Life as a Cabinetmaker
If you have been at it for 5 years, feel it is a struggle, and see no rainbow, then you should step aside. Why you haven't consulted a CPA (or a different one), other business professionals, or even done the search on this topic here at WOODWEB, I don't know. But the fact that you are where you were 5 years ago tells me you have no plan, and have no plan on putting a plan together. Perhaps it is time for an exit plan.
There have been several - many - good threads on just this topic here at WOODWEB, so I won't rehash that info. Look it up, see what you need to do, and make a plan. If that is too much to do, or it is too late, then it is time for a graceful exit.
From contributor H:
At 5 years into it you are just getting to the point were you should start to show a profit. Start up costs, machinery tools, etc should be almost gone. Overhead should be predictable and fairly consistent.
Now is not the time to quit. Now is the time to buckle down and examine your costs and production methods. It’s not always easy to see what jobs you actually made money on and which ones you have lost on. Get with a CPA they can help define this.
I would do it all over again in a instant in spite of all the occasional problems. But I would have started my own shop sooner. Your statement about feeding the beast and getting caught up after the next job tend to make me think you are slightly under pricing your work/and or time.
I am not a big fan of business plans (just wishful thinking to me). Plans change all the time, so what’s the point? I am one who believes you should set reasonable attainable goals. Goals you are confident about being able to meet.
The fact that you are still in business after 5 years means, unless you borrowed to stay in business, you made enough money to survive. You'll do more than survive if you tough it out a little longer and get with a professional who can help you get a clear picture of what you are not quite doing. Once you do that you will know what to tweak to get you beyond surviving.
From contributor G:
I agree with Contributor D and Contributor H. I would have started sooner. As a matter of fact, I would have fed the beast more, sooner. I feed it now more than ever. In return, it feeds me more than ever. After 20 years I am definitely over the hump and it’s now a lot easier then it used to. If you haven't tracked every job you did in the last 5 years start now or get out. If you did track the jobs it should show you why you are not getting anywhere.
From contributor T:
You were in the right part of the business to begin with; "installations". Top notch installers are hard to find and are in great demand. I personally know many who take home more money than the manufacturer. One top installer that I know charges the manufacturer $60 per hour and pays his two helpers $30 per hour and he is a very happy fellow. Maybe you are just into the wrong end of the business and should consider doing what you originally did and what obviously got your interest in the first place, "installations".
From contributor S:
Would I choose this particular field? No. Would I change the decision to be self employed? No. If I had the chance I would do it better and in a different industry/business. Either I would make the changes that need to be made to make a good living working 40 hours or less or sell it all off and work for your buddy. Either way plan for a happy, content and financially secure future.
From contributor C:
The biggest difference between being an installer vs. owning and operating a profitable cabinet shop is night and day. Each has its pluses and minuses.
Installer plus: Low investment in tools. Very low overhead (just need a van and some insurance). You have flexible hours and good pay if you are competent and quick.
Installer minus: If you take a day off, then no money is coming in. You still have to deal with angry homeowners. If the job wasn't built or measured properly, the never ending return trips begin.
Cabinet shop plus: You are building a business. You control your own destiny. You answer to no one if you chose not to. If you have good employees you can take time off and still have money coming in. You can sell the business. The above reasons are good enough for me.
Cabinet shop minus: High initial machinery expenses and high overhead. You’ll also have the occasional angry client and long hours.
I've been at this for 7 years now (am 34 yrs old). The light at the end of the tunnel is getting brighter every day. I just bought the building we're in - 5k square feet. I just paid off the edgebander and leased a new slider and I will be buying line boring equipment within 6 months.
Aside from the lease and the mortgage, haven't borrowed a dime and bought my tools as I went. Every day I look for ways to improve what we do. I want better quality, faster than I did it yesterday. I'm excited about where I'll be in 5 or 20 years. I wish everyone who posted here felt the same.
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