How Should I Deal With This?

[UKRay]

This month has been something of a watershed for me. I have to make some tough decisions. Let me give you the background: 6 months ago I decided to drop my day-job and go it alone with the leatherwork. Okay, I had the cushion of some occasional well paid writing/training work coming in, but essentially I had to make a living beating leather. To cut a long story short, it seems to have worked. In fact it has worked so well that I'm now in a confusion and would appreciate some good advice.

Like most people, I have a workshop at home. Over the past year this has spread to cover approximately 400 square foot of space in three rooms on three floors. The heavy machines are in what used to be my old garage, The office and stores is a separate room and the main workshop used to be a spare bedroom. I'm very lucky to have the space but feel it is time to expand even further as I have a number of machines that I can't use because they are currently inaccessible and effectively in store. I simply don't have enough space to set them up ready for use. The main workshop is very cramped and I would like a much bigger cutting table, a larger space for dyeing and a proper leather storage area.

In addition to a fairly successful on-line business, I'm also facing an upsurge in larger orders that are hard to work on with limited space to store components, leather and finished goods. I have also run a couple of successful booths at local shows and found that the public like what I make. In fact, my inventory was so depleted by the last event that it will take me a while to replenish stocks.

Essentially, I feel it is time to expand but don't know what the next move should be. I could get an industrial unit, but I don't really want to become a 'full-on' manufacturer. I could get a 'store-front' and use the space to create a great workshop with a small retail capability. I could head for the retail sector,employ staff to make the leathergoods and sell direct to the public (not my favorite choice) or I could continue to struggle along in extremely cramped conditions that cost me nothing to run, making a reasonable living.

What have I missed?

Any thoughts? What would you do?

Ray

[Jordan]

I would thank God that business is booming and I still love the work.Then I would build a new shop with all the features I have dreamed about and hire an apprentice. Sadly my leatherworking has taken a backseat to life for the past year.

[Stewart]

Ray,

If you were over rhere In the U.S.A. Your problem would be a lot easer to solve.

There is a lot of good places to lease. Well here goes. Being and retired for a company that sold truck parts

for 30 years from one branch to 5 branches than to (after being sold ) too 182 branches. Having the

capital is the first importait detail- second the down time and added expence in moving ( no time to finish jobs ).

Customers will follow most of the time ( remember what is a good location to you may not be to the customer)

Moiving does not happen iin a week.As my father has always told me sleep on it and make the decision,don,t

keep going over it. After the desision draw up plans (on paper) than if it is you desision is a little off it should show up.

Having help open new branches before all parts are running is a pain What ever goes wrong will, thats a nother list

to look after. Good planning is the thing. If you an,t bleeding your all right

I had a child hood neighbor parents tell me when I was laid off and retired I would be all right and so I am for now,but

I keep opitions open for problems. Retreit is not a bad statement at the right time.

Joe

Ps rolling down hill and not spilling your wine and messing up the cheese is a good thing to learn

[iwannabeacowboy]

Ray-It seems your in a position to make a change (I wish I had this problem). Is there any way you can rebuild your garage by adding another level to it? This would help with the extra room to set up your machines and build a large cutting area which could double as the work in progress section. Leather storage I've solved by building overhead storage with lighting mounted under it. An apprentice fresh out of school(cheap) that would want to learn the trade isn't a bad idea. You get some help and they get some experience.

" I could get a 'store-front' and use the space to create a great workshop with a small retail capability." this also sounds like a good idea if something is available around your area. Although with working out of your home your saving money, and have a tax write off. If you hire a trainee, I think you'll get your money's worth out of them by saving your time for more productive things. I've been laid up with 3 shoulder surgeries this past year, and will be returning to work on Aug 9th. Haven't been able to do any leather work at all for the past year. By this time I was hoping to have an on line business going, but will have to work on it this coming year. I also work out of a spare bedroom that is to small for me. Maybe in a year or two I'll have a problem like you have, but till then I continue to struggle with limited work space. I hope you find a solution that works out for you.

charlie

[JLSleather]

You're the only one kin answer that, really. What do you WANT to do? Why did you get interested in leather in the first place?

I personally don't know what I want to end up with. I have reason right now to NOT have the web site up and running (actually pays me to have it OFF), but I bought the domain anyway because of the propensity for jerks to see my work and create that domain name for THEM.

But I do leatherwork because I LIKE leatherwork. I like doing it, I like seeing what others have done, and I like coming up with new stuff. I like to make money with it, but really don't NEED to. Thus, there are things I can afford to NOT do because I don't want to. Just as example, I have never done skulls and / or flames - and I'm not going to. There's no reason to come to my place and count your money, because if you want skulls & flames you don't have enough. In fact, in the event that someone didn't know that and asked for that type of thing I'd refer them HERE and someone else could do it. Not to be the rude jerk, one more example. There were TWO items we had quite a few posts on, that most will remember seeing this year. One guy made that "evil clown" seat, and the other guy made that "tappedero" lamp. Lots of pictures and talk about both. Neither is really "my thing", and I don't personally want one OR want to make one. Still, there was talent evident in BOTH - so if I talked with someone looking for those things I would send them HERE.

So, without going on about how this "cowboy gear" is in fact from SPAIN and was brought to the US by some marauders who were actively slaughtering Aztec indians - the question for JEFF is ... do I want to grow cows, or do I just want the steak?

[rdb]

There's a fine line between expanding when you WANT to, and expanding when you NEED to.

There is a great deal of expenses to maintain a larger facility or retail store. And when, what was once extra cash is now the rent, it hurts more than you planned on. The only person making money at that point is the landlord.

I want to expand everyday! But I'm holding back. I'll work on the floor cutting sides, until there's two of me having to do that....

[wareagle]

The choice is yours and yours alone(except for maybe the one who holds the purse strings)!

I work out of my home(two bedroom apartment) also and I have the tools set up in the spare bedroom along with the cat box and storage. I have it set up where I have movable carts for the large tools and move them around when I need to use them.. as to cutting it is done on a sheet of Masonite on the floor.

Things to consider if you decide to relocate expense wise are signage, insurance, rent, security services, utilities, advertising, internet, taxes, loss due to shrinkage(shop lifting, theft), trash services, phone etc.

[UKRay]

Plenty of good helpful stuff there, folks. Many thanks. I think your point is very valid, Dave. There is a fine line between moving because you want to and because you need to. Given all the reasons why I shouldn't move yadda yadda yadda I'm starting to look around for ways to stay here a while longer. I can't lift the garage roof as it is built into my house, Charlie, but the ceiling is high so I can use it for storage. Lots of stuff like that is going to be needed to make enough room to work. How do you guys fit everything into the space you have? Any tips or suggestions?

Thanks again for your contributions.

Ray

[js5972]

A cost/benefit analysis would be my first order of business. Could your productivity be increased enough to cover your added occupancy costs? Is your order volume and backlog sufficient to sustain the necessary increase in productivity? Here in the USA, this is an ideal time to nail down low cost industrial or retail space, Similar economics in th UK?

[Suze]

lifting stuff to the rafters is easy Ray

rope and pully

learned that from a model Rail Roader - his whole set up was on plywood sheets that lifted to the celing.

and had legs that folded up underneath when it was in the air.

maybe you could make a cutting table that could do this or storage units.

[King's X]

I would just one thing to possibly consider.....do your changes in steps....there is plenty of evidence in society to shows you what happens when changes are dramatic. At least here in the USA. I would consider contracting some work out as a baby step. It worked for me in my previous employment.....as you said your inventory is almost depleted. Maybe someone to help you cut the leather or something else to assist you to at least stay above water with your money maker (inventory) stuff. At the same time, if you have $$ and space, I would consider maybe a solo building outside like a 2 car garage type set up where everything can be set up as your new shop 4 months down the road?

that is good to hear that you are doing well.....The guy I use to clean my sewing machine; we just found out that he and his family are closing down their sew shop due to the economy.

Good luck!

[BIGGUNDOCTOR]

Stay put for now in order to see if this upsurge in business is going to sustain itself, or fizzle some. You don't want to get into a new building with a lease, and then have the bottom drop out.

How many square feet/meters do you have at your current location?

Can you rearrange items to maximize usable space?

What machines can't you use now?

How much area do you figure you will need to have a working space?

What I did with my machine and fab shop was grow slow, and only when I could pay CASH. I never had a loan, or lease for any equipment.

[hivemind]

Remember also Ray that if you get a retail space, you either need to have someone on-hand to deal with walk-in customers, or you need to interrupt your production to do so.

Like most here, my experience is US-based, but here, commercial charges for utilities (electric, internet, phone, etc.) are at least double what you pay for a residential connection, so if there's a way to keep it a "home business" do so, because business expenses are... expensive.

[UKRay]

Sometimes, you know the answer to a problem but don't want to admit it because the thought of something better is so attractive... Moving my business out of the house would be expensive and, lets face it, there is usually a way to move things around to make some more space. I shall just have to be VERY creative!

As we all know, the economic future is uncertain on both sides of the pond, but I'm fairly sure it isn't going to improve any time soon. We still have another year or more of this to work through and although there is plenty of property up for grabs, I''ve now been convinced to sit tight and make do with what space I have for a while longer. I may have to dispose of a few machines sometime soon though! That will be hard.

Right now I'm counting my blessings that I have enough work coming in and a roof over my head.

Thanks for all your help.

Ray

[King's X]

Bravo!

[BAD HIDE]

Expansion to an external site is a tough decision. One thing to consider other than the extra expenses is just relative location to home. You can't just roll out of bed, make a cup of coffee and get to work, you have to get your stuff together and actually drive there. No raiding the fridge or takin a siesta either. And once you're home, there's no goin back to putz and do a little work after supper.

I kind of like the idea of a retail front that's mostly production floor, but there's upsides and downsides to that too. Mostly, gawkers love to talk and waste your time. If you're doing it by yourself, you'd have to set aside time where the front door is locked, but you're there and working so you don't fall behind on your production. I guess it'd depend where most of your money comes from and what you make that would determine if a retail store is worth it. Saddle and Motorcycle guys probably wouldn't see much from a brick and mortar presence, but I make mostly wallets, bags and small items so I take my goods for other people to sell in their stores. Cutting out the middleman who pays wholesale and making more money per item would be worth loosing a little production time.

Anyway, I'm sure you'll come up with some solutions to keep going in your home. Whatever you're doing sounds like it's working.

For a cutting table, I have a 2'x5' table with a long basket screwed in between the table and the wall. I just throw the rolled up hide in the basket and just cut parts away as I roll it toward me. But I make small stuff, so that may not work for you.

Edited August 2, 2010 by BAD HIDE

[cjmt]

Sometimes, you know the answer to a problem but don't want to admit it because the thought of something better is so attractive... Moving my business out of the house would be expensive and, lets face it, there is usually a way to move things around to make some more space. I shall just have to be VERY creative!

As we all know, the economic future is uncertain on both sides of the pond, but I'm fairly sure it isn't going to improve any time soon. We still have another year or more of this to work through and although there is plenty of property up for grabs, I''ve now been convinced to sit tight and make do with what space I have for a while longer. I may have to dispose of a few machines sometime soon though! That will be hard.

Right now I'm counting my blessings that I have enough work coming in and a roof over my head.

Thanks for all your help.

Ray

Hi Ray,

Staying put has to be a good thing at the moment. I'm in just the same position here, but what if orders dropped off?? Wouldnt be fun to be stuck with a shop + rates you cant get out off without the orders to sustain it. Existing space can always be used better, and if you dont have rent to pay it makes the whole thing so much easier. To me the tipping point becomes when you need staff, at which stage you need moderately respectable premises.

Glad its going well for you,

Charlie (Equus)

[UKRay]

Thanks for the advice, Charlie. I'm convinced you are right and have made some pretty sweeping changes this past week or two to ensure I can stay where I am for a while longer.

The staff issue is one I have explored, but even if I were drowning in work I can't see me employing anyone.

<Rant starts here> I'd like to take on a trainee, but I couldn't afford the insurances, benefits packages and all the other nonsense that goes with it. Despite having an able and willing workforce on my doorstep, the cost of compliance with UK employment law, draconian Health & Safety regulations, and all the nonsensical legislation in between would cripple my business in five minutes. It almost feels like small businesses are penalised for wanting to grow.<Rant ends>

The best way forward seems to be to invest in machinery to speed up operations and make them more efficient. Maybe then I'll be able to keep up with the workload and stay single handed. It has to be worth a try but the issue remains: where am I going to put any new machines? LOL

Ray

[Luke Hatley]

Thanks for the advice, Charlie. I'm convinced you are right and have made some pretty sweeping changes this past week or two to ensure I can stay where I am for a while longer.

The staff issue is one I have explored, but even if I were drowning in work I can't see me employing anyone.

<Rant starts here> I'd like to take on a trainee, but I couldn't afford the insurances, benefits packages and all the other nonsense that goes with it. Despite having an able and willing workforce on my doorstep, the cost of compliance with UK employment law, draconian Health & Safety regulations, and all the nonsensical legislation in between would cripple my business in five minutes. It almost feels like small businesses are penalised for wanting to grow.<Rant ends>

The best way forward seems to be to invest in machinery to speed up operations and make them more efficient. Maybe then I'll be able to keep up with the workload and stay single handed. It has to be worth a try but the issue remains: where am I going to put any new machines? LOL

Ray

* Ray you can put some of the Machines in my shop and i'll do commission work iinternassonaly for you....

[UKRay]

I suppose you'll want me to send the machines by carrier pigeon again... Have you any idea how hard it is to find a pigeon that can carry 400lbs across the Atlantic?

[Denise]

I had most of a post written on this a few days ago and then deleted it thinking it sounded way too negative. But since you brought up the same points, Ray... In reading your initial post, I thought "Your first decision is whether you have employees or not." That would make a big difference as to what kind of space you need. A friend of ours was in a similar circumstance. He crunched the numbers and figured that he would need to turn out three times the amount of work he currently was doing to pay for one employee, so he decided to stay solo. (How he figured this out I don't know.) But besides the costs and paperwork, there is also the fact that "your" work is now not being done by you. And how comfortable are you with that? A huge consideration for anyone in that situation is "Will I make a good employer? Am I willing to give my employee the time to learn, the positive encouragement needed when they make mistakes and ruin leather (because they will!), and space to work without looking over their shoulder all the time?" Giving up control, even in the more mundane areas of work, is a hard thing for a lot of artisans. Our standards are high and trusting someone else to do the same quality of work is tough. And getting a person that cares that much ("Why should I when it's not my name on it?" is too common an attitude) is very tough. If you find such a person, they are worth their weight in gold. But if you aren't a good employer, or you expect to pay low wages, then you will have a revolving door of employees resulting in constant training time and increased costs in mistakes, wasted leather, etc. Being a good employer is a tough job, and a lot of us would rather do the work ourselves than be that good employer.

[JohnBarton]

This month has been something of a watershed for me. I have to make some tough decisions. Let me give you the background: 6 months ago I decided to drop my day-job and go it alone with the leatherwork. Okay, I had the cushion of some occasional well paid writing/training work coming in, but essentially I had to make a living beating leather. To cut a long story short, it seems to have worked. In fact it has worked so well that I'm now in a confusion and would appreciate some good advice.

Like most people, I have a workshop at home. Over the past year this has spread to cover approximately 400 square foot of space in three rooms on three floors. The heavy machines are in what used to be my old garage, The office and stores is a separate room and the main workshop used to be a spare bedroom. I'm very lucky to have the space but feel it is time to expand even further as I have a number of machines that I can't use because they are currently inaccessible and effectively in store. I simply don't have enough space to set them up ready for use. The main workshop is very cramped and I would like a much bigger cutting table, a larger space for dyeing and a proper leather storage area.

In addition to a fairly successful on-line business, I'm also facing an upsurge in larger orders that are hard to work on with limited space to store components, leather and finished goods. I have also run a couple of successful booths at local shows and found that the public like what I make. In fact, my inventory was so depleted by the last event that it will take me a while to replenish stocks.

Essentially, I feel it is time to expand but don't know what the next move should be. I could get an industrial unit, but I don't really want to become a 'full-on' manufacturer. I could get a 'store-front' and use the space to create a great workshop with a small retail capability. I could head for the retail sector,employ staff to make the leathergoods and sell direct to the public (not my favorite choice) or I could continue to struggle along in extremely cramped conditions that cost me nothing to run, making a reasonable living.

What have I missed?

Any thoughts? What would you do?

Ray

The beast must be fed.

Once you increase your overhead then you will be increasingly dependent on getting more and more business to pay those expenses.

I started three years ago in my apartment with one bedroom converted to an office, one room converted to storage and the living room used as the workspace. I had three employees. Three years later I have a 500 square meter shop with 7 sewing machines, a huge laser, and 13 employees. I have $20,000 tied up in leather and other supplies.

I FEEL it every month when the bills come due.

My advice is to wait until you really cannot stand it anymore and then go another six months beyond that. Do everything you can to optimize the space you are in.

I will never forget the time I was in Amsterdam and we went to a shop owned by friends of my father. Two guys who specialized in fetish and bondage gear. I walked down a flight of steps into a basement shop that was one little room in front and a larger room in the back - that's it. In the larger room they had on big cutting and work table - sewing machne on the wall and UP the walls they had hundreds of drawers full of every conceivable metal part known to man. Above that was leather storage. VERY efficient operation. I was a claustrophobic in there but impressed at the same time.

My advice is to stay put and horde your money - don't invest in expansion until you really must. On top of the expense comes the time in transit going to and from work.

Of course if it's critical now then do it. I love my shop but I HATE the 1 hour commute every day to get here and another hour to go home. (don't ask) I'd much rather be five minutes away at best.

[UKRay]

Okay, that all makes perfect sense and pretty much echoes what i was already thinking. I'm staying put a while longer, I'm not going to be employing anyone, Denise and I'm making some serious changes to the way I do stuff... I also hate commuting, John!

Thanks for all your suggestions, guys. I'm most grateful.

Ray