Wife stumped me about knife making...

cbr900son

cbr900son

Joined
Mar 3, 2011
Messages
1,010
Well I make knives as a hobbyist and never worried about alot of things the full time makers do. Me and my wife were talkign about those full time makers and she asked. "How do they make enough money?" & "How long does it take them to make the folding knives and non folding type?" She then stated I cant see how they can afford to do it as a living and honestly I didnt have any clue.

How long does it take the full time makers to do a folder or a fixed blade?
 
There are 2 different approaches

Make and SELL lots of knives, do it fast, standardize & keep expenses and prices low.
ie Bob Dozier


Make and sell a few at the high end of the market at high prices.



I think a working wife and no debt helps.
 
I'm not a knifemaker/craftsman but I did see a video on YouTube of Ray Ennis of Entrek Knives making a fixed blade knife. I don't know how much time was edited out but I think the video was about 15-20 minutes long and it covered him from start to finish. I'll see if I can find it. Their are actually 4 videos totaling about 40 minutes. Having never see the process before I was impressed.
 
takes me 20 to 30 hours to make a folder and 3 to 10 to make a fixed blade. and no i dont make any money at all. but i love it and will continue. and yes the wife makes a great salary and we have no vanity and consume very little.
 
Tait said:
The guys at the very top of the game do a little more than break even.
Click to expand...
Poppycock...

I make a decent living, and I am nowhere near the top.

Get your hours per piece to a minimum, and charge a fair price for time and material.
 
if i had all of my equipment set up where i can go from my disk sander to my belt sander when needed, i could probably make one of my small skinners in about an hour. probably faster if i used annealed steel.
 
I really respect Mike Snody. He lays it out and tells you how it is to be a knifemaker. Work your ASS off and sell A LOT OF KNIVES....
 
The trick is quantity.

I am on track to sell about 200 folders this year.
2012 is shaping up to be even bigger.

There isn't a ton of profit per piece, but there are a lot of pieces.

If I just make one knife, it's a 2 day affair.
Profitable maybe, but burger flipping wages.
It also limits output to 100 - 125 pieces per year.

However, I work in batches.
There might not be any knives at all for a while, but then all of a sudden 10 finish up in 2 or 3 days.
By doing everything 10 times when I am set up, I increase my speed exponentially, decreasing my costs, and increasing profit.
In 10 days, I can make 8-10 knives, instead of 5 if I had just made them one at a time.
 
I think the main way that the top makers make a living at this is that they have paid their dues buy scrapping by and making their name. Along the way they have fine tuned their skills, and paid for all their equipment. So when it comes down to the cost of making a knife for them it is a fraction of the cost for that of someone like me. Someone who has to send out their work for HT, takes a lot longer to grind, sand, and finish a blade, has to wait to get materials in the mail, and is still purchasing the tools of the trade. Things like building a forge, finding a good anvil, saving for a HT oven, and a mill. They all eat up money fast, but once you have this stuff and learn how to use it, your production costs drop. If I was set up to do my own HTing, that would drop almost $50 of the cost of a knife because not only would I drop the price of the actual HT, but the near $40 it cost me to send it to the Heat Treater. Add in the down time waiting for the turnaround (2 weeks plus for me) and it adds up quick.

At my current skill level I figure I could turn out 2-3 knives a week, if I had everything I need in house. They would all be of decent quality, but I don't think I want to be in the one man factory environment I would rather have 1-2 weeks per knife and work on making that knife perfect so I could charge the price of 2-3 decent knives and be proud of the work I sent out.

The batch idea works great and is a good way to make a number of quality knives and shave time, as long as they are basically the same, but I am too ADD to do the same thing for long and I would have 50 million uncompleted knives laying all over:o As it is I think my current count is 6, and I am planning to add more to "the need to be HT'd" pile today.
 
I am an apprentice with andy roy at fiddleback and he has a simple formula 1) work like hell to make a good name, then keep it with fair dealings and good customer service. 2) work in small batches so that you can maintain quality but also get some economy of scale 3) build up your shop with the best tools you can afford and do as much as you can in shop. It is like running any small business hight risk and a lot of work but there is no dress code
 
Brian is proof that it can be done, but maintaining a steady output of one $500 knife a day, four days a week, year in and year out, and having a steady market of new buyers for them seven days a week ,year in and year out is a hard thing to do. In 20 years you will have made and sold 4000 knives to 4000 different people. At many big knife shows, there aren't 4000 knives sold during the entire show.


Be aware that from that $100,000 you will spend:
Materials - from $10 to $500 per knife
shop cost - rental/mortgage, utilities, maintenance, propane, belts,abrasives, overhead, etc.
machinery cost - From $50K to $250K depending on production volume and knife styles.
insurance - health, homeowners/business, fire, liability, etc.
business licenses ,taxes, and fees - City, State, Federal, Incorporation, accounting, Hazmat fees, advertising, etc.
travel, lodging, and show fees - $1000-$20,000
Beer money ( probably should be under shop cost or materials)
New hat for the wife once a year ( should be under fees and taxes) - If Mama ain't happy, ain't nobody happy!

So with $100K on one side of your ledger, you will be lucky to have $10-20K left as profit at the end of the year.
If your wife has a good job with insuracnce...and your home is your shop...and it is paid for...and your kids are grown and gone....and you are a top tier maker who has re-sellers sell your knives for you.....then that amount goes up in the end, but it took a lot of time and money to get there.
I would guess that most every successful knife maker invested $100,000 to $500,000 before he was making anything like what we would call good a good living wage.

About the only way for the volume of work needed to maintain a good income is to have some other sources sell the knives for you.
Some hit it big, and would consider the $100K example of "success" as being too small. Buck has sold 15 million model 110 knives. Ken Onion creates a design, and licenses it to someone to make and sell...and gets a check for each one sold.Buster and Julie Warenski sold $20,000-$100,000 knives. These are all successful knife makers, but are a tiny fraction of a percentage of the knifemakers out there. Maybe half of us sell $100 knives to 10-100 customers a year, and the other half sell less than that. That won't work as a business .

Bottom line is that most good businesses make 10% or less as the final profit.....many only clear 2-3% profit.



I still like Cleston Sinyard's statement, " If I won a million dollars in the lottery tomorrow, I'd still keep on making knives for a living....until it was all gone."
 
Very good points Stacy.

I sure hope to maintain demand.
That is the biggest part of the equation.
Buyers.
With no buyers, it doesn't matter if you make 1 or 1000 knives, there is no income...

I never have, or even could total up the amount of dough spent building my shop, but I wouldn't be surprised if it was 100K already.
I also was fortunate enough to be able to pay for the shop before I went full time.
I wish I had more, but who doesn't?
My shop already has more equipment than most folks.

If, in a couple of years, I discover I am only making 10 - 20k per year, I will wrap it up and get a real job.

Hello, welcome to WalMart...
 
That's a good point, marketing is a big issue.

Websites
Pro photos that go in magazines
Hammer-ins
Shows
Internet forum presence
phone calls and correspondence with customers
videos
books
being a "nice guy" to deal with
doing classes

That will drive demand in the long run.
 
I've owned a business for about ten years but only made the jump to 100% self employed this year. It is my opinion that going into anything like what I'm doing or the full time makers are doing is much more likely to succeed if you can build up over time and spread the purchases out before you make the plunge. Going in with limited tooling, limited experience, debt, and high expenses is a recipe for disaster.

We've all heard the statistic that only one in five new small businesses last five years (or something like that). But you have to consider that a lot of those businesses were started as a tax dodge (such as making a hobby a tax deduction) with no real intent to succeed from the start. And some of those businesses were started by unfortunate individuals without a clue that are doomed to fail from the start (dumb business models going into saturated markets with low barriers to entry etc). When you consider the number of legitimate businesses, the ratio isn't so bad. The other thing to consider is, if you start a business without debt and high expenses, if it fails, nothing really bad happens. You just try again.

I believe that a smart business person doesn't squander their start up wealth frivolously (unnecessary business cards, websites, customer giveaways like customized pens, nice signs and furniture when there are still more important things to focus on) but instead develop a plan, keep their eye on the ball, take stock of what they're doing from time to time, work their ass off and maintain a laser like focus on optimizing their product or service. And don't drink beer before five...

If I can make ten knives in 40 hours (once all time is figured in) that clear $100 (after all expenses are figured in) I'm making $25 an hour. Machine work is more profitable, so I only make knives as filler work (or when I get the itch real bad).
 
I work more and make less than I did when I have a job, bottom line. It's easy to theorize and say you can turn out 3-5 complete knives (and sheaths) a week, making it happen is a different story. Getting all of the operations right is just one hurdle, suppliers end up back-ordered on critical supplies, equipment breaks down, heat treaters get backed up, etc. It's a little bit like work, except for the paycheck part:)
Then when the knives are done you still have to sell them...Short version of the long story is that I work my ass off and don't get to spend much time with my family even though the house is 50 feet away.
 
You must log in or register to reply here.
Back
Top