The Overhead game - Stick it out, or go home?

Chappy · May 26, 2016

As the quiet creeps in I start to ponder about income, where and hows its going to be generated and what can I do to improve the ratio of it.

With that thought, the annually rising cost of Rent seems to be a thorn in my weekly overheads.

The main pro's of my current workshop is that I have excellent highway frontage and exposure, big enough shed to fit Steigers and the largest of Prime-movers in (also heaps of overnight storage) and I am a literal 2 minute drive from every single car yard in town.

Cons are that the rent goes up avg $30 per year, it's almost 'too much' showroom for me, and to get it setup the way I really want it i'll need to chip in 15-20k or so to get the showroom and workshop up to professional scratch. And because I dont own this workshop, it feels like a dead spend.

In my town finding a shed/workshop is few and far between, there is not many options around and the ones that are are too far from the action or too small. Even land to buy my own seems a hard game to play. To get to my point, I have been entertaining the idea of moving my operations to home.

Home for me is a 4min drive from my workshop, on the other side of the car yards. So a pro there is, I am still only 2mins away from them. I have a large 3 bay shed with good lighting, I can setup an office/workshop for half the cost there, and the overheads saved would be a god send, not to mention I would have the room to play with my pricing due to saving coin.

My question here is, is this a smart move from a business perspective? Does it seem 'tacky' or unprofessional working from home? Is anyone else working from home or made the move home from an industrial/commercial setup and did it work out well for you? Any experiences or thoughts welcome, or hurdles I haven't thought of?

Cheers.

Midtown Houston · May 26, 2016

I wouldnt want customer coming to my house....plus...i would not want my employees knowing where i live....

mothhop · May 26, 2016

Home for me is a 4min drive from my workshop

You sir, are living life at it's utmost best

mates · May 26, 2016

It sounds like you have a lot of positives with your workshop you need to make it work for you, theres plenty of cheap ways to improve it without spending 20k.

Main road exposure is great for advertising. Market yourself as the highest quality film/install in town, charge more and be known to customers that dont care for price but want top quality. Unless you're in my area then offer $99 tints so i can market against you lol

You have a good setup so make it work for you a lot of people would kill for that sort of shop and location, i know i cant get a street front let alone main street front shop for under a grand a week for 100m2 in my part of sydney

Chappy · May 26, 2016

oh wow thats crazy. well rent here is almost 580pw, which probably doesnt sound a lot but it is technically a country town so i dont have the demand here as the big cities do, and in the winter time that sort of coin hurts.

Having said that because of my general location i dont have to promote $99 tints to win the work which is great. Most FG is quoted around the $80-$90s/m and rarely quoted under $75s/m that i have seen, with general sedans barely dipping below the $300 mark and s/cab ute around $200ish give or take. So in terms of materials:profit the ratio is great here compared to the big cities, but yeah, the work volume is no where near as high either so it probably evens out.

I wouldnt want customer coming to my house....plus...i would not want my employees knowing where i live....

Lol, well besides my office girl that does all my book work, reconciling and handles the phones, I am a 1 man show. Show that wouldn't be an issue

tintcracker · May 27, 2016

Our rent is 3500 a month.

Supreme · May 29, 2016

I can give you some insight from the residential workshop side of things.

We are still in our residential workshop that we started in. We started in it due to being a new business starting from scratch on our own two feet, we didn't have $500+p/w to spend on a workshop.

As business grew I started to look at workshop rent, $500+p/w in an industrial area or $1000+p/w in main non industrial areas. Straight away I thought, hmm 500-1000 in someone else's pocket or that money in my pocket, was an easy choice for me. I also thought that's $26k-$56k a year, imagine what I could do to my workshop with that money! Over the years we have slowly poured money into the look and comfort of this workshop to a maincave that most guys would die for, sure its always a work in progress, but it impresses my customers which is the main thing.

We are on a large block so you don't even see the house from where the driveway is. We don't give out the address unless a booking/appointment is made and I guess the clientele for a wrap/ppf is different then you may get for tinting. We also do a fair bit of offsite work, so no point us paying for a workshop if we are not there and if a customer walks by and we are out.

Pro's:

Location - walking out the door and into the workshop really is an awesome feeling

Flexibility, This is a big win for us, we can choose our hours. Work late one night, take the morning off. This is one of the biggest reasons I like it, the extra time I have with my kids you cant put a price on.

Security - I sleep 10M from he customers car

Money saving - Speaks for itself. $500+ in your own pocket is a decent amount

Con's

Image - It is hard to shake the stigma of a 'home workshop'. Not sure why when I have seen the state of most 'professional' workshops out there.

Home security - Never had an issue with this, but I get what Upperkirby is saying and agree it could be an issue. There are some crazy's out there!

Size - We personally don't need more than two cars in at one time and prefer one so not an issue. If we wanted more per day then we would need a workshop. Height of entry can also be an issue, 99% are cars so anything larger isn't enough of an issue for us.

As far as the image goes, when you market yourself a certain way then this isn't really an issue. Pics of the workshop will also help this.

Its hard to say what to do in your case, like others said your current location has a lot going for it. It has driveby clientele which is a big thing. That is why we would never open an industrial area workshop. I would want the workshop to also do work for me with it being visually out there to pick up business so I want the main hub areas. In saying all that you can only be the judge of whether all of what you have going for you will still work if you move it home. I guess another way to think of it is, if its at home then all that stuff is still only 4mins away, as long as you keep the dealers......

If we ever outgrow our workshop it will be a sad day for me as I really do love where we work and all of the Pro's I mentioned.

Hope this helps!

edit: we built the business from the ground up by positioning ourselves as high quality and high customer service. Our website was a big factor to this and also our customer service. If we didn't have that then the workshop would have been a flop. Its crazy how many people say our website drew them in or it was our customer service. Looking back on how our workshop first looked, I am surprised anyone turned up! Get a clean, professional looking website, keep the service high and you shouldn't have trouble with people turning up no matter whee you are....

Chappy · May 31, 2016

Thanks for the insight Supreme! Some good points to consider. I have been thinking about putting the feelers out there to some of my repeat customers, ones who I share a good rapport with. Maybe see what they would think of such a venture. After all, it is their perspective I am worried about effecting

Glass Tinting Supplies · June 5, 2016

Hi Chappy,

My experience with working from home 1 day a week was I had folks knocking on my door all days and at any time night and day looking for me.

The game breaker for me was when I had a loud knock on the door at 9.55pm on a Sunday night (Fathers day). I was thinking the worst, when I opened the door there was some clown standing there asking for a price to tint his Commodore wagon. I just shut the door in his face, turned and went back to the bedroom and told my Mrs then and there that I was getting a workshop ASAP.

I waited for months for one to come up for rent local to me. I got a unit in a complex near by and fitted it out... Long story short... I just bought a complex with a couple of units near by and now I'm the landlord...

Read my words... "The best thing I have ever done." end quote.

I hope this helps.