Money saving idea/question for contractors

[bradleyheathhays]

Hey there once again. My daytime job finds me at my buddy's 'cabinet shop' where no actual woodworking is done. We're a cabinet supplier with a little warehouse space to hold contractors' and clients' orders. We can order cabinets either built or flat pack unassembled. Over the last couple years working there I've asked a few contractors how much different the pricing would be if they got their cabinets unassembled instead of assembled...and most of them said they'd save about 50%. 100% of our contractors order them built btw. Building them is crazy easy but everybody opts to pay thousands more to have us put their cabinets together. A wall cabinet takes about 10 min to assemble and an average base about 15 min. We just delivered 20k worth of kitchen and bathroom cabinets to my other buddy's contract built house; it was about 32 cabinets altogether. If we were to have put together these same cabinets it would've taken us about a full day.

So you see where I'm getting to here? Why don't I advertise myself to contractors as the guy who's been building their cabinets for the last two years and see if they're willing to order unassembled, save a ton of money and pay me maybe half of what extra they would've spent? Sounds like a win win huh?

So my question is...what issues aren't I seeing yet with my idea? My contractor buddy who's helping me work on developing this says he doesn't think contractors will want to get into the minutia of adding a different step to the process they've already settled into...building houses the way they do. The way he put it is that contractors want to know one 'cabinet guy' who gets it all done from design to supply to installation. Almost all the contractors we deliver to also use our company's two installers, and my idea would make things a little bumpier for them. I'm sure lots of contractors in my city of 330k population have their own installers but my contractor buddy says that good installers are few and far in between. Of course, all I see is a big chunk of change to be made, for both me and the contractors, and I think they'll be interested in hearing about my idea.


Any thoughts? Thanks as always.

 

[Eric Rorabaugh]

I'd say the company you're working for wouldn't like that too much. Taking money out of their pocket. I also think there's a conflict of interest IMO.

 

[bradleyheathhays]

Eric thanks for your reply. I'd say you're right but I'd also say that's business for ya. My boss is a bit of a baboon sometimes so I don't owe him any fielty. And I'm definitely not gonna pass up the chance to help support my Mom toward the end of her life now because I didn't want to step on anyone's toes. Priorities.

 

[Mike1950]

25 years as a contractor. Had a philosophy that is applicable here. We did what we did best and ta hell with the rest. We farmed very little out but also did not expand beyond the plaster world of work.
In the world of shortage of labor it my be a hard sell to change their routine. You will have to prove savings being enough to be worth their risk and investment

 

[2feathers Creative Making]

Have you run this past your company rep? You may have already signed a paper the limits your ability to do this while employed at that shop.
Your angle may be to buy the flat pack from your boss and install them as a subcontractor. In essence, you would be a third installer who specialized in flat pack instead of pre assembled. That would probably require you quitting your current job title at the least. But most likely would require you becoming a full fledged business complete with work comp insurance and a local business license. Not necessarily a contractor license.
I ran my own business for several years as have many others here. You will have an overhead that will likely eat 30 to 50 percent of the profit you smell at this point. It could still be a profitable niche. Try to help a buddy or two first to see if it really works out numerically.

 

[bradleyheathhays]

Mike I really appreciate your experience and thoughts. I'm lucky enough to have a great guy in the building industry here that's known me for a long time and can really promote me as the great worker I truly am. Haven't missed a day of work in over 2 years. I'm all about reliability and quality, and value. My idea is to do the first job completely free and see how it goes.

2feathers thank you too. This idea just came to me in the last few days so I haven't done a lot of forward thinking on it yet. My employment situation is very 'loose' you could say and I don't even punch a time card, cause I don't like to really. Legally I'm free to do whatever I want. That's a very interesting way to put it...that I would be a third installer specializing in flat pack. Do you say I'd be the 'third' installer because my company already has two, or were you referring to my adding a third (intermediary) step in the installation process? Maybe that's how I can sell myself to other installers in my city...as a specialized 'installer.' I've already thought to learn how other brands of cabinets are assembled in order to branch out if that were possible.

If you have any more thoughts on this idea please let me know.

 

[Nature Man]

Agree that you would have to quit your current job. There are a lot of hidden costs of running your own company. Not that I don't think the idea isn't a good idea, but just beware there is a lot more than just backroom assembly involved. Chuck

 

[bradleyheathhays]

Thanks Chuck. I'll continue on here with my delusional optimism for a while longer before I start to consider the things you speak of. But yes I'm afraid it's never as easy as it sounds. Appreciate the advice.

 

[trc65]

Random thoughts as I understand what you are describing.

As an assembler of cabinets you would also take on responsibilities for any damage that would occur during unpacking, assembly, and repacking. That brings with it liabilities for missed delivery dates, reordering pieces, ect. Cost of warehouse, assembly equipment, labor supply needed in addition to yourself, packaging supplies, etc. You would also take on the role of boss, responsible for all the associated jobs- accountant, purchase agent, janitor, main assembler, packaging, receptionist, etc.

Not suggesting that you haven't considered all of this, but good help is hard to find/afford and it sounds like more than a one man job. As Chuck mentioned, lots of overhead, and that can kill a business.

I think your biggest challenge will be convincing the contractors to use your services. Change is difficult, and if a certain model is working, they will be hesitant to switch. Yes, you may save them some money up front, but what happens the first time something happens and you delay delivery? You've probably lost that customer forever.

I don't mean to dissuade you from pursuing this, just make sure you've covered all the bases first.

Edit, as you proceed with planning/considering this venture, seek out some help / guidance from small business administration/office that most cities maintain to guide people like you with proposed businesses.

 

[bradleyheathhays]

trc65 you might find this funny but when I quickly read your reply I read 'Ambassador of Cabinets.' instead of what you actually wrote. Not a bad company name at all!

Of all the questions I haven't answered yet, I have managed to answer a very important one...good help. My work buddy who does everything I do, but probably better, wants in. Honest and hard working as the day is long. Insofar as the problems that might occur with my idea I think back on something I was taught about how to make a successful relationship last. It's not about what problems come up, it's how they're handled. If any cabinet gets damaged one of the good things about ordering unassembled is that we can get them in a week.

Thank you for the encouragement.

 

[2feathers Creative Making]

More that your company has 2 installers they use currently. You would be a third. You want to tie your install sales to the flat packed cabinets from this company first then sell that experience for other flat pack cabinets. I have assembled and installed, I have installed preassembled, I have had preassembled installed. I have never had an installer tell me he wanted to install flat pack.
Your sales pitch has to be the finished, assembled cabinets. If you are using hot glue at the shop, maybe upgrade the glue quality.
Your contractors want quality and speed. If you can get them installed a week earlier by using flat pack, tell em. If you can get them into tighter corners or through smaller doorways in those tiny bathrooms, tell em. If you can take up for off angles by modifying the cabinet as you assemble, tell them.
I have wrapped cabinets around chimneys, custom set cabinets that contained return air registers, retrimmed cabinets to go through a 30 degree corner, stacked cabinets to make hidden microwave garages, installed specialized pull down or pull out hardware that required not having any shelves installed.

Just be aware your flat pack, site assembled will tend to get you asked for heavier customization than a shop assembled system.
Damhik

The concept is sound. The sales pitch is where the trip hazards exist. You may need to become THE cabinet company. In other words, you may have to build the kitchen on paper for them and place the orders for them so they don't have that 'extra step' that was mentioned.

 

[2feathers Creative Making]

ikea desk drawers as drawer stack custom door fronts 2x open shelves to span a larger area flat pack type cabinet from lowes the upper cabinet was rebuilt to extra depth to match the live edge shelves holding the microwave custom pull down insert. My wife ain't tall... custom pull out lower shelf kit. custom pantry utilizing a bifold door and a cabinet end skin these are some of the cabinet solutions that my lovely wife has come up with. You are not likely to run into these all at once, but you may wind up being asked to do more custom than the other installers such as the live edge shelves or open shelf since the product isn't fastened together yet.
Fortunately, not many of your customers will have restaurant background so the massive quantities of food storage may not come up that often.