Getting ready to launch

[Paul Downes]

I'm just about ready to actually run a pen business and I was wondering if you folks have an opinion about wether or not I should have a lawwyer draw up business papers or should I just do it myself. I have done lots of reseach and have met with a SCORE person and the small business adminisatration. I did check into the lawyer thing and don't see that putting a LLC together looks that difficult.

 

[Hayseedboy]

I have but one question. Are you ready to defend yourself in court against a lawyer that has found a loophole in your paperwork?

lr

 

[Paul Downes]

You know that crossed my mind. I can just imagine some armani suited jerk who gets a fountain pen to puke all over his suit. I was wondering how many folks used a lawyer to set up the business papers, or just winged it. It's not really that hard to file the required papers and get off and running. I'm steadily building an inventory and want to start paying back the bank account. On the other hand I checked out www.legalzoom.com and their prices seem resonable.

 

[jdoug5170]

I don't think you need an attorney to draw up LLC papter, I think you need a good accountant/cpa...of course, the cost may be the same.

Edit: I also don't buy into setting up any sort of corporation at the beginning, if ever. All it really does for you is create more paperwork. It does not shelter income, it certainly offers no protection...that is for the big corporations, and it does not give banks incentive to loan you money (unless of course you absolutely don't need the money). Set up a simple structure and you can do that without a pro if you understand accounting basics (Quick Books Pro is great) and can get through the state application crap. Register with your state, your city, and sometimes your county...they want to know where they can get a little more tax cash!

Most important to me is that you have a good liability insurance policy. Call your insurance agent and don't hedge thinking that your home owners will cover you because you operate out of your home.

Good luck with your adventure.

Doug

 

[OldWrangler]

If you are serious about starting a pen business, I would suggest skipping the lawyers and accountants and going directly to a good PSYCHOLOGIST!! Maybe they can bring you back to your senses. Somebody on this forum once wrote that "the only way to make a small fortune in the pen business was to start with a large fortune". I suppose there are some who are able to eek out a living but they are few and far between.

Good luck with this venture, should, at least, be an ADventure!!

 

[Gary Max]

eek out a living---I like that
I guess that's the noise we make when the mailman brings bills--------
EEK

 

[Paul Downes]

Actually, there is no substitute for a good marketing plan. I haven't had any problem selling pens. I just want to get legal and official.

I just checked with the zoneing board and they said everything was o.k. They are writing new ordances to cover small home businesses and I gave them my 2 cents worth. Basicly, don't bother the small business people. You sure have to guard your mouth to keep from really telling them what you think.

So far I have not made any money per say, but I have been sinking lots of cash into supplies. I do have the benifit of just retiring from my first career. I have time at my discretion but more work than I can handle.

I just spent the last few days rebuilding the front end of my 4x4 woods truck. We had tornados go through the area and there are lots of tree laying about. It was driving me nuts not having the truck available to glean wood. I'm almost done with the job and it took lots of cussing and elbow grease to get it close to finished.

 

[makaiolani]

I once read you can sell anything just as long as you find the market. Or I believe you can make a market. Don't over think on how to start the business. Just do it. Get an LLC and jsut start. Most people don't even get out of the gates because they over think things. If you need any advice or help on anything just ask people on this forum and take everything with a grain of salt.

 

[marionquill]

Why are you setting up an LLC, do you have a partner and employees? I'm a sole proprietor and don't have to go through all the hullabaloo you would normally face with a business partner and/or employees. Best thing to do is visit the small business administration website for your state and it'll pretty well guide you through all you need to do. For Virginia, it wasn't too difficult and thier small business administration site is very good. I’ve had no use for a lawyer thus far but a CPA would be useful. Be sure you set up a file plan and keep detailed track of your expenses, losses and sales. Some states collect taxes no matter what, others have an earnings threshold for reporting…be sure you know the tax rules for your state as this is the main place you’ll run into lawyer issues!

You shouldn't run into too many problems requiring lawyers unless you try to use copy-righted material on your pens (like logos of sports teams, trade marks of companies, etc.)

Good luck!
Jason

 

[airrat]

good luck with your zoning, here in AZ they do not consider a garage part of the dwelling, even if it is attached. You cannot displace parking, again meaning the garage cannot be used solely as a shop. They want to do an inspection and see everything operating inside the house.

 

[OldWrangler]

Paul, you should've kept your last job. But at least you are able to get into the woods and get your own wood. Probably won't find any exotic trees, much burl or any acrylic trees. Now if you can just find a way to steal enough pen kits to go with the free wood, you might stand a chance of making some money. Being retired and having to commit 6-8 hours a day to being in the shop will get old especially when the garage is hot in the summer and cold in the winter. The tools are a big investment, getting you in the hole for a couple of grand tobegin with.
A friend of mine with a fulltime 50 hr/wk job just got an order for 600 antler pens from a company up north. He is now doing 10 pens in the morning before work and another 20 after he gets home. He gets up early and goes to bed late and every pen is the same so the job is very monotenous.
Sure that is almost a $20,000 order and over 1/2 of that is pay for his time and profit so it sounds good. He has other customers too and he normally does about 1200 pens a year. This is not a hobby, this is real work.
If this is what you are hoping for, good luck to you. I hope you do well. The getting in the woods is a great idea and turning a few pens is fun, so enjoy.

 

[titan2]

Try legalzoom.com, there you can do up a lot of legal stuff yourself for a decent price.

 

[titan2]

Originally posted by OldWrangler

A friend of mine with a fulltime 50 hr/wk job just got an order for 600 antler pens from a company up north. He is now doing 10 pens in the morning before work and another 20 after he gets home. He gets up early and goes to bed late and every pen is the same so the job is very monotenous.
Sure that is almost a $20,000 order and over 1/2 of that is pay for his time and profit so it sounds good. He has other customers too and he normally does about 1200 pens a year. This is not a hobby, this is real work.

Gee....that works out to just over $33.33 per pen! What kind of pen is he making out of antler that he's only getting $33 per??? That's an awful lot of work for $15 profit.....boy he's going to be burned out quick!!!

 

[Paul Downes]

Oldwrangler, I know all about work. I have cranked out a few large orders. It is tough sometimes given that the large orders are at a wholesale price. They do provide the cash to get a business going though. I do have the benefit of having 11 kids that like to work. I just hope the labor department doesn't ding me for child labor.

In my humble opinion, there are pen makers and pen makers that know how to market. I do happen to have in my corner some business advisers that have had almost unbelievable success. i think I am just blessed in that way, I don't really know how it happened. One guy has the distinction of having the top rated art gallery in North America and Europe. Another is high up in General Motors in the personel and problem solving area. He studied marketing and likes my marketing ideas.
He has advised me to pick the brains of every sucessful business person I meet. Find out how they have suceeded. I spent the last week cutting tornado damaged trees for the wealthiest people in my area. Two doors down from the governor's mansion in fact. I have been getting some idea's from some of them and establishing some connections. I always have a few pens with me and show them whenever it seems proper.
It does take a while to build up pen making skills. I worked for 30 years as a diemaker and engineer. I have always liked fussy percise work. I also studied jewelry making and it seems that has come back around in the pen making racket. It's just a matter of time and money before I get a metal lathe and mill set up to manufacture my own pen parts. I also am constantly thinking about what I can productionize in the pen making process. I'm up to 4-5 slimlines per hour now and know I can improve that. In all, it doesn't matter how many you can make it's how many you can market. My web site is taking longer than I like , but I think it will perform better than most when done. It helps that my daughter, sister and brother-in-law are graphic designers.

 

[Ligget]

Good luck with your business venture Paul, sounds like all the pleasure and fun part of penturning will be replaced with stress.

If you are turning out 4 - 5 Slimlines an hour and still trying to improve that figure, what finish are you using? The quality aspect of each pen will start to suffer as you start "cutting corners" to make more profit.

 

[sbell111]

Originally posted by Paul Downes... I do have the benefit of having 11 kids that like to work....

Was your wife pushing you into changing hobbies?

Originally posted by Paul Downes... I also am constantly thinking about what I can productionize in the pen making process. I'm up to 4-5 slimlines per hour now and know I can improve that. ...

Wow. That's fast. I'm lucky to be able to complete a nice pen in 45 minutes. My wife's faster, but she's been turning a lot longer than I have.

For what it's worth, my advice to speed up your process is to tweak your organization, preparation, and assembly. While some time will certainly be saved in the turning, sanding, and finishing processes as you perfect your methods, you will (have?) come to a point where you would not want to try to save time in these areas. Rushing the turning, sanding, and finishing processes will certainly result in costly mistakes and/or a reduction in quality.

 

[Paul Downes]

Quality has to be # one when it comes to penmaking in my opinion. AT least I operate that way. I have spent 1000's of hours running a lathe as a diemaker and more than I know in the wood shop. The mantra preached was always speed and accuracy.

I tend to stay with certain shapes that I've learned to crank out. I mostly use the CA finish. Some woods are a pain in the you know what to finish. I do not compromise on "getting the scratches out" Many woods require sanding out to 12000 MM to get the best shine. I recently completed a 50 pen order in birdseye maple. I found that birdseye, being a hard, tight grained wood only requires sanding out to around 4000 MM and then the scratches are indescernable. It takes what it takes.

I have been turning a lot of self casted resin pens lately. I think the first 6 or so took 45 min. to complete. Since then I have figured out that by FIrst sanding the corners off and by roughing down with a sharp, 60 degree scraper, I can do about 4 per hour. After the scraper I go to a skew that I use first flat on the tool rest (as a finish scraper)and then in a shearing cut. I ground this 1-1/2" scraper in a curved profile. I also use a 1/2" straight skew to cut into the bushings to establish that part of the pen too the bushing size. After rough cutting the blanks down I rough sand with 180 then 320 grit sand paper and then go 1500, 2400, 3200, 4000, MM wet sanding, and then polish with novus plastic polish.

I do have failures that drive me nuts sometimes. I have a cocobolo pen that I am going to re-finish for the third time tonight. I hate to think about how much I'm making on that pen. It's for a repeat customer so it has to be perfect.

 

[daveeisler]

Yes you may need...

Aaron, I know you have begun your business, and I am seeing this a bit late, but here are my thoughts anyway, every state is not the same, some have special requirements and if not dealt with can come back and bite you, a good person to ask would be your accountant and you should read the fine print that you got when you applied for your local business license, in this day and age of running a business , you can not afford to miss any detail, also important is having all the right types of insurance, our government both local and federal will show no mercy when it comes to taxes and any type of form that you may need, the other people to talk with are local small business owners who have been established for some time, but in the end, it's more likely the city/state, not federal that you will have issues with, Dave