Responses to the latest CabinetMaker Small Shop Survey confirm that cabinet shop owners are hard workers with little formal training who are motivated by more than money. They are mostly middle-aged and almost entirely male with lots of experience under their belts.
Survey responses came in from January through February 2009 and are a statistically significant representation of the readership of CabinetMaker, which goes to shops with fewer than 20 employees across North America.
It's not the money that drives most small shop owners ( see chart ). The largest segment (32 percent) say a sense of accomplishment is what motivates them in their business. Almost the same number (31 percent) say it's pride in making things of lasting value that moves them.
Dropping down the list, only 14 percent cited profit or financial rewards as their prime motivator.
Feedback from customers was way down the list at 5.5 percent and support from family garnered less than 2 percent.
About 15 percent listed other reasons, but most of those were combinations of the reasons cited above.
Training and education
Shop owners have lots of experience but little formal training. Almost exactly half are high school graduates. A little over a third (34 percent) have a college degree, and some 12 percent have advanced degrees. But most of those degrees are not in business or cabinetmaking.
Well more than half (58 percent) describe themselves as self-taught. About 29 percent say they got on-the-job training to learn the craft. Only 12 percent listed vocational training, and less than 1 percent took college courses in cabinetmaking.
Responses are no better when it comes to business skills.
- The vast majority (67 percent) say their business skills were self-taught.
- About a third (33.7 percent) say they learned on the job.
- Some 15.5 percent have taken college business classes, but less than half that number (7.5 percent) attained a business degree.
- About 5 percent learned business skills through vocational training.
Experience, age, gender
Still, the lack of formal training contrasts with their many years of industry experience. The average respondent has been in the industry nearly 25 years. Their shops have been around almost as long, averaging nearly 20 years. And the average owner has worked in the same shop he's in now for more than 16 years.
With those big numbers, it's no surprise to find most respondents are middle-aged.
- A little over 32 percent are between 46 and 55, the largest age group.
- Another 28 percent are between 56 and 65.
- Some 16 percent are over 65 and 14 percent fall into the 36 to 45 age group.
- Less than 10 percent are under 35.
For anyone who has been in the industry any length of time, it's no surprise to find the owners are predominantly male. Nearly 99 percent of the respondents are male, and only 1.2 percent are female.
Salary, benefits and hours
So, what do shop owners and employees get for their efforts besides that sense of accomplishment they cited? Well, less than half (44.3 percent) of the owners are even paying themselves a salary. Most (55.7 percent) don't pay themselves a salary, but one would presume they take some kind of draw from the business.
Benefits offered to employees are also pretty slim. About 40 percent said they offer no benefits to employees. Some 35 percent offer paid vacation, and another 32 percent offer bonuses. Only 16 percent offer medical or dental insurance, and less than 15 percent offer any kind of profit sharing, 401(k) or pension plan.
The salary and benefit story should also be juxtaposed to long work weeks these people are putting in.
- About 33 percent, the largest segment, say they work between 51 and 60 hours a week.
- But the average response fell in the 41 to 50 hours range.
Sales per employee
When asked about the annual sales volume per employee, the largest single response was 27.6 percent saying their shop bills between $100,000 and $500,000 in sales per each employee. But the average response of all surveyed fell into the range of $60,000 to $80,000. Some 4 percent actually reported sales in excess of $500,000 per employee, and 26 percent said their sales were less than $40,000 per employee.
In examining these numbers, it should be cautioned that one-person shops account for 47 percent of the respondents. Shops with two to five workers accounted for 36 percent. Shops with six to 10 employees made up 11 percent of the pool, and shops with 11 to 20 employees accounted for 6 percent.
What kinds of shops are these?
The vast majority of shops responding to the survey are smaller than 10,000 square feet. Some 35 Percent are between 1,000 and 2,499 square feet, and about 28 percent are between 2,500 and 7,500 square feet.
Kitchen and bath cabinets dominate as the primary product, with 35 percent of shops citing those. Residential built-ins come in second at 17 percent, and custom furniture accounts for 14 percent. About 26 percent listed "other" and often specified combinations such as both cabinets and built-ins or architectural millwork and custom furniture.
- Of the shops doing cabinets, about 43 percent do both face-frame and frameless styles.
- Some 38 percent do face-frame only, and just 19 percent are exclusively frameless.
- Of the shops doing both styles, face-frame projects account for 55 percent of the work and frameless 45 percent.
Target market and promotion
Most of the shops in this survey are trying to aim high as they target customers. Some 65 percent say they target the mid-range to high end of the market. Another 16 percent say they are exclusively high end, about the same number who say they target the low to mid-range market. Just 2 percent say they are going after low-end customers.
So, how do the shops get their customers? It looks like word of mouth continues to rule the day. More than 90 percent say they get their business from referrals. But other marketing methods are making inroads.
- Some 32 percent say they promote their business through Web sites.
- That is followed by 19 percent who use the Yellow Pages;
- 16 percent who participate in competitive bidding;
- 15 percent with a retail showroom or gallery;
- and less than 10 percent who market through trade show
And finally, these shops predominantly see the competition as each other, with more than a third saying their biggest competitors are "other shops like mine." About a quarter feel they are competing against larger custom shops, and about 23 percent say factory-built cabinets are what they are up against.
Some of the targets of past competitive complaints show up only in single digits in this survey. Home centers, offshore manufacturers, and non-commercial hobby shops all came in with numbers below 8 percent.
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