What does it take to start a Hotrod Shop?

[arue333]

I know this is a really broad question, but I thought with all of the custom shops on this form you guys would be the best place to find the answers. I Live up in Vancouver Wa, where it rains 90% of the time so there's not a lot of Rod shops. I am trying to figure out what is the best way to go about starting up a business. I have a the basic home shop tools and a 6 axis mill, and a lathe. How did you guys start out? Did you start in a garage? Rented two bay shop, or lease a space? What are the do's and don'ts or pitfalls of starting a shop like this. What are the essential equipment, ie, welders, benders, ect.. besides skilled employees. What type of jobs did you start out with? Did you do side work for other shops?

The big plus is my day job will be supporting most of this venture so I don't need to make a ton of money, :lol:

Fishing for good advice,

Thomas

[rjsjea]

There's several quality shops in the NW. From big name shops to small three car garage shops........it doesn't make it easy to start up a shop around here.

[ironworks]

Alot of work, alot of money, and a long time to make it profitable.

You will never make a living in a small shop like you could if you just worked for someone else. Unless you have the work and the drive to manage more then 4 guys you might as well stay small. But unless your John Buterra talented, people will never wait the million years it would take to finish a noteworthy car. You have to make periodic splashes in the publicity game to keep peoples interest. Which takes manpower that is very difficult to find unless you just want to hack up cars. If you want to hack up cars your business will last long enough to burn every possible bridge in a 360 degree circle around your shop. But hacker employees are easy to come by. But if you do quality work don't be enticed to think you have to price yourself to compete with the hacksters.

OH and The worst customers are the ones I gave the biggest discounts too.

Most of these lessons took me years to learn, I will let you know on the profitability thing.

Oh and the best way to ruin a great hobby is to try and make a living at it.


But I would not trade building cars for any other career. Well maybe a few careers........:D

[arue333]

Iron Works> How did you start out?

[z4me69]

if you look at all the successful shops they have 1 thing in common it's not equipment .that helps speed things up .but you will find raw talent that is the most important thing

[mexMan]

I want to say tools, a garage and a lot of passion. If you have that, you can start building things for yourself, tell some people about what you do, and, well, profit. But I bet it takes a lot of time to grow and have a shop big enough to keep in the business.

[deuce_454]

its like every buisness... you need costumers! Everybody can stock a warehouse, but selling it is the hard part.... and today i guess yon really need organizational skills.. you need to know what and when you can deliver and how muct to charge.... and lastly you need costumers!

[RECOVERY ROOM]

if you look at all the successful shops they have 1 thing in common it's not equipment .that helps speed things up .but you will find raw talent that is the most important thing

Some of the best builders I work with don't have alot of big equipment,Talent will get you farther than anything else.

[Sandbagger]

I have been in the collision industry most of my life . Id like to know how they bill out some of these zillion hour creations .

[Beegs]

What does it take to start a Hotrod Shop?

Thomas

Balls

[arue333]

Balls

:woot: That i know!..... Still... I'm wondering if someone might have some more tips! Obviously you need talent, customers, guts, and a family that shares your passion or at least understands why they don't see you every evening after 5 like normal.

But how did you guys go about it? Did you take out a loan and get a space to work and bring on a couple of talented guys, or did you operate out of your garage until you had more work than space to put it? Is it better to start in small jobs and custom parts or take on complete buildups? How do you keep the doors open and the shop warm when it takes 18mo to build a quality car?

Thanks for all of your input, You guys are great!
Merry Christmas!
Thomas

[Dieseltorkin]

I recently accomplished what you are wanting to do in a short amount of time even with the economy. Here is how i went about it.

Start with as low of Overhead as you can in the beginning, If you have a garage and basic tools, start there. Of course you will have to get a few speciality tools depending on what your wanting to do exactly. Talent is the main thing you need, I am somewhat of a wiz with diesels, mechanical, design and fabrication, and a friend is amazing with body/frame machine work and paint. We started out getting some mid level ($4-8K) finished price totaled vehicles through an insurance auction and shot to get them into the market at 50-60% of retail value. We started with just 3 cars initially and 2 guys working in my 30x40 shop. In just 8 months we now complete 2-3 cars a week which are pre orders and pre paid by the customer. We do all work auto under one roof and people seem to really like that idea. We also now control our own overhead supply wise as i am now an authorized dealer for every supplier we use. I could go on and on with the details, if you have any questions or anything feel free to pm or email me, i would be glad to help.

The key points are to provide Quality work at a quality price

Start with as small of initial investment that allows you to complete the above yet minimize risk should things not pan out.

Customer service is key, you treat them right, they will come back and bring friends. Word of mouth is a priceless means of advertising, especially with the internet now days.

Hope this helps and feel free to ask any questions you may have, i could type for hrs on this subject. All in all, good luck with your venture should you try! Best wishes! Jared:cheers:

[thedude327]

I am trying to figure out what is the best way to go about starting up a business.

I have a the basic home shop tools and a 6 axis mill, and a lathe.

The big plus is my day job will be supporting most of this venture so I don't need to make a ton of money, :lol:

Fishing for good advice,

Thomas

Here's my take on your post. First you have steady employment and access to tools. Second your day job is currently allowing you freedom to play with branching out and doing something different. Instead of trying to start up your own HOTROD shop, how about joining the aftermarket and using that 6 axis mill and lathe to create some custom parts. You could start by machining some custom pieces for your own car and showing them off at various shows/events. If you get positive feedback, you could start mass producing the parts and marketing them yourself. (Behold the power of the internet) You could also become an additional build shop for an existing company looking to increase production of custom parts. Contact various companies and show them some examples of your work to see if they would use you as a build house for their products.

Good Luck with whatever you decide !!

Paul

[coolwelder62]

Rodger form ironworks is right.If you try to give them a discount so you both can get started you end cutting your own throat.Because they will come back and want even more of a discount the next time.They will ask you to just work with them one more time.He will tell you he needs one more job from you to get that car built.Its funny the guys you give the deepest deals to is the one that will hardly ever tell his customers about who really does the work.Open your shop slowly.Do one job at a time do the very best work you can do.Charge what you think the job is worth.Stick to your guns.If the customer wants a discount or thinks your price is to high tell him thanks but no thanks and move on to the next customer.When a customer wants you to work cheaper that means he also cheap.Cheap and quaitly only work when its your car and you are working for fun. Good Luck.Scott:thumbsup:

[tellyv]

I would say if your making good money at your day job keep it and do this as a hobby or side buisness. good luck!

[youthpastor]

I recently accomplished what you are wanting to do in a short amount of time even with the economy. Here is how i went about it.

Start with as low of Overhead as you can in the beginning, If you have a garage and basic tools, start there. Of course you will have to get a few speciality tools depending on what your wanting to do exactly. Talent is the main thing you need, I am somewhat of a wiz with diesels, mechanical, design and fabrication, and a friend is amazing with body/frame machine work and paint. We started out getting some mid level ($4-8K) finished price totaled vehicles through an insurance auction and shot to get them into the market at 50-60% of retail value. We started with just 3 cars initially and 2 guys working in my 30x40 shop. In just 8 months we now complete 2-3 cars a week which are pre orders and pre paid by the customer. We do all work auto under one roof and people seem to really like that idea. We also now control our own overhead supply wise as i am now an authorized dealer for every supplier we use. I could go on and on with the details, if you have any questions or anything feel free to pm or email me, i would be glad to help.

The key points are to provide Quality work at a quality price

Start with as small of initial investment that allows you to complete the above yet minimize risk should things not pan out.

Customer service is key, you treat them right, they will come back and bring friends. Word of mouth is a priceless means of advertising, especially with the internet now days.

Hope this helps and feel free to ask any questions you may have, i could type for hrs on this subject. All in all, good luck with your venture should you try! Best wishes! Jared:cheers:

Great First Post! lots of nuggets of wisdom here. others have given good feedback too.

My plan is simple- and I think Frank at Prodigy and Jason Rushforth gave me most of this advice. Your first build is going to be on your dime. Show people what you can do. Market the heck out of it and then sell it. I built my first car in our attached garage. I still remember spraying clear on it a week before SEMA when the furnace kicked on and sucked all that smell into the house at 3AM!

I am in the second step. A complete build for a customer in a small 24 x30 shop. Keep expenses low! Low risk...somebody mentioned that. In one year I have a legit business license, bank account, etc. Does it pay the bills...hardly...but the proceeds from this build bought an enclosed trailer and more shop tools....and money to put into my 69 Camaro...which I will market promote...and then sell...you get the idea.

Customer service. quality work at a fair price. and do deliver the car when you say you will.

Have I arrived...not even close....I'm I on the path to having a business doing something I enjoy? I think so.

baby steps..meet the right people at the right time and see how far the rabbit hole goes! - Chris

[Rybar]

Great First Post! lots of nuggets of wisdom here. others have given good feedback too.

My plan is simple- and I think Frank at Prodigy and Jason Rushforth gave me most of this advice. Your first build is going to be on your dime. Show people what you can do. Market the heck out of it and then sell it. I built my first car in our attached garage. I still remember spraying clear on it a week before SEMA when the furnace kicked on and sucked all that smell into the house at 3AM!

I am in the second step. A complete build for a customer in a small 24 x30 shop. Keep expenses low! Low risk...somebody mentioned that. In one year I have a legit business license, bank account, etc. Does it pay the bills...hardly...but the proceeds from this build bought an enclosed trailer and more shop tools....and money to put into my 69 Camaro...which I will market promote...and then sell...you get the idea.

Customer service. quality work at a fair price. and do deliver the car when you say you will.

Have I arrived...not even close....I'm I on the path to having a business doing something I enjoy? I think so.

baby steps..meet the right people at the right time and see how far the rabbit hole goes! - Chris

Chris and Jared, I agree with both of your posts. I am not in the auto industry but I own a retail/custom Furniture store. www.furnitura.ca

The main things I would suggest:

- Low Overhead and expenses at first. As low as possible.

- Don't be stupid with the money you make in the beginning, save it and re-invest it into the company. If you can break even and pay for equipment or inventory in the beginning you should be on your way to success. You may even have to forget about a paycheque for sometime.

- Self Promote yourself and the business. Get out there and talk to people and hand out business cards. sending out e-mails and sitting on your ass don't do much. People like to deal with people. So get out there and start doing some talking and face to face promoting.

- Offer discounts or promotions to previous customers to tell thier friends and family. Word of mouth advertising is THE BEST form of advertising out there. make sure people talk about you and your shop, and recommend your excellent service, prices and work.

- In the very beginning most of your business will depend on low prices and undercutting the next guy. You will have to bend over backwards for people. Some will appreciate it, and some some wont.

- You will make and lose money, make sure you learn from your mistakes.

- Get ready to spend almost all of your time working at your business, and to lose alot of your personal time. It will be hard in the beginning but will pay off years down the road.

- Lastly, try to find a niche in the market in your area. Try to be different. Pick a business model that you want to go after but change it up and make it your own. Have a reason why people want to deal with you rather then the bigger guy.

Hope that helps,

Ryan

[deuce_454]

My grandfarther who was very succesfull in buisness said "There are always somone willing to do it alittle cheaper, at little worse quality and alittle uglier" dont be that guy... and "its always cheaper to do it right the first time"...

[youthpastor]

Chris and Jared, I agree with both of your posts. I am not in the auto industry but I own a retail/custom Furniture store. www.furnitura.ca

The main things I would suggest:

- Low Overhead and expenses at first. As low as possible.

- Don't be stupid with the money you make in the beginning, save it and re-invest it into the company. If you can break even and pay for equipment or inventory in the beginning you should be on your way to success. You may even have to forget about a paycheque for sometime.

- Self Promote yourself and the business. Get out there and talk to people and hand out business cards. sending out e-mails and sitting on your ass don't do much. People like to deal with people. So get out there and start doing some talking and face to face promoting.

- Offer discounts or promotions to previous customers to tell thier friends and family. Word of mouth advertising is THE BEST form of advertising out there. make sure people talk about you and your shop, and recommend your excellent service, prices and work.

- In the very beginning most of your business will depend on low prices and undercutting the next guy. You will have to bend over backwards for people. Some will appreciate it, and some some wont.

- You will make and lose money, make sure you learn from your mistakes.

- Get ready to spend almost all of your time working at your business, and to lose alot of your personal time. It will be hard in the beginning but will pay off years down the road.

- Lastly, try to find a niche in the market in your area. Try to be different. Pick a business model that you want to go after but change it up and make it your own. Have a reason why people want to deal with you rather then the bigger guy.

Hope that helps,

Ryan

great advice Ryan.

[Vegas69]

Like Ryan, I agree that business is business. Here are a few things that matter to me and won't cost you much if anything.

Professional Website: You can be building your first car but look like you have your **** together. It's very important.

A clean shop: Who wants to deal with someone that can't even clean up after themself?

Stand behind your word. The referrals will come if you take care of people.

Start a database today. Every reasonable customer or contact should be recorded. You can then keep them in the loop with emails or mail. Later you may add parts, etc. It's called touches. The more people see your business the more apt they are to call you.

Last but certainly not least. Do quality work and stand behind it.

[GregWeld]

The oldest saying in almost any business --

"You want to make a small fortune in the car building business -- start with a large one..."


You can substitute any business for "car building"... the same applies. The number one failure of any small business is the lack of capital to support the business GROWTH... By that I mean - let's say you start out with one car to build - then half way through - some friends of that guy come by and want you to build them a car too... now all of a sudden you have TWO 50K projects... but you don't have the shop space - the tools - the manpower... and you don't have the re$ources to do the 'above'.... so you can't capitalize on your business because you lack the capital. You can't afford to stay small - and you can't afford to expand either... BIG PITFAL. IF you can get lucky enough to get two or three customers willing to commit -- AND you can make that next step - then you have a good chance to succeed. So start now to plan on how you're going to go live - if the opportunity presents itself.:cheers:

[ironworks]

Really at the end of the day you have to want to build cars more then anything else. If you get into this business thinking your going to rake in the dough, Your extremely mislead. There are very few shops that make great money. I could count a 1/2 dozen that might. And they are not Foose design and Radrides ( parts and T shirts is where it is at). The margin on your labor in this industry is very low, the amount of money it takes for skilled workers is very high and you have to take it in the shorts on the big dollar builds. They have an even thinner margin. Anytime your profit is built into the hourly rate, meaning you have to work x amount of hours times your margin to make good money, you will always run out of time before you make good money.

Now if you can figure out how to estimate quality work and make money on every estimate, you might make great money, but there is not way to estimate perfection.

Tom Hanna of drag race fame was a master metal man. I asked him this summer why he got out so many years ago to sell pet collars, Yeah dog cat and horse collars. He said the only way to make money is to close your tool box. He realized that time was not on his side to build hot rods and make money. So now 20 plus years later he makes so much money from his pet collar business that he can build whatever for whoever and not have to get some customer to pay for it. That is my dream, I just wish I was as smart as that guy.

[Vegas69]

So what are you saying Rodger? Do it for the love of the game?

Doing something you are passionate about is underated. Part of me is not sure I would want to be in the car business even though it's a passion for me. Once you cross that line and make it work........ Real Estate certainly isn't my passion but it pays the bills alright. Sometimes I wonder how dominant I could be with the passion, but then I just think it would ruin the fun. Even though it's different, as a 19 year old kid I decided auto mechanics was the direction I wanted to go. Went out and got a degree at one of the best schools, was apprenticed by one of the best techs, slung parts for a few years. You just can't get rich working against the clock. I realized at 22 that I had mixed up passion and work. I didn't like new cars, they suck. I liked the hobby. To this day, my experience working on new cars ruins it a little. I still catch myself getting irritated thinking I'm trying to beat the clock over 10 years later. Are you mixing up a passion in trade for a job?

[GregWeld]

Todd --

Very "insightful" post... and you raise a very good question.

RE: ROGER -- He does this because what else would anyone do in Bakersfield... right?? :rofl:

[awr68]

Todd, I have been told many times not to cross that line and to leave it a hobby!

[ironworks]

In the hot rod business your customer will always make more money in whatever they do then you will in your business.

[coolwelder62]

Rodger is right so listen to him.I think the shops that comand the big money are few and far between.And only some of those will stand the test of time.I am going back to doing industrial machine & design. And keep the car hobby to myself. I am tried of waiting for the customer to bring me a check or parts so I can keep working on there project. I have two cars left that belong to someone else then its no to everyone else.

[Rick D]

In the hot rod business your customer will always make more money in whatever they do then you will in your business.

You said right there Rodger!!! My brother inlaw said it best the other day, he was on one of his sons hard about school and getting good grades and such and his ex-wife said he should not be so hard on him and he told her " my sons will be members at the country club not work there" he is the manager at a private club and makes very good money, but the members are the ones giving that cash to him! If you have pasion and you love what you do you will never work a day in your life, but that doesn't mean you will get rich. I have had my owe place and you can make a living but now I work for the largest paint company in the world and I get to do what I love on the side. Plus I get a good price on the paint!!!

[HRBS]

17 years ago when it came time for my college decision there were two things I was "passionate" about. Architecture and cars. Both involved designing and creating someones dream. But one required a degree and the other could be played as a "hobby". So thats the direction I went.
My day job pays the bills and allowed me to build cars for myself over the years. After a few were built and sold, I began to get a rep for building "cool cars". More and more people would ask me to build them one and i refused quite a bit before I decided to do one. I established a business name, applied for a state license and opened a checking account in the businesses name. One turned into two, then three and so on untill I slowly outgrew the small 2 car garage I was working in. After a few cars I found that I had established a fine collection of tools and equipment. Today we are 4 strong, have a nice shop and are ALL part-timers. We all still have day jobs and work nights and weekends building our clients dreams. I am greatfull for the 3 guys I have and that they are just as eager to come to work as I am. This IMO allows us to be more passionate than ever because its almost a daily stress reliever. I have been very fortunete to have some loyal customers as well as new ones all by way of mouth. I rarely advertise yet maintain a comfortable work load. Honesty is one of the best policies. I dont promise the world and dont over book if I cant keep up. No hook line and sinker deals here. :cheers:

[nvr2fst]

To make more money you need to do more work, to get more work comes with pay out for more exposure, more work comes with hiring more guys, which comes with more added bills. Its all about passion, if your in it for the funds only then you might as well open up a collision shop. If you have a great reputation and can charge a little more than your competitor most likely your not bringing in more income. A more reputable shop will have larger overhead, higher skilled employees which means higher payroll and more taxes due to the added income. It follows same suit for pretty much any company that does labor contracting.
A consumer most likely will always question the hours and always assume that it shouldn't take that long. If by chance you give the client a bid up front based on the work to be done, you would be pricing it so high to cover your butt just to make sure you don't lose and the consumer will think your out of line.
Your profit is based on payroll only. As Rodger stated earlier, production parts, t-shirts, etc will bring in your additional income but you need that "status" for people to buy your products.
Although Im in the construction industry, an example of a 70.00 rate with the average employee at 27.00 after all expense contributions have been paid the profit would be roughly 18/19% which is 12/14per man hour. This is based on corporate WI. and a very large overhead. When you achieve the 28% tax bracket on income it gets worse.
Keep in mind no matter how many employees you have, they will make mistakes now and then. You can not bill the customer for redo (ethically) and in the end, it's your company, your reputation and your mistake.

[GregWeld]

NVR --

Another good post... on "bidness".

Reading all these good posts on here dredges up some good memories. I've owned and operated 3 of my own businesses - and sit on the board or am an investor in others. So I'm only tossing in my usual .00000003 worth of opinion - and none of our opinions is worth much except to take the info and digest it. In the end - everyone can open a business and some will stay in business and make a living for many years - some will fail within a year - one out of 10 might be considered 'successful'. Some of the best businesses are the ones that can be replicated (franchised)... hot rod building is NOT one of those. Some businesses can find a way to build more things faster and cheaper... hot rod building is NOT one of those. So for me - to hear the guys that speak to the passion side of the business... that is the clearest message and probably the best advice that can be offered. If you can get out of bed every day - and go do something that you love to do - to whatever "level" that is... and pay your bills... and be proud... then that's probably something you should be happy to attain.

I liken this to Steve Rupps comments about a camera purchase... when he said -- "the best camera is the one you have with you". How simple - and how true... owning the best camera is worthless if it's at home when you want to take a shot... in that case the best camera might be your cell phone.

So here's the advice I'm going to put forth.

Go ahead and give your ideas a try. Start a shop or start a project - and see where it goes. What the hell do you have to lose... if it works out.. Great! If not - you've learned something... But you're never going to have the perfect opportunity - or the perfect time - or enough money etc. So might as well just get down and dirty and get acting on your dreams. Just don't hawk your house - your wife - or anything else that affects OTHERS... It's like gambling - you've also got to be smart enough to know when to fold if things don't go as planned (which they NEVER will in business!). Start it out any way that works for YOU. But start - otherwise you're never going to know.

[nvr2fst]

NVR --

Another good post... on "bidness".

Reading all these good posts on here dredges up some good memories. I've owned and operated 3 of my own businesses - and sit on the board or am an investor in others. So I'm only tossing in my usual .00000003 worth of opinion - and none of our opinions is worth much except to take the info and digest it. In the end - everyone can open a business and some will stay in business and make a living for many years - some will fail within a year - one out of 10 might be considered 'successful'. Some of the best businesses are the ones that can be replicated (franchised)... hot rod building is NOT one of those. Some businesses can find a way to build more things faster and cheaper... hot rod building is NOT one of those. So for me - to hear the guys that speak to the passion side of the business... that is the clearest message and probably the best advice that can be offered. If you can get out of bed every day - and go do something that you love to do - to whatever "level" that is... and pay your bills... and be proud... then that's probably something you should be happy to attain.

I liken this to Steve Rupps comments about a camera purchase... when he said -- "the best camera is the one you have with you". How simple - and how true... owning the best camera is worthless if it's at home when you want to take a shot... in that case the best camera might be your cell phone.

So here's the advice I'm going to put forth.

Go ahead and give your ideas a try. Start a shop or start a project - and see where it goes. What the hell do you have to lose... if it works out.. Great! If not - you've learned something... But you're never going to have the perfect opportunity - or the perfect time - or enough money etc. So might as well just get down and dirty and get acting on your dreams. Just don't hawk your house - your wife - or anything else that affects OTHERS... It's like gambling - you've also got to be smart enough to know when to fold if things don't go as planned (which they NEVER will in business!). Start it out any way that works for YOU. But start - otherwise you're never going to know.

Here Here Greg, well put. You cant vision income upfront. Its a gamble on a yearly basis. As long as you have work and love your job in the end thats all that counts. I started from scratch 20 yrs ago bought 2 other construction companies along the way to collaborate with mine and venturing into a distribution company of construction products within the next two weeks. Is it serious profit, NO, but I enjoy it. Once your company has its limits you either need to be comfortable with it or look into adding on to it. (labor with product) The biggest thing I've learned in business is not to carry all the reigns. Business owners have a tendency to be controlling and with that said you will end up doing all the work yourself and have no free time to enjoy life.

[novanutcase]

A lot of great advice so I'm only going to add that, at least in Rodgers case, he also has Workers Comp to deal with which many don't realize is a HUGE pain!

I used to own a factory that employed around 250 people. The WC premiums were INSANE!! Add having to deal with false claims, etc. and your margin shrinks to almost nothing!

One step at a time OP....as mentioned before, build the best car you can on your dime and then work from their. If you wanna get rich this ain't the business to do it.

John

[nvr2fst]

A lot of great advice so I'm only going to add that, at least in Rodgers case, he also has Workers Comp to deal with which many don't realize is a HUGE pain!

I used to own a factory that employed around 250 people. The WC premiums were INSANE!! Add having to deal with false claims, etc. and your margin shrinks to almost nothing!

One step at a time OP....as mentioned before, build the best car you can on your dime and then work from their. If you wanna get rich this ain't the business to do it.

John

Are rates went up in July 09 tremendously. Enough to put some small business out of work. For you California boys here what you may be in for.
www.sacbee.com/capitolandcalifornia/story/1711617.html

[Sandbagger]

Whats the labor rate for a Hot Rod Shop ? A collision shop is around 48.00 per hour here in the midwest for body labor .

[ironworks]

Labor Rate depends on Experience the shop has, Location, and Machinery used to perform given task.

Most West Coast shops are 65.00 - 105.00 per hour.

I had a customer come get a quote from us on chopping the top on his pick up. He asked what our labor rate was, I said 65.00. He said well These guys are 45 per hour. Well when the Job was done I saw the car in bare metal and done, I asked what his total bill was and inquired about the quality, not quite up to what would have left my shop. He said man those guys charged me 5000 bucks, They has like 125 hours in the top. I said funny we did a truck like that last week in 80 hours. He did the math and asked why so different, well we have tools to shape our sheetmetal they use a tree stump. ( Really they have a tree stump and a small bench mount shrinker / strecher). The prices were the same but it took them longer to do the same task, but there quality was a little less due to lack of skill & proper equipment.

Talent will get you along ways, But Talent no tools will only get you so far. Talent with proper tools will you a proper job, Talent with a top notch tooling will get you a top notch product in less time.

Could a talented guy build a really nice home with a hand saw and claw hammer, sure. It might take longer, Could he build a better house with power tools, in some instances yes, but I guarantee it would be quicker.


Oh and my Workers Comp insurance just jumped 40 Percent this year.... YIPPIEE. I have never had one claim in 9 years.

Rodger

[nvr2fst]

Whats the labor rate for a Hot Rod Shop ? A collision shop is around 48.00 per hour here in the midwest for body labor .

Id like to know who's only charging 48.00 an hour for collision work. I just had my daughters Mazda 6S she trashed in the first snow fall we had a couple of weeks ago. Labor rate was 60.00 at ABRA in the Milwaukee area and they did a "fair" job. Collision shop repair trade practices are regulated by Chapter 132 here in WI. administered by the Bureau of Consumer Protection. Hot Rod shops do not have to follow those guidelines.

Prior to my ongoing build I checked around and found the rates to be 50-100 per hour. Sorry I wont pay 100 an hour because its a pretty looking facility.

[arue333]

You Guys are a great wealth of knowledge! Thanks for all the great advice! I am planning on keeping my day job, lol, but this is a real passion of mine and I would love to help others in making their dreams come true. That and I would love to build/work on, a lot more cars than I can afford to own or house.
I think we're going to take HRBS's advice and just start off with a "house" hot rod and see where it goes. The nice thing is that even though I'm not independently wealthy, I only need the shop the pay for its self.
If you know of any reputable shops in the Portland, OR area, I would love to build a relationship with them.
What type of laws and restrictions do you guys have to deal with?

Thomas

[Rick D]

Id like to know who's only charging 48.00 an hour for collision work. I just had my daughters Mazda 6S she trashed in the first snow fall we had a couple of weeks ago. Labor rate was 60.00 at ABRA in the Milwaukee area and they did a "fair" job. Collision shop repair trade practices are regulated by Chapter 132 here in WI. administered by the Bureau of Consumer Protection. Hot Rod shops do not have to follow those guidelines.
.

Dave, Most areas are in the 42.00 to 50.00 an hour range for collision repair. Most shops are locked in to what agreements they have with ins companys that they do work for under a contract (DRP Direct Repair Program). Most ins companys go by the prevailing rate for that area. It's a big long discussion that would take up way to much space on Lateral -G. Most ins companys will say that they do not tell shops what to charge BUUUUT they will tell you that there is a shop down the block that will do it for only X amount labor rate and they don't charge us for all the extras that you have on your estimate. You get where I'm going with it.

[GregWeld]

Thomas -

You want to go see one of the best run shops EVER - IMHO - take a spin down to the bay area and check out Roy Brizios shop.... he builds killer cars - has all the skilled guys - and tools - in a fairly smallish shop... He's been doing it for years - has a fabulous reputation - and the product speaks for itself. I spent some time there discussing my recent frame build - and here's an HONEST shop - he told me - "well, I can build it for you - but it's going to be the same chassis you could buy for half the money from one of the regular frame guys... I'm just not set up to crank out frames so we charge by the hour and really only do them if a customer asks us to".

The club I belong to often has major discussions and "lessons learned" at our meetings -- one thing that we discuss often is the quoted shop rate... the guys that have been doing this stuff awhile - will all tell you what Rodger said above... the rate doesn't count nearly as much as how long it's going to take... 'cause $35 an hour sounds cheap - but not if it take 3 times as long!
And $35 an hour is real cheap - until you have to pay $95 an hour to have it all re-done.

Build your shop car - make note of every single hour you have in it - including the time to chase down parts - and go fetch etc - and every shop rag you use - and tape - and welding supplies... you might be shocked at what you really have into the build! Then see if you can sell it at a profit to start your next build... :woot:

[ironworks]

The nice thing is that even though I'm not independently wealthy, I only need the shop the pay for its self.


Thomas

So your only interested in Volunteering? I don't know about you but I would rather work on my own car, then volunteer free labor for others. If that is the case, I will bring you 2 cars on monday to volunteer on. Let me know when your done, I will bring you 2 more.

Rodger

[Bow Tie 67]

- make note of every single hour you have in it - including the time to chase down parts - and go fetch etc - and every shop rag you use - and tape - and welding supplies... you might be shocked at what you really have into the build! Then see if you can sell it at a profit to start your next build... :woot:

Greg,

Should I add the smoke break time? If so, I have one hell of an expensive car!! :lol:


P.S. After reading some great info from guys in the know, it backs up my thoughts of when have your own buisness, it will monopolize your time, period. I love my time off and the fact that when I punch out, work is never on my mind.

[nvr2fst]

Dave, Most areas are in the 42.00 to 50.00 an hour range for collision repair. Most shops are locked in to what agreements they have with ins companys that they do work for under a contract (DRP Direct Repair Program). Most ins companys go by the prevailing rate for that area. It's a big long discussion that would take up way to much space on Lateral -G. Most ins companys will say that they do not tell shops what to charge BUUUUT they will tell you that there is a shop down the block that will do it for only X amount labor rate and they don't charge us for all the extras that you have on your estimate. You get where I'm going with it.

Yes Rick definitely understood to the shhhhh game. I priced the car out personally at a local place down the street on the damage to see if maybe I'd pay out of pocket. That quote was 3400.00. The insurance quote was 4600.00 with very little difference in labor/material itemization.

Sorry guys for steering this off track a bit. Back to the OP.

[ironworks]

Thomas -

You want to go see one of the best run shops EVER - IMHO - take a spin down to the bay area and check out Roy Brizios shop.... he builds killer cars - has all the skilled guys - and tools - in a fairly smallish shop... He's been doing it for years - has a fabulous reputation - and the product speaks for itself.

Brizio is one of the few that is probably just as good a business man as a builder. He runs a well oiled machine. He turns out multiple cars per month. But his client list gets shorter every month. Another street rodder dies every month. Will his business ever slow down? probably not. Will he ever win a national event award? Not intentional I guess. He knows there is no money in award winner, one off, set the world on fire cars. He does the same thing over and over and uses a proven system.

I think from a business side of things, So Cal Speed shop does a great job. They sell a crap load of T shirts, but builds and sells a very quality product. So did Jesse James, but he did it in 2 years, So Cal will be selling T shirts in 20 years like Mooneyes. Jesse James will just be married to Sandra Bullock in 20 years. Well in hind sight that sounds like a pretty good business plan also. :D :D :D

[Novelli]

1 Go out and buy alot of Top Ramen
2 Plan on having no life for the first few years
3 No its not like discovery channel just because you opened a shop!

Cost
My savings account
Numerous girlfriends
Put all my own projects on the back burner

I worked and went to my shop at night for the first year,I quit a good paying managment job and went to my shop full time, It was a drastic change. I worked 7 days a week and 16-18 hour days for a long time, and still due when needed. Determanation and hard work, and being straight up and honest is what has worked for us. We have put out some cars that were not intended to be indoor show cars and have managed to beat up on some very big name builders and win alot of awards. Oh yeah...its Sundayand I am at work right now, I have been block sanding so long my firgers are ready to fall off.

[Novelli]

On the serious side, if its what you are passionate about, and really want to do it...... go out and do it. There seems to be plenty of good people on here that would be more than happy to give you pointers along the way. Good Luck.

[Sandbagger]

Dave, Most areas are in the 42.00 to 50.00 an hour range for collision repair. Most shops are locked in to what agreements they have with ins companys that they do work for under a contract (DRP Direct Repair Program). Most ins companys go by the prevailing rate for that area. It's a big long discussion that would take up way to much space on Lateral -G. Most ins companys will say that they do not tell shops what to charge BUUUUT they will tell you that there is a shop down the block that will do it for only X amount labor rate and they don't charge us for all the extras that you have on your estimate. You get where I'm going with it.

Im north of Chicago ...Near that Swartzs charachter . Lots of big Body shops that work on volume and give the labor & extras away to the insurance companies so they can stay open another day . I make less than I did 10 years ago . Shops that charge 52.00 dont get as much insurance work .
The body shops recooped there losses by reducing pay or double sheeting the techs. Sorry to get off topic rant over

[bentfab]

I could go for days about this topic. Thank God for Roger!!! He knows how to put the words down. Everything he's said I coincide with down to the t's crossed and i's dotted. It's not easy one bit. Roger and I are in our early 30's and for us to know and understand how things work and what it takes to do what were doing say's alot about a good honest hard working Hot Rod Shop.

I opend my doors in August of 2000 and was sweating at how I was going to pay my $550 rent and $100 bucks in utilities. For the first 4 1/2 years I worked a night job which pretty much paid for my tools. Start work at 7:30 pm work till 4 am or later if overtime. Go home sleep from 4am till 9am wake up get to my shop at 10 or so. Work till 6pm go home shower eat and be at work 20 miles away by 7:30 pm. I was late(by 5 minutes) about five times in those years. I left a $85,000.00 a year job for my passion. Five years later I don't regret it. There are plenty of days where I wish I worked for someone else.

Shop rates vary not only on ones quality of work but also location. I'm in the heart of California where the cost of living isn't cheap. If I could tell you guys what it cost to live a so called blue collar lifestyle you would probably fall over where you stand. Shops that do the same level of work might have different cost cause of location.

This is a great topic but is only the tip of the iceburg on what it takes to run a Hot Rod Shop in this day and age.

The key to any succseful shop is honesty,good work, responsibility,and will. And like I said before Doing better than your best and never letting it rest !!!!

[srh3trinity]

I can't add much from a business owners perspective but I can offer an observation:
I know two guys who both have jobs that were born out of their hobbies. One guy owns a wakeboard/ski boat shop, the other owns a pretty busy garage (not a hot rod shop). The guy that works on boats never makes it to the lake anymore. He is always busy getting clients back out on the water. The guy that owns the garage has multiple projects of his own in various states of completion in and around the shop that he never works on because he is busy on cars for paying customers. By the time he gets all of those done, he is beat and wants to go home and see his family. He never makes any progress on his own stuff.

I can't fathom what it takes to get into a niche market that you are very passionate about and try to make a dollar. I can understand the allure of trying to combine a hobby and a job, but you can't serve two masters. You are either going to have to treat it like a job or treat it like a hobby and your success or failure would be dependent on your ability to do so. I would imagine very few people figure out how to do both at the same time and be financially successful (success can be measured other ways, I am sure these guys live for months off of the smiles they get when they hand over the keys on a completed build).

Either way you go, good luck. There have been some great posts on this thread that apply to business owners in general and I think it is cool that you have generated this great banter from some respected builders on the site.

[novanutcase]

I think from a business side of things, So Cal Speed shop does a great job. They sell a crap load of T shirts, but builds and sells a very quality product. So did Jesse James, but he did it in 2 years, So Cal will be selling T shirts in 20 years like Mooneyes. Jesse James will just be married to Sandra Bullock in 20 years. Well in hind sight that sounds like a pretty good business plan also. :D :D :D

Oh Shut up! You married Sandras sister so I don't know what your complaining about!!!:lol:

Builders? I'm ready to do your T-shirt lines!!!:unibrow: :lol:

John

[tellyv]

This is what I've learned in the 10 years I've been in buisness for. 1. Most people dont understand how much money or time goes into building one of these cars. 2. You'll end up doing way more work for free if you building top notch cars, because you want them perfect to reflect on your workmanship. 3. The people with the most money (for the most part) have more money than you or us because they know how to screw people over and they'll have no problem screwing you over, I've been there trust me.
4. You'll sleep alot better working for someone else, I lay awake at night wondering how to get all the work out or wonder when the next job will come in. 5. So I've built magazine quality cars why do I have to jump through hoops to get any respect or make any money.
So the way the economy is I say stay away, do it on the side and see how it goes. I know some pretty serious shops with no work so keep your day job. Personally I'm out of the custom car building seen it's done nothing but made me not sleep and work for way to less of money than I'm worth so in my shop from now on we'll do the paint work but nothing else or stick with collision work because I know for sure their checks dont bounce. Good luck I wish you better fortune than me!!!!! Telly

[sniper]

I cannot say much more than what has already been said but here goes.

First,
I too worked as a mailman during the day and opened my business at night. I did that for almost two years. They forced me out because I would finish my 9 hour walking route in under 5 hours. They didn't like that so I was fired. Otherwise I would heave kept doing that for a little while longer.

Second, you can have all the greatest skill, tools and whatever, but if you don't get customers it means nothing. It just becomes an expensive hobby. If you are starting out and don't have a recognized name, you need to have something to showcase your talents, ie a built car of some sort. Well building that car will COST you money. It's a double edge sword.

In my experience, after 4 years of being in business, the thing I come back to is that you MUST have a product, something that you can sell that doesn't have to involve installation. Pushing products out the door keeps your cashflow up, maintains decent margins, and that will allow you to build cars, without relying on that as your staple.
Certainly, there are shops that only build cars, but there are a lot of mitigating factors there.

[417 Motorsports]

whats everyones take on advertising when your a new shop... even on a site like this,

is it effective? yes... very

BUT it cost alot.

So is it worth it to just let word of mouth do its job or scrape up some money for very expensive advertising.

[Vegas69]

As a new business if you plan to advertise, it's going to take a while before people want to call you and recongnize you logo and name. It's really no different than watching TV and seeing folgers coffee 25 times in 2 months. You go to the grocery store and it calls your name. It's really no different. The more TOUCHES you get the better. That being said, I wouldn't blow your bank roll on advertising. As a new shop you don't know your direction and you probably don't have the man power to handle the excess anyway. Somem of the most succesful vendors and shops are active on this and other sites. If you get involved with the in crowd and genuinely want to help, you will reap the benefits eventually. Of course you should become a paid sponsor of the site.

[Flash68]

I, too, toyed with the idea of getting into the hot rod biz in some capacity (not building - I have no skills!) but realized I can do better and be more successful at other things, and that this foray might just ruin the hobby for me anyway. And actually, I am doing pretty well at ruining this hobby for myself as it is! :D


3. The people with the most money (for the most part) have more money than you or us because they know how to screw people over and they'll have no problem screwing you over, I've been there trust me.

Oh come on, man. That is a bit ridiculous and bitter sounding don't ya think?

Just because the people with the money are generally better (or at least willing to try) at exploiting the various opportunities presented in the world, does not mean they "screwing everyone over".... :rolleyes:

[Vegas69]

I, too, toyed with the idea of getting into the hot rod biz in some capacity (not building - I have no skills!) but realized I can do better and be more successful at other things, and that this foray might just ruin the hobby for me anyway. And actually, I am doing pretty well at ruining this hobby for myself as it is! :D
:

Sorry....:rofl: :rofl: :rofl:

[HotRodKush]

I started a screen printing and sign shop 8 months ago, so this thread really hits home for me. I started in the basement of a house, printing t-shirts for family friends and it snowballed for a while into a full-time business. Those who say it consumes your life are absolutely correct - I've never been as stressed or unhealthy as I've been this last year. Working 24 hour days, sleeping at the shop and printing out thousands of t-shirts alone at 5am gets old VERY fast. On the other hand, on the rare occasion that I can step back for a second and actually look at my life, I'm so happy that I made the decision to stop working as an auto mechanic and start my own business - I work for myself and only answer to my customers.

Am I making money yet? Absolutely not. Am I ready to quit and get another job? Hell no. It'll pay off eventually and through all of the stress and muscle aches, I know that I will never be able to go back to a 9-5 job again. I have a storefront now, in my own building, and I can get up every morning and unlock my own door, walk into my own office and make my own money, my way. I've had no social life and almost lost a relationship through it all, but when all's said and done there's nothing like it :thumbsup:

[417 Motorsports]

lol already lost 2 relationships due to the shop lol... its not easy

[GregWeld]

If they're really good chicks -- they stay with you through thick and thin... After 37 years of being together -- and there's a lifetime of good and bad... we're still together and going good. :thumbsup:

[tellyv]

I, too, toyed with the idea of getting into the hot rod biz in some capacity (not building - I have no skills!) but realized I can do better and be more successful at other things, and that this foray might just ruin the hobby for me anyway. And actually, I am doing pretty well at ruining this hobby for myself as it is! :D




Oh come on, man. That is a bit ridiculous and bitter sounding don't ya think?

Just because the people with the money are generally better (or at least willing to try) at exploiting the various opportunities presented in the world, does not mean they "screwing everyone over".... :rolleyes:

It sure is bitter call me and I'll tell you why!!! and like I said for the most part, I know there's good rich people out there I've just never delt with one. I've built cars for alot of people and the ones who worked a normal job and made a normal living were alot better to deal with than the one's with a big bank role. Its just my .02, I've been screwed over to many times to have a good outlook in this buisness. Sure there has to be some really great people out there with money otherwise we would'nt see some of these kick ass builds. Yeah I'm bitter or just plain pissed, I guess its time for me to start exploiting different opportunities also. But I'll stick to this the economy sucks and it's a very hard buisness to succeed in if you have a good job I would keep it, if your serious about getting into this I would highly recommend working at a good shop before you jump in you'll learn alot and maybe even get some good buisness tips!

[lhkustoms]

There's several quality shops in the NW. From big name shops to small three car garage shops........it doesn't make it easy to start up a shop around here.

This is very true there are so many hot rod shops in the Portland/Vancouver area. myself L & H Kustoms, hot rod engineering, bruning auto design, Steves auto restorations, don lowe hot rods, www hot rods, restorations & rods, A&M street rods, custom auto restorations, RPM racing, and about a dozen others. Plus there are a lot of little guys who only charge $30/hr I have redone so many jobs from these "cheap" shops its unbelievable. this area is quite flooded. I would do a little research and see if you thinks its feasible. #1 thing you need is raw talent and #2 tools. producing a part to sell is the best way to try and earn a living then build a few select cars a year. Also be willing to give up your free time as you will no longer have any. I work about 60-70 hrs a week and it is hard. I have the best wife she doesnt like me working so much but is behind 100% me to support me. I am proud to say I have been running my own shop for just over 2 years now but it hasnt got any easier yet. I love being self employed and building cars but I do miss working on my own projects. Your either making money or losing money so when I go out to the shop to work on my car I almost always end up working on a customer car. If you want to just get by and hopefully pay the bills every month go ahead and do it. If you think it will be easy to make alot of money go do something else. Good luck in whatever you decide

[796spdbu]

All I can add to this is to tell you about my experience.

In high school I lowered my first truck. It was a luv truck. It was my shop project. I lowered it by cranking torsion bars and removing a leave and adding blocks,then I made a removeable hard top and tilt bed. Then I bought my second truck in highschool,which was also my first loan at the local bank,which I will talk about later. I lowered the 83' c-10 by flipping the axles and cutting springs(I know it wasnt the right way but its what I had). After that it all kinda snow balled for a while. I started installing drop springs and lowering kits in every thing from hondas to mini vans for everyone in my high school. I actually got in trouble by the princepal because I would ask the Vol ag teacher to use the shop to do more jobs so I could better my chances at winning the Ag Mechanics Award at the end of the year. He said that was fine, but I was also charging for doing these jobs. I was good till a teacher over heard me talking price to another "client". I wasnt aloud to do any more work unless it was an approved job that they were for sure I wasnt making money on. I used to read magizines in school every chance I got,because I knew I wanted to build cars at an early age. the school adviser used to tell me if I applied my self to school work like I did those magizines I would be on the honors society. I wasnt interested in all that..

While in high school I worked for an ex super stock drag racer building full tube chassis race cars and pro street muscle cars.I remember working at his shop well into the night and some times I would sleep there and grab a shower at his place before rushing off to school. I convinced the same Ag teacher to let me get into welding class a yr early so I could make even more money. It was at this time that I got hit in my C-10 and took it to a guy who painted on the side to have it redone. Well he ruined my truck..thats another story for some other time. After I realized I was screwed over I went to a freind of the family who owned a body shop to see if I could help around the shop to learn paint and body work. I worked both places while still trying to lead a normal teenage life..I had to break many dates because we had cars that needed to be completed.

Fast forward a few years,
I was 19 and built a flamed 91' sonoma. That one truck brought me alot of work lowering S-10' and other mini trucks. This is also the time when things got a litte hairy for me. I lowered a kids new S-10 that his parents gave him for graduation. I used every thing Bell Tech. But at the time there was another guy hacking trucks and they rode on bumpstops. This kids parents thought I did there sons S-10 the same way. They threatened with a Lawyer. I called the family Lawyer and talked to him about my issues. He told me since I charged over a certain amount that I needed a buisiness license and insurance on the work I was doing. So I did just that. I have had my license and buisiness name since 1998. This is were the local bank cames into play as I got in good with the branch manager and he gave me several small buisiness loans over the years.

Fast forward again. and the small 30x40 shop I was working in became a little small and I added on another 18x40. I had always built trucks and muscle cars on the side. We live in a really rural area so there isnt much of a market here.I got in good with the local speed shop and did a few roll cages for them really cheap so that people from the city could see my work. I started helping a local guy when I was slow in my shop. I learned how to set up rear ends. I learned a lot from that guy and went on my way.

There was a truck at SEMA a few years ago that was owned by Dale Ison,It was called the Hero's Truck. It had 2 complete stainless steel chassis' The body sperated from the lower frame. Helping on that built team showed me even more about finish fabrication work and attention to deatail like none other. Over the last several years I have had a roller coaster ride of jobs. I would work at a place then they would go out of buisiness and I would start over.

At one point in time I tried to run my own shop completly as my main source of income. It went well for 2 years then I ran out of work because of several reasons others have said. You take on a big resto job that needed big space and time then you try to get in a smaller job you feel you can knock out quickly. I guess being "wet behind the ears",I wasnt any good at time management. I tried to hire friends to help out after they got off work but not to many were into the hobby as I was. So after a good run I decided to try the 9-5 again. I slowed down working on hot rods and trucks and went to college to presue a buisiness mgmt and accounting degree thinking it may help out if I ever try again.

So that brings me to the last 2 years. I have spent alot of time working on others projects. One big one comes to mind as a life lesson learned.
A 68 SS 396, 4spd,12 bolt chevelle.The guy wanted it completly redone in hugger orange with white stripes over the hood and trunk lid. I went to look at the car, and give the guy a quote. The car was in primer which I wasnt sure about. I told the guy I couldnt quote a price until I stripped the car to see what I had as a foundation. I picked the car up and started by sanding a few spot that I knew where problem areas. I found the typical hack and pack primer job. I called the guy and told him I had a shop I worked with that would blast the car completely for $750,He bulked at the idea even after I tried to tell him the labor would be alot more paying me to hand strip the car.
Then to add salt to the fresh wound, It needed quarters. Again I told him itd be cheaper to install full quarters but he wanted partials. At the end of the job I handed him the bill which I had gone over every thing several times before and he was floored by the amount on the bill. I told him that we went over the bill several times before and before any work was done or before any part was ordered. He paid the bill but wasnt happy even though I had lost sleep and money over the job.

As with others, It has cost me several really good realtionships because I had to work through holidays and weekends. Its a passion of mine to build cool rides. I also take the time to go the extra mile to make sure things are right even if it wasnt on the original build sheet. Im not one to cut corners or half a$$ something. Thats my name associated with that car/truck. I used to go to my day job on very little sleep some times I wouldnt even go home and the girlfriend would be sleeping by her self. It got to the point where I wouldnt even try to date anyone because these cars consumed me. I just didnt have time for it.I dont mind it but it is nice to have someone to go out with every so often.

I to have several unfinished projects. The name in my avatar 796spdbu. Thats my 79 malibu that I installed a 6 speed and a tune port engine in. I started that car in highschool in 96'. I did a complete frame off. It had all the trick hotchkis suspension and eibach springs. I hope to some day finish it.Even though the B body spindle swap isnt the best idea now..LOL
The truck I bought just for hauling projects with,a 97' crewcab dually, was taken off the road 2 years ago for a simple reapint and air ride job. I worked on christmas night this year from 9 p.m. till 3 a.m. priming the cab and bed,missing out on the last family event that day. I had an open spot in the shop for it and had to do it that night as I had another project coming to the shop the next day. Im not complaining,I chose this life.

I know I wrote a novel here but im trying to give you some insight to some of the things I have ran into over my years of building custom rides. Its a big commitment. Its fun but it will take a lot from you also. Its rewarding to see a project go from nothing to a nice ride. Some times you will want to throw in the towel,but if you really love it you will find the drive to stick it out.
Good luck with your new venture!

Greg