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Moving my business to Texas3/12
I have produced custom molding cabinets and granite tops In the Rochester No area for 17 years. I have very little debt. We are doing OK in Ny. I have a existing customer that does around $400,000 a year with us. We do high volume low profit work for them. They have invited me to expand into Texas with them. If I move or start another shop in Texas I think we can do around $100,000 per month with this one customer. This is the best customer one could ask for. This customer pays you every week and ahead of time if i need it. I build mostly frame less cabs with a cnc. And nice bander. I make a good part of my money o. Installed residential cabinets in the 18 to $25000 range per kitchen. If I move I can live odd from this commercial customer. How does Texas look for my residential kitchens? Open to input. Thanks Andy
Remember the old adage.
Don't put all your eggs in one basket.
Do you really want to become a captive shop?
I have worked with this same customer for over 10 years. This is not a normal customer. These people have a attitude that everyone must win at every deal. No I do not want to be in Texas with 1 customer. I am looking to find out if I can build custom kitchens at a good profit level like we can in western Ny. So far it sounds like they give Millwork and cabinets and construction labor away in the booming areas of Texas.
I think you need to run some numbers on this. A big red flag for me is your statement:
"We do high volume low profit work for them."
I also agree with Leo G. If this customer fails in Texas, or just decides to leave that geographical market, where does that leave you?
If you like high volume and low profits, Texas is THE place for you.
Im about an hour north of Dallas. High volume low profit is the only cabinet business in Texas. Sure, somebody may wander in one day a year willing to spend 18-25 g's on a kitchen, but every other day of the year, you'll be building cabinets for around $75-$100 L.F. In my area, the highest priced builders are shopping out every job and going with the cheapest guy. They believe that the painters can fix everything.
A little caulk and paint will make a carpenter what he ain't. They live by this.
I don't know where your planning your move, but frameless,Pre-finished is a really tough sell around here.
I am an 1 1/2 hrs East of Dallas. Agree totally with the others. Low profit. My average kitchen runs around $6000. I have no shop debt, 6000 sq. ft. of paid off building, low county taxes, no city taxes and low overhead. Me, wife and two part time employees. No CNC, but nice modern equipment. We make our own doors. My Dad started this shop in 1971, I came in 1996. I have built two sets of frameless cabinets since then. All the rest faceframe. My best year done 50 kitchens. When your customer comes here, he will be covered with salesmen that will be lowballing your price. I'd stay in NY if I was you, It is a tough business here. And no "It Ain't Boomin" Johnny
Texas is big state, I don't agree with the previous posts..
Btw, I haven't seen a work week shorter than 50 hours since 1999....