Fabrication Business

Welderpaul · Feb 25, 2007

Hello all.
I have been thinking for sometime about taking that giant leap and leaving behind all that goes with my current job security and starting up a fabrication company, starting out with the manufacture of gates, railings and general fabrication works; then, depending how the business grows, getting into larger projects such as secondary metalwork packages for construction companies. There seems to be a quite a few outfits out there who are making a decent go of it.
I would greatly welcome the thoughts of anyone out there who is already in this line of business; what is the feasibility of this idea, what are the pitfalls, what is the best way to go about it, what sort of turnover/proffits could be expected. etc etc etc etc I already have the vast majority of the kit required - albeit with limited premises, and hugely enjoy this type of work - so why not make money out of something you get a kick out of, and look forward to work on a monday morning for a change.
Any thoughts welcomed. Thanks, Paul.

Alex · Feb 26, 2007

One of the hardest things is not being able to produce your product, but being able to sell it.

You would ideally try to get as many retailers to stock your products, selling direct and funding your own marketing costs is very expensive, the British tend to be quite sceptical dealing with business and some for some strange reason love to deal with the big boys like B&Q, Currys etc even though they sell crap.

rtbcomp · Feb 26, 2007

There seems to be a quite a few outfits out there who are making a decent go of it.

Plenty of competition then!

what are the pitfalls

Bureaucracy - Insurance - Banks - Pil****ks

lexi · Feb 26, 2007

After the skills and tools comes the market research. You must do this to determine who and where your customers are.......what they want and how much and when they will pay. Where will you do this research? I did two separate business courses 15 yrs ago......much recommended.

Alex

weldequip · Feb 26, 2007

Personally, I would forget it & apply for a job in Westminster!

Don't want to put you off mate, but it's not easy. That lot in Parliament & local council have not got a clue!
weldequip

weldequip · Feb 26, 2007

Seriously, cash is king in any business, ie. cashflow is critical. You will have to shell out on materials & wages & you may have to wait up to 90 days before you get paid on some jobs. Yes, 90 days! 'Standard' business terms are 30 days but that never applies.
My advice would be to avoid the bigger companies & concentrate on payment when finished jobs to start with.
weldequip

Welderpaul · Feb 26, 2007

Hear what your saying gents, my first feeling is to start fairly small i.e domestic work, work for small builders, general fabrication work etc to get a founding, establish links and gain knowledge/confidence etc before taking on work for larger organisations who as you say have 90 day ++++ payment terms and work done on a sub contract which leans heavily in their favour, of which they know the ins and out of.
I work damn hard for the company I work for at the moment, so putting that amount of work into my own business which won't have the beurocracy/donkeys which screw most things up at the moment would stand it in good stead I would have thought.
I'm keen to give it a go; the main thing that worries me is finding a sufficient workload to cover overheads and then make a proffit...
Lorra head scratching going on here - should i, should'nt I...!

weldequip · Feb 26, 2007

Better to have tried & failed than never have tried at all!
Go for it! You will either, a/.Never look back, or b/. think S**t, what have I done!
weldequip
Good luck :cool:

Drains · Feb 26, 2007

Start with the old business plan. How much work can you get? Have you got clients lined up or a good market. Do a lot of people round your way want gates and things, and will they pay what you need to charge. Genuinely, how many hours a week can you expect to work, for other people, for money, at your rate (which should probably work out at £200/day, absolute minimum). Then see if you can make a living that way, or if not, can you keep the wolf from the door?

I do all sorts of work. If not enough metalwork is coming in, or my other varions activities ain't covering the bills, I put my chippies bag together and get building work. The pay is good, usually, but I hate the work, and the maggots I usually have to work with. Needs must and that. I decided a few years ago that spare time - when no paid work was coming in - i'd go for the sweat equity thing, so I am building a bloody big boat. One day I'll sell it and have a big fat wad in my hand. In the meantime it takes all my spare cash... something wrong there.

But my main point is, personally i'd rather be poor and happy, working in my own time, when I want, taking work I like, than being secure and spending all day watching the clock.

If you have a workshop and the kit, you're halfway there. If your work is good and the punters like what you do, how much you do it for, and will recommend you then you have a business. People will pay for quality. But never sell yourself short, cos very few people will mention it when they think they are being undercharged.
If you're ambitious, be prepared for the business to take over your life. But start easy. Maybe get some homers (can't remember the english term, sorry) When you get too busy at night, quit your job. Off you go...

Thankyou for listening.... Si

Welderpaul · Feb 26, 2007

Hopefully it would be more a than b!
I suppose it's a case of setting yourself ahead of other competition by being more professional, more approachable when it comes to domestic work, better value for money, trustworthy, better product, and dare I say it - cheaper.
It's a lot to loose for it to fail, and i'm not really one to gamble - especially when it comes to income/job security/future prospects, but I won't find out otherwise. Just need to make sure they are calculated risks.
Thinking aloud here!

Welderpaul · Feb 26, 2007

simondrains said:
Start with the old business plan. How much work can you get? Have you got clients lined up or a good market. Do a lot of people round your way want gates and things, and will they pay what you need to charge. Genuinely, how many hours a week can you expect to work, for other people, for money, at your rate (which should probably work out at £200/day, absolute minimum). Then see if you can make a living that way, or if not, can you keep the wolf from the door?

I do all sorts of work. If not enough metalwork is coming in, or my other varions activities ain't covering the bills, I put my chippies bag together and get building work. The pay is good, usually, but I hate the work, and the maggots I usually have to work with. Needs must and that. I decided a few years ago that spare time - when no paid work was coming in - i'd go for the sweat equity thing, so I am building a bloody big boat. One day I'll sell it and have a big fat wad in my hand. In the meantime it takes all my spare cash... something wrong there.

But my main point is, personally i'd rather be poor and happy, working in my own time, when I want, taking work I like, than being secure and spending all day watching the clock.

If you have a workshop and the kit, you're halfway there. If your work is good and the punters like what you do, how much you do it for, and will recommend you then you have a business. People will pay for quality. But never sell yourself short, cos very few people will mention it when they think they are being undercharged.
If you're ambitious, be prepared for the business to take over your life. But start easy. Maybe get some homers (can't remember the english term, sorry) When you get too busy at night, quit your job. Off you go...

Thankyou for listening.... Si

Thanks Si - good advice, by homers I think we call foreigners/fiddle jobs! I can't agree more - at the moment I am in the situation you refer to above - well paid job and secure, but working with life's scum. Would prefer to spend my day doing something i really enjoy (Fabrication/making things in general) and getting a much improved level of job satisfaction

weldequip · Feb 26, 2007

and dare I say it - cheaper.

NEVER mention that word! Different in my job as I'm in retail so if people can get X welder 10% cheaper than my same X welder they tend to do so. However, you are providing a service, SO if you give a good service at a competetive price you will (should) get the business.
If you go in strictly on price you are destined to failure; there are too many cowboys out there already doing just that.
weldequip

malcolm · Feb 26, 2007

I started out in 2003, though this year I've taken on a temporary full time job. It's amazing how much time it takes out of my day.

The real advantage of working for yourself is the time available to think of niches in the market to go into. Takes time though - word of mouth is the key to getting work. Do good work for one person and the next year their friend will call you. Takes a long time to get going though using word of mouth, so in the meantime backup plans to earn enough money to live are a good plan. Do anthing to make a bit of cash until the main idea picks up.

I lost about £5,000 in my first year, but things have picked up since then to the point where I wouldn't really consider full time work any more. Apart from the full time work I'm doing at the moment obviously - that's handy cash to fund something special.

weldequip · Feb 26, 2007

that's handy cash to fund something special.

Well you've made something special right here Malcolm & I hope you are making a few quid out of it - certainly deserve it for all the hard work you have put in and for providing the platform for others to benefit from.
weldequip

Welderpaul · Feb 26, 2007

Not so many years ago, I started doing building work - drives, garden walls, paving, alterations sort of thing. It was all er... on the side sort of thing.... in between other things i was doing. Once i had done one job, i could guarantee i would work for a friend of theirs, a family member, a neighbour, a workmate etc. Some streets near me i have worked at every house. I never advertised but had enough work to keep me going in between other things. This was great, I don't really want to go back to building work, but it could be a nice infill job if the fabrication side of things slowed down, but was hoping for something similar!

weldequip · Feb 26, 2007

Well you must be a good tradesman then (or too cheap!) so you should be up & running. Recommendation is the very best form of business.
If you have a good meal in a resteraunt you tell other people; if you have a bad one you tell 10 other people!
weldequip

Welderpaul · Feb 26, 2007

I think it's a mixture - because i didn't charge vat i could undercut most other builders, so won the work. I wouldn't be able to sleep at night if i did a cra# job for someone, so all my work was of decent quality. - That might be the way forward with setting up the fabrication business, start fabbing/fitting gates etc along with the day job until it starts to take over then at least it's not an all or nothing break..?? - Is there anything illegal/underhand doing that - carrying out work for a paying customer without being a registered business/not VAT registered/Insured etc etc

rtbcomp · Feb 26, 2007

VAT registration is voluntary upto a turnover of about £40,000 pa, above which it is compulsary. Insurance isn't compulsary unless you employ someone. You MUST tell the taxman that you have become self-employed. You MUST keep a profit & loss account (and additionally a balance sheet if you form a limited company).

Don't fiddle the taxman - they can tell if you're spending more than you declare!

Welderpaul · Feb 26, 2007

So.. If i were to start fab work in addition to my current job (Employed by a large ltd company) i could;

a. Carry out work without charging vat (Obviously including in the job price the vat i have paid on materials) up to 40k, and without having to inform the taxman
b. do not need insurance - other for vehicle tools etc, as long as no one else was employed by me - presumably i would just have to foot the bill for any damage i caused to someones property - if the unspeakable happened

Could i advertise as a company, or just advertise using my name?

weldequip · Feb 26, 2007

I thought the compulsory VAT registration threshold was abot £58K? Don't forget though that is turnoverr & not profit (if we were all earning £58K we'd be happy bunnies!)
If you start turning over more than that (and you need to do) VAT registration will become an advantage, as you can claim back 17.5% on all your purchases; without that you are at a 17.5% dissadvantage to your VAT registered competitors. Only downside is the extra paperwork & their Gestapo like governance!! :mad:

weldequip

Fabrication Business

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