Job shop: advice needed

jarrettbailey · May 28, 2016

I've never posted on here before, but have used some info here before. My dad started our shop in 1979 and built a solid business for our family. I started in the trade when I was about 17 (I'm 36 now) and had been running the shop with my dad for the past seven years or so.

My dad grew the shop to a point, then downsized quite a bit. My dad passed away in January leaving me, one machinist, one started apprentice, and one customer. It's a good customer, but our only one. This customer has also has just started up an on site machine shop, so that worries me a bit. It will take some time for them to build steam, but it is still worrisome.

Also, I am in my senior level classes of my mechanical engineering degree.

With all that said, my current plan is to keep the business, but train my machinist in the business side of the shop and hopefully be able to consult with him in the future.

My main concern is trying to get a few customers and grow the "workforce" at a realistic rate. Any suggestions on how to proceed would be greatly appreciated.

Oh, also, we are all manual machines. Havent gotten into CNC yet, so maybe that would be something we should consider?

Thanks

IronReb · May 28, 2016

Most important thing you can do is finish your engineering degree but I'm sure you don't need me telling you that.

It will be hard getting your feet in the door but try your best to get into the paper mill down in your area or any other industry you can.

You do not have to have CNC to make a decent living at job shop work.

Develop a customer base off of the capacity that you have, avoid going into debt purchasing a CNC that you have no work for and assuming no knowledge how to operate.

Its a lot better to have just one customer but no debt than it is having still just one customer and in debt for machinery you may or may not have work on the floor to feed it.

IMHO having a large VTL and boring mill can give you access to job shop work for these plants.
Not many shops have the capability to turn 60" OD whatsits or mill and bore parts needing 50" of travel.

Good luck and I wish you the best.

extropic · May 28, 2016

Finish the BSME, perform as sole proprietor, grow the customer base, grow the work force, introduce CNC. What are you going to do tomorrow Clark (Kent)? :ack2:

You didn't mention your family/social situation. If it's solid and supportive, I'm wondering why you're here. If it's shallow/shaky, or children are in the mix, that's different.

The most important goal is to finish that degree. If you need the shop operating for you to survive, keep it operating as best you can. Expansion is a lower priority until after you graduate. Just getting by until you graduate will be a win.

Best wishes,

tailstock · May 28, 2016

Look for jobs in your area that are being sent out due to the lack of local machine capacity. A few years ago I picked up a large LaBlond lathe cheap,72inch swing and 22 foot bed.Paid for the machine on the first job and have done many many jobs with it since. Find a niche and fill it. :codger:

Larry42 · May 28, 2016

As others have said, finish the degree. Your business is on very shaky ground with only one customer. Do you have a niche that sets your business apart from the rest? CNC is great but about every shop now has it, so no niche there. If more than 25% of your business comes from one customer, it is risky! Metal is not my primary business but I do make large parts for a machine shop customer and aircraft interior parts for another, all in aluminum or nonferrous. Get out and get known. Is your web site professional looking? Do you refer people there to see what you can do? If you want to primarily do repair work call on places that have lots of equipment. Short run work can be had from small manufacturing operations. Warning; It takes a lot of calls to generate new business. Don't get discouraged.

jarrettbailey · May 29, 2016

extropic said:
You didn't mention your family/social situation. If it's solid and supportive, I'm wondering why you're here. If it's shallow/shaky, or children are in the mix, that's different.

Not exactly sure what you mean by this. I have a very solid family and "social" situation, but they know very little about this business. Hence, why I'm here. And I am married with a child, and still I don't see what bearing that has on me seeking advice from people in this field.

Thank you all for your advice. My one customer is, thankfully, a local paper mill that we have been servicing for over 30 years. And I have done a few jobs at other places trying to "get my foot in the door", I just don't have much time to run a machine, order materials, tend to other operations, and, as my dad would say, "court" these places. I'm running out of me.

TMP · May 31, 2016

jarrettbailey said:
Not exactly sure what you mean by this. I have a very solid family and "social" situation, but they know very little about this business. Hence, why I'm here. And I am married with a child, and still I don't see what bearing that has on me seeking advice from people in this field.

Thank you all for your advice. My one customer is, thankfully, a local paper mill that we have been servicing for over 30 years. And I have done a few jobs at other places trying to "get my foot in the door", I just don't have much time to run a machine, order materials, tend to other operations, and, as my dad would say, "court" these places. I'm running out of me.

The "running out of me" feeling will get worse if the family and social (friends) support isn't complete 100% behind you. This is why the question was asked. The more you grow a company from where you are, time demands will only grow with it. There will come a time where you feel like you need more people some times but now always and you are not sure the sales can handle more employee costs. You will be left with a choice of over-staffing or running yourself/current employees to the brink of breaking.

On a different scale, I was part of a similar situation. Four of us siblings purchased our metal stamping company from our father in 09' right after the recession. After dealing with all that, we started a second division, laser cutting and sheet metal fab) in 2012, we made the decision to keep the operations ran separately (technically one by the books). I was put in charge of getting it going and running it. Started with just myself and another. We ended up working close to 80 hours for the first few months before I learned that I should have added extra people. Once we did though I was able to focus on the sales and customer service. We are now at about 15 employees between day and night shift.

michiganbuck · May 31, 2016

[a local paper mill that we have been servicing for over 30 years]

If that is the business you know you might expand with a simple web site suggesting the standard and special parts you can make or repair related to a paper mill.

This customer has also has just started up an on site machine shop. That may not work out well for them.

[Havent gotten into CNC yet, so maybe that would be something we should consider..] might set up the tooling to manufacture a few paper mill things with having a CNC and being selective to get what you need for a few needed things and expand from there.

DDoug · May 31, 2016

You need a ME degree to run a machine shop that you have been running
for some time now ?

Something going to happen at midnight ?

Carriage reverts back to pumkin et all ?

ME degree takes money.

Shop makes money.

Shop needs immediate attention to shore it up and keep it running
(get a wider footing under it with more customers)

dkmc · May 31, 2016

Doug said:
Why do you suppose your only customer is setting up their own on site shop, are they unhappy with your work or pricing?

Great question and bad sign.
Might already be "too late" for whatever reasons they have decided to set up
an in house shop.

adama · May 31, 2016

No disrespect, but it sounds like the degree is more important to you than the shop, don't get why as the shop can earn you a living, having a degree has only got the potential to earn a living. If your not careful its going to be really easy to end up with neither!

You need to pick what you want to do going forwards, a job shops not exactly a part time commitment especially if you have staff to feed. If you have plans to morph it into something else yes, if not and you want to use your degree to work else were, may be time to sell the shop to one of the employees.

adama · May 31, 2016

dkmc said:
Great question and bad sign.
Might already be "too late" for whatever reasons they have decided to set up
an in house shop.

Your shops taken care of there needs for a while, owner goes, shops not invested in new requirement for a while, they know your there main income stream, they have to ask em selves - plan for the what if your not here tomorrow question. Hence some in house becomes the only option in some areas really fast!

Royldean · Jun 1, 2016

digger doug said:
ME degree takes money.

It's been 18 years since I got my BSME, and I've made over 10 times the cost of my degree since then, and it was a private univeristy.... More importantly, my first salary out of school was already 25% MORE than the cost of a year of tuition, room, and board....

The BSME will make you A LOT of money.

toolsteel · Jun 1, 2016

Once you have your degree it can't be "lost". The bank can't come and take your degree away because of a bad business decision....a tornado can't blow it away.....a flood can't drown it.....and a future ex-wife doesn't get 1/2 of it in the settlement. Not saying to throw away the shop......but I wouldn't throw away the investment you have in your degree either.My .02 cents

dkmc · Jun 1, 2016

adama said:
Your shops taken care of there needs for a while

Op says 30+ years, that's a long while for them to suddenly
decide in house is better......unless they have reason to think that way?

DDoug · Jun 1, 2016

Royldean said:
It's been 18 years since I got my BSME, and I've made over 10 times the cost of my degree since then, and it was a private univeristy.... More importantly, my first salary out of school was already 25% MORE than the cost of a year of tuition, room, and board....

The BSME will make you A LOT of money.

Yes, all well and good. But it don't take a ME to run a job shop now does it ?

Design & Build shop ? Yes. And a P.E. Wouldn't hurt either.

toolsteel · Jun 1, 2016

If the job shop goes "tits up" or if you decide you really arent interested in whats involved....or maybe you dont like the business aspect of being an owner....regardless of reason why. With your ME you should have little trouble finding decent employment. If you quit school and run the shop for 5 years.....then the shop goes tits up......you either need to go back to school....which is a hell of alot harder than it sounds, or be another guy who is ALMOST an engineer. Those guys are a dime a dozen and usually think more highly of their engineering skills than their last employer.

michiganbuck · Jun 1, 2016

Wait.. that should be "belly up"
And the thread could be "Life Advice Needed"
Is the shop putting you through School?
Can it continue to do so?
With the degree will you be smart enough to make a functioning shop run better?
You may be better of with the shop running to support your job quest...or not.

QT: [I am in my senior level classes of my mechanical engineering degree.] that is good and you should be shop smart by now.

Ever post "open time on".. name machines

mkd · Jun 1, 2016

Final year of FULLtime ME schooling: you don't have the time to seriously help run a job shop, IME. Hopefully you have some projects that run on autopilot.
Sacrificing the degree, when so close= lifetime of regret.
You've waited this long for the degree, maybe do schooling part time to keep the brain engaged and interested.

Addressing your main concern; use contacts at school as networking resource. Keep in touch with classmates. Make sure they know you have a shop, without actively selling them. M.E.'s going into varied fields will be your #1 resource for new business. You might offer up some freebie G-jobs to the bright ones that are going places......

Feeny · Jun 1, 2016

I am in a similar place, with a small job shop.

Like others have said find a niche, get a website and start promoting that niche.
Finish the degree.
Dont be afraid to expect more out of your people, but give them the respect, freedom & money that comes with it.
And also half what your expectation for sleep is a night.

Job shop: advice needed

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