Any $1,000,000.00 Goss Sales upholstery shops out there?

[Ihavenoname]

After reading a book on the subject of marketing and asked is it you or the market, the author asked, "If you can think of a company in your industry make over 1 million in gross sales, then it's not the market its you or your business model."

The premise is that a lot of business owners look at their market for their lack of "great" success do to the market not themselves. That is if they were only in a different business they would be successes.

Well, I can't think of any Million $$ upholstery shops. So...

Does anyone here know of an upholstery shop bringing in at lest $1,000,000.00 in sales or more in a year?

Thank you.

[crammage]

None come to mind, although I'd be the first to volunteer to become one if someone knows how!

[Gregg @ Keystone Sewing]

1,000,000 may sound like a lot, until you look at the actual profits being taken from that number.  For some, it may be surprisingly low. 

[sofadoc]

I have a buddy who operates a furniture re-finishing shop in town.
He applied online to one of those "Head hunter" websites for a position in management. He listed on his resume that he had 15 years experience of small business management.
They called to get more info about his experience.
"Would you say that the business you manage grosses less than 5 million?"
"Yes"
"Less than 3 million?"
"Yes"
"Less than 1 million?"
"Yes"
"Well, how much are you talking about?"
"About 100K a year"
The man laughed. "That's NOT a small business. That's a lemonade stand!"

[byhammerandhand]

Said by a guy who probably "works for the man."

About half of my larger customers have closed stores, gone bankrupt, or gone out of business in the last four years.  I'm still here and busier than ever.

Research by the U.S. Bureau of Labor Statistics shows that nearly six in ten businesses shut down within the first four years of operation.  If you're one of the four, I say you get four stars.

Look at the gross revenue of GM, Delta Air Lines, etc.   Then look at their profit (loss).

"About 100K a year"
The man laughed. "That's NOT a small business. That's a lemonade stand!"

[Rich]

That's an interesting thought. I think the reason none of us has ever heard of an upholstery shop grossing over a million/yr. is that most of us are really not in it for the money like some others business people are. I think we'd rather earn our pay by providing an honest service that produces a satisfied customer all the while reaping the rewards that producing something of beauty and function provides. Unfortunately, in today's economic climate, it's becoming more and more difficult to produce a decent profit this way. The big financial rewards don't seem to be going, on any meaningful scale, to those who place a higher priority on old-fashioned craftmanship than on cranking out a large enough volume of a product or service that is in high demand. I used to teach school (my talents don't fetch big rewards as you can see) and that's another field that seems to attract folks who take their rewards from a sense of satisfaction at the expense of much monetary benefits. There are many others fields like this I'm sure, so while it probably IS the market, I wouldn't play down the role of the business model either.
Rich

[Saddleman]

I do not know of one, but feel it would be possible.  It is just a matter of scale.  Sure a one or two man shop will not bring in that kind of gross, but with an 8-10 man shop it would be very doable.

Loren

[Ihavenoname]

Thank you all for your help. It sounds like it's more the market then my efforts.

The sad thing is with all my experience, it's hard to go on to something else. So I keep pressing on looking for that business model that will work. Maybe it's that I need to expand my market from upholstery into a more global home interior business. I don't mind the work, but the pay need to go up.  

[Saddleman]

I don't mind the work, but the pay need to go up.  

Can you not increase your pay by increasing your prices?  It amazes me at how upholstery shops under value their work. 

Loren

[206RB]

I used to work for one. Like an idiot, I left to work for a small shop. The best year while I was there was around 4 mil.  :o

[mike802]

It may be possible to do in a large metropolitan area, but where I live you will be hard pressed to find any small business doing better than a mill. 

The ones that are have cornered the market by using less than honorable methods.  One that comes to mind is the local garbage collection agency.  They lowered their prices for a couple of years forcing all the small collectors out, now there is only one other collector left, and they are probably connected somehow.

We have one or two large gas distributors who own 90% of the service, convenience stations.  sure we have the major chains, Walmart, Kmart, and such, but we are talking small business here, independents.

The people who run the corner store are just hanging on, as are most independent restaurants, car salesmen, contractors etc.  I think most of us don't realize that the government has a different view of "small business" than we do.  I would not classify any business grossing over a mill as small, but the government sure does, I guess we would be classified as micro business.

The trouble with upholstery is any Joe with a handful of tools can set up a shop in his garage, or front room and under cut the competition.  Sure the skill level may be questionable, but if the price is right people will keep him busy, there is always a segment of the population looking for the cheapest price.  What are we as upholsters to do, go around with our staple guns threatening to tack his ears to the back of his head if he dosent get out of Dodge!LOL :o Opps my air hose is only so long, guess I can only defend 20 feet of turf. >:(

All kidding aside, if I was to run a mill+ upholstery business I would'nt be upholstering anymore and what would be the point.  I once worked for a handcrafted furnituremaker who grossed over a mill, he had 35 people working for him and he personally did not make any furniture.  The business was also bleeding away his inheritance and he had to pay in advance for his fuel oil delivery's.

I, like most business people on this forum run a mostly one person operation, I am debt free and my bills are paid on time and my business has assets.  That is a business model many mill+ business cant boast about.  They think working for a fortune 500 company is tough, they should try and run a one man operation, as stated in a post above, most fail.

[kodydog]

When we relocated to North Fl their was only one other guy who did quality work in the area.  His prices were way lower than ours and I often wondered how he could work so cheep.

He passed away several years ago and his sister called and asked if we wanted to buy some supplies. When we got to his house we saw he lived in a beat up single wide trailer home with his shop in the front half. He drove a broken down pickup truck. His sister said he had no insurance so when he got sick he couldn't afford decent care. She said he didn't P/U or Del furniture. I never met the guy. He could have been the happiest guy in town. His sister said he liked to fish a lot.

After he passed his customers started calling us and they were surprised our prices were much higher than his. In the back of my mind I couldn't help but think that people were taking advantage of him.

My point is the upholstery business is a labor of love but you make it what you will. When the games over you can end up like this guy or have a million dollar business or somewhere in between, its your choice.

[scottymc]

I worked in a place about ten years ago, there were 10 upholsterers, 4 machinists, 1 cutter, 2 woodworkers, 1 cushion stuffer, 1 secretary, the 2 owners and I don't know how many salesmen out doing quotes, but there was never a shortage of work. The wage bill for those people alone would be at least $15,000 a week, so they would have been easily turning over a mil. I noticed some very questionable quality, but having said that I saw very few pieces bought back and generally the finished item looked good, over a beer one night with the boss's I questioned over the ethics of some of there working practices. They explained that they just picked a niche market where there customers are the ones that want a good looking product, but are looking for the cheapest price so they screw these guys on the price, so they screwed the customer on quality, in the end everyone seemed happy.   

[Ihavenoname]

As for price, I have pushed that enveloper to the max. About 90 to 95 % of the people who call are shocked at how much my work costs. But that 5 or 10% that do have me do the work are worth the wait. I hear a lot of "Wow, I did not realize it was that much."

So I don't think I'm underbidding my jobs. I'm pretty high.

I'm 2 to 4 times the price of new furniture. A new sofa can be had at JC Penny for $600. Do the math. Plus foam, plus fabric. But with all the work and time that goes into the project and the time and effort that goes into estimating and selling, it's not that much money. Plus being in business is a lot of risk. 

[gene]

Let's take the average sofa at $1,000. The average chair at $500.

You do an equal number of both. To have 1 million in gross sales would take:

500 sofas and 1000 chairs.

How many upholsterers would it take? How big of a facility would you need? Where would that kind of volume come from?

60% gross profit margin?

gene