How many times have you dreamed about doing more work with less people, and making more money while you’re at it? What if you didn’t have to find that $250,000 to get the beam saw, edgebander and new machining center? Instead, you could simply start carrying new cabinets made by someone else, and let other folks worry about skilled labor, government air-quality regulations, shop leases and so on.
While it may sound great at first, there’s only one problem that you can see: the quality of these “bought-out” cabinets is not as good as your own shop. You believe these big outfits are just production-line companies, and their end product lacks the hand-made aspect of cabinetmaking.
That’s changing these days. We’re seeing good work done at a very low price point – and if you don’t sit up, you may miss the boat.
Keep your own shop set-up in place and start offering your clients more styles and finishes with a line of cabinets that you don’t make yourself.
Reasons to Consider
First and foremost, there’s only a certain amount of work you can put out from your shop. While this sounds obvious, your capacity is usually dictated by one or more of three limitations: your physical space, your people or your equipment.
Not too many of us have huge amounts of unused space; most of the time, we cram ourselves into a small shop and have trouble finding space for the work we do. If we have extra staff standing around we’re not making money, and if machines are idle for too long they’re not paying their way, either.
Offering cabinets made by firms other than your shop means that you will probably not have to expand too much in any of the three capacity areas. While you may need more square footage to store the bought-out cabinets, if you’re smart, you’ll have that product shipped straight to the jobsite. You may need to add someone to help sell or design cabinets, but you may be able to manage that with your existing staff. You certainly won’t need any more shop equipment to help with buy-out work – but you may end up having to upgrade your computer systems to cope with drawing and ordering.
One appealing aspect of having other people manufacture is that you have a guaranteed cost when you place the order. Compare that to building things in your own shop, where things go wrong, mistakes happen and your profit is only real when the job is totally over. And, the price that the outside manufacturer gives you is usually less than you would have to charge. That means more money in your pocket.
Consider, too, the increasing regulatory pressures we all face as shop owners. Isn’t it nice that another facility will have to deal with OSHA, EPA and the other agencies that scrutinize our industry?
Then there are the details. At our own shop, we’re often amazed at the range of styles and finishes some of these manufacturers are able to offer – sometimes results we even have trouble attaining – at an excellent price point.
Choosing the Right Fit
Choosing the right cabinet company is a tough decision. Often the most established cabinet manufacturing firms don’t really want to have a cabinet shop representing their work, and maybe don’t actually need more representation, anyway. It’s worth bringing that into the conversation when you’re talking to reps about your shop becoming a dealer. It may be that a newer manufacturer looking to expand its presence is a better fit for your shop. That company’s motivation to get into a particular market may be a factor in the firm choosing you.
A very important factor for you is to select a company that complements what your own shop produces. If you’re not set up to make plastic laminate or foil-wrapped door cabinetry, why not add in a manufacturer that does that type of work? Or, perhaps your own shop struggles with those flush-inset, distressed-finish raised panel doors? There are many lines out there that offer this, and can fit well into other styles and finishes that your own shop can make well.
There are several other things to take into consideration, as well. How is the manufacturer’s dealer network? Are you going to be the only dealer within 100 miles? What will your support and backup be like? How is the company’s training? Does the company offer good discounts or incentives for putting in showroom displays? Will the manufacturer put you on a COD basis or will it extend credit to you in the early days of being connected to the company? Will you be on any kind of exclusive basis with the firm, or will it have another dealer in your town?
The main thing here is that you may have to design around what a particular manufacturer offers. Certain heights, widths or depths, for example, may be difficult to change. Things may be “customizable,” but may come at a hefty price tag. This is where training and familiarity with a particular line will be invaluable.
Your shop may also need to invest in more design capacity – and not just in experienced personnel. Many manufacturers will insist that you become a “displaying dealer” so you can show off their wares. This will mean a showroom, which will no doubt involve more time, money and physical space. Remember that your clients do not necessarily want to visit a dusty shop to see their dream cabinets!
Remember, too, that your current installation systems may not work at first for this new type of work. You have to be patient here. Much of the work will come in parts and pieces, wrapped and labeled, unlike some of the work your shop puts out, which your crew prefers to be pre-built and ready to set in place. Some of it may arrive wrong, too. At our own shop, we’ve had experienced installers tearing their hair out when faced with their first buy-out cabinet installation!
If your shop works with building contractors a lot, these folks may not like pre-manufactured cabinets. They’re used to getting work from your shop, and they, too, may feel very uncomfortable working with unfamiliar systems. They’ll need some hand-holding, maybe even some help from your own people when it comes to setting the work in place.
All in all, buying out cabinetry may be a great thing for you and your shop. You are uniquely positioned to take care of business. Not only do you have a good back-up in your own cabinet shop, but you also are much more than a regular dealer/middleman: you understand the way things physically go together. It could be a good road for you to explore as you develop your business.