How to Start a Furniture Repair Business
It takes a talented, patient person to take a used, tired piece of furniture and make it new again, but many people find the art of furniture restoration an enjoyable challenge. It’s not an easy feat, especially when you’re working with an antique and are trying to preserve the heart of the piece, but the rewards can be big. If you’re a talented and creative woodworker, turning your passion for furniture repair into a business could help you profit from your hobby.
Furniture repair businesses fix and restore a variety of furniture, saving customers from having to purchase new furniture. Some businesses specialize in particular areas, such as restoring antiques, furniture refinishing, or repairing office furniture. Furniture refinishing businesses are closely related to repair businesses, and some repair businesses may offer refinishing as parts of their services. Many furniture repair businesses also offer reupholstery services.
A repair business may establish a relationship with antique store owners, office building owners, or the owners of apartment rental complexes. All of these industries have a need for furniture repair, as well as the everyday homeowner who would rather be able to fix and continue to enjoy a piece than buy something new.
One major advantage of this type of business is that it can be started on a part-time basis from home. Starting a business from home can help save money on some expenses like a lease, making it easier to build up clientele in the business’s beginning stages.
The furniture repair industry has undergone growth from 2014 through 2019. According to IBIS World, the industry is predicted to bring in $2 billion in revenue in 2019. While the industry experienced a 0.5 percent growth from 2014 to 2019, the number of furniture repair businesses declined to 23,571. Industry employment has remained steady at 33,589.
This industry is subjected to multiple factors that affect its growth and profitability. Furniture repair businesses often thrive when the economy is distressed since customers are more likely to have furniture repaired rather than paying for new furniture. When the economy improves, customers are more likely to simply buy new furniture. Still, an improved economy means more offices are full, leading employers to repair furniture instead of buying new office furniture.
The furniture repair industry often experiences growth as office vacancies are reduced, and business owners need to repair furniture that sees a high amount of use. Homeowners who choose to remodel their homes also generate business for this industry since they often choose to have the furniture reupholstered to match the new decor.
A furniture repair business may target any number of different markets. Businesses that specialize in antique restoration will appeal to antique collectors, families with antiques that have been passed down, and even museums. Businesses with more of a general, full-service approach may appeal to homeowners, business owners, rental property owners, and anyone else with more modern furniture in need of repair or reupholstering.
In general, a large portion of business comes from higher-earning homeowners as they are more likely to purchase nicer furniture.
Checklist for Starting a Furniture Repair Business
If you’re thinking about starting your own furniture repair business, there are a few things you should keep in mind. Here is a checklist of the essentials to get started.
Step 1: Write a Business Plan
A business plan is an essential document for any business, especially a furniture repair business as it will help you set goals and track progress over time.
To write a business plan for a furniture repair business, start by outlining the company’s mission statement and key objectives. Then, describe the target market for your business and how you plan to reach them. Next, outline the products and services you offer, as well as your pricing strategy.
Finally, describe your management team and how you plan to grow the business. Be sure to include financial projections, including revenue and expenses. The more detailed your business plan is, the more likely you are to attract funding and achieve your business goals.
Related: How to write a business plan
Step 2: Name the Business
Finding the perfect business name for a furniture repair business can be challenging. Not only does the name have to resonate with your customers, but it also has to be available to use.
Step 3: Form a Business Entity
A business entity refers to how a business is legally organized to operate. There are four primary business entities to choose from, which include the sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). Each type of entity has its own pros and cons, such as liability exposure, costs, and administrative requirements.
When deciding on which business entity is best for a furniture repair business, it normally comes down to the sole proprietorship and Limited Liability Company.
A partnership opens the owners up to unnecessary personal liability because if a partner does something to get the business sued, or runs off with cash from the business, the other partners are personally liable to repay. The corporation can be a good choice because it separates the business assets from the owner’s assets. If the corporation is sued or certain business debts can’t be paid back, the owners aren’t personally responsible to repay them. The downside to the corporation is that it is more complicated than all the other entities and requires more administration than the LLC. If you plan on raising a lot of investment though, the corporation is usually the better choice.
That leaves the sole proprietorship and LLC.
The sole proprietorship is the least expensive and easiest entity to start which is appealing. The downside is the owner is personally liable should anything happen to the business, which is an important consideration. The LLC offers the ability to operate as a sole proprietorship with the liability protection of a corporation. Depending on the state, the cost to form an LLC runs from $40 – $500, which is pretty inexpensive for protecting the owners from business-related lawsuits and certain debts.
Related: Guide to forming your LLC
Forming an LLC sounds complicated and expensive, but using an entity formation service guides you through the process so you know it was done right.
Some popular LLC formation services include:
IncFile - $0 plus state fees & free registered agent for 1 year!
IncAuthority - $0 plus state fees & free registered agent the first year!
ZenBusiness - $49 plus state fees & free registered agent for 1 year!
Step 4: Select your Location
When choosing a location for your furniture repair business, there are a few things to consider. First, you’ll want to find a space that is large enough to accommodate your equipment and inventory. Second, you’ll want to choose a location that is convenient for your customers. And finally, you’ll want to find a space that is affordable.
One of the benefits of starting a furniture repair business is that it can be run out of the owner’s home. A garage or basement workshop may be all the space that a startup refinishing business requires, as long as the space is well-lit and enough outlets are available to power tools.
Related: Choosing a business location
Step 5: Apply for Business Licenses and Permits
There aren’t specific business licenses for furniture repair business owners; however, there are general business licenses that will be needed, such as a sales tax permit and Employer Identification Number.
Step 6: Find Financing
Coming up with a good business idea and having the skills to run it are one thing, but getting the funding to start a furniture refinishing business is another. Fortunately, the cost to start a furniture repair business is relatively low; however, financing can be difficult. In order to get a loan, the borrower(s) will need to have good credit and be able to personally invest 15-25% towards the total start-up costs.
Step 7: Open a Business Bank Account
Keeping your small business and personal finances in separate bank accounts is important to track the income and expenses of your business and identify trends.
Many banks offer free business checking accounts, so be sure to find a cost-effective option for your business.
Step 8: Get your Marketing Plan in Place
A furniture repair business will rely on marketing to initially draw in customers, especially when the business is new. Marketing doesn’t have to be complex. Furniture repair shops can post ads in newspapers, post on social media platforms like Facebook, Instagram, and Pinterest with before and after pictures of finished products, and even post flyers at local non-competing businesses. Furniture repair shop owners can even bring in business through the simple act of going to local apartment complexes and office owners and introducing themselves and their businesses.
As the business grows, word-of-mouth marketing from antique dealers and collectors will be the most effective and profitable source of new customers.
One important task while working on the marketing is developing an online presence. A website developer may be out of the budget, but Wix makes it easy for non-technical people to get a website running quickly and affordably.
Step 9: Get Business Insurance
There are several types of insurance to consider when starting a furniture repair business. A few of these include:
– Commercial liability insurance protects the business in case a customer is hurt while at the store or workshop.
– Commercial property insurance provides coverage for the cost of equipment and inventory, as well as the cost of the store if it’s ever damaged by a fire, flood, or other events.
– Worker’s compensation insurance is required when a business has employees and covers lost wages or medical bills if an employee is hurt while on the job.
The cost to insure a furniture refinishing business will vary depending on a number of variables, like the value of a business’s inventory and equipment, the number of employees on staff, a business’ location, and more. To get the most accurate idea of what insurance will cost, contact a number of different companies, and request quotes. Carefully compare those quotes and consider factors like premiums, deductibles, and the quality of coverage to decide what’s best for your business.
If you are operating out of your home, check your homeowner’s policy to ensure operating a business won’t violate your policy.
Step 10: Hire Employees
Depending on the size of a furniture repair business, employees may be needed. According to PayScale, employees in the furniture repair and reupholstering industry make an average of $17 per hour or a salary of about $46,000 per year.
Labor is typically the largest expense for a furniture restoration business. Having skilled employees is critical for both customer satisfaction and not causing costly damage to the furniture.
When hiring employees, a business also needs to budget for expenses like workman’s comp insurance, contributions to unemployment insurance, and paid time off. Depending on how a furniture repair business is designed, additional staff may also mean purchasing additional tools and workstations.
Related: Hiring your first employee
Step 11: Set up an Accounting System
Setting up an accounting system for your furniture repair business is critical to your business’s long-term success.
Staying on top of taxes not only keeps the business out of trouble with the government, but the numbers can be used to track and monitor trends and cash flow in the business and maximize profits.
The thought of accounting can be intimidating for a lot of new entrepreneurs. There are a number of ways of handling bookkeeping, from DIY to hiring a bookkeeper. These include:
- Pen and paper - Low expense, but difficult to track.
- Spreadsheet - Low expense, but easy to make errors.
- Accounting software - Medium expense, but owner typically inputs expenses. Some great accounting software programs include Freshbooks or Wave Accounting.
- Hire a bookkeeper - Higher expense, though very affordable at $100-$200 per month in most cases. A dedicated bookkeeper will probably save money because, in addition to handling all of the bookkeeping (so you can focus on the business), they also provide personalized tax advice and ensure the business is in compliance.
Find bookkeepers in your local area or use a service like 800Accountant.
How much does it cost to start a furniture repair business?
Rather than investing in inventory and a storefront, many furniture repair businesses are started in basements with only basic tools and supplies. Starting small and then expanding into a retail space as the business grows helps to keep costs down and offers the convenience of being able to work flexible hours from home. Expect to invest about $3,000 in supplies and tools on the low end, though costs could range up to $10,000 for more extensive or new equipment. Specialty repair businesses, such as those focusing on antiques, may cost more depending on the equipment and tools required.
Some common startup costs for opening a furniture repair business include:
– Woodworking tools
– Upholstery tools
– Paints, stains, stripper, varnish, and wood fillers
How much does a furniture repair business owner make?
A furniture repair business’s profits depend on the business’ specialties, location, rates, years in operation, and customer base. According to the Bureau of Labor Statistics, as of May 2017, upholsterers made a median annual salary of $33,660. Furniture finishers made a median annual salary of $31,300, but the 90th percentile made approximately $48,610 per year.
Specializing in a particular area, such as restoring antique pieces, can let a business ask for higher prices and enjoy higher profits.
An additional revenue stream can come from making money furniture flipping by refinishing inexpensive pieces found at garage sales and flea markets.
Are there grants to start a furniture repair business?
It’s extremely rare to find a grant to start a furniture repair business. If you search for business grants, you will come across a lot of scams and misinformation. Occasionally an organization will offer grants to start a business, however, be skeptical and don’t provide any sensitive personal information or pay money to get more information.
Legitimate federal grants can be found at Grants.gov and you can check on your state’s economic development office to see if they have any grants available.
What skills are needed to run a furniture repair business?
Attention to detail. Repairing furniture well requires excellent attention to detail. From matching an exact shade of stain to ensuring perfect alignment between two pieces, a repair business owner needs to be aware of the nuances involved in every piece of furniture. If you feel like more training is needed, completing an apprenticeship or other type of training is a valuable option.
Woodworking skills. Some carpentry and woodworking skills are beneficial in opening a repair business since some repairs may need new pieces created and assembled.
Upholstery skills. Offering furniture upholstery and reupholstery services can expand the offerings and versatility of a furniture refinishing business, potentially bringing in new clients and resulting in higher-paying projects.
Creativity. Finding the right solution to a furniture repair challenge takes some creativity and resourcefulness. A business owner who is innovative and creative is often better able to meet the repair challenges than an owner with limited creativity is.
Multitasking capabilities. Repairing furniture is often a balancing act, and a business owner may be working on multiple projects at once. The ability to multitask helps ensure that all projects make progress and that the business meets all deadlines.
Customer service skills. A repair business owner needs to provide quality customer service. Previous experience in a customer service setting will help owners understand the importance of clear communication, address customer concerns, and find solutions to problems.
Marketing skills. When a business owner is able to handle some of their marketing, they can save costs and get more return on a smaller marketing budget. This is particularly important to startup furniture repair businesses, which often have a limited marketing budget.
What is the NAICS code for a furniture repair business?
The NAICS code for a furniture repair business is 811420, which is classified under Reupholstery and Furniture Repair.
The NAICS code (North American Industry Classification System) is a federal system to classify different types of businesses for the collection and reporting of statistical data.