Almost everyone dreams of leaving their current day job behind for something where they work for themselves. Many times, the first idea that a person has about making this career change is by transforming one of their current hobbies into a full-time business.
Due to the popularity of woodworking, it’s not surprise that I often hear the question “Can I make a living doing woodworking full time?” The short answer, is YES, however, there are many other things that must be considered before quitting your day job.
Many people have made this leap and have proven that that can be done. Like any other business, it takes time to get established and to turn a profit.
Understanding The Basics
Having your own business is a great experience, however, there are somethings that you need to understand before making a career change. Talk to almost any small business owner and they will tell you one of the most difficult aspects of their job is handling everything outside of their primary product or service.
In addition to being a woodworker, you will have to engage in a wide range of tasks which can include: sales and marketing, customer service, photography, design, publicity, purchasing, accounting, and shipping. You will have to balance all of these items while still finding time to actually make products that will sell.
Fortunately, you won’t have to worry about all of these things as soon as you start your business. Instead, the need for these other tasks will increase over time and it will be important to make sure you allocate your time to those that are 1) making profits, 2) reducing costs or 3) business necessary (like preparing taxes).
Below are a few things you’ll need to take into consideration as your move towards launching your business as a full-time woodworker.
Many people engage in woodworking as a hobby or to create a supplemental income, but it is possible to make a full-time living from woodworking. It is important to remember that a full-time living is one that pays the bills, feeds the family, and educates the children.
Many times, people looking to make the jump from their normal day job to their own business forget the salary paid by their current employer isn’t the entire package of benefits they are receiving. In fact, most companies are paying taxes and insurance costs that you won’t see on your paystub. The general rule of thumb is that these expenses are approximately 25% – 50% of our salary. The large variance is impacted by what state you are in as well as how good the benefits are from our company.
Therefore, if you estimate that your company pays 30% in additional benefits, and your current salary is $50,000 – you will need to earn at least $65,000 in salary from your woodworking business to maintain your current standard of income.
This is one of the most overlooked aspects of a small company. If you are the only employee of your woodworking business, you’ll be responsible for the customer service work needed. You will have to learn to work with upset customers and decide how to manage customer expectations. Having the old mindset of “the customer is always right” is not a sound strategy as the statement itself simply is not accurate. Always giving in to a customer’s demands and not being able to say “no” can set your business up for failure.
In addition to woodworking, you will be engaging in sales and marketing. If you do not make sales, your business will not succeed. Business must be first while woodworking must be second. This prospect can seem surprising to many woodworkers, but, any business that is successful spends a significant amount of time marketing and selling.
The aspect of marketing is finding what you are going to sell. What products do people want to purchase that you can produce efficiently and well enough to sell for a profit? There may be great profit in a $1,000 live edge dining room table, however, you may find that in your area there are a limited number of people willing to pay that much for a table. Finding the products that you can sell with decent margins will take some time and experimentation.
The second part to the marketing section is how will you sell your items? Selling on existing platforms such as Etsy are difficult due to competition. Etsy fees can also take a sizable portion of your profits. I suggest setting up at local craft fairs. I feel there are multiple benefits to this approach.
First, you get to talk to potential customers and get an idea of what they think of the products you have available. You may find that everyone loves your product but aren’t buying because of a minor change that is needed. Speaking with customers will also help you to determine if your pricing is reasonable for your product offerings. Craft shows are a great opportunity to experiment with products and pricing.
Craft shows also help you to get future work by doing customized pieces. So many times, customers at shows will see a product they want, but they want it personalized or a small change made. This is a great way to secure sales before you have even produced the item.
Make sure that if you customize items that you are compensated for the additional work that you are having to do. Profits can disappear quickly if you are having to spend 2 extra hours personalizing a cutting board and charging the same amount as you are for generic cutting boards.
For additional ideas on places to sell your products online, please take a look at the article I wrote “12 Options to Sell Your Woodworking Projects Online.”
Once up and running, a full-time woodworking business would most likely need to have some employees. The number of employees would depend upon the size of the business, equipment used, and the number of steady customers. Hiring employees can be a great way to free up your time as a business owner. However, managing and motivating employees can be difficult if you have never done it before.
What Products Should I Sell?
Below is a list of products that typically sell well in a craft show environment. I would recommend that you create a several different types of products before attending your first craft show. This will help you to see what people are interested in and allow you to move into the direction of the items that sell well.
Although we live in the age of technology, there are still people who have a love for books. There are always people purchasing wooden bookshelves. Not only could you make these for individuals, but there is also a need for bookshelves in schools, daycare centers, libraries, preschool centers, and offices. When personalizing bookshelves, a wide variety of design can be considered.
Some of the types of bookshelves you could construct are wooden shelves with special designs, shelves with unique functions, shelves with cartoon character designs, or bookshelves with artist designs. Conduct some research and explore the options. Look around at businesses and public places in your neighborhood to see what they might already have, or what they might need.
Believe it or not, people shop for unique cutting boards. In addition to the traditional rectangular shaped boards, people look for cutting boards shaped like flowers, leaves, animals, toys, and other interesting shapes. Many people use wooden cutting boards as simply a decoration. There are a wide variety of possibilities in this area for you to consider.
Another wooden item you might consider constructing is a device stand. Wood is strong and sturdy as well as elegant, therefore, making device stands could bring some work your way. Display stands can be made for shops to display merchandise. Stands can be made for mobile phones, tablets, and other electronics. Key holders, jewelry holders, and watch holders are other uses people have for these types of stands.
Many businesses give gifts to their clients. You can take advantage of this by offering wooden pens, coasters, key chains, penholders, lighters, calendars, mini games, and clocks. Personalized gifts such as these are in demand.
It is vital to research your target market. Find out what types of promotional gifts corporations and small businesses are interested in purchasing for giveaways. Think of ways to make your products stand out through design and promotion.
Wooden picture frames are charming. Although metal and plastic frames are popular, wood is durable, and wood has charm and style. Picture frames make great gifts for all occasions which means you should have a steady stream of business if you choose to make this part of the products you offer. Some wooden picture frame ideas are wooden frames for corporate gifts, wooden frames for commercial establishments, wooden frames for portraits, and wooden digital frames.
Puzzles and Toys
Wooden puzzles and toys have remained popular throughout the years. Jenga, chess, and tic-tac-toe games are classics that will always sell. Wooden animals, dollhouses, puppets, doll furniture, towns, trains, beads, strings, alphabet toys, and counting toys will be in demand for as long as children are in the world.
The Furniture Maker
A professional furniture maker and licensed contractor states that he has had more success making furniture than in any other area of woodworking. Although he has enjoyed this success, he admits that he also teaches classes and writes articles for woodworking magazines to supplement his income.
Financial success does not matter much if you do not enjoy what you are doing. This professional furniture maker states that, with all the ups and downs of business, he still loves spending time in his wood shop. Loving your profession is a must because becoming a businessman, salesman, marketer, etc. can be tedious and seem burdensome if you do not love what you do. Learning to be content where you are is a key to true success. If you do not have a contented attitude, it is difficult, and more often, impossible to grow in your business.
Additional Tips for your Business
You could have the best wooden products available, but if you are not promoting these products, you will not make sales. Offer products that people will like. Conducting marketing research for your projects is a must. Set up displays where it would be permissible. Make use of social media sites for advertising. If necessary, you might need to pay for some advertising. Any investments you make to market your business will pay off in time.
Make products that bring value to your customers. Making toys is fine, but educational items are even better. Parents are more likely to invest money in products that bring educational value to their children.
Keep your contact information up-to-date. People need to be able to contact you easily and conveniently. Pamphlets and fliers are great tools to use in addition to your website. Make yourself available to answer questions concerning your projects. The more convenient you make doing business with your establishment for your potential customers, the more business you will have.
Managing Your Customers
Filtering your customers might sound a bit too exclusive, but people who are only interested in cost are not customers you will always be able to satisfy. Clearly outline the work that goes into your products. Your costs to customers not only need to cover your materials and expenses, but they also need to accommodate any employee pay for which you are responsible.
Most people with successful woodworking businesses recommend that you take 50% of your cost up front. It is not fair for you to finance a project for someone else. If a customer is not willing to pay you at least 50% up front, you do not need the business.
Do not feel guilty about having to turn down work that will not be profitable to you. Unfortunately, many people try to make purchases they are unable to afford. Do not put yourself in an awkward position in which you will be on the losing end. There are plenty of customer who are willing to pay for good work, and those are the customers you want.
Treat Your Establishment as a Business
It is vital to know and cover your costs. Knowing the costs of insurance, waste disposal, rent, wages, and taxes are vital to covering before you can establish a profit. Do not apologize for your fees. You must cover your costs if you are going to have a successful, established business.
Building relationships is important. Establish connections with interior designers and architects as these types of people are always looking for good workers. Good relationships will bring steady work to you.
Always keep your website up-to-date. Your site should be simple and clear with nice, vivid images of your work. If you are unable to maintain your website, hire someone for this job. In the technology age, internet circulation is everything.
Seek ways to improve your business such as taking classes. Conducting online searches is a great start, however, taking classes to improve your skills and methods is even better. Taking a business course might be helpful as well to improve your business skills.
Ups and Downs
As with any business, there will be times when it seems there is no work in sight, then, there will be times when you can not seem to fill all your orders. When you are first starting a woodworking business, the start will most likely be slow. You will have to invest time and money into finding the proper equipment, marketing, and making sales.
I would recommend taking your time as you transition from your career into a full-time woodworking business. In fact, I suggest, continuing to work your regular job until you have a solid line of work established within your business.
Another thing that is useful as you begin to grow your business is to look at see what other successful woodworkers are doing. In the past, a woodworker didn’t need to spend much time on a computer. Today that has changed dramatically. Most full time woodworkers maintain a blog or have a heavy social media presence in order to promote their creations.
Having a blog to go with your website is no guarantee of success, but any type of marketing and advertising is helpful. Social media is a great tool for marketing. Images of quality work have ways of circulating far and wide and could bring you much needed business.
Any venture will not become successful before a series of trials and errors have occurred. Some of the best lessons people learn is from mistakes. It is as important to have knowledge of what does not work as it is to know what does.
Only If You Are Passionate
If you are not passionate about woodworking, then you should not attempt to make a full-time business from this venture. The other steps that go into making a business successful will soon exhaust you if you do not have a great love for what you are doing. Woodworking is a fantastic business opportunity that has great potential, but you must be willing to go through difficult challenges along the way.
How to price your items
The amount you charge for your services can be a matter of some debate. It’s also one of the most important steps in starting your business. If you charge too much, the item will not sell. If you charge too little, you will lose money. When pricing your products, there are several factors that you should consider. Some of the factors that you must consider are material cost, overhead, labor, and selling expenses.
Let’s look at an example.
If you are setting a price for a small table, you will have to first consider the time it took to make the table. For the sake of argument, you could say the table took approximately two hours to make.
Next, you need to total the cost of the table. If the table has 12 board feet of oak which might cost $3.00 per board foot, then the cost of the wood would be $36.00. If you used any type of hardware (screws, knobs, etc), then you would have to add the cost of those parts.
If the hardware cost approximately $20.00, the cost would need to be added to the $36.00 which would bring the total material cost to $56.00.
Now you need to factor in your time. How much are those 2 hours of time that it took you to build the table worth? If you make $50,000 in your regular day job, you earn approximately $24 per hour. However, as we discussed earlier, you won’t have access to all the benefits that you had before at the job you left (or are consider leaving).
Let’s assume, you decide that your time is worth $35 per hour.
The sale price of your table should be approximately $36 (wood) plus $20 (hardware used) plus $70 (labor). Those numbers total $126. The $126 is the least amount you should charge to make a profit that pays you $35 per hour. Once you have this price, you can mark up from there, but it’s important to establish a minimum threshold that you can accept for a piece.
Long Term Pricing Strategy
The example above is a general outline of how to come up with a starting point for your pieces when you are first starting out. As you transition into becoming a full-time woodworker, there are additional factors that you will want to consider when pricing items.
In the example above, we estimated that it took 2 hours to complete the table. However, we didn’t factor in the time that it takes to drive to the lumber yard and purchase wood. There’s also time spent on the phone talking to customers to gain an understanding of the piece they are envisioning.
All these tasks are non-value-added time expenses. They are both necessary, but they aren’t tasks that are putting money into your pocket. Building pieces that sell are the only value-added tasks for your business.
As your business grows, you’ll want to figure out ways to factor these types of costs into your product too. I would highly recommend that you track your time each week, so you can see where your time is spent each week to ensure you are devoting as much time as possible to building products that will sell.
Having a steady method of cost calculation will make the process easier for you. Pricing your products at the beginning will save time later. As stated before, never apologize for your prices. People are in business to make money as well as to give customers quality work. You can do both if you plan carefully.
It is possible, even probable, for you to make a living as a woodworker. Careful planning, research, marketing, and calculation are required. Producing quality projects is another requirement. When you first begin, business might be slow, but give yourself time for true profit to begin turning. Time and patience are two factors that must be contributed for success.
Most importantly, love what you do. If you lose your love for woodworking, your attitude will become negative, and your time and investments will be wasted. Maintaining a positive attitude and loving your work will make the challenges in your woodworking career worth the time and effort.