creative machine funding ideas

[Pat of TN]

This is inspiring to me, and I'd like to eventually do something along the same route...

Question... what is the liability involved with such a venture? Making something, selling it on eBay for a profit, making money off of it - is this stuff that factors in to one's taxes? With such an asinine tax system as we have in the U.S., it's a hard pill to swallow.

 

[John Hasler]

This is inspiring to me, and I'd like to eventually do something along the same route...

Question... what is the liability involved with such a venture? Making something, selling it on eBay for a profit, making money off of it - is this stuff that factors in to one's taxes? With such an asinine tax system as we have in the U.S., it's a hard pill to swallow.

Yes, of course the profits are taxable income. No big deal. You just report it and make your payments. It only gets hairy if you have employees.

 

[JimDawson]

Yes, of course the profits are taxable income. No big deal. You just report it and make your payments. It only gets hairy if you have employees.

John is absolutely correct that profits are taxable, but to put that in perspective let me show a very simplistic example.

Lets say you make a widget that has $1 in materials, and sell it for $2. That is a $1 gross profit. Now lets say you use that money to buy a new tool for your business for $1, you get to subtract that from you gross profit, so your net profit is $0, thus no taxes are owed on that money you made to buy that tool. The bottom line is that you an equip a shop, over time, without paying any taxes on the money you made to buy those tools.

The US tax code is actually pretty good to small business unless you have employees. There is a reason I have not had employees for 35 years, 40 years ago I had employees, never again. Running a small business doing something that you love......, well it just doesn't get any better than that.

 

[bosephus]

hmm taxes ,.... not much of a worry there , as mr dawson points out that wont be a problem for me , i dont plan on having any profit after buying a machine and some tooling .

on a lighter note ,... after fee's and shipping lets chalk up another $31 to my fund , $181 and some change now , with three more auctions going up tonight .

i am going to try a 5 day auction ending on sunday evening this time , just to test and see what days actually do the best to end an auction on

 

[bosephus]

woo hoo ... i just went past the 10% mark , thanks to the buy it now button lets chalk up another $29and change after fee's bringing me up to $211 and change.

it was the case forming die that sold ,less then 24 hours listed and three views .i am not sure what to think about that , but it must be good .
off to the shop i go to light a fire and turn another one out .

 

[Dranreb]

I'm hooked on this thread, I reckon it'll be entertaining and inspiring us for quite some time.......

Bernard

 

[bosephus]

well , well , well ... another buy it now hit on my intermediate case forming die , after fee's that brings me up to $233 and some spare change .

this is a bit unexpected , both of these that i listed sold with the buy it now in less then 24 hours .. no complaints here , just a bit surprising .
i think i could use some advise from a more experienced ebay seller here .

ok , i have a fairly low starting bid to attract bidders , and my buy it now price is set at what is a comfortable profit margin considering the time it takes to make and what my material costs will be once i use up the stock i have on hand .

would i be better off to list one without a buy it now just to gauge what the actual interest is in these and to see what the market will bear , or keep the buy it now and let people use it to their hearts content .

i am pretty sure there is going to be a finite market for these ... my quandary is how finite is it going to be ... is it going to be 10 dies or 1000 ,.. neither of the two stayed up long enough to see .
and i'd really hate to get greedy and drive potential bidders away

 

[pebbleworm]

My favorite example of creative funding comes from the early 20th Century. Dr. Martin Couney was an MD who was just interested in keeping premature babies alive. It was and is an interesting field but there was no funding available for it at the time. No insurance, and with large families most would just mourn briefly and move on. But he thought it was just too fascinating a field to ignore. His solution was to put his neonatal intensive care unit at Coney Island. And charge admission. It worked- he had repeat customers coming in to watch the progress of "their" babies, and most of the babies survived with no charge to their families. He went on to open clinics with a glassed in viewing area whenever there was a worlds fair or other big, long term fair. Preemies arrive all the time and he would take care of them, and charge admission cover his costs. Not directly related to machine tools, but think outside the box and get things done! Here are a couple of links for anyone interested:
http://www.themeparkinsider.com/flume/201310/3734/
http://io9.com/5885939/babies-in-incubators-were-once-an-attraction-at-coney-island

 

[Pat of TN]

John is absolutely correct that profits are taxable, but to put that in perspective let me show a very simplistic example.

Lets say you make a widget that has $1 in materials, and sell it for $2. That is a $1 gross profit. Now lets say you use that money to buy a new tool for your business for $1, you get to subtract that from you gross profit, so your net profit is $0, thus no taxes are owed on that money you made to buy that tool. The bottom line is that you an equip a shop, over time, without paying any taxes on the money you made to buy those tools.

The US tax code is actually pretty good to small business unless you have employees. There is a reason I have not had employees for 35 years, 40 years ago I had employees, never again. Running a small business doing something that you love......, well it just doesn't get any better than that.

Hmm, I see... now that is interesting! Would one have to be "officially" a business - thus paying for SS taxes and Medicare and such for the sole employee...? Hmm... I suppose I should research this on my own, but... that is a fantastic thing indeed. Sell $1000 worth of stuff, and every time you save up some profit - purchase something of the same or greater amount for that - material, tooling, machines... hah. With no visit from Mr. Tax Man...

 

[master53yoda]

well , well , well ... another buy it now hit on my intermediate case forming die , after fee's that brings me up to $233 and some spare change .

this is a bit unexpected , both of these that i listed sold with the buy it now in less then 24 hours .. no complaints here , just a bit surprising .
i think i could use some advise from a more experienced ebay seller here .

ok , i have a fairly low starting bid to attract bidders , and my buy it now price is set at what is a comfortable profit margin considering the time it takes to make and what my material costs will be once i use up the stock i have on hand .

would i be better off to list one without a buy it now just to gauge what the actual interest is in these and to see what the market will bear , or keep the buy it now and let people use it to their hearts content .

i am pretty sure there is going to be a finite market for these ... my quandary is how finite is it going to be ... is it going to be 10 dies or 1000 ,.. neither of the two stayed up long enough to see .
and i'd really hate to get greedy and drive potential bidders away

when I first started i was to low for the market. if you are selling out on a Buy it Now in 24 hrs your priced to low. raise your price about 20% FOR THE bUY IT Now and take offers, it will let you find out what the market will pay. Keep doing this untill your getting enough offers to average out the price and then set the Buy it Now at that level. You will find that if you don't do something like that the demand will outrun your ability to meet it. EBAY is a huge market, and you can't meet its total needs.


The IRS will let you run at a loss for 3 years and then you must make a profit, I show a profit between 5 and 10% of sales. The rest gets used in tooling, fuel for the truck, part of the truck payments etc.

Good luck

Art B