Approaching industrial clients

[jason0012]

I have forging capacity well beyond what my old product line requires. I have also been out of the business for a few years ( the internet was a new thing) and things have changed a bit. My new shop represents a fair cost, just to maintain so it needs to start producing. On top of that I despise my day job, and see far greater potential in my forge shop anyway. I know full well that selling trinkets at art fairs is not going to cut it, and big architectural work is no fun when working alone ( been there done that) I am thinking some good old fashioned comercial forging would be good, but have no idea how to find the work. There are lots of farms, quarries, and stone companies near me. I also can't help thinking of a post from a while back complaining about rail road work forging break wedges. How would one find these sorts of jobs?

[rockstar.esq]

Jason0012

It can be very difficult to get contract work with industrial firms.  "Front line" workers in charge of the operation might get to award contracts, but they rarely have authority to get a given contractor approved to work with the firm.  Be warned, that typically won't stop them from wasting your time with a whole bunch of false starts.  

Purchasing agents can be the same way, but they're often better informed about who to talk to at the main office.

I can tell you that many/most office minions won't bother to process any paperwork unless there's a super obvious benefit to doing so.  "I might be handy someday", isn't good enough.  "I'm a direct competitor to XYZ corporation that you're already working with" might work, depending on how satisfied they are with XYZ's work.

Bigger outfits have a few people who are simultaneously smart enough to understand what you're pitching, and empowered to do something about it.  In my experience, these people see to it that all sales calls go to voicemail or lesser minions.  Cold calling and/or dropping by mostly doesn't work.  I know one small firm that "penetrated the bureaucracy" by conducting a long-term quasi-espionage campaign. 

They call the main number and ask for the shipping dock because nobody screens calls for the shipping dock.  Once you get the shipping dock guy, you tell them you were holding for the purchasing agent while pretending to struggle to find their name.  Sometimes the shipping dock guy will volunteer a name, or tell you if that department is in a different building.  On the next call, maybe you ask for accounts receivable instead of purchasing.  Explain that you're a vendor trying to get set up with....I'm sorry, my boss just asked me to check on this before heading out the door, I don't know who to ask for.  Protip;  if anyone offers to transfer your call, first ask them for the number in case you get disconnected.  

Take notes, and eventually you'll have a rough map of who does what with the ultimate goal of determining who's in charge of getting new vendors approved for contract work.  You'll need to know what they care about so you're prepared to make the most of the opportunity.  Big firms often have stringent business insurance requirements for their vendors.  Some will do a credit check on you.  Go in prepared for a long process.  Getting paid works the same way.  It's really common for large industrial firms to take 120+ days to pay a small contract.  

It might be worth your while to size up the client's potential before you sink the time and money into getting approved for contract work.  One or two contracts a year might not be worth enough to merit six months of chasing your tail with office drones.

 

 

[BIGGUNDOCTOR]

What do you consider "commercial forging" and what kind of capabilities does your shop have?

 

[anvil]

To make a living as a traditional smith, you must move iron, common sense. 

If you dont want to do commission work or crafts fairs, heres a couple of avenues that might work.

check for a specialty local hardware outlet, one who deals in top notch commercial hardware, and ask to become their  Hand forged hardware source.

As for crafts fairs, Instead of hitting up different fairs, seek out "Wholesale" crafts fairs. These are the ones where buyers go to buy large quantities of crafts goods and supply many galleries and boutiques with their wears. Have just a few hand made items that you can make money on. Be prepared for large orders that will keep you busy enough to make a decent wage.

 

[George N. M.]

The problem with Anvil's suggestion on making a large number of the same item for a wholesale buyer is keep your motivation and interest while producing a large number of the same item.  Maybe I have an attention span problem but after I have made a number of the same item it stops being fun.  Over 35 years ago I did an order for 500 hand forged nails and as a result I still hate making nails and only do so when I have to.  What makes sense economically may not be viable psychologically.  Making the same thing over and over IMO turns you into an assembly line drone.  That may be as bad or worse than your existing day job.

"By hammer and hand all arts do stand."

[anvil]

On 3/30/2019 at 5:22 PM, George N. M. said:

The problem with Anvil's suggestion on making a large number of the same item for a wholesale buyer is keep your motivation and interest while producing a large number of the same item

 Correct. Thus the reason why I chose architectural iron over this pathway.  I call doing a forged railing "limited production". 

However I do know a few who have chosen production as a blacksmith and done very well at it. A couple of specialty tool makers, a knife Smith who has a specialty product for special forces types, and two who do the path I described above.

Also, the above have a tendency to better fit the more conventional business model than does "work by comission".

Also, considering the parameters of the OP, this is a pathway that may fit his needs.  

[George N. M.]

There are some people who can happily get "into the zone" for an extended period and turn out lots of the same item.  It only happens to me very occasionally.  When it happens it is almost what I imagine a Zen state is like.  Jason is going to have to decide what works best for him both economically and personality-wise. 

It has been my experience that it is rare in a craft/art area for someone to find a model that fits a person's personality type and art/craft and will support them and their family economically.  That is why so many of us have a day job.  Also, if there is the added pressure of having to make enough dollars, pounds, euros, or yen to pay the rent/mortgage and put food on the table and pay for the kiddos braces the art/craft stops being fun and has all the responsibility and weight of a job.  It is an unfortunate reality and a hard truth.

"By hammer and hand all arts do stand."

[rockstar.esq]

56 minutes ago, George N. M. said:

It has been my experience that it is rare in a craft/art area for someone to find a model that fits a person's personality type and art/craft and will support them and their family economically.  That is why so many of us have a day job.

Well said! 

People often think of this in terms of a balancing act, which oversimplifies the reality of the working world.

For example, it's pretty easy to spot stratification in any given market.  What's not so obvious is how structural the differences are between layers.  I like to visualize it as mesas and buttes.  Mesas are flat topped land masses that are wider than their height.  Buttes are flat topped land masses that are narrower than their height.  Mesas and Buttes can be the same height, and they can have the same surface area.

Cheap public bids that have no barrier to entry would be low mesas.  Lots of competition (area), and very little reward (height).  Larger public bids would be a higher mesa, because they're harder to complete so the small-fry's couldn't handle the bigger work.  There's a structural difference between players on adjacent mesas.  If the "too big" company chases the little work, their overhead will make the work unprofitable.  If the "too small" company chases the bigger work, they risk penalties for failing to deliver.

To strategically transition from one mesa to another, you have to metaphorically descend from your current mesa, cross the dark valley floor, and do whatever it takes to ascend the new mesa.  A successful trip is trans-formative to the business.

As mentioned earlier, buttes can exist at the same level and size as Mesas.  These are the more elusive and elite clientele.  They've chosen to avoid buying at the public market so it takes a considerable amount of work to be in the right place at the right time.

When things are going well across the entire economy, life on the buttes is always better than life on the mesas.  The biggest down side of the butte is that you're relying on a smaller market share.  If your "golden geese" quit laying, you're crossing the dark valley knowing that life on a mesa will require different strategies to be successful.  Even if you transition to the same "height" of mesa.

The "dark valley" in my metaphor is the part of business growth that many people are almost willfully blind to. They figure they'll jump up a level when things are good, and let the new work pay for the structural investments.  Conversely, they figure they'll jump down a level when things are bad and hope to break even until things turn around.  Both scenarios run up debts that must be paid while the work is getting done.   While that's happening, you don't really know if it was a good move or not.  It's entirely possible to have done everything right, at just the wrong time, so it all comes to failure.

[George N. M.]

Dear Rockstar,

To take your buttes and mesas analogy a bit further and to introduce some active geomorphology, the outside economic forces may be analogized to erosion by wind or water.  Sometimes you are on a butte (think of being in a soft shale bad lands) and a big gully washer thunderstorm washes your butte away under your feet and you are back down in the valley and have to climb another butte or mesa to escape the mud and flood waters.  That is what happened to me in the early 80s when the bottom fell out of my career as a geologist.  I didn't want to go to work for Burger King or 7-11.  So, I went to law school which provided a career which has supported my family and I since.  It was during that transition that I supported myself as a black smith.  I didn't make much more than unemployment would have paid but it felt better.

There are lots more land forms which you could work into your analogy such as a hogback ridge, usually steep on one side and more gently sloping on the other (the Devil's Backbone near Loveland is an extreme example, less extreme are the hogback ridges between Loveland and the mouth of Big Thompson Canyon) or a questa, similar to a hogback but with a more gentle slope on one side.  Also, a closed basin from which water cannot drain away and it is uphill in all directions may have an economic/business analog.

George (A recovering geologist*)

"By hammer and hand all arts do stand."

* Geology is something from which you never completely recover from or are completely cured.  The first step to partial recovery is to admit you have a problem ("My name is George and I'm a geologist.  I've gone 27 days without hitting a rock with a hammer or making a map." [cheers].

 

[ThomasPowers]

Early '80's---that's when I was my geology career "bottomed out" too.  I apprenticed to a swordmaker for a year and then got married and had to get a "real job" to support a family.  Finally was hired by Bell Labs and got a CIS degree in the abundant spare time of having a young family, an old house and a more than full time job.  (Still seemed like less time than 12 on 12 off 7 days a week babysitting oil wells 3 hours away from my apartment...)

[rockstar.esq]

George,

I liked your geological references quite a bit!  I really wasn't sure if my analogy would resonate with people.  Your comment about a flood raises a very practical example of what I'm on about.  Climbing up out of a disastrous flood might sound like the end of your problems.  It's not.  Everything on the new mesa was unaffected so you're effectively showing up for a duel with half your stuff, exhausted, starving, dripping wet, and freezing cold.  

When the 2008 crash hit, there were huge firms chasing tiny jobs because there wasn't anything else.  When a company went under, many of the bystanders assumed it was because they couldn't win work.  Maybe it was for some, but all the failed firms I had firsthand experience with were put out of business by jobs they'd won.  For a couple of them, the fateful job was smaller than what they were doing before the recession.  

I suspect that the majority of working professionals visualize the "size" of a project in terms of it's contract value.  If you're used to doing jobs twice the size of one that goes unpaid, it can seem like a minor problem.  In reality, you're only earning some percentage of the contract value in profit.  The accumulated profit is the only fund to "pay" for stuff that's not a job cost.

To illustrate just how brutal this is, let's imagine a company that's used to doing jobs worth $100,000 apiece.  Keeping it simple, let's say they always make 5% profit on everything they do. OK, so times get hard and they take on a job for $50,000 with a shady client who doesn't pay them.  To earn $50,000 in profit to pay for that single bad job, they'll have to successfully complete $1,000,000 worth of revenue.  That's 10 jobs at the $100,000 level, or 20 jobs at the $50,000 level.

Pretty bad right?  It get's worse.  All of those jobs are now effectively break-even propositions where the "wolves are always at your door".  Anything less than flawless performance put's you deeper in the hole.  Some of that's outside of your control.  During a down economy, there might not even be twenty jobs, timed such that you can plausibly complete them, let alone competitively win the contract(s).

Sticking with simple, round numbers, let's say overhead comes to roughly 10% of your contract value.  I don't condone calculating overhead as a percentage, but let's proceed to illustrate a point.  A $50,000 job will occupy some unit of time. Let's say it's one month.  If you didn't land work for one month, you'd be pulling $5,000 out of savings, and be looking at roughly two months worth of break-even work to make up the difference.  

In this example, this means that biding your time will cost you two to one. That's dollars, days, hours, whatever.  Jumping on the first sketchy job that comes along risks a cost of twenty to one. Simply put, winning the wrong job is ten times the risk of not having a job.

Individual situations will vary, but the overall trend still applies.  This is one of many reasons why competitive work in down markets is so cutthroat.

 

 

  

 

[George N. M.]

Rockstar, 

The butte/mesa analogy may have resonated for me or Thomas because of our geology backgrounds (also because we live in butte and mesa country).  Maybe not so much for ordinary folks but who knows.

Much of what you have said on this and other threads is a good example of how business requires a whole different toolbox of skills than any craft or profession no matter on what scale a person is operating.  We have all seen people who are good at their profession or craft but who are really bad at and have no training in business skills.  People like that, when they strike out on their own often go back to working for a wage or salary because they do not like and are not good at what it takes to run a business.  They are happy doing their craft or profession and not as happy having to do all the business stuff.  Some of it is training and experience but often it is personality.  The stereotype of a creative person who can create wonderful and beautiful objects but is not very good at dealing with the more worldly aspects of life has a basis in fact.  It is not always true but to a greater or lesser extent can often be recognized.  I've known brilliant attorneys who are great in a courtroom but if it were raining soup they would go outside with a fork.

"By hammer and hand all arts do stand."

 

[ThomasPowers]

I go past the town of Elephant Butte travelling between my domiciles (and glad I don't have to tell folks I live there...)

[Frosty]

4 hours ago, ThomasPowers said:

I go past the town of Elephant Butte travelling between my domiciles (and glad I don't have to tell folks I live there...)

Oooh, is there a "Trunk or Tail" road, street we could sell an address to mass marketers?

Oh wait, that's somewhere else. Sorry.

George: Your example of doing production work taking the fun out of blacksmithing is THE difference between hobby and job. You don't get or make a job to have fun, sure it'd be nice but it's not a very realistic expectation. I was an exploration driller and lived in a tent or motel room for 15 of the 20 years I held the position. When the well drillers did our's the ONLY participation I contributed was site prep. I cleared the trees, brush and leveled the site. I'd asked on the phone if they wanted the drill nose high to facilitate leveling. They said they had a nose jack so close to level would be a treat. 

I watched them spud in the casing and went away. I was interested but sated it from a distance.

Same for camping, I lived in a tent for the better part of 15 years and it's not fun anymore. I'm really good at it and it's not unpleasant provided I use my good gear and can pick my site but I don't do it for fun. I'm or was a killer camp cook, the only thing I can't do at a camp fire is microwave stuff. Macrowave you betcha.

Sorry, got sidetracked but a job isn't supposed to be fun, it's supposed to operate in the black. If it's not profitable you need to hunt up a new formation to live on. The Butte, Mesa analogies are excellent, it clicked immediately. Not saying you can't have fun and be profitable, it just should NOT be part of your business model!

How do you as a business owner protect yourself from erosion? Be it: competition, economic disaster, developmental obsolescence, litigation, whatever: flood, drought, quake, whatever. How do you protect yourself? 

ALWAYS HAVE A FALLBACK. Period. If you're living off a paycheck, keep educating yourself so you're too valuable to let go. The more you can do the less likely you'll be out of a job. Hunt a career in the most stable market. Hmmm? Nothing wrong being an employee if you choose well.

If you're a business, keep the scouts hunting new markets, new products, research how to invest yourself in the new. NO, I'm NOT saying get involved in every new thing coming down the pike but keep an eye on them and check them out. If you have suitable equipment and resources it may be worth it to train SOME of your workforce in case a move is profitable. 

Keep a couple few scouts in those dark valleys looking for the easiest paths and exploring other buttes and mesas for spots to occupy in case your's crumbles. The best bet is to have the butte crumble BEHIND you and let the company that bought into your old niche suffer it. Heck you can buy your old gear back at auction if it's a good hedge. 

Everything, EVERY THING is competition, collecting enough fuseable materials is a MUST for a star, as is enough of the right dust for planets. Chemical reactions continue till they exhaust the necessary elements. Life expands to the limit of resources, microbes to mega fauna, same rules. Same rules apply to business as it does to plate techtonics and salmon runs. Expand your resource base, change or die. 

Living on a butte, rich but limited type resource base is dangerous, there may be lots NOW but a small base is easily upset. 

I'm envisioning buttes as predator country and mesas as grazing ir herd country. For the purposes of conversation and example.

Hmmmm?

Frosty The Lucky.

[Irondragon Forge ClayWorks]

We have some colorful road names too, like Possum Trot and Goat Ranch Road to name a couple.

[George N. M.]

Frosty,

Your comments about fun in work reminds me of my father who could never understand why I wanted to leave Chicago because that was where the biggest paychecks were.  He could never understand that there was more in Wyoming that I wanted besides a paycheck.  I have been very fortunate in that I have always had jobs that I enjoyed doing in places I enjoyed living.  My days have ranged from OK to pretty darned good.  Unfortunately, many people are in jobs where their days range from pretty crappy to OK.  If OK is as good as it ever gets IMO it's time to be looking elsewhere.  I think that fun and enjoyment in your work is a major factor in choosing what you will be doing.  Yes, it has to support you economically but that is only the base line to which you add the other factors.  Life is too short to spend it doing something which you do not enjoy or is at least tolerable.

That said, there are lots of things that people enjoy which will not support them.  My son would love a job which paid him to play video games but that is pretty unrealistic.  Fortunately, he has found a college major (aviation) which he has found to be his passion and love (after video games).  It looks like he will never work a day in his life because he will enjoy "going to the office" every day.

I do agree with you that once you have to support yourself with something like blacksmithing and it takes on the responsibility of a job and that pressure can easily take out the enjoyment which was there as a hobby which did not have to pay for itself plus supporting you.

"By hammer and hand all arts do stand."