Could starting out cheap cripple your business

[beefy]

I'm getting closer to looking for paying work for my plasma table.

Operating at home in the back yard and I don't like it (too many interruptions, not enough room, need to be quiet, etc, etc), and would one day like a proper shop in an industrial estate or wherever, which of course means extra cost.

Many talk about being able to give cheaper prices because of lower overheads when operating at home, and that is good IF you always plan to operate there. But my worry is that if / when I move to a "proper" shop I would have to increase prices to cover the extra overhead. That could immediately lose a lot of work then I'd be up the creek without a paddle.

Has anybody started at home then progressed to a commercial space. Were you charging the same price while operating from home.

Keith.

[BTA Plasma]

No, work is the absolute bottom line. When we started in 1989 it was a gang of drill presses in a garage drilling and reaming hydraulic handles for Dana. They didnt care who we were or how we operated they wanted a perfect product. The next year was a dramatic change to a industrial building and lots of equipment. From there we moved onto design packaging and even made parts for IBMs zip drive assembly line which was fully automated in the early 90s. Small beginnings are fine as long as your customers are there and understand an on time payment schedule. All things being relative you can grow super fast and stay your same size its all up to the work flow and output. When you have that everything else moves along quite nicely.


BUT

Buying the right equipment or building it is what will seperate you from the folks that cannot get throughput flowing. At the end of the job you want a tool that will continue to perform. Oh and yes you have to charge a commercial price no matter where you are. A discount will leave you in a foxhole the rest of your life. But if your happy then you met your goal.

[beefy]

Thanks BTA, you are always so helpful.

So I guess I need to work out my pricing as though I'm already in a commercial shop. I guess even though it will feel like a drop in profit when (if) I move from backyard to commercial space, that would get made up for quite quickly. More room and better material handling, no operating under the radar or needing to be quiet, operate 24/7 if I want to, etc.

Just as big of an issue operating from home is I don't want customers there, delivery trucks, etc, so that is going to reduce business a lot. I can see a commercial space increasing profits easily despite the extra overheads.

Just have to get there.

Keith.

[BTA Plasma]

Work hard and you'll definitely get there! You built your own table didn't you?