Starting cellphone case manufacture business

[deny_winarto]

Hi all, i'm new here.
I just graduated from college, where i learn some Powershape and PowerCAM and took several industrial classes about production processes.
I already set a goal, (because it's better to have one).
It's to become a cellphone case manufacturer, but to be honest i almost have no idea how to get to there...

So could anyone with experience in this business give me a general idea and advices?
I have tried importing and selling some cases from china to get a better look on how this business work.. And i think it's got a good prospect in my country.. Cellphone users are growing rapidly, and so is the accessories sales..

Some of my questions :
1. Why is Delcam not as popular as Solidwork or other CAD/CAM software? It's the one that i know so i prefer using it..
2. How or where do you guys think should i start this business? Should i work as employee first?
3. Could anyone suggest which cnc machines are used in this business? Especially for creating the molding?
4. What do you guys think about the pirating problem? I'm concerned about competition because alot of famous casings are being "reverse-engineered" by chinese companies
5. Anything else i should know? to survive and be successful in this business?

Thanks

[xyzeugene]

Originally Posted by deny_winarto Some of my questions : 1. Why is Delcam not as popular as Solidwork or other CAD/CAM software? It's the one that i know so i prefer using it.. 2. How or where do you guys think should i start this business? Should i work as employee first? 3. Could anyone suggest which cnc machines are used in this business? Especially for creating the molding? 4. What do you guys think about the pirating problem? I'm concerned about competition because alot of famous casings are being "reverse-engineered" by chinese companies 5. Anything else i should know? to survive and be successful in this business? Thanks

1 Solidwork is a more professional program with more industrial features its like the comparison: Ms Works Pad to MS Word

2 Get a corporate or engineering job, save lots of money through the stock market so you can have capital to start a business - this will teach you how to look at the paper end of a business.

3 CNC machines are very expensive thats why you need capital - buy one according to your needs there are lots of them. I assume your talking about cell phone cases when you say molding - So buy a Sherline under $1K so you can make a prototype - then you try to sell your prototype on amazon.com. No need in buying a $50K machine not including overhead such as building rental; Plus you will know if your idea will sell.

4 Expensive machines prevent much of piracy also the patent office is there if you got a really good idea to protect.

Chinese Machining is not very accurate - you get what you pay for. US always wins against them in accuracy in production

5 To start a half way decent cnc machine shop you need about 1 million dollars. This includes good used machines, rent, tooling, insurance, loan interest, legal fees, computers, permanent phone lines, software, guard dog, and etc...

-----
As you can see its not a very cheap proposition - if you have family money to spend then thats the risk you are taking -

I myself work as an internal auditor for a fortune 15 company - so my salary is very good. I assuming my family business and turning it into a cnc machine shop in a 3 year plan. Part of the plan includes me coming up with $150K to buy machines - yes this is sucking up all my paychecks. My family already has 30K sqft - land and lot with the existing welding business which is been appraised at $4 million since it is in Houston proper. I already have customers in the pipeline since my family business is a major vendor for Landry's(publicly traded).

You may think your clever, you may well be- but I got a perfect score in Math and top 5% in English in SATs . I have a degree in business and computer science which I both use in my professional career - so I may be your peer intellectually. My point is you will need a lot of resources inspite of your clever self. But don't be discouraged - but you may need to think about this a little bit more.

[underthetire]

I know what the fruit logo company uses.
MORI SEIKI GLOBAL WEB SITE | PRODUCTS | NVD Series

Figure 175K for the smallest one. We have one, er actually the small ,medium, and largest one Considering I can buy cases off Evilbay for 5 bucks shipped to my house, it's gonna take a lot to pay for the equipment.

[deny_winarto]

Originally Posted by xyzeugene 1 Solidwork is a more professional program with more industrial features its like the comparison: Ms Works Pad to MS Word 2 Get a corporate or engineering job, save lots of money through the stock market so you can have capital to start a business - this will teach you how to look at the paper end of a business. 3 CNC machines are very expensive thats why you need capital - buy one according to your needs there are lots of them. I assume your talking about cell phone cases when you say molding - So buy a Sherline under $1K so you can make a prototype - then you try to sell your prototype on amazon.com. No need in buying a $50K machine not including overhead such as building rental; Plus you will know if your idea will sell. 4 Expensive machines prevent much of piracy also the patent office is there if you got a really good idea to protect. Chinese Machining is not very accurate - you get what you pay for. US always wins against them in accuracy in production 5 To start a half way decent cnc machine shop you need about 1 million dollars. This includes good used machines, rent, tooling, insurance, loan interest, legal fees, computers, permanent phone lines, software, guard dog, and etc... ----- As you can see its not a very cheap proposition - if you have family money to spend then thats the risk you are taking - I myself work as an internal auditor for a fortune 15 company - so my salary is very good. I assuming my family business and turning it into a cnc machine shop in a 3 year plan. Part of the plan includes me coming up with $150K to buy machines - yes this is sucking up all my paychecks. My family already has 30K sqft - land and lot with the existing welding business which is been appraised at $4 million since it is in Houston proper. I already have customers in the pipeline since my family business is a major vendor for Landry's(publicly traded). You may think your clever, you may well be- but I got a perfect score in Math and top 5% in English in SATs . I have a degree in business and computer science which I both use in my professional career - so I may be your peer intellectually. My point is you will need a lot of resources inspite of your clever self. But don't be discouraged - but you may need to think about this a little bit more.

Thanks for your answers,
i am aware it requires alot of capital, but there's another solution,
ever heard about outsourcing?

For beginners like me i think it's best to do the mold design by ourselves, and outsource the manufacture process.
The manufacture/ mass producing machine is very expensive, but the Mold maker itself is not too expensive (usually between $10000 - $30000)

The cost of outsourcing is alot less compared to building a factory and self-manufacture.
Even if we already have the equipment,
i read somewhere that if we factors the costs such as electricity, labor cost, machine maintenance, etc. is still cost less to outsource than to manufacture.
This is especially true in china, where labor cost is very low due to low labor salary (low salary is common in china because of overpopulation)

Most factories are also wiiling to accept outsource requests, because this would reduce idle machines situation and unused labor time / electricity.

So i think that's better way to start,
Find a good product, make the mold and outsource the manufacture process..
it's alot more important to find a product that will sell well than manufacture it, and that's what i'm focusing at right now..

That's my opinion so far, please correct me if i'm wrong, as i'm also beginner

[deny_winarto]

Originally Posted by underthetire I know what the fruit logo company uses. MORI SEIKI GLOBAL WEB SITE | PRODUCTS | NVD Series Figure 175K for the smallest one. We have one, er actually the small ,medium, and largest one Considering I can buy cases off Evilbay for 5 bucks shipped to my house, it's gonna take a lot to pay for the equipment.

Thanks for the link underthetire,
Did you buy the machine secondhand or straight from the vendor?
Is their customer service good?

Yes competition in this field can be very tough thanks to chinese products

[harryn]

It might make perfect sense to outsource your production, and even more of the design / proto work.

Just something to keep in mind about chinese copies. One common tactic that is used against firms in North America and Europe, is that the "customer" provides the information, mold designs, and sometimes even the mold to the chinese manufacturere.

Once the supplier has the mold and specs, how hard is it for them to make 1,000 for you, and 10,000 for them to sell on the general market ? Well, pretty easy if you think about it, and no contract will matter to them, as they are nearly immune from any laws that matter to you.

Their cost is just the plastic, and that is subsidized by the government if it is for export. Within 6 months, your product opportunity will be gone.

There is no limit to the sophistication of product which can be copied by the chinese this way. Even very high end Cisco telecom routers, computer chips, software, have been perfectly copied to the point of being sold by their own distributors to end customers.

In the US, our brilliant politicians like to imagine that the merchandise trade deficit problem is one of currency manipulation, but that is just a small fraction of the real problem. The real problem is as described above.

Your idea of outsourcing is not bad, just don't outsource it to China.

Your single largest challenge for dealing with companies in the Americas and EU is that Indonesia has an exceptionally bad reputation for business and banking fraud. As a result, they will require you to work with specific banks and letters of credit, not flexible payment terms. Regardless of your personal honesty level, it is just business reality.

[Ashley Cobb]

That's how the chinese pirate alot of designs. People send them moulds and schematics etc, and as harryn said, they turn around and make 1000 for you and 10000 for themselves. They can then sell the product cheaper because they mould cost them nothing!

[stizzit]

I have a pretty intimate knowledge of this business without actually being in it. I'll tell you now that it is extremely competitive. One manufacturer I know has no engineers on staff (at least not ones doing engineer work) and is a multimillion dollar company. They simply send sketches to their Chinese mold making shop and less than 3 weeks later they have samples. They air freight all of their product to try and be first to market.

If you purchase machinery and do it here, unless you are the best of the best and hire the best, you're in for a long tough road. Plan on working 3 shifts and hiring tool and die guys with lots of experience. You'll need the best machines money can buy.

Or you can find a niche somewhere in this or another market. No doubt it'll be copied but if you make a name for yourself quick enough, you'll do fine. Just remember, the bigger the market, the more competition.