Buying an established shop: People & Companies

On my first day at my machine shop, I had money in the bank, jobs on the floor, an experienced crew, working machines and customers. Everybody knew what they needed to do, and we had tooling for every job. Better yet, I made money on each job. There was no “I have to buy $100 in tools to do a $200 job” to suck up all the profit and then some. This may sound like a shop fantasy. But I was able to do it because I bought an established, working shop, which was far easier than starting one from scratch. I know this because I twice had tried to start a business by myself.

When I worked for a large defense contractor, I traveled the country checking on jobs subcontracted to family-owned shops. I saw families doing very well for themselves, and I wanted that for my family too. So I formed a company nearly 25 years ago. As a degreed engineer, I began with a business that required almost nothing except a professional engineering license: a manufacturing engineering consultancy. It went well, and I made more money than when working for someone else. However, the travel and time away from home were hard on my young family. It didn’t make sense to risk losing the people I was trying to do something good for, so when a client offered a permanent job to me, I took it.

For my second attempt six years later, while still employed, I chose to start a shop so I would not have to travel frequently. I rented a space and began the grueling task of calling on customers, planning and running jobs, packaging and delivering, programming and purchasing tools. I found that profits mostly went toward buying tools. Also, I was away from my family in evenings. I reached a point at which the business provided 30% to 50% of my salary, but my waking hours were 100% gone. It’s a moment that many “evening startups” experience. I had to decide whether to leave my day job and commit to the startup at perhaps half my regular wages or continue both endeavors and exhaust myself. In the end, I sold my business to an established competitor in my town.