Business Plan for a Prototyping/Hobbyist Shop - Can It Be Done?

[GearsGrinding]

At 65 years of age I have some money in the bank, a 2700 square foot building suitable for a shop in inner St. Paul, MN, experience starting and operating a business (not related to machining) and an enduring interest in machining (albeit, no experience). My recent mid-winter get-away to Austin, TX was spent using the TechShop Tormach machine. My question to this group is;

Is it possible to combine these assets into with a financially viable work space oriented towards serious hobbyists and budding entrepreneurs?

Current thoughts:

· Building costs $3000/month to run

· $75000 worth of machines, benches, etc. ≈$1200/month x 7 years

For Instance

o Tormach 1100 @ $15000

o Tormach Slant Pro Lathe @ $20000

· Cost/month ≈$5000

Questions that seem important:

· If the facilities are available 24/7, what is going to be the workable number of users vs monthly costs to users?

· Is it workable for the users to pay for a base membership and then so much per reserved machining time?

· Can a handful of users operate a facility on a co-operative basis, i.e., not need a full time manager/care taker?

· How/where would one go to find these users?

· In TX I talked to several TechShop members that were in the process of taking delivery of their own Tormachs. They’d developed products and were selling them to the point that having a machine in their garages now made sense. Would this type of user be common or would hobbyists with more casual desires be the main user?

· Is there a market for offering training, like TechShop and my local makerspace does, where the house and instructors split fees to run classes for newbies?​

Thoughts and Ideas, Everyone??

 

[Chipper5783]

I for one, would love to see where this thread goes. I've been playing this home machining thing for 30+ years. I really enjoy it and as a hobby I think it is awesome. For my day job I am in industrial shops regularly and work with machinists often. When it comes to manual machines, I think I am a pretty good hand. I am not as fast as the pros, but I get good results taking on tasks that the pros won't touch.

I have zero dollars at risk (everything paid for - machines, building) and I would not attempt what you are suggesting without at least a dozen paying ideas in place (right now I have none). Maybe I'm just a chicken!

Make a business of it? Only if you have a good hand full of valuable ideas. The actual making of chips is very competitive - hard to make money without investing a fair amount.
A community shop that would pay its' own way? Wow! I can't imagine finding enough like minded people. I have been looking for like minded machinist folks. I have found a very few over the years. I have even had a few come over and do their own projects with my equipment (though it would still have been quicker and cheaper for me to have simply done it for them).

I think what you are talking about is an extremely small market. "Maker Space" is trying to do just that, and some of them do work out. I have also seen some that get started and soon whither away.

 

[barnbwt]

Maybe if you require users to purchase "crash" insurance or some similar arrangement so if they break it, they bought it. Otherwise, you're stuck trying to determine how the entry fee should account for that factor, from a group of random nobodies of dubious training/skill level. IIRC, Tech Shop has a tiered approach, where you can only use more advanced tools after first mastering the simple ones, and taking training; not a perfect solution, but no doubt better than nothing.

You'd also think a rentable 'tinkerer's' space for simple automotive repair would be really popular, but alas...

 

[scwhite]

At 65 years of age I have some money in the bank, a 2700 square foot building suitable for a shop in inner St. Paul, MN, experience starting and operating a business (not related to machining) and an enduring interest in machining (albeit, no experience). My recent mid-winter get-away to Austin, TX was spent using the TechShop Tormach machine. My question to this group is;

Is it possible to combine these assets into with a financially viable work space oriented towards serious hobbyists and budding entrepreneurs?

Current thoughts:

· Building costs $3000/month to run

· $75000 worth of machines, benches, etc. ≈$1200/month x 7 years

For Instance

o Tormach 1100 @ $15000

o Tormach Slant Pro Lathe @ $20000

· Cost/month ≈$5000

Questions that seem important:

· If the facilities are available 24/7, what is going to be the workable number of users vs monthly costs to users?

· Is it workable for the users to pay for a base membership and then so much per reserved machining time?

· Can a handful of users operate a facility on a co-operative basis, i.e., not need a full time manager/care taker?

· How/where would one go to find these users?

· In TX I talked to several TechShop members that were in the process of taking delivery of their own Tormachs. They’d developed products and were selling them to the point that having a machine in their garages now made sense. Would this type of user be common or would hobbyists with more casual desires be the main user?

· Is there a market for offering training, like TechShop and my local makerspace does, where the house and instructors split fees to run classes for newbies?​

Thoughts and Ideas, Everyone??

I think it is a great idea but I have no idea how you could cover the cost on School tuition .
It would be a 2 year training just to learn the basics
Most people that would come don't have the money
To pay big fees just for schooling
I hope you can figure it out . Because there is a lot
Of young people that need to learn this trade

 

[barnbwt]

What you need is to get home shop stuff wrapped up with the whole "lumber jock" fad thing going on (guys with coiffed beards, wearing fine flannel, drinking expensive beer, and carrying unused 200$ Gransfors axes in their clean, lifted bro-dozer diesel trucks) --that's how you pay for this

 

[GearsGrinding]

The fantasy is for a limited number of members. Tooling, I'm thinking, would be each users responsibility. Damaging the machinery would be an interesting issue to solve. Charge enough to set money aside? Spilt repair costs like a special assessment but each person only gets a certain number of strikes? Not sure what the best answer would be. First question I'd like to solve is how do you find that handful of intermediate players to talk through the problems.

 

[chips&more]

Crashing a machine or breaking a cutter/tooling is one problem. But what about if someone gets hurt!

 

[barnbwt]

That's easi(er) as far as insurance; won't be cheap, but there's at least a clear path to accomplishing it (see: gun ranges). Requiring members to carry insurance, or simply 'employing' them and providing your own as compensation, for example. Going even further down that rathole, you could have the machines/assets owned by that entity, and end up with what is essentially a machinists' commune (Communism can work when you don't actually have to deliver anything and have new capital constantly flowing in via dues)

A tax-exempt non-profit you can give/loan your machines to as a tax write off but still get to use regularly...hmmmm

 

[EmilioG]

There are plenty of makerspace businesses in the US but they are expensive to join and use.
Training courses are a must and the place must be insured to the hilt. From what I've seen, it is very expensive
and the time you get is limited to about two hours. (imagine only two milling machines and 300 members vying for time).
It's a great idea and many are doing it, but the costs involved translate into high user fees for members.
That said, go for it. Look in to it and let us know what shakes out. I like to see people realize their dreams.

 

[JimDawson]

For a few years I was involved in a local maker space. It went through a lot of growing pains to get a smooth running operation and took a lot of investment. Has it ever actually made a profit? I don't know, but I suspect not. In addition to machining, you may also want woodworking and welding. But in 2700 sqft the woodworking might not be possible.

Is it possible to combine these assets into with a financially viable work space oriented towards serious hobbyists and budding entrepreneurs?

I think that you would have to go into it with the idea that it will be a non-profit, and in fact incorporating as a 501 C (3) educational enterprise might be the best idea. IMHO, the best you can hope for is to have your own hobby shop and get someone else to support it while actually providing a useful service to the community.

· If the facilities are available 24/7, what is going to be the workable number of users vs monthly costs to users?

Good question, but no real way to answer, too many variables. But I would shut it down at around 9:00 PM, maybe open the doors again at 7:00 AM. By special arrangement, you could allow later work on a case by case basis. The reason for a reasonable shutdown time is that mistakes start happening as it gets later. For safety, never less than two people in the shop.

· Is it workable for the users to pay for a base membership and then so much per reserved machining time?

A multi-tiered membership might be an option. Where increasing fees would give access to more of the shop equipment. Maybe fees based on allowed machine use. Members always supply their own cutting tools. You should have a ''store'' on site that is stocked with common items.

· Can a handful of users operate a facility on a co-operative basis, i.e., not need a full time manager/care taker?

You need a Shop Master on site at all times. The organisation should be run by a Board of Directors, but there needs to be a general manager that handles the day to day operations.

· How/where would one go to find these users?

Good question. Advertising, community events. Get a local non-profit(s) involved in getting the word out. Maybe buy an ad in the local community college newspaper. Get a local newspaper to do a story, or maybe the local TV station. Use social media, Facebook, Twitter, etc. Get the word out on the various machining hobby forums. Most will allow free ads for non-profit organizations.

· In TX I talked to several TechShop members that were in the process of taking delivery of their own Tormachs. They’d developed products and were selling them to the point that having a machine in their garages now made sense. Would this type of user be common or would hobbyists with more casual desires be the main user?

I think the casual user would be the most common.

· Is there a market for offering training, like TechShop and my local makerspace does, where the house and instructors split fees to run classes for newbies?

Yes, there is a small market for this. The fees are normally split between the instructor and the house. I was getting 60% This is more of a service rather than a profit center.

Talk to Tormach and see what they can offer in the way of discounts, donations, and other support. Also talk to AutoDesk, they are really big into supporting maker spaces. Offering software, support, and in some cases cash grants and equipment. Here is the ultimate makerspace. https://www.autodesk.com/pier-9

Some of the other members above have addressed the liabilities above so I won't rehash any of that. Just make sure you have good insurance.

Best of luck to you.