starting the business

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Okay, I quit a job about 6mths ago. On my exit interview the owner told me if you want to start a business just do it, there's never gonna be a better time. I went to work for another shop in hopes to be able to start my own within a little over a year. Goal is to be self supporting by 2017. My former boss' insight was, you're good at what you do, of the right age (30's), just start and customer basis will follow. Once the word is out business will come to you. My question was how to start? Do I start welding coupons and throw them into the middle of the street with a business card! That'll never work. In the beginning for those of you that are operating your own fab/welding shop how did you get that first couple customers? I've done a couple of custom projects on the side with good results/feedback but how to build that? Do I start looking at local industry and cold calling so to speak? Walk in and ask for purchasing and make a case of what can I do for you? My big obstacle is funding of course. Lease rates are expensive as is equipment. I'm equipped with 300amps for MIG and TIG as well as 80amp plasma. Cutting all small tubing with a porta-band at the moment, which works but isn't efficient of course for the long haul. Is it feasible to think I can take 45k salary the first year of full-time while building my equipment listing and holding a $6/sq ft lease on say a 2000sq.ft. bldg.? My ideal is to build a business to support a couple families in addition to my  own, employing higher end welding/fabricators with a good head on their shoulders. I have a couple of ideas for local products but I want to find a few contracts to help support the business while refining these ideas and bringing them to market. I fully realize the work involved in the process so please don't get on that soapbox, I've been enrolled in an entrepreneur class for a bit over a month and have a month left to iron out the business plan type details with. Currently I'm operating out of my 1000sq ft garage with wood shop in it (less than ideal but it's a starting place for now). Thanks for any input, ideas, and suggestions.
Reply:I find it crazy that someone told you with a straight face just start and the customers will come. I hope you are able to get something going though.
Reply:[QUOTE=mikecwik;6884881]I find it crazy that someone told you with a straight face just start and the customers will come. That advice is exactly as good as what you paid for it.......NOTHING........Go back to Mr. Encouragement and see how much $$$$$$$ he's willing to invest .......( since he thinks it's such a good idea) .......Remember ;" Money talks and B.S. walks" .........
Reply:A very successful business owner, of which I disagree with many of his practices in business but he's a to argue as he's been very successful. Started with nothing 20 yrs ago and now has a job shop so to speak with 245 employees. He's also a man with means now. He'll buy a 1/2million dollar pc of equipment and then tell his engineers to go sell something so it'll make money. Has no 'sales' team. Most of his business comes from referal. Adverising budget is nearly nill with no formal advertising beside business cards and the like as well as supporting localNFP organizations.
Reply:Uhhh...assuming you can produce quality fabrication on most metal substrates, not just weld good but the knowledge and ability to fabricate metal projects,( the welding together of a product is the final step in fabrication).  Take advantage of every possible situation to hand out a business card and chat up your services.   A web site that captures local searches is your best tooling to achieve customers but I imagine your budget wont do that at first. Years ago I traded out custom fabrication ofthe latest and greatest wood turning, hollow rig tooling and fixtures to a neighbor, a hobbyist wood worker but a professional IT Guru, for a custom built web site. My web site generates 90% of my customer base.  Good credit line and establish working relationships with all your local material suppliers. I've gotten several jobs from my local suppliers recommending me to people that contact them looking for custom metal fabrication.  Network with other local fabrication shops. I'm sure you have to out source metal rolling or sheet forming to larger shops. I've gotten many smaller jobs from said.  Consider tooling up to do portable work. Typically there are many old school established large fabrication shops in your area that you cannot compete with on material costs and turn around time. But if you offer a go to the customer service with a personal feel, even if its just for a consult, you will capture the smaller or too busy customer that don't want to do the deliver too, pick up from larger shops.If you are serious about a welding/fabrication business, you do need to be able to offer and deliver all that said encompasses. Weld, fabricate structural steel, process pipe, industrial needs, commercial needs, fab/weld sheet metal, ornamental, mild steel, stainless steel, aluminum. Project design. Know your capabilities and limitations. Know when and how to farm out work. Good Luck.Miller TrailBlazer 251Miller HF-250-1Miller MaxStar 150 STLHyperTherm PowerMax 380 plasmaLincoln PowerMig 180Millermatic 252Miller Diversion 180
Reply:Originally Posted by hawgletA very successful business owner, of which I disagree with many of his practices in business but he's a to argue as he's been very successful. Started with nothing 20 yrs ago and now has a job shop so to speak with 245 employees. He's also a man with means now. He'll buy a 1/2million dollar pc of equipment and then tell his engineers to go sell something so it'll make money. Has no 'sales' team. Most of his business comes from referal. Adverising budget is nearly nill with no formal advertising beside business cards and the like as well as supporting localNFP organizations.
Reply:You can start it that way if you want but I will almost guarantee you will fail.  If the truth were known I bet he either already had connections or had a product lined up when he started.  It is tuff to have a product to sell with the chinese selling everything cheaper than you can buy the material for.  If you do then great.  I have found that repair is 99% of my business . I am in a very rural area so I knew when I started that it would be tuff. I work part time and started 3 years ago. You need at least 1 customer that will give you steady work before you get started. That can be a trick if you do not have any connections. Owners do not like to give anything to an unknown entity because it will cost them money if you drop the ball. Not droping the ball is 99% of having a busines. If you drop the ball one time you will lose the customer.  I have spent several weekends repairing things that did not work out so that my customer did not lose production. I did not charge him for my bad judgement and he appreciated it and now he does not even question me . He knows I will do everything in my power to take care of him. To clear $45k and buy equipment and pay for material and consumables , insurance . you will need to gross at least $120K the first year. That is unlikely . I would suggest starting on the side and see how it goes for a couple years. In any case figure on working, sleeping and eating only for 5 years. I hope you are not married because you will not have time for family . Every minute needs to be either fabing something or getting customers. The first 2 years I bet I spent as much time finding, getting, installing equipment as I did working on customer jobs. If you get in a hurry to get equipment you better have deep pockets. I spent a lot of time finding used and I probably spent 1/4 of what new stuff would have cost. The trade off was my time. If you are fortunate enough to have paying work for 40 hrs a week that will mean you are working 60hrs a week. Just cleaning up after myself is probably 45 minutes a day. I have revamped my shop at least 3 times because of one reason or another. Buying tools and equipment seems to never end. Like I said I am only doing this part time to earn some mad money and pay my health insurance. I am not even close to $120K a year gross. I hope I never am. I do not want to work that much. If you are going to rent a shop, have insurance, buy material, tooling , consumables and sutch you need to figure $40 hr just to break even. Probably 50% more if you live in an expensive part of the country. That is not paying yourself anything. In this country now you do not want to have debt if you do you will have even more problems.  I work alone . that limit me a lot but to have an employee when try to start you better have a good pile of money to fund the shop and your life.  Everything is reavent though. If you have $200k sitting around and your shop is set up you might find things happen a lot faster than it did for me. Then you could devote every minuite of the day to the business and have an employee to do a lot of the mundain stuff I had to do myself because I started with very little and had to build up as fast as I could.Last edited by thegary; 02-15-2016 at 10:37 PM.
Reply:wow, $6/sqft @ 2000ft ... that's some real money.  did you mean $.60/ft? Just keep a day job. set a welder up in the garage and get started hustling something for anyone with cash and a pulse. Over time, you'll meet people that will be important stepping stones for you. small jobs will yield referrals to bigger ones and so on. put all your money back into equipment until you have good, commercial grade tools. And I dont mean Baileigh. Build a good relationship(s) with a bigger shop that you can buy press brake work, laser work from. Maybe have them refer small jobs to you?  Then commit money to a dedicated workshop. I am paying .45 /sqft for 2200ft. Keep working that nights and weekends until you cant stand it anymore, then work it 8 more months before quitting a good day job. By then, you should have a couple good, gravy "house" accounts that order the same **** over and over, paying good money for it that covers your overhead and + some.The process I described is years and years in the making. 5+ years probably, to grow it organically from the ground up from nothing. I am about 8 years in from starting as a new years resolution, buying a 110v miller, shop saw, grinder and drill in a single car garage nights and weekends.
Reply:Hawglet, I don't think anyone is saying that you can't do it. I think your time frame is hasty though.Anybody in the world can say anything they want to. I think it is absolute lunacy for a multi million dollar business owner to offer that advice to someone who knows nothing about business. It is his comment that I have issue with not your skill at what you do. Money to start the business is a small concern to other things you have to consider.The first thing you need to do is build a network and that might take years. That is the reason that caused me to realize that I  will never have a legitimate business.
Reply:I can tell you it's going to be a tough go and a great risk. That being said ,if you don't try it you'll never know if you can do it, but be prepared to be more then a welder. And this isn't meant to discourage you either.
Reply:Hawglet, ask yourself: Why do I want to start a welding shop? If the answer is, to make money, there are much easier ways to make money. If the answer is, the pride that comes from being self employed, let me tell you, that wears off pretty quick. If the answer is, there is way too much work for all the welding shops around here and there is a need for one more, then maybe you should go for it.Ian TannerKawasaki KX450 and many other fine tools