Cabinet-making companies are involved in the manufacturing and crafting of cabinets and vanities. These operators are mainly non-employers and individual builders and they design, build, and install cabinets, and bathroom vanities. The market size, measured by revenue of the Cabinet & Vanity Manufacturing industry is $19.2bn as of 2022. There are currently an estimated 109,300 cabinetmakers in the United States.
Steps to Start a Cabinet Making Business in 2022
Table of Content
1. Conduct Market Research
The first step in the market research process for a cabinet-making business is to develop market-based research questions in line with your overall business goal and objective. In this regard, you should source information that will help you maximize your business and also help you operate your cabinet-making business with less stress.
a. Who is the Target Market for Cabinet Making Business?
If you are thinking of opening a cabinet-making business then you should make your target demographics all-encompassing. It should include all construction companies, office facility owners, players in the real estate industry, home staging companies, shipping companies, and households.
b. Is Cabinet Making a Profitable Business?
Yes, the cabinet-making business is profitable and reports show that the business is currently on an uptrend. By making five cabinets a day, a custom cabinet business could bring in between $2,500 and $6,000 daily. Making 2,000 stock cabinets per day, a large company might earn between $12,000 and $24,000 per day.
c. Are There Existing Niches in the Industry?
No, there are no existing niches when it comes to the cabinet-making business because cabinet-making is a subset of the carpentry and woodwork industry.
d. Who are the Major Competitors?
- MasterBrand Cabinets Inc.
- American Woodmark Corp.
- Masco Corp.
- Elkay Wood Products Co.
- ACProducts, Inc.
- Foremost Groups Inc.
- Wood-Mode Inc.
- Wellborn Cabinet Inc.
- Master WoodCraft Cabinetry LLC
- W W Wood Products Inc.
- Reborn Cabinets Inc.
- Kitchen Cabinet Kings®
e. Are There County or State Regulations or Zoning Laws for Cabinet Making Business?
No, there are no county or state regulations or zoning laws for cabinet-making business, but players in this industry are expected to work with existing regulations governing similar businesses in the county where their business is domiciled.
f. Is There a Franchise for Cabinet Making Business?
Yes, there are franchise opportunities for cabinet making businesses, and here are some of them;
- Premium Cabinets Franchise
- Cabinet Refinishing Franchise
g. What Do You Need to Start a Cabinet Making Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Workshop facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Suppliers of woods, screws, locks, nails, and related cabinet making raw materials
- Startup Capital
Memorable Name ideas for Cabinet Making Business
- Four Corners© Cabinet Makers, Inc.
- Fine Finish® Cabinet Makers, LLC
- King of Cabins© Cabinet Makers, Inc.
- Cabinet Solutions® Cabinet Makers, Inc.
- Perfect Square™ Cabinet Makers, Inc.
- Moses ED™ Cabinet Makers, LLC.
- Day Light© Cabinet Makers, LLC
- Lincoln Allen® Cabinet Makers, Inc.
- Perfect Touch© Cabinet Makers, Inc.
- Bernad© Cabinet Makers, Inc.
- Sleek Design® Cabinet Makers, LLC
- Boar Group® Cabinet Makers, LLC
- West Ends™ Cabinet Makers, LLC
- The Nation© Cabinet Makers, Inc.
- Red Woods® Cabinet Manufacturing, Inc.
- Santos Marcos™ Cabinet Manufacturing, Inc.
- Emmanuel Anthony™ Cabinet Manufacturing, Inc.
- Reil Tims© Cabinet Designers, Inc.
- David and Davids® Cabinet Company, LLC
- Dallas Kings™ Cabinet Makers, Inc.
Register Your Business
a. What Type of Business Structure is Best for Cabinet Making?
Even though there are several options when it comes to cabinet-making businesses, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.
Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below. Most new single-member LLCs classified as disregarded entities will need to obtain an EIN.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Cabinet Making Business?
- General Business License
- Health and Safety Permit
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections
d. What Type of Certification is Needed to Open a Cabinet Making Business?
You don’t need any certifications to open a cabinet-making business. Although most cabinet makers hold a trade qualification, often completed as part of an apprenticeship.
e. What Documents are Needed to Open a Cabinet Making Business?
These are some of the basic legal documents you are expected to have in place if you want to legally run a cabinet making business in the United States of America;
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering starting your own cabinet-making business, usually you may not have any need to file for intellectual property protection or trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Cabinet Making Business?
When it comes to starting a cabinet-making business, the startup costs range from $20,000 to $200,000 and above depending on how much equipment the business owner decides to purchase, the number of employees, and the size of the workshop facility. Please note that this amount includes the salaries of all the staff for the first month of operation.
b. What are the Cost Involved in Starting a Cabinet Making Business
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services totaling – $1,200.
- Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $80.
- The cost for hiring a business consultant (writing of business plans inclusive) – $2,500.
- Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
- The cost of accounting software, CRM software, and Payroll Software – $1,500
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of – $35,600.
- The cost for workshop facility remodeling – $5,000.
- Other start-up expenses including stationery – $500
- Phone and utility deposits will cost – ($2,500)
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $30,000
- The cost for start-up inventory (a wide range of woods, screws, nails, wood polish, gums, and other raw materials et al) – $16,027
- The cost for the purchase of a utility truck: $25,000
- The cost of launching an official website – $600
- Miscellaneous – $2,500
c. What Factors Determine the Cost of Opening a Cabinet Making Business?
- The size of cabinet making business
- The choice of location
- The required licenses and permits
- The type of facility
- The cost of hiring and paying a business consultant and attorney
- The cost for branding, promotion, and marketing of the business
- The cost for furnishing and equipping the cabinet making business – facility
- The cost for insurance policy covers
- The cost for registering the business
- Source of your supplies and ongoing expenses
- The cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new facility for your cabinet-making business, but if you have the required finance, it will pay you to build your facility. The truth is that building or reconstructing a facility will help you come up with a facility that will perfectly fit into your overall business vision.
e. What are the Ongoing Expenses of a Cabinet Making Business?
- Supplies (inventory expenses)
- Utility bills (fuel, internet subscriptions, phone bills, signage and software renewal fees et al)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Chief Executives Office (Owner) – $45,000 Per Year
- Admin Officer (Cashier) -$30,000 Per Year
- Cabinet Makers – $29,630,000 Per Year
- Truck Driver – $26,100 Per Year
g. How Do You Get Funding to Start a Cabinet Making Business
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Applying for business grants and seed funding from the government, donor organizations, and angel investors
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Our cabinet-making company is located in Sharonville – Ohio; in a location highly suitable for the kind of business we want to establish. We have been able to lease a facility that is big enough (a 20 thousand square foot facility) to fit into the kind of cabinet-making company we intend to launch. Our cabinet-making company will design, make and install a wide range of office and household cabinets and vanities. We are set to service a wide range of clientele in and around Sharonville – Ohio.
b. Products and Service
- Building cabinets
- Designing cabinets
- Installing cabinets
- Custom cabinetry
- Bathroom vanities
c. Mission Statement
Our mission is to establish a world-class cabinet-making business whose products will not only be retailed in the United States of America but also be exported to other countries of the world.
Our vision is to become the leading brand in the cabinet manufacturing industry in Ohio and to establish a one-stop cabinet-making company in Ohio.
d. Goals and Objectives
The goals and objectives of a cabinet-making business are to make cabinets to suit every client’s needs, cabinets that will fit into building designs and add to the beauty of the interiors of houses.
e. Organizational Structure
- Chief Executives Office (Owner)
- Admin Officer (Cashier)
- Cabinet Makers
- Truck Driver
a. SWOT Analysis
Our core strength lies in the quality of our finished cabinets, the power of our team, and the state-of-the-art cabinet-making factory we own. We have a team of highly trained and experienced cabinet makers and support staff members that can produce quality office and household cabinets. We are well-positioned in the heart of Sharonville – Ohio and we know we will attract loads of clients from the first day we open our business for operation.
A major weakness that may count against us is the fact that we are a new cabinet manufacturing company and we don’t have the financial capacity to compete with multi-million dollar cabinet manufacturing companies when it comes to making cabinets at rock bottom prices. So also, we may not have enough cash to promote our cabinet manufacturing company the way we would want to.
The fact that we are going to be operating our cabinet manufacturing company in Sharonville – Ohio provides us with unlimited opportunities to sell our cabinets to a large number of individuals and corporate organizations.
Just like any other business, one of the major threats that we are likely going to face is an economic downturn. It is a fact that an economic downturn affects purchasing or spending power. Another threat that may likely confront us is the arrival of a new cabinet-making company or a furniture manufacturing business that is also into cabinet making in the same location where ours is located. Unfavorable government policies may also pose a threat to our business especially as it relates to the importation of raw materials.
b. How Does Cabinet Making Businesses Make Money?
Cabinet making businesses make money by;
- Building cabinets
- Designing cabinets
- Installing cabinets
- Custom cabinetry
- Bathroom vanities
c. Payment Options
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
d. Sales & Advertising Strategies
- Introduce your business by sending introductory letters alongside your brochure to households, home staging companies, and players in the construction and real estate industry
- Advertise your services in community-based newspapers, local TV and radio stations
- List your business and products on yellow pages ads (local directories)
- Leverage on the internet to promote your cabinet making company
- Engage in direct marketing and sales
- Encourage the use of word-of-mouth marketing (referrals)
- Leverage on the internet to promote your business
- Join local chambers of commerce and industries around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks.
- Engage the services of marketing executives and business developers to carry out direct marketing for you.
a. How Much Should You Charge for your Product/Service?
There is no fixed cost when it comes to the amount you charge because there are unique factors that will determine it. For example, a professional cabinet refacing for a typical 10-foot-by-12-foot kitchen starts at around $1,000 to $3,000 for laminate. You are expected to pay $2,500 to $6,000 for real wood veneer. Costs can rise from $7,000 to $9,000 or more for a large project with high-quality wood veneer.
b. How Much Profit Do Cabinet Making Business Owners Make a Year?
It depends, but available reports show that cabinet-making business owners make over $55,000 annually.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the cabinet making business
- The types of cabinets they are specialized in
- The location of the cabinet making business is covering
- The management style of the cabinet making business
- The business approach of the cabinet making business
- The advertising and marketing strategies adopted by the cabinet-making business.
- The number of years the cabinet making business is in business
d. What is the Profit Margin of a Cabinet Making Business?
The profit margin of a cabinet-making business is not fixed; to a large extent, it will depend on some factors that are unique to your location. It could range from 45 to 60 percent depending on the size of the contract and the types of cabinets to be designed.
e. What is the Sales Forecast?
Below is the sales forecast for a cabinet-making business. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $220,000
- Second Fiscal Year: $350,000
- Third Fiscal Year: $470,000
Set Up your Office
a. How Do You Choose a Perfect Location for Cabinet Making Business?
- The demography of the location especially as it relates to activities in the real estate market
- The demand for the cabinets and bedroom vanities in the location
- The purchasing power of businesses and the residents of the location
- Accessibility of the location
- The number of cabinets making businesses in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Cabinet Making Business?
- Los Angeles, California
- New York City, New York
- Brattleboro, Vermont
- Tucson, Arizona
- Silver Spring, Maryland
- Rowland Heights, California
- Portland, Oregon
- Richmond, Virginia
- Green Bay, Wisconsin
- Dallas, Texas
- Green Bay, Wisconsin
- Passaic, New Jersey
- Plano, Texas
c. What Equipment is Needed to Operate a Cabinet Making Business?
When it comes to starting a standard cabinet-making company, you will need a truck or van, a complete toolbox, and other related equipment. It is important to state that this equipment can be purchased as fairly used if you are operating on a low budget.
When it comes to hiring employees for a standard cabinet-making business, you should make plans to hire a competent chief executive offer (you can occupy this position), cabinet makers, and truck drivers.
Launch the Business Proper
You can choose to organize an opening party to officially launch the business. You can choose to do a soft opening party if you are operating on a low budget or you can go for a grand opening party. The bottom line is that with a proper launching of the business, you would have officially informed people in your city that your cabinet-making business is open for business.
a. What Makes a Cabinet Making Business Successful?
- Choose a good location and workshop facility to launch the business
- Make sure your cabinet makers are familiar with trendy cabinets and faster ways for making cabinets
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your cabinet making business
- Leverage on available online and offline platforms to promote your cabinet making business
b. What Happens During a Typical Day at a Cabinet Making Business?
- The workshop is open for the day’s work
- The jobs to be done for the day are reviewed and all the needed materials are put together
- Cabinets are designed and made
- Cabinets are transported to the site and installed
- Staff return back to the office and reports for the day is written and submitted
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Cabinet Making Business?
- Excellent tool handling skills
- Excellent cabin designing skills
- Excellent project managing skills
- Customer service skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in cabin making or even furniture making
- Experience in managing people
- Experience in business administration
- Experience in handling projects.