The final aspect of this is that all "new businesses" require many times the hours invested than you will get paid for. It doesn't matter what business you are in, whether its knife making, restauranting, or making firearms accessories don't expect to get well paid for your time for many years to come. I am a professional engineer with a personal license, a business license, professional practice insurance, two degrees, I work a day job, run a private engineering practice, and am a partner in a firearms business. I work a LOT of hours in a week and many of them are for little or no pay (that's why the day job). Because I know that that is what it takes to get a business off the ground.
I follow some of these threads with interest. I have started four companies, all successful to one extent or another, including the one that I have now. At 57, I probably won't start another unless the opportunity is too tempting to resist.
The amount of hours it takes, the amount of attention to details, the financial commitment, the personal investment of one's self, the requirement to be a businessman is beyond the understanding of most until you have done it and been successful. Being in business and failing is very easy as there are so many factors that make it so. Being and business and lasting 10 years or more is a level of commitment that most folks don't understand.
Let me also say that with over thirty years of self employment under my belt, right or wrong, I define "in business" as being able to make the house and car payment, utilities, support the household, and getting through your first IRS audit with some hair left on your butt. A business card with your name on it is a nice start, but bringing in one or two thousand a month can't pay anyone's monthly expenses these days. It might be a great secondary income for some, but then it probably just gives them the pride of being thought of as a professional.
Knife making has to be one of the worst industries to try to break into in my own opinion. For less than $5,000, it seems you can have a nicely set up shop of tools and have enough materials to get started. Many seem to do it with less. To add fuel to the problem,
it sure looks like a lot of hobby makers turn out a really fine product.
It is a difficult industry to call standards to, as well. If a knife performs poorly, isn't up to expected fit and finish, or even breaks, just send it back and the maker will send you a new one. Not much exposure at all! What is a maker out if his product fails? Another $300 knife? A low liability factor, low investment factor, and low daily costs make this a perfect cottage industry.
I am comparing this to my construction remodel/repair business where I am thinking of flooring coming up, an undiscovered dishwasher leak that causes thousands in damage, siding on a house that was installed properly but was replaced by me because the manufacturer had a "bad batch", etc. If I could make my customer happy for any reason with a new $300 knife (known to me as a $300 fix) and then have him come back here and sing my praises "for being honorable", etc., I would be thrilled.
As it is now, it took me too many hours to count and about 3-5 years to get this business where repeat customers keep me going by calling me. Still, if I don't stay committed to them and my business, they will go somewhere else.
To draw a parallel to the knife business, I can go back to when I was making humidors. I had all the equipment for woodworking in place due to its requirement in my business. And as a professional woodworker, I had the techniques, training, industry knowledge, and was able to set up a workable business model in no time. This was to be "walking around money" generated by using up fine wood scraps from my business.
Couldn't make it. Making humidors became the rage about 25 years ago, and everyone with a saw and sandpaper was making them. Some were crappy quality, some were every bit as good as my product. Some were priced much higher (someone not dependent on sales to pay bills) and some were priced much lower (someone not dependent on sales to pay bills). There was no consistency in pricing at all. I met many of the guys making these when there were woodworking craft shows, and almost all were young guys just trying to make a buck, old guys that were looking for something to do, and none of them had any pricing strategy other than "seeing what the market would bear". They worked out of their garages or tiny shops and had none of my overhead. None of them used their business as 100% of their income.
NONE of them reported their income to the IRS, which would have certainly affected their pricing. None of them had a business model, and a few were just "following their passion as traditional wood workers".
I sold all the humidors I made after cutting my price on the existing stock and haven't done anything like that again.
To conclude this long ramble, the knife making business isn't any different than any other business. It is all about commitment, staying power (and personal and $$ reserves) and some luck. No doubt some here will be the next benchmark makers and recognized geniuses of the industry, just as there is no doubt that many will fail even though they put out an excellent product.
So to all you guys that are struggling and working your butts off to make it, the best of luck. You are going down a road every craftsman travels whether it is a Maloof/Krenov inspired furniture maker or a knife maker. You know it is an uphill climb. Hopefully your personal investment of time, money and effort will pay off.
From the outside looking in, it seems to me that the best chance of survival is for all the makers to be sure they stay in touch here. From my chance reading from time to time, I have to say all the makers here seem to be really supportive of one another and ready to help where they can. Kudos to those that developed that mentality and a great pat on the back to those that maintain that air of collegial support for folks they have never met.
Robert
