I think the only real good way to a steady income is with your own products.
Agreed. Friend of mine owns 2 separate businesses in separate locations. One is a very modern and well equipped job shop and the other is a shop where he manufactures a series of products (same item in several different sizes) as the sole supplier for a large manufacturer. Not really his own product per se, but it might as well be since the typical job shop would lose their ass trying to make the same stuff at twice the price.
Job shop has around 30 employees and he's very good at keeping a good work backlog. The dedicated shop runs with 5 or 6 people, and takes up 15% of his total worktime at the most. He's got single machines in the job shop that are worth twice the total value of every piece of equipment in the dedicated shop.
But, at the end of the year, the dedicated shop makes 2 to 3 times the net as compared to the job shop. If someone quits, there's not a job in the dedicated shop that can't be learned in half a day or less by someone who's never seen the inside of any sort of manufacturing operation before.
He's one of those people who thrives on the challenges of running a job shop and keeping enough profitable work to keep everyone busy. If he was one of those types who cares about nothing but the money, he could liquidate the job shop tomorrow, bank the money since everything there is debt free, and have a strong 6 figure income off nothing but the dedicated shop and maybe one day of work per week at the most.
We've got a few small stupid little things that we make over here, and they have really helped make it through the lean times. When times are good(and the PO's are rolling in), keep the stuff at a fair price, and then when times are lean, we have a fire sale, and generate a couple of dollars.
Agreed again, and the more stupid simple the better. You'd be surprised at the sorts of hourly rates you can generate making your own crap, and you don't have to have half a $million in whiz bang blinding fast machines to do it. IMO you do have to have CNC milling and turning, else someone who does have those capabilities will copy your stuff and eat you alive price wise. Gotta get that Mazak online, Frank
Ebay, more than any other single factor, gives guys like us access to "test marketing" that would otherwise present a barrier to entry that most small shops just wouldn't be willing to gamble on. If you think something might sell, make a few and throw one on Ebay. You'll find out real fast, for near zero investment, not only whether it'll sell but also whether it'll sell profitably. I've tried things that I was sure would sell like hotcakes, only to find I couldn't net minimum wage at what they'd bring. Another item brings in about $8K/yr and I'd have sworn it would be lucky to gross a hundred bucks a month. Made it originally for a friend with no intention of trying to market it. He convinced me to try it because he really thought there was some market for it. It's been consistent for the last 8 yrs. You just don't know until you give it a try.
You make good money off your own stuff by tweaking the process, and you have to learn to resist the invariable requests from folks who will want to know if you can "make me one just like that, but with these modifications". That puts you right back in the job shop scenario of ones and twos, and unless you charge a premium they won't be willing to pay, you'll lose money on every order you take that involves modifications. I've wasted enough time and money on customer requested modifications to know this for a fact. Make what you make, and sell it to those who want it as is. If you sufficiently refine the process, you can make good money and still be at a price level that doesn't encourage other shops to compete with you. Get greedy because you happen to be the only guy on the block who makes the item, and you'll attract competitors like flies to honey.