Don't work for individuals, everybody is too cheap and wants shit done for free. Unless you make and sell your own products, then you collect credit/debit card payment at the time of sale.
Work for companies, they understand what stuff costs and have money to pay. All will expect at least Net 30 (or longer) payment terms with you, it's standard business practice...
Larger machine shops can be good places to get work when starting out. Yes, they will offer you their "shit" jobs for "little" money, but after a few successful deliveries they will realize your capabilities, and you should be able to make a decent shop rate working for them over time. If not, fire them and try other big shops. Never burn bridges!
Tool cat,
The "buy machines and get work from larger shops" method is often given here on PM but rarely does anyone explain
how to do it.
For example; How does one actually approach a large company in a manner that will convince them to give you their work and enough work to cover your machine payments, buy tooling, stay alive ect?
If you need work to pay for new machines, tooling and support equipment but you do not know what that work is yet, how can you justify hitting up doosan for a $100k machining center?
Let's say we lease the machine and drain our savings on installation, tool holders, all of the oils and coolant, an air compressor, a bench, a PC for card/cam and all of the other things needed to run the job.
Now, we find a large shop that says; "Yes, Please take some of this 4 axis milling off our hands!"
But we don't have a 4th axis and this machine isn't set up for it. Call Doosan and they say $10k and 4 weeks out but the machine payment is due in 3 weeks and we're broke.
What then?
You have been at this much longer than I have and you've been successful doing it. I assume that I am just not seeing the whole picture here.
To me, skimming work from large shops is akin to water skiing. If everything goes just right; the rope you're holding and the boat pulling it will bring you right up on the waters surface. You feel on top of the world as you haul ass across the rippled surface
but you are always one wrong move away from taking a 40mph faceplant and having that rope ripped right outta your hands.
Buying cheaper machines with cash is much safer. Starting with a plethora of small customers who are not necessarily in manufacturing is also safer and brings rewards that otherwise wouldn't happen.
For example; let's say a guy spends a few years collecting a customer base of local businesses and buying equipment from auctions with cash.
One day a customer comes in with a broken part off his 'ditch digger 200' and says; "Can you make me a new one? The manufacturer discontinued support for this machine, no one in the country has this part and it's already broken or missing from every parts donor machine. There is a used one on eBay for $2k but even then, it's only a matter of time until that one would also break."
You agree to make the part and you make it from steel instead of cast, thus solving the problem for good. Now you make 10 more @ 4 hours per piece and throw them on eBay for $1500 each with free 3-day shipping and a money back guarantee. When you run low, just make more and keep restocking.
Next example; the local bakery brings you their 'dough squeezer 3000' with a cracked frame, bent shaft and shattered sintered metal gears and asks you to repair it.
Come to find out, dough squeezers are stupid expensive and only made by a handful of companies. One of which (the dough squeezer 3000) is newer to the market and 40% cheaper than the big brand names so everyone begins buying them.
You repair the machine and "bulletproof" it to prevent it from grenading itself again. After seeing the crap quality of the parts, you decide to advertise a repair service for this machine.
6 months go by and you get a call from John Doe, the owner of dough squeezer international. Turns out, he is just a salesman who broke out on his own selling cheap imported machines, which are now all failing the exact same way. Hearing about your work, he asks if you would be interested in becoming the official warranty center for all dough squeezer products.
Things like this happen all of the time. Many people just leave the money on the table and move onto the next job. Why? I really don't know. It is easier to advertise and sell today than ever before in the history of mankind.
Dirt work contractors and bakers don't know anything about what we do. They won't try to undercut you or take your customers and they aren't trying to make a profit off your direct labor.
Deliver a pallet of parts to "the large shop" and they reward you with an email from accounting letting you know that they are now net 60 with you and your $38,000 check won't be arriving on time.
Weld up some garbage for the local farmer and he'll spend the next 3 McDonald's morning meetings telling everyone how great you are.
Make name placards for the bank, weld repair sewer flange gasket surfaces for the town and a water pump block-off plate for the mayor's race car... Your name will be everywhere in a week.
To make a very long story short, trying to jump on and ride the coat tails of a single 'someone bigger' means they decide if you win or lose. Building your own ground-up network, customer base and revenue streams will get you rooted so deep that not even the IRS could prevent you from earning income.
