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How much do you invest in a new space???3/27/14
I'm guessing almost all of us have had to move shops at least once in our careers, so hopefully you guys will have some insight in this. So I've explained in another thread that I'm moving into a new "as of yet to be found" shop in the next couple months. I have found one space that meets a lot of my criteria except that it would need a LOT of investment up front on my part. Now we all have to invest in new spaces as it's just part of the business. We have to wire up machinery, install air lines, possibly add lighting and/or a myriad of things to make a space suitable for our particular business. How does one decide what a reasonable amount to invest is? Do you figure a percentage of your yearly gross? Maybe figure 1, 2, or x amount of months rent? I'm trying to figure out how much I'm willing to invest in someone else's property without having a lot of certainty in the future?
Now of course there are other factors that affect that decision. For instance, if the space is significantly under market rate b/c it's a less desirable space, than the ROI will be far shorter than on a market rate space. In the case of the space I'm looking at it is well under market rate, and is only suitable for non-conditioned storage at this moment. So in order to make it into usable space would require a minimum of 3-4 months of rent. Some I may be able to negotiate with the owner….but at this moment I don't know how much.
I'm not sure there's even a solid answer to this question? Maybe it's a case by case basis and every situation needs to be looked at differently? I moved into my current space almost 10 years ago and have spent several thousand to get it into a usable space. I probably put another several thousand into it over the years. Now I can look back and say I easily recouped all that money as my space has been so far under market rate. But it did take time to recoup that and it was a somewhat unique situation. This time no matter where I go I'll be doubling my rent, and this time the economy isn't exactly booming so a bit different than my last move.
I guess I'm just looking for advice/stories from other guys on how they managed moving their shops. I've got a lot of decisions to make in the near future and looking for all the input I can get.
Oh and b/c it seems to be something that comes up fairly often I'll nip it in the bud. Buying is not an option for me right now. There are several reasons for it not the least of which there just isn't realistically enough time for me to find and purchase a property. I would definitely like to in the future, just not at this time. So for the sake of keeping things on track let's leave that off the table.
If you are planning to move again someday try to keep your investments portable.
Lighting fixtures, for example, can be wired for plug in or can be hardwired. A plugged in light will be more easier to move later.
Rack storage on the walls is best to make as a freestanding system.
Put as many pieces of equipment on pallets as you can and get a pallet jack to move them as needed, particularly as you learn more about your work flow.
Don't spread out your equipment because you finally has some extra space. This extra space is going to make you more efficient and your going to need more storage for finished goods. If you don't have a storefront in the space you're going to rely on work in progress as your showroom. Give this enough space so that the finished goods make a good impression on the customer when they first walk in.
In general try to develop infrastructure as stand alone cartridges. This way when you move again life won't be so chaotic. You just have to locate the cartridges.
Don't underestimate what this move is going to cost. If you want to be scientific about it come up with a number that will make you puke then double it.
( If you want to be scientific about it come up with a number that will make you puke then double it. )
That sums it all up.
I rent the property. I searched high and low for a reasonable property. We are located 10 minutes from a large city so land especially this size is a premium.
Your about to go through exactly what I just went through.
The rent is dirt cheap which makes sense when your industry has such small mark ups and even smaller profits.
The building was in total disarray when we moved in. The owners allowed in the lease to tear out and retrofit as we saw fit.
We invested a lot of our money but did it wisely and supplied most of the labor ourselves. Which save us into the tens of thousands. It may have taken a few years off of my life though.
The machinery is to large to leave or even put on pallets but it's not a bad idea.
Make sure the electrical is up to code but can be removed easily.
We ran all of our air lines. No easy task.
The last thing we are having done is lighting. We Put in many ourselves and now we are having the main shop area redone with new lights that will be subsidized by the electric company through a special program.
After all that I would say it was worth it. However if I had more working capital I would have used some of it to take the burden off of me. 80 and 90 hr weeks get old fast when your bank account is going the wrong way.
Now we have a shop in a desired area with 4 more years on our lease and we pay less then half of what the average sq' price is in our area. That means less worries in lean times, more money in my pocket(probably going to orthopedic surgeons in the near future) and better machinery on the floor.
I can't offer much on just how much you should invest into a building you don't own. We were in a similar situation as you about 9 years ago. We were renting a 2,400 sq. ft. building (owner kept a 300 sq. ft. office for his own use). Owner dies, we were given the choice of 1st dibs on buying or move out. I chose not to buy since the building was not really suited to our use - broken into four different size rooms, different floor levels and only 12' ceiling height with a flat tarred roof that was pathetic at best. A cinder block building and the interior walls were all weight bearing. Bottom line - I needed to move out.
Okay - our rent was $650 per month. Ridiculously low for our area which is why we had stayed so long. But when I started looking around, nothing under 2,500 sq ft could be had for less than $3k per month (15 mile radius). Yikes! A Godsend, I miraculously looked at a 4k sq. ft. building to lease and actually purchased outright due to the owner in a tight cash flow situation. My mortgage is less than I would have paid for rent, though property taxes and insurance bring the monthly overhead up. But I'm owning, building equity and cannot express in words how ecstatically satisfying it is to own a building!
Okay - your situation is different. So - my advice on the move. Ours was only 1/2 mile. Using our 14' box van, my two of previous landlords flatbed 24' trucks and his forklift, we put everything but some of the larger machines on pallets and shrink wrapped them. I bought a great used forklift (actually an 18 month lease, no interest with $1.00 buyout on the 18th payment) for my end of the move. Also buy a pallet jack, or two - used you can find them for $100 or so (don't pay $400 new like I did, duh). Bottom line - we spread those pallets across half the 4K sq. ft. of our new shop and spent almost a year working our way through them. I filled 7 - 30 yard containers with junk I felt we'd never use, I could have filled another 5 with stuff we brought and are still sitting on pallets on an upper mezzanine we built. I'm guessing they'll never be opened and should just be trashed.. ;-)
By the way - I did move a couple machines and my steel plywood rack by just driving my forklift from the old shop to the new. Holy moly! Yea, I did this after midnight (minimal traffic) and had my Dad follow me closely with his pickup truck since we moved at only about 5 mph. A rigger would have charged a couple thousand to break down, load and unload those bigger pieces - it was a cakewalk to just forklift them down the road. Be sure to "know" the local PD if you are gonna try this..
Run all your electric and airlines BEFORE you move in!!! Design your layout and get set before bringing in your existing machinery or you'll spend forever trying to do it afterward. Much easier to do this in an empty building. Label all pallets and make yourself a diagram floor layout. Break it into quadrants or more, and label each pallet per the quadrant the contents will be moved to. Have a plan - do not, ever, think that you can just put everything in a corner and then start to plan your layout.
As others stated - the cost of electric outlets, plugs, wiring, etc. is formidable at the least. I was fortunate - 9 years ago when I made the move I purchased dozens of those huge spools of #14, 12, 10, 8 and a few #6 wire. The cost almost doubled two years later! I think I spent about $2k in wire alone. Another $1,500 in outlets, switches, plugs, etc. All my machinery has plugs, I wanted to ensure that if my layout didn't work I could easily move things around. Lighting needs a huge consideration. Our shop (it was previously a warehouse with 28' ceiling, wood trusses with 18' clear) and had only 6 metal halide high bay lights (the kind you saw years ago in Costco, Home Depot, etc.). Good for warehouse, bad for woodworking! I've been adding the florescent 1" high bay tube fixtures little by little as we (9 years later) are still in the "setting up shop" scenario.. They are not cheap, but pay off in the long run as they cost pennies to run compared to those $65.00 metal halide bulbs that burn out in about a year.. Think long and hard about your lighting! These florescent 6 bulb fixtures hang on chains with a short wired plug - you can easily take them with you in the future, or remove and sell if you've no need for them. Either way - you won't have to "donate" them to the next tenant..
Long story short - pallets for everything, labeled, pre-plan your floorplan, throw out everything you won't be using in a 3 month period (I know, hard to do but a necessity), too much lighting beats not enough lighting and plan your electrical layout for the machinery very, very careful. That wiring will break your bank! No need to dedicate a home run for each machine if you are only a 2-3 man shop as simultaneous use won't be an issue for amperage draw on each circuit. Dedicate only large amperage machines such as your widebelt. Most other machines can share circuits, saving on multiple copper runs.
Did I mention to throw out anything you won't use? :-) Now is the time to "clean house"... Maybe hold a yard sale before moving - you'd be surprised at how much those "garage shop" homeowners will buy if you price it cheap enough! Put up a sign with a date, place an ad in the garage sale section of your local paper. Hey, you can easily bring in a few hundred on all that accumulated crap that we think we will use on the "next" job, but never do..
When moving - don't use friends and family except minimal. This is one time paying a moving service can be the better option if you don't have enough employees to do this yourself. Let your friends stay friends by not asking for their help. No risk of obligations this way (free kitchen, wall unit, etc.).. But be sure to use the wife! She's part of this move and believe me - they are better than us at managing the packaging, shrink wrapping, and delivery than us. If having that yard sale - let her deal with the buyers. She won't know she's selling a $400 belt sander for only $20 and won't feel the pain like us. But she'll feel so proud when she hands you several hundred dollars at the end of the day, you'll feel good because you won't have those pangs of sorrow at losing so much on your "extra" invested power tools that you won't be using anymore anyway. As well as those old ss sinks, formica cutouts, lumber cutoffs, outdated hardware, old drawer slides, etc. etc. etc. that have piled up over the years and will never be used anyway.
Your costs of setting up new shop in a building you don't own can only be answered by yourself. Invest the minimal you need to operate, keeping in mind that you are only investing for your landlord. He will benefit from your $$. If you're figuring on about 10 years, yes - it's worth spending the bucks since you'll spread that investment over a decade. If you think 5 years or less - spend the least possible. For sure talk to your landlord - request, beg, implore, threaten - whatever it takes try to get him to shoulder some of the costs. He knows who benefits. Just make sure to adhere to local codes, both fire and electrical - as well as any ordinance that may address exhaust on a spray booth should you be needing one. Talk to your fire inspector first and see what he requires. If in a residential area - know that those solvent smells will bring them screaming... Don't ask how I know..
Check out waste management. Can you have a dumpster (our location we can't unless it's indoors). How much will your local trash pickup take and what exactly will they take? You need to know this ahead of time. We are allowed 5 regular trash cans twice a week. No building materials (sheetrock, studs, tile, etc.) but plywood, lumber, etc. is okay as long as it's cut up small and no extremely heavy cans. Solvent cans (lacquer, paint, thinners, etc.) no issue if empty and crushed down (we drive the forklift over them to flatten). We also tip out the local garbage guys once or twice a month, if we are in early when they arrive (6:00am or so) we go out and help dump the buckets. We've built a great rapport with them and they are less likely to refuse a can or two that might be a bit heavy or the wrong "stuff". Cardboard is also cut on our bandsaw into VERY little pieces and mixed up through different cans... So - check out this "waste" issue as well before you move in. If sharing a community dumpster in a commercial area - check what you can or can't put in it. Local horsefarms will take bags of sawdust and chips - that's always good to find out.
Mail delivery. Hmm. Check your local post office. Most commercial buildings get morning deliveries - if your route is a late drop-off, you may be able to have that changed to morning which is best for any business. Doesn't hurt to ask. Also check with UPS, FedEx, etc. to find out delivery for your area. If you have an account they are sometimes restricted on some areas when calling for pickups or deliveries.
Cable, Fios, etc. - find out what's available and be sure to have that all setup before moving in as well. They bend over backwards for commercial installations (well, in our case - yes they did). We have fiber optics run not just to a box outside, but into our building and routed right to the office where requested - at their expense. Optimum also installed a very powerful FREE Wifi unit for us. We get free publicity out of that. Same as you find in Starbucks, train stations, etc. ASK! We were also offered free tv for two years. After two years they started to charge $30 per month - I squawked and they dropped that to $6.95/month for the next two years. ASK! They love to "give" freebies to businesses.
Oh yea, one more thing. Signage. Check your local ordinance - there may be restrictions on the size and location of any sign you may wish to use.
Hope some of my tirade helps in some way.
Thanks for the feedback guys!
If I go for this bigger space I'm going to try to do it as cheaply as possible, which of course is a relative term. I'm figuring about $7k upfront to get moved in and up and running. With a couple thousand more over the first year to button things up. That's with using a good friend with access to forklifts and flatbeds to help with the actual move. My shop is not that big and most of the machinery I could, (if absolutely backed into a corner), move myself. That's how it got here in the first place. But I'd rather spend a little and have it go a bit smoother/quicker. Of course the CNC drill and edgebander would definitely require several guys and some equipment to move safely.
I'm capable of doing the basic wiring up of all the machinery, but it's a new space and as such I'll need a permit. So it's good that my BIL is a licensed electrician who's volunteered to help me as much as possible. Of course I still plan on paying him something that we'll work out as we go. So the largest expense may likely be materials. I'll be removing all the receptacles, (3ph), and lock-outs from my current space. But I don't think it's worth the time to remove wiring or conduit and try to re-use it? I'm guessing what little I'd save on material I'd eat up on extra time trying to figure out where to use it.
Air lines are going to be modest at the beginning. I know in general it's better to do it all up front and get it done with, but the reality is I just won't have the time and/or money to get it all done. I think I'm also going to go with new here. My current air lines are black pipe and probably 50 years old. I tend to get a fair amount of scale in the filters so I don't think they're worth saving?
So the biggest expense is going to be enclosing the space to make it possible to heat. It currently has a quonset hut style corrugated ceiling thats easily 30' feet+ to the apex. Obviously a space like this in New England cannot be heated with any degree of efficiency. My first though was suspended ceiling, but that makes it more difficult to run the air and electrical. Right now I'm toying with the idea of framing the ceiling in. I don't yet know the practicality of trying this, but I can get 32' wood trusses fairly easily and cheaply that will easily support the modest weight of a drywall or panel ceiling. I'd have to split the space into 2 zones to cover it all, but it would probably be smart to turn at least some of it into usable loft space. Alternatively I may only frame in say 2000 sf of space at this time and leave the rest to "grow into".
The third alternative was suggested by someone on another forum. I haven't looked into the feasibility or cost of it yet, but he suggested the possibility of having foam insulation sprayed onto the corrugated ceiling. I didn't even know this was possible. but apparently it is. Also not sure how effective it would be as the heat is still going to rise up and would require at a minimum some ceiling fans to blow it back down.
So I have a lot of things to figure out if I decide to go for this space. The short term will require a lot of my money and even more labor. Over the long term the reduced monthly rate should pay it back. There are also things the owner will have to invest his own money in to make it feasible. So that's another unknown at this point. Though the space as it sits is only capable of non conditioned storage, so he's probably not going to have many people beating down his door for the space or willing to put the time and money into it to make it more useful.
Anyway that's a little more of the details. I'm still looking at other spaces and going to chew on this one over the next few weeks. But I pretty much have to have a place by the end of April so I can start the next phase of planning.
ML, we must have been typing at the same time;) Great advice! I've already sold off about $1200 worth of scrap wood and odds and ends I never use. I figure I may even be able to get another $1k when all is said and done. I learned on my first move it doesn't pay to move that stuff, but the hobby guys can make use of it. I'm also going to try to sell a couple machines that are not necessary to my operation. Nice-to-haves that can be replaced if necessary down the road.
This potential move is a bit farther as it's 2 towns away. However one of the perks is the space comes with a forklift left over from the owners previous business. Not sure of the weight rating yet, but she looks like she'll handle 5k no problem. I'll be paying a couple guys I trust to help me with the move. Not necessarily riggers, but knowledgable in moving equipment. I used family last time but there was no real machinery back then.
I'm not sure how I'll address lighting yet. I installed all the lighting here, but it's all T-12's. Not sure it makes sense to bring it as it would be better to go with something more efficient. Then again I will run out of money pretty quickly and saving several hundred by re-using these lights at least for the short term could help?
Anyway there's a lot of things I have to button down with any space I move into. Though this space is in a more commercial setting than my current one, so could make things a bit easier. I just have to come to a decision on where I'm going and then I can start to attack issues one by one.
Don't underestimate the power of pallets for your machinery.
We have around 40 pieces of equipment. The only items directly on the floor are an altendorf slide saw and a martin jointer. The slide saw has built-in wheels for moving and the Martin people cleverly design all of their equipment so you can get a pallet jack under it.
Even our two headed 42 inch widebelt sander is loaded onto beams. We have moved it three times with a pair of pallet jacks to fine tune position in the shop.
Pallet jacks allow you to stack things tighter or move them when needed. We have a lot of dedicated table saws. They have linear bearings attached to the table surface in lieu of using a miter gauge. These get dragged out of their corner on rare occasions but when we need them there is no set up costs involved. Could not do this without pallets.
Our airline trunks are in PEX. The next improvement would be to get a continuous roll of rubber airline and cut to specific lengths needed. The people that sell the rubber airline also sell a brass nipple that just shoves into the end of the rubber hose. There's no clamps involved so you don't have that nasty screw clamp with all the electricians tape unwrapping over time.
In Bill Norlin's book he talks about the use of pallet jacks. You can shrink wrap pallets for the tool room or supply room.
Also think about down time, this is a big cost. Have the shop pre-wired with plugs so that all you have to do is plug in machines when you move. Think of the entire move getting done in 2 days.
IMO more business' go broke when they move than any other time.
Don't get me wrong, pallet jacks are great! However moving machines around to use them is not always practical or efficient. Believe me I've also been doing it for years! I can definitely see if you have extra room having some extra infrequently used equipment on standby. But for the last couple years I've had to move machines in order to use other machines that get used weekly! There's just no place to put those machines in my current space.
I think 2 days may be realistic for the actual moving of equipment from point A to point B. However I have weeks in other labor getting the new space ready and packing up the old space. A LOT of this is going to be done on the weekends as well. I can't say I've got it all planned out yet, but the priority will be machines that get used daily will be hooked up first. Then I'll move to the rest depending on the types of jobs I have lined up for that first month or 2. I made a 50' 10 gauge extension cord a couple years ago for hooking up new 3 phase purchases to be able to run them before before hard wiring into place. I have a feeling that's going to get a lot of use as I won't likely get every machine wired up immediately.
Anything you can do to have machinery running sooner is great. I used a cord similar to what your talking about and 3hp single phase vac to run all necessary machines for the first month.
Since I spent so much time on my layout I had no need of leaving machinery on pallets or sticks.
I have adjusted most machines a foot or 2. No pallets necessary.
My previous shop was much smaller so plugs and floor space were at a premium. I had many smaller machinery on carts or casters. Now they are all permanent and wired and efficient.
If your going to move into a larger space then be efficient as possible. With the move and the way you work the space.
We also moved all of our machinery. We rented a fork truck for one month and kept it at the new location. It was expensive but it was worth it. We were also able to borrow a fork truck for the old shop to do the loading since the two spaces are 10 miles apart.
After the lease was up on the forklift I found one at one at our sheet goods suppliers for dirt cheap. We payed $2,500.00 for an old 6000lb lift. A lot of miles but it was well maintained and a great investment.
Having been through the process several times: Plan well, considering future additions of equipment. For a larger shop I'd say use bus duct for electrical, makes moving equipment much cheaper and easier. The foam on the metal works but check with codes before, They may require a fire resistant ceiling or covering.
T12s are obsolete. In a short time you won't be able to buy lamps for them. Check with the power company, ours is offering rebates to install more efficient lighting and controls.
Consider conveyors in your layout, even if just to connect the CNC to the bander.
Lease term? In one shop I had a 1 year lease which then went month to month. Fine for about 3 years. Then one day the landlord walked in and gave me 30 days notice! Owning has pros & cons too.
Around here you would be required to have fire sprinklers, Expensive.
We just finished a move from two 1200 and 1400 sqft spaces into a 3500 sqft space last week. In terms of the cash on hand, it was terrible timing, but in terms of available space and workload, the timing was perfect. We saved a lot of money and time because the move was just 100 yards across the parking lot. No trailers/trucks/machine movers, we just picked everything up with the forklift. Sold the vertical panel saw, so we didn't have to move that and got a little cash for the move.
The electrician, who is reasonable, and has worked for us in the past, quoted $5,200. That was a nonstarter, so I just had him hook up the big subpanel and did the rest myself. I thought about ditching the old conduit and copper but I was able to reuse almost all of it. We will end up paying him about $1500 and I spent about $400 for new materials. We bought another dust collector for $500, and $400 on black pipe and fittings for air.
I estimated the move would take 5 days with my two employees. It took 8 days. We still need to build a lot of cabinetry to organize the workshop, but at least we can start making money again.
All in, I think it cost about $5000 with our time and materials, but the loss of productivity was more painful, and that, combined with a slow-paying client has put us in a financial nosedive. I will bail out the company but we are going to have to make some big changes to recover.
Alot of great advice here. When i moved to florida from canada almost 10 years ago, my landlord covered 3000.00 of a 6000.00 electrical upgrade as there was no 3 phase power in my bay. He gave me a 3 year lease with my half of the electrical built into the lease over the 3 year period. I still invested in halide lighting myself as there was a 16' ceiling with just flourescent lighting. My new space needed 4500.00 in electrical work, but my rate per sqft is considerably lower and the same landlord as before. The space was clean, painted and needed little else to be done. I used flexible air hose for all my machines to avoid mechanical drawings and give me flexibility for change. One of the things i learned on this move was getting rid of junk with one large waste container rental. I didnt do it and moving things that i later scrapped took too much time. If you havent used it in the last year...Scrap it. I have very little solid wood and saving materials that you think you will need will cost you much more than the cost of the material in time and space. Be scrupulous and dump stuff once at one container rental. Harold.
That's good advice Harold! When I moved shops almost 10 years ago I filled a 30 yard dumpster with scrap that I deemed not worth taking. When I started unpacking and setting up shop I must have made at least another 1/2 dozen trips to the dump getting rid of additional crap. Of course I pay by weight to dump, so it was a pain having to pay twice for all that material.
Over the last couple weeks I've been posting scrap wood on CL to try and unload as much as possible. I've already pulled several hundred $ selling it off, which is a heck of a lot better than paying to dump it! Even shorts under 2' long are attractive to some guys for the right price! I still have quite a bit to get rid of and then I'll start on the sheet goods rack. I don't think I'm going to take anything less than full sheets with me. And there won't be many of those either.
Altogether with some small tools, a project dust collector, and other misc odds and ends I've brought in enough to put towards a new MacBook! If I get rid of everything I want to move, including a couple machines, I should bring in close to another $6k which will help with the move.
Thats great Jeff, We process panels mostly, so melamine, prefinished maple and MDF are too cheap to save and move. Almost no solid wood at all. I still have my stash of exotic veneers in usable sizes that i keep.
Everybody has to have a stash! Mine is a collection of wood. Wild grain patterns or exotics. Keep telling myself I'm going to make something "special."
Jeff, you are in California aren't you? Would you mind giving me your location so I can notify Environmental Health, Air Quality Management District, CalOSHA, and the Fire Department that you are moving into a new space?
Sure thing Johnny, you can find me down around the corner of your street. In that indiscreet looking industrial building.
Seriously though, you couldn't pay me to live on that coast. It's only a matter of time before they'll have laws against breathing excessively as it's bad for the environment! I wouldn't mind except that it affects the rest of us as well. This new thing about CA. listing wood dust as a dangerous carcinogen has the potential to affect every shop in the country….and not in a good way! Who knows, maybe they can find another out of work actor for governor and curb their activist enthusiasm just a bit:>)
I was evicted from my building and relocated due to a railroad crossing project. I was treated by all agencies like I was going to explode and level my city, or like I was a criminal! I had to install fireproof glass along 100' of the building. I had to sprinkler the building, and the city decided to use my project update the sprinkler codes. They all totally disregarded the extra money or delay in the move date. They were inefficient and lazy. This reality check forged a contempt that lives (no grows) to this day!! Good luck to you on your move.
I personally think that the new space is not worth to move in to if it requires a huge amount of investment before you can move in. The new place should be a blank canvas in a move-in condition that does not require too much renovation to provide a conducive space. The costs you would have to spend on things like machinery, wiring, etc which are the essentials and not additional.