Recently, Firetrace International had a panel discussion with two entrepreneurial machinists – Adam Demuth of Demuth Tool, and Dan Rudolph of Rudolph LLC, where we discussed how they got started with their own machine shops and advice they had for others looking to do the same. We took that discussion to compile a list of some of the most important things to consider if you’re also looking to start your own shop.

1. Figure Out the Industry You Want to Go Into

Whether it’s due to space restrictions, knowledge and expertise, or your book of potential clients – it’s important to decide what industry you want to center your shop around. Many times, if people go too general with a “jack-of-all-trades” type of approach, they can continuously be buying new things to fit the projects they’re getting in or run into an issue with not having quite the right equipment to complete the project. You will have more success by specializing and becoming an expert in a chosen niche.

Understanding your areas for potential can help get you on the right foot to be competitive, build a good reputation for yourself, and make smart investments in equipment to generate a quicker return.

2. Take the Time to Put Good Processes in Place at the Beginning

There are some things that are worth putting the time into before you even open your shop doors. Having good processes in place will make your day to day operations run a bit smoother than they would otherwise, especially when starting out. Two recommendations from Dan and Adam are to get a sound quality system in place and create your templates for processes like quote tools, accounting, etc. This will save you time and frustration once you start bringing in jobs.

Having the proper quality systems in place, can put you ahead of other manufacturers, especially if trying to win jobs with large companies. This demonstrates that you’ve taken the time to ensure your process is up to their standard.

3. Try to Keep Your Equipment Costs Down

Keeping costs down is probably easier said than done, but having less debt allows you to invest your money into other aspects of the business. There are going to be cases where you need to buy a brand-new machine, but looking for creative solutions can be just as effective and may be better for the longevity of the company in the long run. For instance, looking into buying used machines, or maybe leasing a machine to start.

If you’re looking to start your own business, there are also ways to work in the machining space without needing to invest in equipment right away. If you have the experience, there can be opportunities for contract programming, automation programming, metal flow analysis, etc. which can all be done from a laptop with software. This can keep initial costs down, as well as building a network of potential clients to work with if you decide to start investing in your own machine tools.

4. It’s Okay to Say “No”

When starting your own shop, it will be difficult to say “no” to work coming in. But it’s critical to assess every opportunity and turn down the ones that don’t fit into what your shop is trying to do or might require expertise and equipment you may not have. The quicker you can assess and turn down work that isn’t the right fit, the easier it will be on your business because you can keep your focus on what you are trying to build. It goes back to being focused on a specific market – the more specialized you are, the more your shop will differentiate itself, and you can build a reputation as an expert in your field.

5. Running a Business First, Machining Second

While being your own boss can come with a lot of rewards, there is also a lot more work involved outside of machining that is involved to ensure everything runs smoothly. Both Dan and Adam mentioned that they work on the shop floor during the day, and then work on the admin tasks at night. They recommended using YouTube as a great resource to learn how to do some of the accounting work, business planning, etc.

The saying “it takes a village” can also apply to building a machine shop. While you are building a machine shop by yourself, make sure to use your network – whether it be friends, family, or past colleagues – is essential for success. There is a lot of work involved, and if you can get people in your network to help you get started, the quicker you may learn and progress your business.

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