Starting Upper Cut Woodworks #3: Project Workflow and Documentation

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Blog entry by Matt (Upper Cut) posted 01-04-2010 01:04 AM 1126 reads 0 times favorited 7 comments Add to Favorites Watch
« Part 2: The Mechanics of Starting a New Business Part 3 of Starting Upper Cut Woodworks series Part 4: Dedicating time to Woodworking »

I imagine the workflow of a job will go like this:

  1. Customer contacts me, describes what they want, perhaps sends pictures.
  2. I discuss the project with the customer: needs & wants, budget, materials, finish, hardware, timelines, etc.
  3. I sit down a design the project in SketchUp, create an initial cutlist, and price things like hinges, knobs, and other hardware.
  4. I then write the project up, with the sketch and the estimate, into a document.
  5. The customer signs the document, provides half the payment, and I begin work.
  6. Upon delivery the customer pays the rest, signs that everything was delivered as promised.
  7. It’s interesting to note that I am only billing the customer for step 5. If the customer doesn’t sign on the dotted line, I’m out my design time.

There are some things i need to figure out here though:

  1. What should I do if my estimate is way too low?
  2. What should I do when it’s difficult to get the customer to pay?
  3. What should this document look like from a structure perspective, and what should the content be to make it legally binding without being too unfriendly?
  4. How do I incorporate customer visits and design change requests during the build (between steps 5 & 6)?
  5. What should the relationship with the customer be post-delivery: warranty, follow-up, etc.?

Potential customers: I’d love to know what you think of this process and how I can make it great for you.

Woodworking buddies: I’d also love to know your opinions on how to make this work from a business perspective. If you have sample documents that you’re willing to share, email them to me.

-- Matt Gradwohl, Upper Cut Woodworks,

7 comments so far

View kolwdwrkr's profile


2821 posts in 3615 days

#1 posted 01-04-2010 01:31 AM

#1 should be getting a license and bonding. In CA you need a contractors license. If you don’t have the license you can get fined. You also don’t get to file a mechanics lien. Your state may require a business license of some sort.

#2 Make sure you have a registered ficticious business name

#3 Insurance and workers comp

#4 A good contract. The contract should have the notice of cancellation, mechanics lien rights and law, your license #, warranty information, notice to change orders, down payment, progress payments, timeline, materials, description of work, additional fees explanation (for instance if you are requested to install handles or knobs but they are not available at time of installation a return trip charge will be charged), etc

#5 Get a seperate contract made for design. The contract should say something to the effect that you are charging X amount for the design, however, should they sign a contract with you the fee will be waived. If they choose a different contractor, the fee purchases the right to the design.

#6 Statement of completion

#7 Change order

#8 Payment schedule

You shouldn’t charge 50% upfront then 50 % at the end. In fact it is illegal in california to take a down payment of more then 10% or $1000 whichever is less. However, if you take progress payments then you can continuously pay the bills. For instance on a $6,000, if I take $1,000 down on day 1, as well as $1,000 for progress payment for materials I will get $2000 the first day. Then I can have scheduled payments, say $2,000 in 7 days and $2,000 upon completion. That way I don’t spend $3,000 right off the bat and have to hold my breath for the other $3,000. I will get $4,000 before the job is done. You could also say $1,000 upon completion of cabinetry, and then the Additional $1,000 upon completed install. That way you get $5000 before you even deliver the cabinets.

If it turns out that you bid to low you will know at the end of the job if you are making profit and loss statements for each job. Then the next job you will know to charge more. You can’t up your price in the middle of the job because you decided you didn’t charge enough. The only way to do that is with a change order if they add additional stuff.

Your relationship with the client should be completely open and honest. Even take progress pictures and keep them updated. Open communication is key too. If there is a general contractor make sure you communicate with him too, and that he has your drawings. This will ensure that things like plumbing and electrical are in the right place.

Make sure you have the customer sign YOUR drawings before you build anything. Don’t assume they know what they are getting. This way you can take the drawings back and show them if something is wrong or overlooked. Make it their fault as well as yours. This way they will be more understanding when you ask them for additional funds should you need to make a change.

I’m sure I can go on and on, and I don’t even know if I answered your question. I’m just rambling. LOL Good luck with your business venture.

-- ~ Inspiring those who inspire me ~

View Fireball's profile


71 posts in 4092 days

#2 posted 01-04-2010 06:03 AM

I think it would be very helpful to know what types of projects you think you’ll be taking on and the scope of the projects.

Based off your first posts, it sounds like what you’re doing will be on a smaller scale and I wouldn’t get too bogged down in the smaller details. A simple agreement that you and the client sign is more than sufficient. I’m a GC and every job I’ve done has been with a 2 page document. No problems yet (fingers crossed). Also, a 1 year warranty is pretty standard and makes people feel good.

Another important decision is how you will charge – are you charging a fixed price for the product? Are you giving the customer an initial estimate(range) and then charging on actual L&M basis? I would recommend that you spend a lot of time discussing item #2 in your work flow above before proceeding to #3 and 4. Steps 3 and 4 will take lots and lots of your time, which as you mentioned will be wasted if the Client doesn’t sign on the dotted line.

View Matt (Upper Cut)'s profile

Matt (Upper Cut)

264 posts in 3838 days

#3 posted 01-07-2010 01:33 AM

Really good tips guys, I’m definately going to include your feedback and guidance in my Standard Operatiing Procedures

-- Matt Gradwohl, Upper Cut Woodworks,

View Todd A. Clippinger's profile

Todd A. Clippinger

8901 posts in 4124 days

#4 posted 01-07-2010 01:41 AM

I back the other guys and kolwdwrkr has the most thoroughly expressed thoughts that I completely back.

In Montana I can take as much as I want upfront. I have been taking 75% because the money flows out fast.

I take the final 25% on completion or progress payments depending on the size of the job.

My subs require 75% from me as well when they show up on the job.

75% insures that all the material and subs are paid and if I get left holding the bag I don’t owe anybody any money, it just leaves my pockets light.

-- Todd A. Clippinger, Montana,

View WWilson's profile


106 posts in 3087 days

#5 posted 01-08-2010 06:51 PM

Hi Matt. Check out this book if you haven’t already :The Woodworker’s Guide to Pricing Your Work by Dan Ramsey. It’s a quick read and pretty comprehensive. I am almost done with it and it brought up a lot of good points that I hadn’t yet considered about how to price my projects. Let me know if you find it useful. Todd’s suggestion is good because it won’t leave you holding the bag if the customer changes their mind.

View Matt (Upper Cut)'s profile

Matt (Upper Cut)

264 posts in 3838 days

#6 posted 05-29-2010 09:33 PM

Just re-reading these comments, these are all very good, and thanks for the book recommendation!

-- Matt Gradwohl, Upper Cut Woodworks,

View a1Jim's profile


117115 posts in 3602 days

#7 posted 05-29-2010 09:36 PM

Keith covered it really well

-- wood crafting & woodworking classes

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