According to the US Census there are over 25,000 machine shops with less than 4 employees, not counting thousands of 1-man operations scattered across the country. Making a profit while owning a small machine shop can be tough in these economically depressed times. Here are some tips on making a profit.
Hire family or close friends and classify them as officers not employees. This will help with insurance charges. Check with your insurance agent and state for particular requirements.
Down size – Do you really need that 10,000 sf building? If possible run out of your shed, garage or barn. If not many self-storage facilities now offer storefronts.
Upgrade to CNC Milling – If you have all manual machines consider upgrading to a CNC.
Offer reduced rate services to local manufacturers. Locale manufacturers will have contracted large shops many miles away to machine their product. There are times when they need to rework, modify or make changes on the fly. They will turn to the closest, cheapest ship in the area.
Offer reduced rate services to local Hobby Clubs – Many hobby clubs including RC Model Clubs, Model Building Clubs, and Engineering Clubs require prototypes and custom parts and accessories built. Offering a group discount hourly rate to these clubs will insure all machining requirements come to your shop.
Quote on government work – The United States Government is the largest spending customer in the world for goods and services. There are hundreds of machining opportunities everyday.
Overflow Work – … Read more