The Leather Business - A Rant

[cdthayer]

Small retail store fronts will soon die out. Small service store fronts will continue to increase. For about any kind of product.

Concentrate on services. Repairing poorly-made products is where the money will be for the foreseeable future. Any spare time can be used for making your own quality products and having them available for sale or as samples to sell good stuff to the people that came in for repairs on not-so-good stuff.

Always consider the money spent on Trade Shows or any other remote sales venues as advertising only, not meant for profit. You'll feel better about getting skunked that way. If you do happen to bring home a few hundred, consider it return on investment of your advertising. Just don't expect it next time.

A service store front is best located well away from the Big Box stores in the older part of town. It's cheaper to operate it, you'll keep more of the money that you take in, and people will still come to you for repairs when they wouldn't normally be in that area to shop. Back yard repair shops are about the same. People will open and close the gate, follow the sidewalk around the house to the workshop, ring the bell, and wait patiently while the dog is barking at them for someone to greet them. But they'd never go there to shop for new merchandise. Why? Because they think it's the best place to get cheap repairs on their expensive stuff. And they're usually right. Lower overhead usually means lower prices for the customer and more profit for the shop owner. But once there, they often will buy quality stuff.

CD in Oklahoma

[Ian]

Yes, the reality is a sobering thing. I'm remembering the days when hundreds of small owner-operated businesses flourished - shoe and clothing stores, hardware stores, pet shops......I look around my town, and there's barely even a privately owned restaurant - everything is a national chain. I travel a lot, and from California to New York, every shopping mall has identical stores. I used to love hanging out at the feed store, until a Tractor Supply moved in down the road and that store closed. It's nice having a huge variety of products, but we sure have lost a lot in terms of human interaction.

Opening a full time business will mean lots of hot dogs and beans. But I'm still not 100% convinced that it's not a possibility...........

I bought an Adler flat bed machine from a guy who used to have a small awning business. One day he was offerred a contract sewing job making some kind of filters for manufacuring. He ended up with 7 employees and was grossing a million and a half a year before the imports floored him. But, stories like that always give some hope that putting yourself out there will result in the 'big break'. It keeps me going anyway.

Edited July 26, 2013 by Ian

[BIGGUNDOCTOR]

Running your own business has it's drawbacks, but I was never happier working then when I had my machine and fab shop years ago. I actually think that now is one of those golden opportunity time to start a new business. The problem is with any craft based profession it is a tough sell to customers that have gotten used to big box prices - I have termed it the Wal-Mart effect. You may want to check out Dave Ramsey's book Entreleadership which is written for entrepreneurs. When dealing with custom stuff, involving the customer can save some headaches. When dyed material comes in, have them approve it before you cut into it. The best advice I can give you is do your research, start small, and most importantly avoid debt at all costs. Build up to where you want to be, don't start off there. When I had my shop, my partner and I cash flowed the entire operation. Every piece of equipment in that 4,000 sqft shop was paid for. Auctions were the only way we could buy equipment at affordable prices. On average we were paying 10 cents on the dollar compared to new. We knew we could afford something when we had the cash to pay for it. That was the best decision we did over the 6 years we operated. When we were forced to close due to outside forces we were able to keep all of our equipment without fear of repossessions. Work from home as long as you can.

[EquusCustomLeathers]

Working from home is definitely the way to go these days, if that is possible. The only drawback is that it tends to take over your every waking moment. If you have the self discipline to "turn it off" for certain times, you can do quite well with a small business at home. It's a lesson I learned the hard way

[WScott]

Running your own business has it's drawbacks, but I was never happier working then when I had my machine and fab shop years ago. I actually think that now is one of those golden opportunity time to start a new business. The problem is with any craft based profession it is a tough sell to customers that have gotten used to big box prices - I have termed it the Wal-Mart effect. You may want to check out Dave Ramsey's book Entreleadership which is written for entrepreneurs. When dealing with custom stuff, involving the customer can save some headaches. When dyed material comes in, have them approve it before you cut into it. The best advice I can give you is do your research, start small, and most importantly avoid debt at all costs. Build up to where you want to be, don't start off there. When I had my shop, my partner and I cash flowed the entire operation. Every piece of equipment in that 4,000 sqft shop was paid for. Auctions were the only way we could buy equipment at affordable prices. On average we were paying 10 cents on the dollar compared to new. We knew we could afford something when we had the cash to pay for it. That was the best decision we did over the 6 years we operated. When we were forced to close due to outside forces we were able to keep all of our equipment without fear of repossessions. Work from home as long as you can.

Great post, like what you say about debt aversion and financing yourself.

This would be an interesting thread to hear from those who had troubles, what happened and how they reacted to survive...or not.

[BondoBobCustomSaddles]

Lan, all the things that everyone says are true. You seem to have hit a "real beer drinking day". All I can say is, why did you get into leather in the first place? If it was to make a living, then I will tell you that the most and consistent money I ever made at leather was working the race track for tack repair and making goods for the horsemen there, however; that was during the summer and I spent 7 days a week 10 to 12 hours a day banging out repairs and goods, ( 1200 horses tear up a lot of stuff!!!). That left me no time to do what I like to do, ride some, make really good artistic saddles, and just putz . If you can find a nitche that meets your needs and allows you to enjoy it, you are ahead of the game. Only you can figure out what that is, it is good when you find what it is that makes you happy. Good luck on your quest. Bob

[Murf]

Ian, every few weeks I work with a custom hotrod interior guy learning the trade when I have weekends off. He gets his leather from a tannery in canada. Im not sure if they handle Veg tan but i know that every single time we have needed a specific color hide they have delivered without question the exact color we were after. We usually pay about 450$ per cow (really odd i know, to buy by the cow) and these are quality hides. Ive read the pamphlet we have at the shop and there isnt even barbed wire around these cows for fear that it might damage the future product. Ill get the info the next time i go and post it here. If they dont handle Veg someone will at least get some info on some great interior leather.

Ps. Ive watched your video on tool pouches for bikes and it really got me into the bike leather part of the craft, you may be at your wits end with the business end, but on the crafting end you are great at what you do and have showed me a thing or two.

[Dwight]

Leatherwork is no different from other business ventures, . . . in the truly "business" end of it.

Find some part of it at which you are good, really good, or great: concentrate on that area. That is the way businesses have always survived.

Example, . . . where would Ford be if they had continued making the Edsel, and had forsaken their other lines? In the ditch with Yugo, Studebaker, and Frazier.

IF YOU HAVE TIME, every time you make a custom piece, . . . make 2 of them. One you sell, . . . the other is for craft shows, inventory, immediate sales, etc.

Yes, you will wind up with some dusty old pieces in a cardboard box that no one wants, . . . but you will also get some quick sales.

As a personal anecdote, . . . I took one of those boxes with me to a gun show with some friends, . . . borrowed a corner of one of their tables, . . . unloaded the whole box for $10, $15, and $20 a pop. Came home with a nice bunch of folding money, . . . and some better ideas of what my customer base wanted.

The other day, . . . I made a serious mistake on an IWB holster, . . . after an accident in the drying room ruined another one, . . . between the two, I now have a new product line to offer, . . . higher end, . . . better prioduct. All because of a couple of accidents.

I'm actually getting ready to put my sign out by the road, . . . holsters, belts, chaps, and saddle repair. I'm certain that as soon as it is visible to the public, . . . I'll be busier than ever before. But those are the areas of my interest, . . . I enjoy them, . . . makes all the difference in the world.

May God bless,

Dwight

[bizbeblu]

I'm a newcomer here so take my views with a grain of salt if you must. I've been in and out of business for myself multiple times over the last 30+ years. I have periodically gone to work for others (principally in an educational bureaucracy) and it never turns out well. I guess I'm arrogant - have been accused of it more than once - but I just can't work for someone who isn't at least as bright and dedicated as I am. My tenure in any bureaucracy (governmental or business - doesn't matter) will be a short lived thing.

I have several crafts and trades. The only one I ever made a complete living at was as a master carpenter doing historic restorations. It will surprise no one to learn that such business has utterly disappeared in the "Great Recession." I work in leather, wood, and am a reasonably successful photographer. Between the three and a fair amount of hustling, I make a living in part because I keep my cost of living very low. I'm not sure how to advise the OP as I could never be a "shopkeeper." I'd just go crazy. There are many times that my best work is done at say 2:00 AM thus flexibility of work time is critical.

Virtually all of my work is sold word of mouth. This is a truly poor community. When the mine shutdown there really wasn't much left. We do "eat the tourists" in the winter time when the population doubles with folks from WI and the Canadian prairie provinces. But even they don't often recognize the real value of hand crafted excellence. Nearly all my work comes via word of mouth thus there's no need for a retail outlet. I require 50% down, that I'll only refund if I haven't started on the project. I've never had any objection to that. I draw a small amount of work off my web site. I make it explicit that once you agree to the commission it's 100% upfront and there is no refund for anything. On the other hand I have on occasion reworked and even redone things when a piece just doesn't strike the customer as beautiful. I've lost money on rare occasion, but consider that a part of excellence and acting honorable.

With local customers everything is face to face and I've never had any problem. I consider the overhead of a physical space just too much to bear considering the outcome. By overhead I don't mean just the rent, utilities, fees, etc., but the fact that by opening a business and posting a sign (with my hours) I've entered into a contract with any and all potential customers. It's just not a commitment I'm willing to make. So I get by on word of mouth, some Internet and I'm slowly developing outlets in local businesses that are willing to be merchants. I figure 30% is far less than the cost of a store front and am not bothered by it at all.

On the other hand, I have known people who really enjoy having customer interaction and the day-to-day intrigue of "who or what is going to happen today?" If you are that type of gregarious person then a storefront might well be a good thing. Do make sure you have a sound business plan and the capital to keep you going for at least a year.

There really is no answer to the "Why is your stuff more expensive than Walmart?" As a culture - assisted by a great deal of advertising and even political support - we have become obsessed not only with consuming but also having everything. I prefer a few well made, well crafted things than one chintzy copy of everything. The Walmart mindset is that you can have it all (though it likely won't last more than six months and was made by slave labor in Bangladesh or China). I go out of my way to try to by local and buy directly from the producer or maker. I believe that if my work is of higher value, then buying in the Walmarts of America would make me a hypocrite, so it has to be a real emergency to get me in their doors.

I remain cautiously optimistic that high quality, unique work coupled with personal and excellent service can keep one alive. Alive, but likely never rich.

Robert