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Discussion Starter #1 (Edited)
First, a little background. Myself and a partner are considering this. We both work for a printer now(Paper) but we both broker print and embrodery work. Several years ago my partner owned and operated his own screen printing business(he know how to run a manual, do screens, etc...) But, has never run an automatic. The company we work for now is flailing and were suspisous of it's viablitly.

So the deal is. Our current embroder is using a screen printer for her screen print work that she is not happy with and has told us she would give us all of her business. (60-70k per year) Granted its wholesale business so we only make money on the printing, she is buying her own shirts. This part of the business is about 1/2 1&2 Color and the other 1/2 is process or multi color. My best guess is that is about 3100 shirts per month from that account.

We have about 40k worth of accounts that we would bring with us from our current company(the owner would not want to continue doing screen and emb work).

So thats around 100k we are starting with. Not counting the emb work we would still be brokering. We are both sales people and I feel quite confident in our abiltiy to quickly grow the business.

The reason for this post.

We would start this in my 500 sqft garage for probably the first 6 months. So the main question is, Do we start w/ a 6 color manual and fight through it for 6 months till we get a larger space and more new clients, or bite the bullet and get an automatic and a small 4 head manual as well?

Thoughts.

Thanks
 

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250 square feet is a small, small set up for that length of time. I'm not certain you will have enough room to operate a single manual / dryer/ ink system/ screen processing. An automatic will probably not be a viable option without more space... the conveyor dryer needed to justify the production capacity will be very large.

stick to manual, be sure and lay out the space with the proper equipment on paper before you invest in the equipment. outsourcing the printing and heat pressing plastisol transfers may be something to add to your start up model.

Just my opinion from setting up a few shops.
 

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lol. much better. I still suggest you stick to a decent manual, lay everything out on paper and enjoy. you will probably enjoy your small shop much more than the larger one you are hoping for.
 

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Discussion Starter #5
lol. much better. I still suggest you stick to a decent manual, lay everything out on paper and enjoy. you will probably enjoy your small shop much more than the larger one you are hoping for.
Thanks for the input. I just have conserns about the 3000 piece per month account (w/ about 1/2 of the work being multi color double sided) we have already and production time for it. That doesn't include any other work.

How long would 500 pieces 5/5 color on a 6/2 press take?
 

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5/5 on a 6/2? I see your dilemma, short answer is probably way too long. Your space will probably restrict your production amount. Maybe someone out there has a potential solution for you, sounds like a tough nut to crack.
 

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Get a good manual or two. Outsource the auto work to your stronger. Potential accounts are not real accounts to the contract is signed, or the money is i n the bank. I wouldn't take on the overhead until your income is proven and stable. The overhead can kill you.
 

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Discussion Starter #8
Get a good manual or two. Outsource the auto work to your stronger. Potential accounts are not real accounts to the contract is signed, or the money is i n the bank. I wouldn't take on the overhead until your income is proven and stable. The overhead can kill you.
The 70k account is a done deal, we just have to start. Also, its already being done by a wholesaler, so there really isn't any margin to do the work outside of house. (We would be the new wholesaler) And we do have another 40k of accounts that would carry over with no interruption.

Basicly, we have about 110k worth of work annualy from the day we open the doors(even if they are garage doors at first:) )
 

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Yeah, but you can't run an auto an excess ancillary equipment from a 500sq ft garage. IF you got the stomach and cash, go 2000 sq ft shop 20' dryer, darkroom, nuarc exposure unit and 10 color auto. 100 grand in equipment and 4000.00/ mo base overhead. You can make the money, but the outlay and overhead is not for the faint of heart.
 

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Discussion Starter #10
I'd love to do that, but that is WAY more production that I need. A 20' dryer? Max production I'd like to be at 4-600 per hour.

I was thinking something like the Lawson for the press. Either the mini or the 8 station one that is 11' across. It would fit in my garage. And a super small 2 color press for short run stuff.

Proabably a used 8' dryer.
 

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If multi-color and process is going to be a big part of your business, then an auto is the way to go. Yes, you will be cramped, but so what. You're starting out with some secure business and the time savings in printing with an auto will give you an opportunity to sell and grow, There are autos out there that are 12' in diameter. A 3' x 16' dryer will be big enough to start with and still give you room for inks, screenmaking and more. You may want to make a simple 1-color manual printer for some items that will make you money but are too difficult to print on an auto. Put this and all tables on wheels so you can easily make room when and where you need it.
 

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First what is determining your price point for your wholesale account? Are you trying to provide better quality and better service for the same low price as the company the client is not satified with? I woudl VERY carefully examine my profit margin here and make damn sure the work is worth it.

My first goal would be to as rapidly as possible replace the wholesale work with retail higher margin work. Or plan on easing my profit margins up as the relationship matures, and perhaps being very up front about this intention with your client(or not depending on your comfort level).

Do you have a plan for success and a plan for failure? One problem that I have seen repetitively in business partnerships is that if the business takes off and kicks *** there is bickering over who is doing more work while we are splitting the profits down the middle. If the business begins to fail then there is bickering over who pays for what as the ship sinks to the bottom of the sea. In other words I suggest have a very clearly worded exit plan for either party in either scenario. In essence a formula by which one partner can be bought out that both of you agree to BEFORE you take in your first order. It helps a LOT with eliminating the bickering. The other thing I think I woudl plan for is hiring employees as soon as possible. IF you are both sales people then your hourly efforts are a lot more valuable knocking on doors, providing extimates and trying to build the sales base. (instead of producing too low margin wholesale prining for example)
 

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Discussion Starter #14
Thank you for your insight. We're going into knowing the wholesale work will not be the bread and butter. But...It sure is a nice start. We actualy have another client we would be doing wholesale for as well worth another 30-40k.

The way it is looking now, we would start with a manual(simply for cost sake) and work the hours needed to get the jobs done. It looks like an automatic is a definite need. But until we actualy start, its really hard to spend that kind of money and be screwed in 2 months because it didn't work out.

It may turn out after 1 month that we are ready, and I will have no issue spending the money once were there. Hell, we may have to turn some jobs away till then. But I'd rather say no than miss a deadline or screw a job up. I've done that before in the paper print company I work at and will not do it again.

CJ
 

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YES- under promise... over deliver.

I would definitely start off charging a bit more than the current wholesaler that the client doesn't like, then build the relationship on service. One other thing... receiveables? How fast will your wholesale client pay you? That can be HUGE when you are starting out, as the sooner you have the cash in hand the sooner you can go and do another deal on the more profitable retail side of the business.

Cash FLOW is huge for startups and yours will be no exception, I was able to initially grow because my largest account would pay me in 5-7 working days. Had it been 30 days I would have been screwed and constantly in the "hurry up and wait" mode.

If you have been selling and brokering printing work (paper) I would try to keep that going as well. Or best yet try to get the wholesale side of your business working and the receivables flowing and wait for your current employer to go belly up. Have all your ducks in a row and be ready to strike as soon as it's clear they are folding. Though that may mean you also get screwed on your last pay check...

Good luck and always have a plan of attack. Make sure you have the ability to accept credit cards even though that means you lose a couple percent of margin, the cash flow will be all important and this will help. Do not take ANY job from a new client without payment unless it's a monster corporate account where you know you will get paid. Any non-payment really screws the cash flow.
 

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Discussion Starter #16
Well, with the large wholesale account, we've allready agreed to match the pricing. So thats a done deal. And this account does pay in about 10 days now. From what she told me.

If this happens, It is likely that my partner would get let go first. So he may start while I am still working. I am in a noncompete, so I really can't do both at the same time. My boss has been good to me and I don't want to completly burn that bridge.

We will definitly keep doing printing where we can. I did 150k last year in sales. 3 years ago I did almost 300k. Unforunitly, alot of that work really doesn't carry over to brokered print. But I will keep what I can.
 
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