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  1. #21
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    My right hand man / software architect used to say about consultants - having worked for several high powered engineering companies,

    "Consultants are like pigeons...",

    "they fly in,

    randomly peck at stuff,

    shit all over everything,

    and then fly off.".


    The point being said consultants not actually being responsible for what they prescribe, criticize nor advise change on.

    OTOH Gordon Ramsey's kitchen Nightmares ?


    __________________________________________________ __________________________________________________ __

    * Maybe there's an original version of consultants being like pigeons somewhere.

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    Quote Originally Posted by munruh View Post
    Good Morning, our shop has had tremendous growth the last 10 years and it's a challenge for the owners(there's two of us) to keep it going. We have done all the bookwork and both been on the shop floor all the time. Along with that, we have done all the sales. We have two locations that we are considering merging into one. I feel like we could use some good advice to guide us into the next phase. So I have the bright idea for a consultant. Is there anyone that you all know of that can consult job shops on the business side?

    I'd like to keep this thread focused on the title if possible and get into what we should do or shouldn't have done in our shop. Thanks fellows!
    I'm currently in a small shop only a bit larger than yourself. 12k sq ft, 12 machinists plus a few others in overhead roles (customer service, quality, accountant, President) for a grand total of 18. I would recommend an approach something like:

    1) Whether you hire a Consultant or not, establish your OWN outline first, do some footwork to create some kind of "baseline" to work from. Don't just call in a Consultant cold, positioned to be held hostage to their "expertise" or personality, both of which can not be predicted.

    This would entail some basic mapping out of your business. Use whatever software tool you'd like to use, but start with Job positions. Simply lay them out and create a list under each: What are the responsibilities handled by each person.

    Get that layed out completely, then identify any gaps or problems in work loading. So, for instance, maybe you've grown enough you think you need to actually hire an Accountant at this point because of workloading.

    Part of this is also laying out a list of Responsibilities and checking to see if those are currently covered. If you've got a Responsibility that's important to you but it's either not covered, or not covered very well, it's in the open to identify how to correct that with existing people, or if a new hire is needed.

    2) Create another list of Machining positions from each site, with associated footprint and power requirements. This information is necessary to think through whether to consolidate two locations. Consider EZ-Blueprint as a cheapy, but perfectly functional floorplanning software that allows you to quickly create custom symbols for machinery and what have you, with dimensioning. Again, the intent is to get some kind of facts-based outline in place you can follow through with later, as needed. I used Ez-Blueprint here to completely map out the floorplan for the new facility we moved into two years ago. It made all the difference in planning and evaluation.

    Maybe these suggestions miss the mark, but are my immediate reactions when reading your OP and the implication (I thought) about work loading with "you two guys" pulling double duty both in the shop and running "the books", along with contemplating consolidation of two facilities.

    In a past life I gained some experience in facility evaluation and design (Police/Fire Dispatch centers). Don't jump the gun with a Consultant, for reasons some in this thread have mentioned. I'm not knocking Consultants, per se, I'm saying you know your business, you know your people, you know your workload and Customers.

    Take the time to lay that out, on paper or in a software program, and baseline some info and facts first. If you hire a Consultant that will help guide your discussions, and if you don't you'll have a good start on building a set of decisions on your own.

    Best of luck to you and everyone there.

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  5. #23
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    Quote Originally Posted by cameraman View Post
    My right hand man / software architect used to say about consultants - having worked for several high powered engineering companies,

    "Consultants are like pigeons...",

    "they fly in,

    randomly peck at stuff,

    shit all over everything,

    and then fly off.".


    The point being said consultants not actually being responsible for what they prescribe, criticize nor advise change on.

    OTOH Gordon Ramsey's kitchen Nightmares ?


    __________________________________________________ __________________________________________________ __

    * Maybe there's an original version of consultants being like pigeons somewhere.
    My broadcast TV shows old episodes of Kitchen Nightmares, if you look up the restaurants on there most did not last long after the makeover.

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    Hmmmm....Consultants....

    Someone who sits on your chair, behind your desk, drinking your coffee, telling you what's obvious about your business.
    While you pay them for the privilege...

    OP - You've obviously done a lot right to get where you are.
    Yes there's always room for "some" improvement in all businesses, but i wouldn't deviate too far from what you're doing as it's obviously working for you...

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    my view on general business consultants.....in a big organization, the CEO or board can't see into all the dark corners. Having some bright educated business people having the collective time to scurry around looking everywhere, in the context of a clearly articulated strategy (from the CEO) can make a lot of sense and pay off - its like it lets them scale their time and creates visibility they don't/can't have. I've seen it/done it.

    Not the same with little businesses like ours. We likely can see into all the dark corners, they're not very far away. And there isn't 800 people (or 80,000) to keep rowing in the same direction, with an edict like strategy as the compass, it's more hands on steering of the boat with one brain able see and process pretty much all of it.

    What they can do is provide some fresh ideas/perspective. There are very bright management strategy consultants and corporate finance consultants etc but their fee structures are geared for billion dollar corporations and they usually specialize by sector. For what we can pay we're likely going to get the leftovers. So, you get dullards who don't know your business or sector. What's worse, its not just their fees, its how much of your and others time they will take up. imo you will be best to help your self.

    While you should start by defining your objectives, I would surmise from the intro its something like a smoother running business less dependent on you., The volume of business has grown, but you haven't grown the business - i.e. systems/process/people to keep pace with the volume and you want it its smooth running to not be a 1:1 ratio with your time.

    Given that, and if you agree its got to be business self help, the way to get fresh ideas is read and educate thyself. For the small entrepreneurial business, and how you've described it, Gerber's "The E Myth Revisited" would be an excellent start and I bet would generate a bunch of ideas. Read other stuff, do some navel gazing, list out the ideas, look at the payback and cost.....you can then prioritize the ideas and start implementing them. A piece at a time.

    and you'll have an ear to ear grin about avoiding the fees, frustration and wasted time a consultant would bring.

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    We all have blind spots, even if we think we can see it all.

    Replace 'consultant' with 'smart friend' who tells it to you straight.

    Also, ask your accountant how your numbers compare to similar shops. Have a meeting with your accountant. They are your financial consultant anyway.

    Finally, be careful with this, but ask your employees what is the biggest problem or what change will make your business run better. They may be holding onto something good.

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    I don't want to hijack this thread as many of you are making valid points. However, I'm shifting my software business to be more of a machine shop consultancy business. Typically when machine shops grow they need custom software so I'm going to keep the software side alive, but with the new focus of consulting on processes and software within small to mid sized machine shops. I myself worked in a machine shop for several years and was a key factor in this 15 year old ~$1.2M Peak Annual Gross shop growing into a ~$5M shop over only a few years. I'm taking a lot of my experience from that with the goal of helping other smaller shops ($600k+) do the same. At the same time, I'm creating extensive online resources such as blogs and training documents to help shops as well integrate and think about processes and such that they perhaps hadn't otherwise.

    Now many of you have shared the experience with consultants as being people who come in briefly, bark orders, make changes, and fly away. What I'm intending to do is become more of a partner to these shops. As such, if you were looking for a consultant, would the fact that I charge very little upfront with most of my payment being a % of increased revenue over a period of years be more convincing for you? What I mean by this is I would charge a deposit of probably $5k and then over a period of X years work WITH the shop to make changes, integrate software, etc and open up space for more revenue. When the shop sees that increased revenue, then my company would be paid on a percentage for it's services.

    Would that help calm the nerves and serve you better as a shop owner than the fly in and out flat-fee consultant?

    p.s. my intention is not to sell my services. I'm simply seeking to understand what you are looking for as shop owners and how I can best build my business practices around serving you.

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    Quote Originally Posted by ftoconsulting View Post
    I don't want to hijack this thread as many of you are making valid points. However, I'm shifting my software business to be more of a machine shop consultancy business. Typically when machine shops grow they need custom software so I'm going to keep the software side alive, but with the new focus of consulting on processes and software within small to mid sized machine shops. I myself worked in a machine shop for several years and was a key factor in this 15 year old ~$1.2M Peak Annual Gross shop growing into a ~$5M shop over only a few years. I'm taking a lot of my experience from that with the goal of helping other smaller shops ($600k+) do the same. At the same time, I'm creating extensive online resources such as blogs and training documents to help shops as well integrate and think about processes and such that they perhaps hadn't otherwise.

    Now many of you have shared the experience with consultants as being people who come in briefly, bark orders, make changes, and fly away. What I'm intending to do is become more of a partner to these shops. As such, if you were looking for a consultant, would the fact that I charge very little upfront with most of my payment being a % of increased revenue over a period of years be more convincing for you? What I mean by this is I would charge a deposit of probably $5k and then over a period of X years work WITH the shop to make changes, integrate software, etc and open up space for more revenue. When the shop sees that increased revenue, then my company would be paid on a percentage for it's services.

    Would that help calm the nerves and serve you better as a shop owner than the fly in and out flat-fee consultant?

    p.s. my intention is not to sell my services. I'm simply seeking to understand what you are looking for as shop owners and how I can best build my business practices around serving you.
    The problem with consultants is, as previously mentioned, they have no skin in the game. Successful businesses today are solution providers for their customer base. The customer base is by far the most valuable asset any successful company has. Beneficial changes require an in depth analysis and an investment in those agreed changes by all parties. I like your approach.

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    Quote Originally Posted by steve-l View Post
    The problem with consultants is, as previously mentioned, they have no skin in the game. Successful businesses today are solution providers for their customer base. The customer base is by far the most valuable asset any successful company has. Beneficial changes require an in depth analysis and an investment in those agreed changes by all parties. I like your approach.
    I 100% agree. That's why my thought is, if I can afford to not receive payment for some time, I'm going to try this method out and basically be an equity partner for a few years during the revising and changing of the business, then when it has succeeded I get a decent paycheck and the shop is capable of continuing the work without me.

    And I find that often times the most significant changes a shop can make include organization (I recently toured a shop where they literally just threw all their tooling and inserts into a drawer and had to sort through it to maybe find what they need) and setting them up to run through more parts through as well as find new customers and keep more machines running (this same shop had about a dozen machines, a couple of which were brand new $400k machines, sitting turned off and only 4 machines actually running parts),

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    I’ve done some consulting with very good results for the customer. A customer I met at a trade show bought a lot of my product and liked how I looked at things. He asked me do some consulting, come down to his operation and look over what they were planning. I asked for a 20 day contract at $1000 a day and all expenses, air fare hotels etc. (25 years ago) and we would end it if he wasn’t happy after the first day. Went down to his plant for 3 days and saved him $20K the first day by redesigning a bracket and sourcing it. Next trip I designed a valve and saved over $50K.

    I wrote the business update plan for a customer that the crooked consultant should have done. The customer didn’t like what I wrote but his wife loved it. They executed it and the results were fantastic. The owner spent $50K fly fishing with his buddies every year.

    Another customer asked me to review the expansion plans his people had drawn up. They hadn’t looked far enough ahead and were taking production offline at great risk and blocking access to a future expansion. On the way to the airport he thanked me because he was really worried and couldn’t get his people to consider other options.

    So it can work if you find the right person. Over the years I have gotten work from customers not because of the work we did but because they liked the point of view I brought to the table.

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    Quote Originally Posted by ftoconsulting View Post
    I 100% agree. That's why my thought is, if I can afford to not receive payment for some time, I'm going to try this method out and basically be an equity partner for a few years during the revising and changing of the business, then when it has succeeded I get a decent paycheck and the shop is capable of continuing the work without me.

    And I find that often times the most significant changes a shop can make include organization (I recently toured a shop where they literally just threw all their tooling and inserts into a drawer and had to sort through it to maybe find what they need) and setting them up to run through more parts through as well as find new customers and keep more machines running (this same shop had about a dozen machines, a couple of which were brand new $400k machines, sitting turned off and only 4 machines actually running parts),
    CAD Drafting, CNC Programming, & Manufacturing Consultation -...

    Is this your ad?

  21. #32
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    Quote Originally Posted by munruh View Post
    Good Morning, our shop has had tremendous growth the last 10 years and it's a challenge for the owners(there's two of us) to keep it going. We have done all the bookwork and both been on the shop floor all the time. Along with that, we have done all the sales. We have two locations that we are considering merging into one. I feel like we could use some good advice to guide us into the next phase. So I have the bright idea for a consultant. Is there anyone that you all know of that can consult job shops on the business side?

    I'd like to keep this thread focused on the title if possible and get into what we should do or shouldn't have done in our shop. Thanks fellows!
    A name that comes to the top for someone in the metal working industry is Steve Hasty, Retired, Shawnee Kansas. Linkedln.com. He built A&E Custom, Kansas City, Ks. from the get-go to a company with 70 souls on the payroll when he retired.
    I worked with him in to Mid-90's as a Die Maker, Product and Die Designer. It may be worth your while to make contact with him.

    Roger

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    Quote Originally Posted by ftoconsulting View Post
    I 100% agree. That's why my thought is, if I can afford to not receive payment for some time, I'm going to try this method out and basically be an equity partner for a few years during the revising and changing of the business, then when it has succeeded I get a decent paycheck and the shop is capable of continuing the work without me.

    And I find that often times the most significant changes a shop can make include organization (I recently toured a shop where they literally just threw all their tooling and inserts into a drawer and had to sort through it to maybe find what they need) and setting them up to run through more parts through as well as find new customers and keep more machines running (this same shop had about a dozen machines, a couple of which were brand new $400k machines, sitting turned off and only 4 machines actually running parts),

    I would change that to "If I can afford to not get paid at all..." If the businesses you are working with fold, you receive nothing. Even if they don't fold are they really going to want to pay you for work done years ago? At what rate?

    Your best bet would to create a software package that is highly customizable by the end user during setup that would take care of maybe 75% of shops. You can then offer consulting for changes for the other 25% and offer maintenance and support on the standard package for some fee.

    I've had a lot of experience working with outside consultants that our clients had hired and without a doubt they were all completely worthless. Pointing out the obvious and telling you want you want to hear. Not worth a plug nickel.

    FWIW - I spent many years working for a computer consulting firm that wrote custom software for lawyers. I LOT of hands on and never made the money to make it worth while. We did finally morph into writing software utility packages which became a "pot o gold".

    JMHO

    -Ron

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    Consulting
    If you can't find a solution there is money to be made prolonging the problem.

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    Have seen all levels and capabilities of consultants in the machining world from small to giant sized shops.
    I have no clue as to how to pick a good one. Perhaps background with chips in shoes along with managing such?
    Sales or money side background guys tend to be a little .....off kilter?.
    Bob

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    This is a pretty tough topic.

    I've done a few engagements as a "consultant" for shops I have a personal relationship with and would be happy to see if there is anything I can bring to the table for you here.

    Otherwise I have been entirely unimpressed with the consultant shops I've explored trying to do something with in my own place.

    Everything is so super specific to your situation and where you are attempting to get to.

    In my experience it is such a very narrow skill set and even further narrowed to the problem you are solving.

    You will need to outline what you want to solve and how you are going to tell if its solved before you even engage with someone.

    And then if the way you are measuring it is even correct.

    How are you booking revenue?

    Do you have loads of discrete jobs with a basket of customers? or a low number of customers?

    Do you want them to tell you how to consolidate the two shops and cut indirect so you can boost margin (proxy for cash flow)?

    Do you want them to go out and find you customers?

    Do you want them to professionalize your books?

    If you are running a high number of jobs, your supply chain is probably a mess...do you need a supply chain guru?

    Are you doing government work? Do you need a FAR ninja?

    Are you attempting to consolidate and implement some sort of ERP to manage the excel intensive ops/planning/production piece of all this?

    Do you understand your own job costing?

    Purchasing to inventory or stock?

    Are your jobs chock full of subs and outside processes?

    Freight and logistics?

    and on and on down the rabbit hole of things to solve.
    Last edited by Daniel Wheeler; 08-09-2021 at 01:04 PM. Reason: Clarity

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    Quote Originally Posted by Illinoyance View Post
    Consulting
    If you can't find a solution there is money to be made prolonging the problem.

    Business model for Cancer Treatment Centers of America?


    -------------------

    Think Snow Eh!
    Ox
    Last edited by Ox; 08-09-2021 at 03:45 PM.

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    A friend told me he considered becoming a dermatologist. No one ever gets better and very few of your patients die.

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    Quote Originally Posted by ftoconsulting View Post
    I 100% agree. That's why my thought is, if I can afford to not receive payment for some time, I'm going to try this method out and basically be an equity partner for a few years during the revising and changing of the business, then when it has succeeded I get a decent paycheck and the shop is capable of continuing the work without me. ,
    you may benefit from hiring a financial consultant

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    Quote Originally Posted by Garwood View Post
    No, that isn't me.


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