Writing A Basic Business Plan for your Garage Woodshop
You think you might want to take the leap someday. You can’t do it today, but how do you lay the foundation so that in the future there is a sustainable woodshop business that could grow into something significant?
Of course, it all starts with a plan. A business plan.
A good business plan will be a blueprint or road map to achieve your lofty goal. Deciding now what steps need to be taken, what thresholds you need to achieve, what investments you need to make, will make the road much smoother, without needless detours. An excellent source for guidance is the Small Business Administration, or SBA.
“A good business plan guides you through each stage of starting and managing your business. You’ll use your business plan as a roadmap for how to structure, run, and grow your new business. It’s a way to think through the key elements of your business.”
Their easy to read general Business Plan Guide can be found here
But much of that information is generalized. So let’s review what you need just for your particular circumstance.
Writing a Business Plan for Your Garage Woodshop
At this time, let’s assume you are keeping your day job, and this business plan is going to serve as a guide for the coming year. If you will be looking for major expansion, investors or bank loans, this guide will not be comprehensive enough. Having said that, let’s go through 5 common sections of a simple business plan.
1. Summary of Your Business
This is a brief summary of the details of your business. Nothing fancy, just the facts.
- Business Name:
- Business Location:
- Business Legal Structure: (what is the name of your LLC or partnership if you have one)
- Business Description: (What is the 2 sentence summary you will give when someone asks you what your business is about?) Here are some questions you might want to answer, to get you started:
- Are you focusing on custom furniture or giftable products?
- Will you be operating an Etsy store, your own website or both?
- High end or affordable pricing?
- Hard to find wood species or popular wood types?
- Who is accountable for business functions?
- Typically this would fall under 3 basic functions: Financial, Marketing, Production
2. The Message of the Business
What important themes are important to you that you want your business to represent? Here Cardinale Furniture Co chose Mid-Century furniture, handcrafted quality and Michigan.
Take the time to think about what will be the primary theme of your business. What important themes are important to you that you want your business to represent? Here are some questions to help you focus.
- What primary problem does your business solve?
- If you sell cutting boards, you are most likely solving a gift giving dilemma
- If you sell cabinets, you are offering a remodeling option for customers who can’t or don’t want to do the work themselves
- What is the result or vision the customer should expect from your service?
- A spectacular new kitchen featuring customer cabinets with dovetail drawers?
- A surprised and grateful gift receiver?
- Given the problem you solve, who then is your primary customer?
- Gift purchasers?
- Home remodelers?
- Interior Designers?
- Why should those customers purchase from you instead of anyone else?
- Do you offer the highest quality?
- Do you specialize in a particular item, or medium, or technique?
- Do you offer customization, like engraving, or size or color?
- Do you specialize in urban lumber, reclaimed wood, sustainability, or support a particular cause?
Now, put those answers together, and you have what is called your Red Thread: a theme that should be present, either overtly, or subconsciously, in all your messaging.
- Missouri Woodworking: Walnut Boards hand crafted exclusively from Missouri forests, customized for your special occasion.
- Smithfield Fine Furniture: Heirloom custom furniture from the local urban hardwoods of Smithfield, Virginia.
- George Supply Company: Build Your Woodshop Brand with Information and Resources, Branded Merchandise and Printing Services for the Woodworking Industry.
This is a simplistic summary of a fairly complex concept, but it should work for your garage woodshop. If you wish to delve deeper, there are multiple books and resources written on this topic, including Find Your Red Thread: Make Your Big Ideas Irresistible by Tamsen Webster
3. Service and Product Line
Will you have product categories like food service, home decor or custom orders?
List out the items you plan to sell, their cost and their retail. Include all the sizes, variations and customizations possible, with their upcharges. Be as specific as possible. Now is a perfect time to standardize your pricing process, and to calculate the production cost of each item. See our post The Art & Science of Pricing Your Work for much more detailed information on this subject.
- After making your assortment list, here are some additional things to consider to keep you organized:
- Can your products be grouped into collections or themes, that will make it easier to think about marketing items as a group.
- This might be home accessories, bar accessories, mid-century furniture, etc
- Will you have Seasonal collections?
- This might include a Christmas collection, or Mother’s Day gifts
- Will you have product categories like food service, home decor or custom orders?
- What percentage of your total business do you expect from each, and how can you maximize the most profitable ones and the most time efficient ones?
4. Marketing and Sales
In section 2, you identified the general categories of your customers. Now, let’s get more specific regarding how we find the ideal customer for our product, using some tried and true marketing questions:
Who is your ideal customer and where do you find them?
- Who is your primary customer or target market?
- What are their demographics?
- Age, sex, income level, location, etc
- What are their psychographics?
- What do they value, or is important to them?
- Do they value ethically sourced materials over value?
- Do they value craftsmanship over price?
- What are their typical interests?
- Health? Family? Home decor? Entertaining?
- Where will you find this ideal customer?
- Are they searching for gifts on Etsy, Instagram or Pinterest?
- Is it an older customer who scrolls through Facebook?
- Or a younger demographic on TikTok?
- The answer is most likely a mix of multiple locations...
- For example, will your holiday and bridal collections be offered on Etsy, while your custom furniture line may be on your website.
- Is it a higher income customer who might utilize an interior designer?
- How will you be using your Instagram and YouTube channels to garner new customers?
- We discuss customer acquisition through the use of Instagram hashtags in our post 5 Kinds of Hashtags for Woodshops and through the use of a content calendar in Use a Content Calendar to Turn Posts into Sales.
- Will you be using paid ads in the future as the company grows?
- Will you be supporting local teams or organizations with donations to grow local brand awareness?
- Will you have a customer referral program?
5. Future Growth
Is the craft show schedule in your area expanding or contracting?
Now is the time to determine how we go from here to there. How do you go from the garage on weekends, to the business in your imagination? We start with where we are today, and your next few moves.
- What were sales this year?
- What do you expect for the coming year?
- What factors will be contributing to achieving that goal?
- Will you start a new product line?
- Will that require new equipment, and how will that be funded?
- Will you be devoting additional production time, giving you more product to sell?
- Will there be some other fundamental change?
- Is there a marketing opportunity you can exploit?
- Is the craft show schedule expanding or contracting?
- If contracting, what will you be switching your marketing efforts to?
- Is there a particular product demand change you can meet?
- For example, in your market does the demand for custom signs continue to grow?
- Should you plan to add a CNC machine in the next 24 months?
- Are you getting increased calls for custom furniture and see that as an opportunity?
- Or are you going to focus for example on exotic hardwood cutting boards and turn down custom work?
This is a perfect time to be realistic about your personal life. Is it realistic to plan for additional production time this coming year, when you have small children? Have you already committed additional time to other aspects of life like family, exercise or vacation? Or will time be plentiful as the last child is off to college?
And so like building a house, you have to set a firm foundation for your business. The building blocks are this business and marketing plan, listing out exactly what you will sell, who you will sell it to, and how they will find you. Then you need to plan the next probable steps for the future based on your local market, the market for your products as a whole, and what you specifically want to sell to maximize your profits, and build this woodshop into the business of your dreams
Now go tell the world what you do and what you stand for.
Have other questions about building your maker brand and business? Subscribe to the Business for Makers Blog and Business for Makers Podcast for insights and tips. Tune to Sawdust Talk on IGTV Live on Wednesdays at 10 pm CST to hear from makers about their projects and business and meet some great members of the maker community.
By the way, once you get your business name, you’ll need T-shirts to show it off! Check out georgesupplyco.com to get your maker business’s name and logo on a shirt, hoodie, or hat.
ABOUT THE AUTHORS
Scott Chervitz is owner of George Supply Company, dedicated to helping woodshops build their brand. See more at GeorgeSupplyCo.com. You can reach him at Scott@GeorgeSupplyCo.com, on Instagram at @GeorgeSupplyCompany or Twitter @ScottChervitz
Brian Chervitz, M.S., is an Associate Instructional Designer at the University of Wisconsin Extended Campus.