help on selling my business.

[knight_toolworks]

I was going to let knight-toolworks My plane making business die off. I pretty much was burned out and sales were low enough it was more of a hassle then anything else. This is no ones fault but my own I never did any marketing and I am not a great businessman.
I don't have much in the way of assets to sell with it. Mainly my knight toolworks stamp and angle stamps and a word stamp with all the letters. Some jigs and a few irons. What I do have is the webpage the reputation and the knowledge 12 years of plane making several magazine writeups and there may be another in the works.
I have one offer but it is dirt low. I can see giving lessons on tuning and making planes and such and that won't be free.
He wants me to cut kit parts on my cnc and I am ok with that charging by the hour. But the time it may take to redesign and all would end up extra.
I would like to see my planes live on there are planes like the sliding dovetail plane that no one else makes.
But I don't want to have to ship a plane here a plane there. So doing wholesale would be good for me.

[michael_schwartz]

Have you thought about licensing the brand/designs instead in consideration of a royalty, and exclusivity for the CNC cutting?

Might work out better for the prospective buyer as the there wouldn't be an initial investment, and you might make more in the long run if they can do something.

[myxpykalix]

I don't know what kind of a market is out there for handplanes, I would expect probably a fair market. I think you clearly lack marketing skills. I had talked to you years ago before you got a shopbot so the reputation is out there.

Before you hand over your reputation and name you might want to see if you can find a woodworker with marketing and sales skills and see if you can work out some type of partnership deal.

I guess it depends on the profit margin on a plane, if you are talking 20-30 bucks it might not be worth their time but if it is higher you might want to compare the difference between your profit on a "kit" versus your profit minus marketing cost.

In any event i wouldn't want my name on a product that he (could) go get soemone else to cut for him and leave you totally out.
Any agreement should have a clause tieing the use of your name to your exclusive right to build the planes. If he gets someone else to cut them then he can't use you name...

[knight_toolworks]

There is not a bad market but to get to it takes work. it takes doing shows and demos and classes and such.
I mean I made a name for myself and I don't rally want to do it anymore. but the guy only offered me 600.00 I mean lall the physical stuff may be worth that much but what about the intellectual part? I can see spending a lot of hours helping him learn the ropes. I would supply him the plane bodies one way or the other. but 12 years and 3500 planes under my belt is about enough.

[Brady Watson]

$600 is peanuts...I would not sell my name and reputation for that paltry amount.

I wouldn't be so quick to toss the business - even if you are tired or bored of it. Let it 'brew' for a little while. You may want to look at this portion of your business as part of your 'portfolio' - in terms of being able to make money in a unique way when other areas slow down. That portion of your business is money in the bank to YOU.

This isn't meant to hurt anyone's feelings, but...Unless you can demonstrate solid sales numbers for the past 5 years, plus you have substantial assets (equipment etc) + a solid customer base to go along with the sale, your business really isn't all that marketable and probably isn't worth anything to anyone but you. (Many can relate to this)

A deal is either hot or not. Unless it really gets you jumping for joy...it ain't worth it. My advice would be to let it ride some more.

-B

[michael_schwartz]

The brand name is worth more than $600. I knew about it long ago from reading posts over at SMC. I have seen the reviews, and heard people speak highly of your product. I am tempted to buy one but I have already spent far too much on hand tools :o

My logo cost $400.00 alone. I know I have more than $600.00 in time invested in my website.

Your brand name is already out there. You mentioned you have sold 3500 so there is a large user base. The right person could probably do something with the brand. $600 would barely get a website going for somebody starting from scratch.

I would suggest licensing the brand to somebody if they wanted to give this a try.

[MogulTx]

I own a couple small businesses, and they are pretty worthless to most folks- but not to me. That is a shame, but it is what it is... If you are going to sell, what I would do is to look at who else is in the same field. Custom folks. See if one of them wants to add your products and brand name to their line up. I would also look to someone who stocked or stocks your product. Maybe they have an appreciation and would want to buy the line. I think Brady's idea- exclusivity on supply- is a great idea.

When I sell my "regular business" it will likely be to a customer who sees that I can offer them something that they can not get elsewhere. They will use my skills and assets to help compete in a field against a larger, more well funded company- because I can show them how to do what I do in a "lean" way. Think of what YOUR product and personal strengths are and what they will get in the deal. Try to think of how they will make it make Money for them, and show them THAT. THAT is what they need to make a positive buying decision.

I gotta tell you- $600 is small money for the labor you have invested. I would not surrender it to this person unless you were in DIRE need of $.

See if one of the other scenarios might fetch you a better return. ( I mean, you are not going to get rich off it but you would like to do a bit better than that!)

Monty

[bleeth]

Steve:

Let's try this scenario (pretend this is you thinking)
1. I been doing planes to order for so long I am bored with it.
2. People out there do love my product.
3. I've been offered a few bucks for my brand but I know the offer is a joke.
4. I do have times when I don't have diddley squat to do.
5. If I made up a bunch of kits while I had spare time I don't have a way to market them effectively.
6. Voila-I need someone or some company to market them for me!!!

If you reach item number 6 in your thinking then you only have one more thing to do-Identify a sales/distribution system and set it up. As I noted in a previous thread to you I had the guy in the local Woodworkers store raving about your planes as soon as I mentioned your name.

PS-I want one too!!

[knight_toolworks]

Sales over the last two years has gotten down to 1 a month average. Unless I really worked hard or the review in fine woodworking goes through they would not come up.
Plus the plane iron the most expensive part and I just ran out. I used to make 100 at a time it was nto hard but I am not really setup for it and I don't know if the heat treaters I used are still using the method I need. The quality was going down anyway. I tried to get a quote from a local p[lace but I bet the cost would be 30 to 40. when I did it the cost was around 10 each.
Since I lost interest the quality is going down. Well only the making sure all parts are in the box and the time it takes.
I really would like to teach someone how to do it and keep my ideas going. But I don't want insulted about it.
I know the value for a business like this is who knows? But I just made 400 last week. So it's worth a lot more then a months pay. I mean I can do 600 or more on a good cnc day.
I rather let it die then take 600

[harryball]

Anything is worth what someone is willing to pay. What would you want for it? $1000, $5000, $10,000, more?
Decide.

Clean it up, make a bunch of planes to create assets, pile up your articles and let people know what you want.

i.e. I want $10,000, here is how I'm organized, here is $3000 worth of planes along with the jigs etc..., I'll work with you for 2 months and teach you how to make them and you can use my name in a "Designed by..." capacity for any unaltered designs... No takers? so it dies. That's what it's really all about.

I think you don't want to "let it die" for sentimental reasons. It doesn't sound like you're delusioned into thinking you'll sell it for $5M and buy a yatch with a dozen bikni clad women on board. If you sell it for enough you can maybe buy a big screen TV, you'll feel like your work will "go on" while you watch whatever it is you like to watch on a 73" HDTV. There is nothing wrong with that.

My suggestion is to decide what you want emotionally. Maybe make one last grand plane or set of planes and donate them to some place that would display them... I'm sure somewhere like that exists. After that, it didn't die, you just let it rest.

/RB

[Brady Watson]

No matter what...No matter when...No matter how...

One thing holds true:

There is ALWAYS room in ANY market for the BEST.

If you decide to be the best, then price doesn't matter. If it costs more for heat treating, then that has to be added on. If a competitor is able to put something out cheaper, then you need to see where they are cutting corners or where they are getting their treating done etc. It's OK to let a business die if you aren't into it anymore. You're the creator. You're the destroyer. It doesn't matter - unless you have the passion to keep it alive with vigor.

Tiffany & Co. , Rolex, Cadillac, Cartier etc. all stayed in business despite major wars, economic depressions & recessions and other calamities. How? ....because there is always room for the best in any market. Being the best takes work.

Only you can answer if it is worth it or not.

-B

[knight_toolworks]

I never had luck retail. that would take the marketing and demos and shows to get effective. I had planes in stores that just sat there for years.
but really I would have to go back to building them and that I don't want to do. Plus that does not mix well with the cnc work I found too many distractions.
I have made planes ahead of time but with so many choices it's tuff. I used to do it then change the design and have out of date planes sitting around.
But the biggest problem is I ran out of irons and that would take an investment I can't afford. That was kind of the last straw.
But if someone what's to do the marketing and get some plane building advise then they can make money at it.

[woodworx]

Steve,
It's true, your business is only valuable because you are running it. If you have some machinery, and a few solid customers this only makes for a small dollar value.

Right now your machinery isn't worth anything. The company I work for just bought hundreds of Weining milling knives yesterday that were offered for $7000 by the owner of an 81 year old company. We bought them for less than 5% of that. Wide belt sanders and 6 head moulders went for less than $2000.00. The market on used machinery is down to almost 0.

Yes there are days where you make $600.00, but those days are few and far between. Look at it gross profit for a month and divide that by 20-22 business days and that will show you what your revenue for a day really is.

My suggestion is keep your business, continue to sell your product. You don't have to be good at sales, just be confident in your product.

Take a full time job. People are starting to hire again. Do your milling at night and on the weekends. Trust me, you will miss being hands-on.