Should you buy that serger you've been coveting? It's expensive. But if you had it, could you grow your business in ways you can't right now?
Or maybe it's a kiln you need? Or a Wacom tablet? Or a shipping label printer?
Sometimes it makes sense to make a capital investment in your business, even if you have very little extra money to spend. A capital investment is money your business spends to buy a fixed asset, like a machine or a building. If that asset will propel your business forward and help you reach new goals you're struggling to attain otherwise, it makes sense to spend the money now.
I was on Twitter a few weeks ago and caught a glimpse of a capital investment my friend and fellow plush maker, Phil Barbato, had made, something that would surely make production work easier for his plush business: a custom die cutter.
Phil designs and sews a wonderful line of softies. They are silly and cute with his signature design feature – a row of rounded teeth (sometimes one tooth is a bit yellow). I’ve admired Phil’s work for years, and had him on the blog once before to talk about selling softies at ComicCon.
Meghan proving that you can indeed sew while wearing a baby.
With a die cutter, Phil and his wife and business partner, Meghan, can cut fabric for toys quickly and accurately. If you sew you know that cutting fabric is really time consuming.
Phil and his wife are savvy business people who really look carefully at the bottom line to be sure that they are actually profiting from the wholesale orders they fulfill and the shows they attend. I figured investing in custom dies and a die cutter wasn’t something they just jumped into. I wanted to ask Phil more about why he chose to make this capital investment in his business, and how it was working out.
“In the last 12 months we sold about 1,000 pieces," Phil said, "We never have much back-stock, so it's fair to say that's what we produced. That does include about 250 monster scarves, which technically aren't plush.”
Okay, so that’s about 83 items a month, on average. That's a lot. I can see why Phil started searching for ways to simplify and speed up the process.
“My wife and business partner, Meghan, and I both arrived at Accuquilt Studio die cutting machine separately through research and recommendations. A key selling point was the ability to order custom dies. We had other concerns about what thickness of fabric it could handle and how to format design files for the dies, but customer support at Accuquilt was really great with our pre-sales questions.”
“Once we were sure we could have our shapes made into a die and be able to cut the fleece we use (for the record, the Accuquilt can cut through three layers of fleece at once with no problem), we placed the order."
"Accuquilt has frequent sales on the die cutters and dies, so we waited for one and picked up the machine for around $450, I think. You can also find used machines out there on eBay and such, but you know, caveat emptor."
A few of Phil's custom dies.
Once you have selected a design to have made into a custom die, you send the digital templates to Accuquilt. “After your design is converted to a CAD drawing, skilled craftspeople shape and set the blades by hand. I would love to watch that process!” Phil said.
I watched the short (and sorta corny) video on the Accuquilt website and, as the name implies, this tool is really meant for quilting cottons so it's great to hear that it can also handle three layers of fleece.
Parts for a tiny octopus. By hand, this takes 15 minutes to cut out. With the die cutter it takes 10 seconds to cut 4 sets.
Phil says, “The first custom die we ordered at the time we got the machine was for our Tiny Octopus plush. These guys were a serious pain to cut out, very small and fiddly. The perfect candidate for a die cut pattern. I'm pretty sure the machine paid for itself on the first batch of Tiny Octopi. It used to take about 10 minutes to cut one pattern out, now you can do dozens in the same time period.”
Fast and accurate. That's pretty great!
Phil emphasized a few key points about the die cutters.
- While the machine can cut through the faux fur we use, I don't like the way it cuts the fur short on the bottom, so we still hand-cut those pieces.
- The startup time and cost is significant. From new design to cutting dies costs anywhere from $150 to $300 (not including your own or someone else's design time, that can be a couple hours) and can take a week or two. We only have dies for pieces for which we have perfected the pattern and are high volume enough to justify the cost of the die.
- If your patterns are not already digitized and/or you're not comfortable with something like Adobe Illustrator or CAD, you might have to pay someone else to layout the template designs.
- Custom dies are limited to a few stock sizes, so you may have to get crafty with die layout.
- If you want to cut anything wider than 16 inches, you're can’t use the Accuquilt. There may be a bigger machine out there, but it's probably industrial grade and has a "call for a quote" kind of price.
- If you're particular about lining up fabric patterns with parts of the piece or trying to match fabric patterns to different parts of the piece it will take some practice and you might have to take that into consideration when designing the layout of your die.
- The dies are permanent (and expensive, did I mention that?), so do not order a die until you're confident your pattern works. I made the seam allowances on our Tiny Octo die a little too small, and I curse myself every time I make one (it's still cheaper and faster though).
- Dies need to be cleaned periodically. Fuzz will build up in the corners and the fabric will not cut in those spots. Accuquilt sent us a (very sharp) dental pick for doing this. I'd say you need to clean the die every hundred passes or so.
Look at all those octopi!
“Having the die cutter has given us a little more breathing room on production costs and freed up the time of my chief cutter (Meghan) to do more marketing and business-y stuff. It's much easier for us to sell pieces wholesale without losing our shirts.”
I wondered why Phil and Meghan decided to buy a machine to do the cutting rather than have their toys factory produced.
“The advantage over a factory mass-production run is time and cost. Didn't I say that using these dies was slow and expensive? Yes, but just to get a run of one design mass-produced at a factory will set you back about $10,000 and six months. The cost and time only goes up if you're picky about quality control, want color variations or multiple designs.”
“Mass-produced plush is made pretty much the same way we make it, by people sewing on machines. The biggest cost savings with factory plush are mass-cutting and cheap labor in developing countries.”
I was curious if having the die cutter might allow Phil to more easily hire local help. “We definitely still need to hire help (Do you know anyone? We desperately need piece-workers!), and the cost savings and uniformity of parts makes it much easier to do so.”
Sometimes it really makes sense to invest in a significant piece of equipment that will allow you to run your business more efficiently. Buying a die cutter and ordering custom dies for his most popular toys is a good solution for Phil Barbato’s plush business, allowing it to grow and become more profitable than it could otherwise.
Are there pieces of equipment, or significant capital investments, you could make that would propel your business forward? Please share things you’ve purchased, or hope to purchase some day, that would take your business to the next level.