Tractor Restoration business

Good afternoon everyone. I recently have been getting some interests sparked in opening my own tractor rebuilding and restoration business. Wondering if anyone thinks it would be a profitable business in MN. I am only 22, and have been doing it on my own tractors for about 10 years (3 done so far). I would love to open my own business doing everything from minor jobs to major overhauls and include painting (base/clear or single stage options). I know some things to overcome would be finding a customer base. Having reasonable prices that people would be willing to pay. I know a lot of people in our hobby do the restoring themselves because they find it rewarding/stress reliever/like it, and so forth. So the customer base is only a fraction of the people that actually restore tractors. Wondering what everyones thoughts are, as I would love to do something that I have always loved to do, and actually make a living doing it!

May as well ? Not much else to get into as alot of places laying off and shutting down.

If you live at home and can keep it all cash and under the radar then it is WAY easier to make good money at it then if you go get a vendor liscense and then have to deal with all the record keeping and taxes.

The success of any business is relative to the operators ability to conduct business. That's includes far more than your ability to restore a tractor. Of course you'll need to be proficient at restorations. But, you'll need to be able to run the administrative end of things. Paying bills (on time) managing cost, dealing with taxes, insurance, and state/local business licensing. You'll need some background in labor managment and relations if things go well. And you'll need the self-motivation to work when yo don't always feel the urge. Owning a small business is 24/7.

Then you need customers. With he current economic climate, discretionay funds are in short supply with the bulk of us. Not to say no one will be knocking on your door, but things will be slower now than ordinary. Who knows when/if the business climate will pick back up.

There are a number of very successful restoration business's around. I hope someday to read where you're another one of them.

Nobody gets anywhere unless they try! Since you are young man with presumably no bills to pay or mouths to feed, I say stick your kneck out and give it a go.

Ken, I will never knock anybody looking for work they enjoy. I would, however, caution them to take a realistic look at whether that work will be a money-making proposition.

I don't know how you'd begin to use the search engine here to find them, but there a gazillion posts about how it's difficult to refurbish (never mind restore) a tractor and come out ahead in terms of dollars, even if you don't charge your labor to the project. The typical case starts with the $300 carcass of a Farmall A, adds $1200 just for parts and subbing out the head and crank to get the motor running right, another three or four hundred for bearings and seals here and there, Say $300-500 for nice paint and decals. We're up to $2100-$2500 and haven't even discussed tires, steering wheels, rims, voltage regulators, fan spindles or tin-work. All that for a tractor that might bring $3 grand when done.

OTOH -- I read about these fellas that pay megabucks to have a tractor restored to factory. I think they're a little nuts sometimes, but they are out there and are willing to pay somebody to do it for them. It's largely been a green thing, but my sense is that I'm seeing more of it in the various shades of red and other colors. These guys will not have a hex where a square-head should be, and they won't have a plain square-head where the original was a dot-head. If you've got the skills and the parts sources, and are willing to invest in the tools (as in fabbing parts), manuals and parts catalogs necessary to do that kind of work, there is a market for that. But it will take some time to build a reputation. I can't imagine building that kind of reputation without being able to eat the cost of producing a couple of tractors like that on your own, and eating the cost of taking them out to shows to have as showpieces for the kind of work you can do.

So as far as the restoration scheme, you can make it work, but I wouldn't give up my day job until the business is bringing in enough to keep me sleeping indoors and eating.

As far as repair and maintenance, that's another story, and I'd think it would depend on where you are and whether there is enough call for that kind of work. You could make a decent side business out of it but, unless you're in heavy ag country with a lot of privately owned farms, it'd be tough to make a living solely off of that work. To do well with it I'd think you'd have to have a shop for people to bring stuff to, as well as be willing to work off-site, which means staffing the shop while you're in the field, duplication of tools . . .

This all sounds discouraging, but it is worth looking into. It can be done, but will take a good bit of skill, time, and patience to get either scheme up and running.

The Small Business Administration sponsors classes/seminars for folks thinking about starting up a business that might be useful to you, whether you need a loan from them or not. Maybe call them, and see if they have anything like that scheduled in your area.

MF Poor is right on. I've seen some very talented people go under because they don't keep up on the business end of things. Too nice of guys. The first rule is NO CHARGING the bill, and you've got to be hard nosed about it. No pay, no tractor.
Like others have said, you might try it as a side job for a while until you get established. Good luck on whatever you decide.

Irv*

Ken,
I"ve been doing what you are talking about for about two years now, only I"m doing it on the side and keeping my day job. I"ve had no trouble keeping customers so far, but with the economic climate as it is (whether real or perceived) I would hate to bank on this business as my only income. You will get lots and lots of inquiries about restoring folks tractors, but when they find out how much it is going to cost, many will fall by the wayside. Since you have restored your own tractors, you know as well as I do, that you will put more money into the tractor than what it is worth. Now add in your labor and the cost becomes much higher. You know from experience how much time is involved in restoring a tractor correctly. Most of your customers will not. I always have a serious sit down meeting with any prospective customer and lay it all on the line right then and there. I tell them that it is going to cost much more than they can ever hope to sell the tractor for. I tell them I can wait on my labor, but all parts, machine work, supplies, etc will be paid for in advance. Most customers put down a lump sum to get started and when I need more money, I contact them and work stops until I more money is received. Don"t bankroll anybody"s restoration, or you might get caught holding the bag. I also have them sign a form that states I"m not responsible for any damage or theft to their tractor while it is in my shop. I also have them sign a mechanic"s lien stating that they will not take possession of the tractor until all bills are paid. There"s probably a lot more that I"m forgetting, but you get the general idea. Keep very detailed records of all money spent. I set up an Excel spreadsheet that has columns for vendors, what was purchased, amount, running total, date, invoice number, etc. I keep all invoices together and depending on the customer, I will give those over to them at the end of the restoration after everything is settled, or as they request them. If you give them out on request, make copies for yourself.

I hope that you have great success in whatever you decide to do.

Go to many shows, talk to many owners, find out who did what on their tractors. Three tractors in 10 years ? I want mine done for the NFMS in Louisville in FEB 2009, or you don't get the job. How much machine shop experience do you have?? Can you fab parts that are no longer available? Are you going to pay full retail for parts that are available; no profit there and don't try to sell me a part I know costs$1 for $1.25.
Buy a couple of models, restore then as show pieces of your work, keeping an exact log of time(even phone calls/or talking about), expenses(ALL: shop heat/light, shop towels, etc.). Take these to a show with a for sale price,the CORRECT POLICE will tell you exactly what is wrong, as will the customer who spots a paint/decal flaw.
Are you going to warranty the "rebuilt" mag from e-bay? How about the carb kit that is right for the tractor but wrong for the farmer replacement from 50 years ago?

Thought of one other thing. If you do get started in the restoration business, don't EVER get talked into compromising you quality by the customer. I restored a Minneapolis Moline for a fellow who wanted to know blow by blow what I was doing, which was OK by me. The sheet metal was badly pitted and was going to require a lot of time filling and sanding. I made the mistake of telling him that, and he did not see the value in doing so. After much discussion, I caved and did not do all the prep work that I should have. He got a shiny paint job, but the pits stood out like a sore thumb. He was happy as a clam, and even got two large magnetic signs stating that his tractor was restored by me. Now, the customer was happy with the end result, but I was not, and now he is advertising that this is the kind of work I produce. I still cringe when I see that tractor knowing that I could have done a better job. I don't know how many customers I have lost, if any, due to that tractor. Basically, don't put out anything that you wouldn't want your name on.

I have to agree with scottHOMEy below.

My son and I are approached occasionally about doing someone's tractor. We decded not to get involved. If you do decide to go for it, be totally upfront with the customer about all costs--parts AND labor. That can change a customer's mind real quickly.

I will say that if you try this make @amn sure that the "customers" sign an agreement that they are to pay, "x" amount in parts and labor. Also include a down payment like 25% of the estimated total. A lot of people are real cheap and will frown at the cost of their restored John deere B costing $5000. I say go for it and see what happens, dont get burned by some cheap shmuck that wants to stiff you.
PS: Be sure that payment is made in full with check cleared before the guy drives off with the tractor.

Go down to the local JD or IH dealer and apply for a mechanic job. If you are not good enough to get that job you are not good enough to start your own repair business.

DO that for 5 years. Save your money to build your own shop. After 5 years you can decide whther you want to fiddle around with old stuff or repair the new machinery. Having your own shop and doing quality repairs to modern ag your competition is the dealer 70 dollar an hour labor charge.

Gordo

I agree with DRL. Do NOT ever compromise quality.

I occasionally have people come to me with a beater car and want me to "just shoot some paint on it so it looks better". Then they leave in a huff when I refuse. I will NOT paint anything I haven't prepped from the start, or do work of lesser quality than I'm capable of. I'll either do it to the best of my ability or forget it.

Always remember, any paint job you do has your name on it in front of the public.

Im thinking you should take a general business course first.Then theres the mechanical side then the fabricating then the electrical then the bodyshop then dont forget the painting.Then when you finish that there is the collection agency part.What ever you do go slow and methodical in these turbulant times.

I would certainly recommend a tractor repair shop but defenitely not a tractor restoration shop. If somebody wants a 12 conversion on a 9n, tires changed, tires repaired and chloride pumped, carb kits, plugs, wires, fuel tank leaks fixed and coatings applied to fuel tanks. Occasional repaint job, radiators changed or fixed, new belts, hoses, new hydraulic hoses and fittings. The list is endless with just repairs. Most shops charge $85 per hour. Charge $30-$40 per hour and advertise the rate. Be efficiant and honest and you will have all the work you can handle. Tractor restorations get into a whole new can of worms where you will find yourself working for 10 cents per hour and people will still find something to complain about. Good luck.

Goose, I agree with you and DRL 100%. A repaired tractor goes back home anonymously to do it's work, but a restored tractor is paraded in front of the whole world. Jim

There are a lot of small acreage tractor owners out there who are not prepared to do more than change the oil. Keeping all those Ford 9Ns and MF 135s running could be a business in itself, with restoration in the winter and odd times. Heaven knows that somebody local who is competent and reasonable would beat calling the dealer to send a mechanic out and have to pay for 2 hours road time.

Ken, this is one of the things that I wanted to do after I graduated from high school. Not saying how old I am, but I'm closer to 50 than I am to 40. Still haven't attempted it, but still comtemplating doing so. If you were to diversify I think you would have a bettr chance at success and prosperity. Do repairs, sales, resto's, and pickup a couple of short lines of equipment and parts sales. Also, if you were to sell on consignment I think that would help your business. Remember to keep your doors open to repair jobs.

BEST OF LUCK WITH YOUR BUSINESS

Give it a shot. Remember that Bill Gates dropped out of college to start Microsoft and a lot of other successful businesses were started by guys like you who are passionate about something and took a risk based on that passion. If you don't try it, you'll always have the "what ifs."

You're young, now's the time to try it. Just wait until you have a wife and a couple of kids. You chances of trying it then is pretty much zilch.

My opinion is that the repair part of the business is where you'll be sucessful. Restoration jobs don't come along every day, but there are an endless number of hobby farm/food plot guys here in Minnesota that need that 8n to run again. Word of mouth is your best advertising. I helped one neighbor a year ago split his 460 to fix the TA. Ever since then I've had a lot of random people stop by asking if I could help them with their tractor. This all came from word of mouth. It's not a businees for me and I don't do it for money, it's just an addiction! (I just ask for a bottle of whisky in trade for my mechanical skills). Get your name on craigslist, go to the shows, LeSueur, Albany, Hutchinson, etc.
Good Luck!

These are things that are best left unsaid.

irs