5 Mistakes To Avoid When Starting A Woodworking Business

If you’re new to woodworking and looking to take your hobby to a business that generates income, there are many things to look out for. While I cannot explain each and every possible problem or scenario you may encounter, I do have 5 common mistakes to avoid when starting your woodworking business that I would like to discuss.

Tool Purchases

Let’s start with tools as this one is the most obvious and the essentials you’ll need when starting a woodworking business. If you’re ready to start your woodworking business, you probably already have the basic tools. However, let’s talk about the more advanced tools and speciality tools. What I would offer as my biggest piece of advice is this - don’t buy new tools based on what tools you want, buy tools that you need. As woodworkers, we are all lovers of tools and we all want the latest and greatest. However, those are wants, not needs. As with starting a business in any industry, cash flow is important until you’re able to get established. Purchasing new tools based on what you want can hinder your cash flow and increase your chances of running out of money fast. It may be nice to have that new drum sander or that mortising machine, but is it really needed? That is something only you can answer. On the contrary, however, if a machine or tool purchase makes sense, then don’t hesitate! For example, if you just signed a deal to make 4 kitchen tables, 2 built-in sets of cabinets, and 6 end tables, an investment into a larger table saw may be perfect. Tools that are purchased as a shop investment and will pay for themselves in a short amount of time on just a few projects, is not “dumb” spending. It’s actually smart. In fact, it may be smarter to make the purchase than to not purchase the machine if it can speed up productivity in your shop.

Pricing

As a new craftsman, you may be developing your skills, both with the craft of woodworking as well as the business side of woodworking. With that said, and if you’re anything like me, you’re hesitant to set the correct prices. You may be willing to take on any and every job that comes through the door, and at a lower rate. While you’re still learning, you may feel as though your work isn’t worth a lot yet since you’re not a “professional” yet. My advice would be to set your prices correctly from the very beginning. You can always lower prices and provide the customer with a pleasant surprise, yet raising prices can sometimes leave the customer with an inaccurate expectation. It will be very hard to continue woodworking as a legitimate business if your business isn’t a profitable one. So, ensure your pricing reflects your material costs, labor costs, deliveries, etc. While no one can answer what your shop prices are as each situation is different, there are universal costs across all shops. What I would not recommend is over-pricing your work either though. Simply price your work based on what amount of money you need to cover all of your costs and have enough money leftover to obtain some profit.

Expertise

When I discuss expertise here, I will consider 2 aspects. Physical skillset when working with wood as well as digital assets. Let’s start with woodworking skills. The best thing you can do is to become an expertise in one discipline of woodworking. Avoid drinking from a fire hydrant and trying to become a master craftsman overnight. Focus on one type of wooden projects and master the craft of that type of project. For example, maybe you want to make and sell wooden boxes. If so, become the bet wooden box maker there is, and focus your time and effort on that process. No need to try and be an expert in box making, lathe turning, CNC routing, conference tables, and stools all at the same time. Usually, when spreading your focus thin on multiple disciplines, the others will suffer. Additionally, if you can become an expert in one area, customers will come to know you for that specific discipline. Start small, master one thing at a time, then branch out. When it comes to digital assets, again, start with one thing at a time. For example, no need to rapidly gain a following on all social platforms at once. Maybe you pick Instagram to start. If so, put all of your effort into Instagram, and focus on building that tribe and following first. Once you feel comfortable with your Instagram following, slowly branch out into something else, maybe Pinterest or Facebook. The concept here is similar to skillset in that if you try to focus on all social media platforms at once, they won’t grow nearly as quickly as if you focus on one at a time.

Too Big Too Fast

One common mistake that some new business owners make is that they feel the need to grow their brand into a large company immediately after starting the company. This is not a necessity even though some people may feel it is a large “want”. Growing too big too quick will hinder your process of learning along the way. Growing your business at a steady pace allows you as the business owner to learn from your mistakes and develop the processes of trial and error. If you immediately grow your company into something bigger than what you’re able to comfortably control, you will overlook or even completely miss the fine details that will ultimately help your business. There’s no need for a 100,000 square foot shop or 20 employees within your first year of being in business. Start small and work your way into growth over time rather than a massive expansion of the business in a short amount of time.

Your Wants Vs. Customer Wants

One mistake I sometimes see woodworkers make is that once they master a skill, they continue to make products that they enjoy and that they want. Honestly, that is great. It builds excitement and motivation to keep pursuing the craft of woodworking. However, if you are looking for your hobby to turn into a business, the focus has to switch to become more about what the custom wants as compared to what you want. The customer is the one paying the money, so the products you choose to sell need to be tailored towards fitting the customer’s needs. Figuring out what products a customer wants can be an entire art form in itself with market research, keyword searching, and split testing. In the beginning of your business however, I would see what sells and keep doing more of the same!