.

I figure it’s going to take approximately 2 ½ to 3 years before I break even with my initial material and equipment investment before I start seeing any profit. By then I should have a solid customer base and be somewhat self-sufficient. I may also go bust and I’m ready for that as well but one never knows unless one tries.

Terry

[Grant Vanbokklen]

What about custom chair makers. I've seen a few sites that look nice. Not sure if they are making money at it though. Are they? And if so, who are they.

Look at who is making money for good examples.

[Karl Brogger]

I'm an idiot. I started off on my own just as the housing market around here was take the long trip down the xxxxpipe. I'm going to brag, I'm really fricken good at what I do. That isn't enough though. You need to have a niche and establish yourself. Getting a name is the hardest thing you can do. I'm five years in and people are just starting to know. The first year I was on my own I lost money. The second year I lost money. The third year I was a little ahead and hired my first employee. The fourth year would've been good, but I spent about another $25k on equipment. It's a good investment but I could've used the cash for fun things like eating/sleeping indoors. So far year five has sucked majorly. There is no work to be had by anyone in the area. Up to today I've done only two jobs of any size, both of which were still pretty small and we've only scraped up $17k worth of business, and I was hoping to break $200k this year (an almost 60% increase from last year). We have a severe saturation of small shops around also, which doesn't make anything easier.

If you're planning on doing it for just some extra cash my advice would be to get a part time job at a cabinet shop. I'm 27 years old and from working in the trades the last ten years, (plus some of the sports I have taken up in the past), my body is about shot. I dread delivery and install days. Especially on big jobs where I may fill my 16' enclosed trailer 2-3 times to get the cabinets there.

I went into this trying to make more money, not because I enjoy it. In fact I'm getting to the point now that I flat out hate it. I recently was offered a job from a builder that I used to work for to run their cabinet and millwork shop. I may take them up on it because I'm living in borderline poverty now. But, if you aren't counting on the income and you don't NEED it then I say go for it. Just don't spend too much money.

I've come to the conclusion that if a business, regardless of what it does, isn't growing it is dying.

Another thing I forgot to add. Quality has NOTHING to do with how much you pay for cabinets/furniture. I've found the more you charge the more people think they are getting. Granted I don't build crap and I don't think I charge too little or too much but what people really want is percieved value. The first thing I do when I do to a house for a bar or an entertainment center is look at what the people drive. If they have a decent house, but have a aged mini-van, and a rusty corolla then I know they aren't interested in what they want people to think of them. On the other hand if they have a Lexus and a BMW SUV chances are they want people to think they're important and wealthy, which most of the time they're way over their heads in debt. They are the ones who WANT to tell their friends they paid $20k for a bar or entertainment center.

[J. Z. Guest]

I don't think it is a good plan to put yourself under that kind of stress when you're retired.

To me, the better plan is to work part-time at a Woodcraft or Rockler, and spend the rest of the time doing woodworking.

This will make you break even with your woodworking expenses. You'll still buy the stuff, but you'll just spend your Rockler paycheck at Rockler, and still have your Social Security (if we still have it) and retirement for day-to-day stuff.

If you are REALLY serious about this, my suggestion is to make small, inexpensive stuff in bulk, like the wine balancers thingies and clock/picture frame thingies and sell them on ebay. But then, you're doing repetetive stuff and it isn't fun any more. It has become W-O-R-K, a four-letter word.

Make templates for everything you do, so that you can go back and crank them out with a jigsaw and pattern bit in your router.

For an answer on how to make money in kitchen cabinetry, you should get a quote to redo your own kitchen, then price out the materials to make your own cabinets. You'll notice there's at least a $5k difference between the materials cost and the cost of paying a kitchen cabinet company. I recommend the book by Danny Proulx on kitchen cabinets. He seemed to make everything out of melamine except face frames. He said it didn't pay for him to spend time making his own doors. He seemed to become efficient at every step of the process, using modern hardware to save himself from stupid, time-consuming tasks. (for example, using adjustable cabinet legs instead of shimming cabinet bottoms to make them level & even)

So I guess my answer is that the only way to make money is to pick a specialty and get very good at it. Preferably a niche that hasn't been filled yet.

You also have to take into account that you're going to be 15 years older. Your body will get tired sooner. You'll be weaker. You might have some health problems that slow you down. Kind of depressing, but worth considering if you're going to bank on it.

[Bill Wyko]

I will say that I made 3500.00 bucks on 3 turnings at my first art show. But the price of the tools it took to make them is much, much more.

[Craig Kershaw]

I suspect my bosses comment about how to make a small fortune in the trucking business might hold true for woodworking - start with a large one.

[Peter Quadarella]

Here's a thought - custom doors. I can't find a decent custom interior door maker in all of Charlotte. And no one I know knows one. I'm about to the point of making one myself, but I want it to be nice .

[Dennis Montgomery]

Ray, I have been a full time woodworker for a little better than 6 years. I spent 28 years in the telecommunications field and just walked away one day and decided to do this. I did not retire, I just changed careers. I had no prior training, just the desire. I have run about $175,000 in sales each year for the past three years as a one man shop, building cabinets, custom casework, and custom closets. Yes, you can make money in woodworking. Here are some thoughts.

I love building custom stuff in my shop, but at 52, I’m finding it more physically exhausting to load stuff in my trailer and go carry it up two or three flights of stairs to install in a customer’s home, and I am in excellent health. You may want to seriously consider this at retirement. Cabinets are easy to build, but installation can be a b**ch.

You are in an enviable position right now. You have the time to slowly invest in good quality tools and develop the products you want to market before retirement. I have a friend that did this same thing. He bought a unisaw, 15” planer, drum sander, routers, lathe, etc., over time while he was working a “regular” job. He got interested in and started building bank boxes using the old post office box doors. Over the years he bought a 6 x 10 enclosed trailer and started hitting craft shows. It took a few years of trial and error to find the right shows where people would actual buy his products, but now he does around $4000 per weekend and only does a few shows each year. He retired a couple of years ago and builds 400 to 500 boxes during the winter and goes to the shows during the summer.

Look at Fine Woodworking magazine for examples of fine furniture. If you want to build fine furniture and get paid appropriately for it, I suggest building some and showing it to interior designers. My biggest single sales come through interior designers. It’s hard to hook up with them, but once you enter the inner circle, it comes with great benefits. Their customers have the financial means and will buy your product if their designer tells them to. Sometimes the designer contracts directly with me on behalf of the customer.

The point is, you have the time to fund your tools, at your pace, develop product(s) and also develop a sales channel whether its craft shows, retail stores, or a loyal following of fanatical customers.

One thing I have found is the longer I am in business, the easier it gets because of the repeat business of my large customer base. My business is down right now because of the economy, but I’m still doing enough to pay the bills and feed the family because of repeat business.

Put a 15 year plan in place and move out…..

[C Scott McDonald]

I was a partner in a custom cabinet shop roughly 12 years ago. I started it with a very good friend of mine. We scratched together a small living for the two of us for about 5 years. We never really got ahead and made it what I would consider a success. We sold the shop at a break even price and went our seperate ways. I have since got into the ATM industry and my friend is an engineer for a rather large millwork shop in NM. I dropped of the wood radar up until last year when a friend of mine asked for some help with an entertainment center. With the few tools I had left we threw one together. I looked at it and was somewhat disappointed with my rusty skills, he was estatic.

That is when it occured to me. I have an income that takes care of my needs. Woodworking now has a place in my life again. It gives me a sense of peace and the ability to create. Do I want to make money at it? yes ... Is it worth the potential heartache and ruin my desire to build? For me, No ...

Just something to think about ....

hey Dave,

You work for Diebold, NCR or god forbid Triton?

[Bob Feeser]

I come across this topic from time to time, and there are those, including Dave who can advise you better than I. But I did go into the business for a short while. Made wainscoting for a bathroom in an upscale home, did a pair of oak doors, and some oak steps. The thing I was up against, was that I had to spend so much time designing, and everything I was building was a prototype. Also on individual projects is was:

1. Visiting the sawmill using the same amount of time, and fuel, whether I was doing a little project, or a big one, or better yet, several of the same project.
2. Setting up different router tables to get the registration perfect between all of the bits. e.g. cabinet doors.
3. Setting up for each stage, including sanding, refinishing, glue ups, etc.

The list goes on. With all of the prototype procedures with making a custom piece on every shot, I wound up making less money then I wanted to. I can see high end quality pieces, known by those who will pay for the quality, being an interesting way to go, but consider this.
If you look at the big boys, Ethan Allen, Wood Mode Custom Cabinetry etc. They are not really custom anything. They mass produce pieces. Why? Because of the economics of it. This country went through an industrial revolution, including Henry Ford, when people were taking mass production methods, and applying it to the trades that used to be all custom made, and very expensively.
So let's say you are making a line of entertainment centers. You design up a couple of models. Gain the advantage of perfecting that model with each build. You offer it in oak, walnut, or cherry and when you get several orders for the same model, you make them all at once. You save time on buying the materials, on design, on setting up the tools, on setting up for each stage of the procedure etc. Everything becomes economized, while still allowing you to do custom level work. If you look at some of the aforementioned manufacturers pieces, they are putting out a semi mass production piece, with a hand made feel to it. (More solid woods, and final stage finishing including ultra fine steel wool the cured last coat, and apply wax, for a hand rubbed feel. You also want a fancy name like to give it some style. This is not bull, or deceiving anybody, this is providing people with a quality product, hopefully being skilled enough in the art of marketing that you are getting a good price for it, and utilizing mass production to make it profitable, and worth your while. It is not unusualy to get $3500 for an entertainment center in three sections. If you got only 4 orders per month, and got used to building the same model, you could knock them out in about 2 weeks, and still have time to enjoy life.
As was mentioned earlier in the post, carrying heavy boards, or cabinets up and down steps, when you get into the more mature years is not exactly what you aspire to. I spent my youth building a body shop for 20 years and did all of that. Wound up with 11 employees, and did a lot of high end work. And like someone else posted, downsizing, getting involved yourself, instead of having to watch a lot of others is more profitable and less risk.
These are my thoughts. There is a lot of great information posted in this thread from others more experienced in this biz then myself, and I am half tempted to print it out and keep it for reference.

[Jack Clay]

I have got a chance to make projects for a local store that sells primitive items. I have never had a business so I am wondering how all of you do taxes IE tax numbers and income taxes. Do you get help with that part or do you keep track of it yourself. How much work is it to keep track of everything for taxies? This would be a side business with no intention of replacing my job.

[Mitchell Andrus]

Schedule C

[Dave Burris]

Actually I work for First Data, the former Core Data, so I have to support all of them. Keep me in your prayers, my sanity is slipping fast!!

[Ben Rafael]

If you want to make money at woodworking you need to make art pieces, not crafts. Work to get your work in to art shows.
I've done several craft shows and my only comment about them are that the people there who are selling art pieces sell nothing because it is the wrong market, people coming to craft shows rarely spend serious money. The people who are selling crafts are pricing their items too low, IMO they are selling them at cost. The only people making money at craft shows are the ones who are selling imported asian garbage.
My advice, and I will not be offended if you dont take it, is to take your time and make fewer but high quality art pieces. Check out some art shows and galleries to get an idea about pricing and placement. Look at the artists and talk to them, you will find that many are not artists and have just relabled imported work hoping to make a killing(avoid those shows). Some shows will want to judge your work before allowing you to present, those are the better shows.
And most of all , Enjoy.