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Should i start my own business? College student seeking advice.

Should i start my own business? College student seeking advice.

Should i start my own business? College student seeking advice.

(OP)
I was recently "permanatly layed off" from my job working as a custom machine designer and builder. I was working on average 50 hours a week and still attending college full time. not to mention that i just bought fix er up house and only 21. the work load became to much and i was late a few times because of studying late at night. Instead of collecting unemployment, i got the idea i should start my own drafting buisness. Just something from home and nothing to complicated. Basically my services would be dimensioning parts, creating drawing packages of assembly's, and creating 2d drawings into 3d.

I did this when i first started out and am very proficient in solidworks. the way i see it, a company could outsource this job(india, ect) or have the designer finish the drawings after the designing process and pay them full wage or they could pay me to do it. this would keep buisness in the states, and also reduce cost for the company because i would be doing the job an engineer would be doing just as good for a fraction of their wage. they would also help out a college student further his education.

The only problem i'm worried about is the demand for a buisness like this. I am from the West Michigan area and my intent would be local buisness around here. Possibly elsewhere but i feel communication would be difficult and being able to have face to face interviews would produce less misunderstanding.

I understand that a buisness takes money and i have $2000 in savings that i'm willing to use. Any thoughts or opinions would be greatly appreciated. Thank you.

RE: Should i start my own business? College student seeking advice.

I am probably going to get blasted for this.

I don't quite know exactly how unemployment works or even if you can collect if you are a full time student.  I should learn this because I may be in a similar situation soon.  Taking the student approach out of the equation, couldn't you collect unemployment and continue with the consulting work?  As you sell work and collect the money, you just report it to UE and they make the necessary adjustments (like taking you off for a while).

Again, I have never been on UE so I do not know how it exactly works.  I'm sure others will be here soon to smack me around.

RE: Should i start my own business? College student seeking advice.

I'd double check on the liability aspect and potentially any issues relating to offering engineering services to the public without PE.

Not saying you can't do it but make sure you don't get yourself into trouble.

Posting guidelines FAQ731-376: Eng-Tips.com Forum Policies http://eng-tips.com/market.cfm? (probably not aimed specifically at you)
What is Engineering anyway: FAQ1088-1484: In layman terms, what is "engineering"?

RE: Should i start my own business? College student seeking advice.

Kenat

Is doing CAD work considered engineering?  In my side of the engineering field it isn't, but I am not sure about you mech guys.

Also about my previous post.  It may tack some tact, but you might want to discuss what I said above with the UE office.

RE: Should i start my own business? College student seeking advice.

A "drafting business" in my state would probably require a PE.

RE: Should i start my own business? College student seeking advice.

I recommend that you choose one thing that you want to do. Don't try to do everything at once.  Your schooling should have been your priority at your age.  Don't end up as a drafting hack at age 50.

RE: Should i start my own business? College student seeking advice.

Steel PE, my guess would be that if you're careful in how you offer your services and what you call yourself etc. that you can work around it.  However, I'm just saying to keep it in mind.

As to the implied issue of engineers not doing their own drafting, at least in the exempt/machine design part of mechanical engineering a lot of engineers need to do their own drafting/CAD work.

Posting guidelines FAQ731-376: Eng-Tips.com Forum Policies http://eng-tips.com/market.cfm? (probably not aimed specifically at you)
What is Engineering anyway: FAQ1088-1484: In layman terms, what is "engineering"?

RE: Should i start my own business? College student seeking advice.

$2,000 seems very small, I just wonder with such a small investment where you plan on getting clients. Also what is you buy in for the solid works package?  

http://www.nceng.com.au/
"Programming today is a race between software engineers striving to build bigger and better idiot-proof programs, and the Universe trying to produce bigger and better idiots. So far, the Universe is winning."

RE: Should i start my own business? College student seeking advice.

You can collect unemployment as long as you do not have to report NOT being available for full time work (such as being a student during the day).  School and studying at night is OK.

You can collect your full unemployment benefits as long as you do not have to report any income you might receive, such as income that may be reported on a 1099 or CASH income that you self-report.  Let me emphasize that last point,  CASH income that you SELF-REPORT.  

Unemployment benefits for me barely cover my rent.  It does not cover food, gas, utilities, cell phone, and medical insurance.  The IRS wiped out my savings in November (long story.  I expect to eventually get most of it back, but it will take about 6 months and a lot of fighting.  And I might not win).  So I do what I have to do, like sell my furniture for half of what I paid for it just to pay for my cell phone, gas, and food.

Starting a business takes capital, and lots of it.  $2,000 is nothing, $20,000 is more like it.  No one is out there just dying to help a poor college student.  You will get the work if you are good, fast and cheap.  Start by putting a business plan together, and filing for your benefits.






 

"Gorgeous hair is the best revenge."  Ivana Trump

RE: Should i start my own business? College student seeking advice.

Depending on what type of companies that you have in your area you may be able to make this work. The more you listen to people who have spent their life working for companies the more discouraged you may get. Stick your neck out there and start offering your services up to smaller businesses and you may just find one who needs someone like you to come in and help them get projects off the ground. If you did a good job you would probably end up working for one of those companies OR you could expand your business and hire some people to help you. I wouldn't limit yourself to CAD work either but don't expect at you age to get a lot of hardcore design because you don't have the experience. I have worked for smaller companies who have big ideas that they needed a smart person or two to get things off the ground but not necessarily full blow engineers. Kinda like interns but more focused on getting work done and less on learning. So I say pick up the phone and start talking to people. You will be surprised at how helpful people will be to you most of the time.  

RE: Should i start my own business? College student seeking advice.

(OP)
first off, thanks for all the replys. its good to get a lot of opinions on this before i actually do it if i decide to. Too clarify things, i WOULD NOT be on unemployment if i start this business. i am hoping it would be the only source of income for me and not unemployment. Second, my intent is to do this for as long as i'm still in school. I should get my Degree in 2 more years, but if i get alot of business, i hope i could continue this business and expand and offer more services.

The only thing im after is just the "documenting" portion of engineering. I'm not sure if other companies are like this but when i first started working at my previous job, once the machine was designed and built, i would take the assembly file, make sure all the dimensions on the drawings were up to date and correct, create views of the assembly and then balloon every part out and include a BOM. this also included creating all the custom properties and when done, i would print every drawing on a tablet sized page and put it all into a binder for the customer.

I plan on using the educational version of solidworks since i get it free being a student at my school. Or if that edition didn't have the things i needed in it, i might be able to purchase the software myself.

thanks for all the feedback and i hope i receive more. i'm going to research everything more in depth this weekend and next week and hopefully i will be able to decide if this is a route i should go. Thanks again!  

RE: Should i start my own business? College student seeking advice.

You already lost one job trying to do to much and failing. Make sure you learned that lesson. You can do three major things in your life, but you need to set priorities and a schedule for each that is attainable and viable re both finances and health.

You seem to be willing to sail dangerously close to the wind on a number of issues, several being legal issues. For instance, I would expect a software educational license excludes commercial use.

Regards
Pat
See FAQ731-376: Eng-Tips.com Forum Policies for tips on use of eng-tips by professional engineers &
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RE: Should i start my own business? College student seeking advice.

I'm not sure solid works would like you using the student version of their software to make money.  After all, you usually sign some agreement that allows you to use their software for the purpose of your education (at a greatly discounted fee).... and not to make money.

RE: Should i start my own business? College student seeking advice.

If you are using the Solidworks Student edition when you print models or drawings . It will have a watermark that says " Student edition not for commercial use."
B.E.

The good engineer does not need to memorize every formula; he just needs to know where he can find them when he needs them.  Old professor

RE: Should i start my own business? College student seeking advice.

berkshire hit one point I was going to make... add on top of that, if anyone finds out you're using an educational version for commercial purposes (jealous rivals, companies losing business to you, etc.), they can report you and bad things start to happen.  You agreed to a legally binding document when you start using that software (the Terms of Service), and they almost always state that commercial use is prohibited.

I encounter quite a few people like yourself trying to break into my line of work... they want to use educational software for commercial enterprises, thinking they can slide under the wire.  It rarely works out in the long run.

Not to poo-poo on your idea, but it sounds like you need to re-evaluate what you want from life and set a more reasonable timeline.  Owning a home at 21, particularly one that needs repairs, is a major issue unto itself.  Add in a full college schedule and trying to make enough money at a job to pay for it all is pure folly, IMHO.  It may make sense to sell the house (even if at a loss), move into an apartment, take a part-time job, take out student loans, and concentrate on the schooling for the next two years.

Dan - Owner
http://www.Hi-TecDesigns.com

RE: Should i start my own business? College student seeking advice.

There is some potential middle ground here.  For a time, I owned my own seat of SW on a laptop.  I was able to get contract work with companies that needed CAD work done, but did not have the resources to install another seat of SW.

RE: Should i start my own business? College student seeking advice.

(OP)
i totally forgot about the student edition not being able for commercial use. i looked it up on their website and it even says that they put the watermark on there to stop cheating companies. I agree with them on that one! i wouldn't cheat solidworks out of their money even if i could. i heard their are torrents of it but even if it is easy to go that route, i would rather pay the full licence amount and be honest. i wasn't raised trying to "steal" every penny i can from someone.

So i have decided this is something i would enjoy. i have taken serious time to think over if i would be getting my self into trouble with balancing school and being a homeowner as well as a small business owner all at once and i feel i can do it comfortable. The house repairs are easy weekend projects and studying for school i can do anytime. i am very quick at learning and don't need to re-read things. The only thing preventing me from starting up is the price of the Solidworks Software. My parents are willing to cosign on a small business loan but i'm not sure if i actually want to sink $4000 into possibly a 2 year company. does anyone know of any alternatives(legal!) that would work in creating drawing packages or grants, ect?

thanks again guys. You have no idea how much you are helping me out!

RE: Should i start my own business? College student seeking advice.

If you're unwilling to sink a mere $4k into a company that will last 2 years, business ownership is not for you.  Others are free to disagree, but that's a paltry sum to be in business for one's self.  You also can't forget the amount of money needed to set up your business licenses, personal property tax (you have to pay taxes every year on the seat you sit in, the computer you use, likely the software... everything required to do business), etc.

Dan - Owner
http://www.Hi-TecDesigns.com

RE: Should i start my own business? College student seeking advice.

(OP)
the way i see it, i would be making an average of $10 an hour. working probably 30 hours a week. being a college student with tuition and all, i don't know if the 4K program would let me profit anything. prove me if i'm wrong but make $10 an hour for 2 years and having to pay a 4K+ loan seems like i would break even.

about the taxes, my buddy started his own photography business and he writes such expenses off come tax time. He also said business licences was like $50 total. Again, i would be working at home and i would be the only employee. Not going and renting office space, ect.

RE: Should i start my own business? College student seeking advice.

eatdesignsleep I got two things:

1) If you are going to take on that much stuff, do it while you're young and have the energy:)

2) At $10/hr, I think you would be way underpricing your time.

Regards,

Mike

RE: Should i start my own business? College student seeking advice.

$10/hour?  You must suck at either CAD, negotiating, and/or estimating.

RE: Should i start my own business? College student seeking advice.

Seriously, you need to do a lot of groundwork.  $10/hour is unimaginably low, unless you are talking start-up net when businesses typically operate in the red (at a loss).  I have attached a sample business cash projection spreadsheet.  You need to understand what all of these things mean and be able to fill it out.  A business plan requires that you do your market research including fees, operating costs, etc.  Your outgoing costs will drive your pricing (incoming).

I think a 4-year projected profit statement is typical.  It's about where most start-ups begin to break even.

"Gorgeous hair is the best revenge."  Ivana Trump

RE: Should i start my own business? College student seeking advice.

Alibre is cheaper than SWX in all 3 flavors, $299, $999, $1999, but just as Dan Quayle is no Jack Kennedy, Alibre is no SWX. I found myself grinding my teeth with it.

RE: Should i start my own business? College student seeking advice.

Moon161,
welcome to the club. I switched to Alibre from SWX because I did not have enough work to justify SWX and you are right , it is different.
B.E.

The good engineer does not need to memorize every formula; he just needs to know where he can find them when he needs them.  Old professor

RE: Should i start my own business? College student seeking advice.

Alibre-using client base is how big?

RE: Should i start my own business? College student seeking advice.

I do a good 90% of my 3d about 50% of my 2d work in SketchUp ($400 for a full license, HUGE internet use group, and it comes with a layout software) its cheap, accessible on almost any computer, and you can open and save files to almost any of the major modeling standards (2d and 3d CAD, solid-works, Pro-E, etc).

It does have issues with layered drawings and drawings that have a high amount of faces.

But most of my work is structural, not sure how it operates when you get to the smaller scale details.

RE: Should i start my own business? College student seeking advice.

(OP)
jmcoope3, that SketchUp program is somthing that may be perfect for me. do you know if you can create BOMs, import solid modeling parts and automatically create projected views such as solidworks can(.sldprt files)?

Also on wages, what would one expect to pay a college student with years of cad classes in high school and college and also with almost a year of experience? i was paid $7.40 for everything i did(machine building, running erands, designing small assemblies, creating drawing packages, ect) so i was basically used. would i be better to say around the $15/hr mark? or is that still cheap? i can do my job efficiently and quick with hardly any errors.

RE: Should i start my own business? College student seeking advice.

Generally as an employer, it costs you around twice what you pay an employee.

You have to cover paid time off, insurance and overheads like software, computers, office space, facilities and consumables, non productive or non billable but necessary time, costs of aquiring work etc etc etc.

Regards
Pat
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http://eng-tips.com/market.cfm
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RE: Should i start my own business? College student seeking advice.

Median wage for an experienced designer in Buffalo (2nd poorest city in the US) area is $41.6k = 20/hr + min 2wk vacation/sick time.

You should bill about 1.5-2x what the hourly wage would be in your area for comparable position.

You did get used, I worked as an intern at Motorola for $390 wk in 1996.  

RE: Should i start my own business? College student seeking advice.

The tick.
""Alibre-using client base is how big?""

These are companies that use Alibre
B.E.




Featured Customers




 Abbott Laboratories
 Alcoa
Allied Power Products Inc
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 ArvinMeritor
Avistar, Inc.
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Boyd Lighting Co
BWXT-Y12 Technical Services
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Calsonic-Kansei
Carrier Corporation
Caterpillar
EG&G Defense Materials, Inc. - URS Corporation
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Fabrico
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JPL - Jet Propulsion Laboratory
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MSI
NASA
Naval Air Warfare Center ( NAWCWD ) and Naval Surface Warfare Center (NSWC)
 Northrop Grumman
Pfizer
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Praxair
SAIC
Sandia National Laboratories
ShopBot Tools Inc.
Siemens
SouthWest Research Institute
Tamko
Tripar, Inc.
Whirlpool
 Wyle Laboratories Inc.

 
 

The good engineer does not need to memorize every formula; he just needs to know where he can find them when he needs them.  Old professor

RE: Should i start my own business? College student seeking advice.

Hey Berkshire, (I thought about saying BS, but reconsidered, well 1/2way.). Could I contact you in regard to Alibre? I've got the budget one, and just got frustrated w/ it, but would like it to play nicely. Drop a line to moon161 at gmail dot   com.
 

RE: Should i start my own business? College student seeking advice.

Moon 161
I just tried to send you a message, it bounced as an "invalid recipiant"
Did you get it?
B.E.

The good engineer does not need to memorize every formula; he just needs to know where he can find them when he needs them.  Old professor

RE: Should i start my own business? College student seeking advice.

We have one contractor who we let use one of our SW licenses - as far as I know it's all above board but I don't know the details.  Maybe you can find somewhere that needs part time drafting help, can loan you a copy of SW to use on their work only etc.  However, it may be a long shot/lot to ask.

While your basic idea isn't ridiculous, you've got to consider what you really have to offer.  

It doesn't sound like you're really expert level in drafting and design from what you say - so they aren't really buying that expertize.  

You may or may not be a relatively expert SW user, which you might be able to leverage.  

With your level of experience I'm not clear that your an expert in a particular field of engineering design etc., and you'd have to be careful about offering engineering services without PE anyway.

There are already companies that offer drafting/engineering services that you're competing with. They'll often be degreed engineers and/or experienced drafters.

So, what is your selling point?  At $10 or even $15 an hour it might be price, I don't know what's typical for your area.  However, can you really operate on that price scale by the time you need a decent PC, software...?

If you have some kind of personal relationship with a potential client you might be able to leverage it, otherwise in an open market it may be challenging.

I'd think carefully about the business plan aspects.

Oh, and your experience of how your previous employer documented things is not typical of all industry segments/companies.  It may be standard in custom machinery design, I don't know.

Posting guidelines FAQ731-376: Eng-Tips.com Forum Policies http://eng-tips.com/market.cfm? (probably not aimed specifically at you)
What is Engineering anyway: FAQ1088-1484: In layman terms, what is "engineering"?

RE: Should i start my own business? College student seeking advice.

It seems better to go intern somewhere for now.  I remember interning in 2001 making $14/hr getting some much needed eye opening experience working for the govt.

And once you have more years of real experience see if going off on your own makes more sense.  I know the exact type of people who would hire you right now, and I see what the finished product ends up looking like, and it's not good.  I don't know why you were in such a rush to do all of these things at once, instead of concentrating on just finishing with your degree.

B+W Engineering and Design
Los Angeles Civil and Structural Engineering
http://bwengr.com

RE: Should i start my own business? College student seeking advice.

A $4k loan is nothing in a small business.  I work for a small tech start up.  We've spent $30-50k of cash in an afternoon for our larger purchases. Most start ups have no income.

But you spend the money now, and it's an investment, against you learning and earning money.  

I'd finish school first.  You can be a jack of all trades, and a master of none.  But they way you sound right now, you're not even going to be a face card.

RE: Should i start my own business? College student seeking advice.

There are many things that in my opinion don't add up.

It does not make sense to me to start a business that you are planning to do only for 2 years. You're talking about having your parents co-sign a loan for business expenses; why not have them co-sign a loan to tide you over for 2 years while you pursue your degree? The sums don't make sense; you're anticipating that you will be able to pay your bills if you make $10/hr, and even $7.40/hr was working for you before. That is not a ridiculous amount of money to take out a loan for.

I think the biggest strike against the idea is the risk. There are plenty of businesses started that fail. More fail than are successful. Even successful businesses don't make money for the first few years. At 21 with home ownership expenses I believe it would be ill-advised to make moves that have a distinct (if not good) possibility of leaving you worse off than before.

Could your plan work? I think so. But it is important to consider what will happen if it doesn't, and also important to consider that if you're only looking at making $10/hr you could make that much doing something else with no overhead (i.e. getting a regular labor job or better yet an internship) or take out a loan to help get you through school.

RE: Should i start my own business? College student seeking advice.

I agree with New Postpatdh1028 on this, and a few others.

If you are a college student, then finish being a college student.

You are only 21, and right now, it seems you are running around a bit like a chicken on acid.

Do one thing, do it well, finish it, and then move on. Get your education first, and make that your priority. Then, when you are done with that, look at your options; come back then and ask for advice.

Right now, you are just wasting valuable time and energy when you could be studying.

Charlie
www.facsco.com

RE: Should i start my own business? College student seeking advice.

I think the real eye opener will be when you get your first job after college and work a few years.  You will realize that you really do not know anything.  And like one of my past project managers told me, anyone who tells you they know everything, knows nothing.  Get some experience first.  If you are that go getter you will probably understand a lot of posts on this forum of awful hours and wanting to do an easier job that makes significantly more money.

At that point if you start your business you will know you paid your dues and are ready.  I am doing this right now, and it's been tough going through the depression, but we are still chugging along.  Can't say that about a lot of my competition.  But you really do not want to start a an engineering business being happy starting out at $11/hr.  Go work at McDonalds and have no stress.

B+W Engineering and Design
Los Angeles Civil Engineer and Structural Engineer
http://bwengr.com

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