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Forum topic by Bob #2 posted 03-11-2008 03:24 PM 1713 views 0 times favorited 34 replies Add to Favorites Watch
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Bob #2

3808 posts in 2709 days


03-11-2008 03:24 PM

Topic tags/keywords: resource

I found these local wage brackets today and it puts the trade into a dollars a sense perspective.
Many woodworkers complain that they can’t make a living with their own shops and I am beginning to understand that it may not be a function of their woodworking abilities or their training or the decline in the need for custom work but more a factor of not having the necessary business skills to manage a business.

Believe me when I say that this is tougher than cabinetry any day of the week.

Roman spoke of cabinet shops disappearing from the yellow pages in about 3 year cycle.
I wonder how many of those fellows had the time or resources to take a course on business or design or marketing?

I’m not knocking anybody here- just saying it’s tougher today than ever before.
So if you think you can be a master cabinet maker/designer/advertiser/bookkeeper/project /tax consultant manager/daddy/husband. then a cabinet shop is definitely for you.
Today the best way to make have a million dollars in the cabinet shop business is to start with 2 million.

Still , as a trade, you can make $45,600 a year here in a larger shop or if you can endure hardship at all you can make double to triple that in Ft, McMurray. ( The Tar sands project)
Bob

-- A mind, like a home, is furnished by its owner


34 replies so far

View Tony's profile

Tony

978 posts in 2718 days


#1 posted 03-11-2008 03:32 PM

INTERESTING, The figure are a lot lower than I would have expected.

I agree with you Bob, if you want to make a million, then do not choose cabinet making, but go into Engineering or computers (seen it, done it and got the “T-Shirt to prove it), but if you want job satisfaction then this is the place to stay (for me).

Thanks for the information – busy with my Computer hat on today – rebuilding my web site from scratch (Martin you have my sympathies)

-- Tony - All things are possible, just some things are more difficult than others! - SKYPE: Heron2005 (http://www.poydatjatuolit.fi)

View Ryan Shervill's profile

Ryan Shervill

278 posts in 2500 days


#2 posted 03-11-2008 03:39 PM

One thing to consider with those numbers though, being as they are referenciing Canadians: Income Tax.
If you are a registered business, there are substantial tax savings as well. even “lower” income #’s by a busineess owner can equal quite a bit more in your pocket than say, someone drawing a wage in a 35-40% tax bracket.

Just adding a different perspective :)

Ryan

-- Want to see me completely transform a house? Look here: http://forum.canadianwoodworking.com/showthread.php?41055

View Peter Oxley's profile

Peter Oxley

1426 posts in 2562 days


#3 posted 03-11-2008 03:43 PM

Bob – this chart is for an employee working as a cabinetmaker, right? Not an independant/owner?

You are right on the money (pun intended) about why many businesses fail in the first two or three years – not just woodworking businesses. You can be the best (insert the name of any profession here) around, but if you can’t run a business, you’re better off working for someone who can.

And Tony, you have my sympathy – I procrastinate on website updates for months! The thought of a complete rebuild makes my skin crawl!

-- http://www.peteroxley.com -- http://north40studios.etsy.com --

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Woodchuck1957

944 posts in 2452 days


#4 posted 03-11-2008 04:14 PM

I think you guys are fooling yourselves, I don’t know whats going on in Canada, but I know whats going on in the USA, Ethan Allen is gone, and Lane furniture company is gone, etc. theres two big ones there. Then if you know anything about houseing, interior doors are from Malaysia and the veneer is so thin you can barely sand it without going threw it. Raised panel doors have MDF veneered raised panels in them, painted trim is MDF with a paper coating over it. Premade cabinets are comeing from lumber yards and big box stores. While this may not be going on in all homes, it is going in most medium priced homes and it takes away from the American woodworking market one way or another. I don’t think you can call all of it mismanagement in the cabinet shops. Your lucky if you can make $10 an hour starting out here in ND working in someone elses established cabinet shop.

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Bob #2

3808 posts in 2709 days


#5 posted 03-11-2008 04:50 PM

Woodchuck, I presented the facts as they are written.
They were not about “Manufacturing” as you were quick to discuss, but aimed at the cabinet trade and it’s current employment here.
There is a tendency to believe that this is a U.S. site and that what takes place in the U.S. is the norm where in fact this is probably one of the most cosmopolitan sites on the INTERNET with members from all parts of the globe.
What occurs in North Dakota has less significance here than it might over at WoodCentral or Sawmill Creek. Having said that,we do have many things in common as far as woodworking is concerned.

I wont speculate as to why the American manufacturing sector is taking a beating but a betting man would put his money on the fact the US laws have allowed it’s corporations to move the manufacturing overseas and keep the profits off shore. (There is no tariff to keep the home based sectors competitive.)

I think it would be fair to say that you don’t know what’s going on in the US but you definitely can see the results.
Of all the country’s in the world I can honestly say that the US has a love affair with the cheapest price and the maximum return on investment.

Canada, by the way is not far behind.

So you can lament the poor quality and short half life of construction products all you want but in reality you are the people buying them so it must suit your goals in life.

“Pity the man who know the price of everything and the value of nothing.”

Bob

-- A mind, like a home, is furnished by its owner

View DaveH's profile

DaveH

400 posts in 2466 days


#6 posted 03-11-2008 04:54 PM

If you own a cabinet shop and you are the only employee and it is your only source of income, I’m guessing you will fail in the 1 to 3 year range (I’ve heard the 90% of all business startups fail). The problem is that if you are doing the work, you don’t have time to do marketing. If you are not marketing, where’s the next job coming from? What usually happens is that you get an order and you work on it. When you complete the project, you go looking for more work. That leave you too much down time to survive. You bid your work at $40/hr and it always takes 50% more time. So now your making $30/hr on the project. Then you have 2 weeks of down time because you didn’t have anything lined up when you completed the last project so your effective hourly rate is maybe $10/hr. How can you survive? Maybe we just do woodworking as a hobby or side business because it’s fun. I can buy a lot of tools with the $50/hr I get paid for writing software.

-- DaveH - Boise, Idaho - “How hard can it be? It's only wood!”

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Woodchuck1957

944 posts in 2452 days


#7 posted 03-11-2008 04:55 PM

Whatever Bob, I don’t know why I bother with some of you.

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Shopsmithtom

780 posts in 2883 days


#8 posted 03-11-2008 04:57 PM

Bob, you raise a great point about business skills vs trade skills. I’d be willing to bet that, other than under capitalization, the biggest reason for a small business failure is when someone takes a skill and/or passion and wants to follow the American dream of turning into a business without understanding that turning out a beautiful and self satisfying product, in and of itself, won’t put bread on the table.

Like it or not, you need the numbers. You need a realistic business plan based on fact, not based on dreams, passion and the love of doing your thing…whatever that thing is… cabinet making, T-shirt design, or whatever.
Oh sure, there’s always someone who comes up with something that’s much bigger than they ever thought (Google, for example), and then they’re stuck trying to run fast enough to keep up, but I don’t think any woodworking related businesses will fall into that category.

I know there must be jocks, here, who have thought about starting their own business. I even think about it on those days when the real bread winning gets frustrating. But then I remember the numbers…yuk, the numbers.

Then I remember something else that happened to me a long time ago when, as a young struggling newlywed with a love of photography and some pretty good skills. I started doing wedding & family photography as a side business, and discovered that my love of photography as a skill/hobby was dulled as I began to think of it in a business sense instead of as a hobby/fun. I think it’s possible that when you add the business stress to your skill, at least for me, this kind of thing can happen.

Since I’d hate for that to occur in woodworking, I’ve always resisted trying it as a business. (Also, on a realistic note, I’m probably not in the same league as some of the folks here could legitimately do this, but one can always dream, right?)
-SST

-- Accuracy is not in your power tool, it's in you

View Bob #2's profile

Bob #2

3808 posts in 2709 days


#9 posted 03-11-2008 05:01 PM

Peter O asked:
“Bob – this chart is for an employee working as a cabinetmaker, right? Not an independant/owner”

As far a I know this would be a Govt. survey either conducted randomly or extrapolated from UI (Unemployment ) insurance figures.
They are probably accurate +- 10% for most of Canada.

It’s difficult to get figures from independents as they work a lot more hours and probably more productively than the wage earners. (At least those that survive do.)

Bob

-- A mind, like a home, is furnished by its owner

View Tony's profile

Tony

978 posts in 2718 days


#10 posted 03-11-2008 05:18 PM

I think that one of the problems with small shops, mine included is marketing – There are only so many hours in the day,and you have to share that amongst a lot of skills you must have to run your own business, other than banging big nails into a piece of wood, also you must have some time for family life. Luckily the internet is out there and this can help severely with the marketing of you and your product/s.

I do not make a fortune, but I pay my bills every month and manage to save a little. If I underestimate the hours on a job, or have to remake an item, then it is my fault, nobody else’s. If I have no customers for a while, again my fault for not marketing or perusing potential customers enough. So long as at the end of the month, the money is in the bank what does it really matter. I enjoy my work immensely, I am sometime frustrated at people buying from big box stores, when I can provide a similar product for a similar price, but hopefully a higher quality, but at the end of the day I would never go back to my Engineering lifestyle – the money was fantastic, travelled a lot to exotic places and never saw my family.

Maybe we are all too hung up on money these days, why do the billionaires need billions more? Why to the petrol/Benzine companies have to make $10,000’s/second.

Sorry LJs, I am rambling on and on. Life is what it is, and we can do little individually or collectively to change it. Money is Power and power is money, so we just have to make the best of our lives, adapt the best we can to the environment that we are in and be more sociable to fellow man

-- Tony - All things are possible, just some things are more difficult than others! - SKYPE: Heron2005 (http://www.poydatjatuolit.fi)

View tenontim's profile

tenontim

2131 posts in 2432 days


#11 posted 03-11-2008 05:21 PM

Here’s my two cents: Most of the people buying furniture don’t really know the difference between “big box furniture” and hand made. The first thing they look at is the price. The public has to be educated as to the benefits between having something “thrown together” or a quality piece of furniture. The problem we have here in Texas is, the place is flooded with furniture from Mexico. A person can buy a whole room of furniture for the cost of one piece of custom built. After it starts falling apart,they toss it and buy more in a slightly different style.
I think the one item in your business management has to be lots of advertising and getting out to furniture shows to educate the masses. I’ve increased my advertising budget the past two years and the business increase has been way more than that cost. Your clients will advertise for you also, but it’s a lot slower. Statistics are, if you do a good job for someone, they will tell 4 people. If you do a lousy job they will tell 10. So keep the quality and customer satisfaction as you main priority.

View Bob #2's profile

Bob #2

3808 posts in 2709 days


#12 posted 03-11-2008 05:29 PM

Woodchuck said:
“Whatever Bob, I don’t know why I bother with some of you.”

We are trying to tell you the very same thing.
Bob

-- A mind, like a home, is furnished by its owner

View GaryK's profile

GaryK

10262 posts in 2676 days


#13 posted 03-11-2008 05:33 PM

Bob #2

I don’t think he can go away.

I find that he is an endless source of amusement. You can’t really take anything he says seriously, but
for amusement purposes he’s great!

So please don’t go away Woodchuck1957, I could always use a good laugh.

-- Gary - Never pass up the opportunity to make a mistake look like you planned it that way - Tyler, TX

View Bob #2's profile

Bob #2

3808 posts in 2709 days


#14 posted 03-11-2008 05:37 PM

Gary, No one is completely useless.
He can always serve as a bad example.

Cheers
Bob

-- A mind, like a home, is furnished by its owner

View Bob #2's profile

Bob #2

3808 posts in 2709 days


#15 posted 03-11-2008 06:59 PM

If we can see what the problem is why don’t we put our heads together and try to fix it.
I’m not happy criticising things unless I can offer constructive criticism.
Hell , we got a man on the moon, surely cleaning up our economy and reducing the red tape and bureacracies is not insurmountable.
It’s time to get back to basics.

I have a freind of mine that writes millions of dollars in cabinet business each year.
His work is all custom and is built by a team of 38 people of which 15-18 are cabinetmakers, the rest are sales, CAD engineers or operators.
Everything is designed by CAD and translated to cutting machines on the floor. The delicate hand finishing work is done by experienced cabinet makers .
They do their installations around North America and do not necessarily depend on the local market.
He mainly does bars, restuarants and casinos but you can see his work in schools and museums as well.

Bob

-- A mind, like a home, is furnished by its owner

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