(I NEED YOUR OPINION!) looking in to Starting a rocket kit business...

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That's not really how it works. The customer tells you what he wants and then you tell him what you can deliver and at what price. If you can't deliver what he wants at a good price, then he will say no deal. Anyway, I'll mention this to him on Tuesday in case you come by the shop. Randy loves to involve kids in rocketry so maybe he will take a chance on you. Be prepared to tell him what you can deliver and when. And bring prototypes of your kits.

Keep in mind that Randy already has (according to him) the world's largest selection of rocket kits. If you have never been to eRockets you will be amazed at all the kits he has in stock. He may not want to add more kits, especially from a small, part time vendor. But it never hurts to ask. Also, keep in mind that you need easy to follow instructions with every kit. A good color photo or nice art work of the kit would be a good idea too.

I live just north of Cincinnati. So trying to get to eRockets isn't easy as it is a 54 minute drive (Not including traffic). I would LOVE to go to Build night there, but it is a little far, and I am busy on most Tuesday nights. I have seen pictures & videos of his shop, it looks like a really cool place to check out. If I could go, I would. Unfortunately I can't. :(
Thanks,
 
Andrew, take the advice you've been given. I can't tell you the number of "rocket kit startups" that I've seen over the years on the forum. All of them follow the same pattern:

New Guy: "Hey guys I'm starting such and such rocket company, check out some of my cool rocket designs!"
20 or so TRF members: "Whoah! Those look awesome!"
New Guy: *begins to sell kits*
*crickets*

And said person drops off the face of the earth never to be seen again.

It sounds like an awesome idea, selling rockets to make money. But I'll tell you (taking some lessons from my Econ class) that it's not economically worth it. You need too much overhead cost in order to even get close to breaking even.


As a teenager, I feel you on the money. I always love to make some cash. I did figure out some decent ways to scrape together a decent amount of money:
1. Lawn mowing. My sister and I run a lawn mowing business in our neighborhood. I didn't think it was worth it at first. After a while, I realized that I was making $15-20 an hour mowing lawns, weed whacking, picking weeds, picking up sticks, etc. I make $40-50 per lawn I mow.

2. Local small businesses: I live in the country, so this might not be as feasible of an option for you. I work at a farm near my house. Currently, it's a berry patch. I get $8.50 an hour cash to stand out there and tell people where to pick. I also work at a winery (yes, this is legal, before you ask, I've been working there for 2 years). I get $10 an hour to be a waiter for weddings and other events. Bonus: both of these jobs have super flexible hours (hours are essentially my boss texting me saying "hey, do you want to work on such and such days"). This is how I get the majority of my income.

3. If you have computer knowledge, (this is one I'm actually starting to do) is computer refurb and parts flipping. Friend of mine does this and can make $20-30 on a part flipping it from Craigslist to other places. He also does computer builds for $100+.


There's plenty of good ways to make a LOT of cash, if you know where to look, and if you are creative in your use of skills and resources.

Feel free to message me any time if you have questions. You can also call me (I'll give you my # in PM) if you need some more advice from a fellow teenager.


Here's to hoping you take the time to read this post. :)
 
I can't help but think of this scene from Dune:

[video=youtube;-Ci44G8j1F0]https://www.youtube.com/watch?v=-Ci44G8j1F0[/video]
 
I definitely think you need to revisit Jim's post. He's spot on with the inventory. I have my own business, and I can tell you for a small product like the kit you want to make it'll take roughly $3,000 for starting inventory cost plus another $500 - 1,500 in capital equipment, supplies and other overhead to spool up the product line, plus all your free time doing sales an marketing. If you're hell bent on doing this, here is my advice:

- Before you blindly order product in, you need to test the market and figure out whether or not people want your product. Why would I buy your product over Estes, Fliskits, Quest, Sunward, etc? They look similar to designs I could get from those companies. Especially considering I can just stroll into the nearest Hobby Lobby or go on amazon and pick one of the other guys up without shipping. What's your unique selling proposition? One company to really study here is fliskits. They broke into this extremely competitive market by introducing some very unusual designs. The other thing you might want to consider is using Kickstarter to test the marketing. It costs nothing to run a campaign and you'll get answers very quickly as to whether or not your product is viable. If it is, you have a bunch of pre-orders to help get you over the initial inventory hump.
- How are you going to sell to people? Is it through an online store? In person at launches? Through marketplaces like ebay and amazon?
- Before you buy any components, figure out your costs for the whole product. Figure out the cost of components (including shipping in, fees, etc.), packaging, and labor time to assemble the kits. That's your base COGS. Now that you have this number, multiply it by 2.25. This represents a 50% markup on your cost (which becomes your wholesale price to distributors) and a 50% markup on the wholesale price to get to the final retail price. This is important. You need to build in both markups if you want to distribute, and the extra work of selling direct gives you a little more profit. It also helps ensure you're actually turning a profit and overhead is not killing you.
- Compare the price you calculated from the point above to the price of competition in the market. How does it stack up? Is it higher or lower than most? If it's on the high side, for a competitive market like this you need to revise and figure out how to bring it in line with other market options.
- Figure out how your are handling customer service things like returns, damaged goods, sales and support questions, etc before you start selling. Make sure to communicate with your customers.
 
I definitely think you need to revisit Jim's post. He's spot on with the inventory. I have my own business, and I can tell you for a small product like the kit you want to make it'll take roughly $3,000 for starting inventory cost plus another $500 - 1,500 in capital equipment, supplies and other overhead to spool up the product line, plus all your free time doing sales an marketing. If you're hell bent on doing this, here is my advice:

- Before you blindly order product in, you need to test the market and figure out whether or not people want your product. Why would I buy your product over Estes, Fliskits, Quest, Sunward, etc? They look similar to designs I could get from those companies. Especially considering I can just stroll into the nearest Hobby Lobby or go on amazon and pick one of the other guys up without shipping. What's your unique selling proposition? One company to really study here is fliskits. They broke into this extremely competitive market by introducing some very unusual designs. The other thing you might want to consider is using Kickstarter to test the marketing. It costs nothing to run a campaign and you'll get answers very quickly as to whether or not your product is viable. If it is, you have a bunch of pre-orders to help get you over the initial inventory hump.
- How are you going to sell to people? Is it through an online store? In person at launches? Through marketplaces like ebay and amazon?
- Before you buy any components, figure out your costs for the whole product. Figure out the cost of components (including shipping in, fees, etc.), packaging, and labor time to assemble the kits. That's your base COGS. Now that you have this number, multiply it by 2.25. This represents a 50% markup on your cost (which becomes your wholesale price to distributors) and a 50% markup on the wholesale price to get to the final retail price. This is important. You need to build in both markups if you want to distribute, and the extra work of selling direct gives you a little more profit. It also helps ensure you're actually turning a profit and overhead is not killing you.
- Compare the price you calculated from the point above to the price of competition in the market. How does it stack up? Is it higher or lower than most? If it's on the high side, for a competitive market like this you need to revise and figure out how to bring it in line with other market options.
- Figure out how your are handling customer service things like returns, damaged goods, sales and support questions, etc before you start selling. Make sure to communicate with your customers.
Thanks for that. This is excellent business advice for the rest of us as well who have had the occasional daydream of starting a business of any sort. I can't even count the number of times I hatched up a brilliant plan for a business, just to have it all fall apart when reality hits after crunching the numbers. It takes serious commitment and risk - and capital. I remember Tim Van Milligan's advice, it's far easier to buy an existing business. I believe I read that in an Apogee Newsletter somewhere.
 
Thanks for that. This is excellent business advice for the rest of us as well who have had the occasional daydream of starting a business of any sort. I can't even count the number of times I hatched up a brilliant plan for a business, just to have it all fall apart when reality hits after crunching the numbers. It takes serious commitment and risk - and capital. I remember Tim Van Milligan's advice, it's far easier to buy an existing business. I believe I read that in an Apogee Newsletter somewhere.

Of course it is because you are buying cash flow and existing customers.
 
When I read this you had 1,005 views and 37 replies with less that half from unique individuals with most of those comments negative. I really don't think you would be able to make any sales.

What does seem to sell are vintage kits. There seems to be a lot of old guys wanting the kits they had or wanted when they were young. I would be looking for estate sales/garage sales and craigslist to try to find old kits. Get the word out that you are looking and you might find some good stuff. Put it on eBay or list it here. Study eBay stats to learn what is selling.
 
New Guy: "Hey guys I'm starting such and such rocket company, check out some of my cool rocket designs!"
20 or so TRF members: "Whoah! Those look awesome!"
New Guy: *begins to sell kits*
*crickets*

That is so true! I've brought prototypes to launches where about 20 people say they would buy one on the spot if I had them ready to sell. So the next time I don't make that mistake and tell them I have about 20 kits ready to sell in the back of my truck. And then everybody just shuffles away looking at their feet. People will have you running in circles if you let them.

Just last week I pulled the Stealth and Devastator off of my website. The only Stealth I've sold in the past two years was to Scott Binder, lol. Within days I have customers coming out of the woodwork saying they always wanted to buy one. So I tell them, "No problem, I'll kit one up for you right now if you place the order.". Again crickets.

So predictable.
 
That is so true! I've brought prototypes to launches where about 20 people say they would buy one on the spot if I had them ready to sell. So the next time I don't make that mistake and tell them I have about 20 kits ready to sell in the back of my truck. And then everybody just shuffles away looking at their feet. People will have you running in circles if you let them.

Just last week I pulled the Stealth and Devastator off of my website. The only Stealth I've sold in the past two years was to Scott Binder, lol. Within days I have customers coming out of the woodwork saying they always wanted to buy one. So I tell them, "No problem, I'll kit one up for you right now if you place the order.". Again crickets.

So predictable.

I want a Stealth! I am still working on my Tyrannosaur though and no cash for it now. Gotta save for the J motor to fly the thing. Paint is giving me fits. Grrr.
 
I have a extremely unique design that I'm going to keep a secret! Let's just say there is nothing like it on the market. And, very soon I will probably be testing it out! :)
Thanks,

You should be testing every design you plan to sell.
 
I love the gumption. Hopefully you sell some rockets, make some money, and learn something along the way. If for some reason it doesn’t work out, you can chalk it up as experience and learn that failure doesn’t mean the end of the world (if you don’t know that already). A college buddy of mine was always trying to start little businesses to make some side money. Some worked, some didn’t. But he never stopped trying or learning. Now he has some little internet business that brings in a small steady stream of cash. Good luck!
 
Yes, I know that. And that is what I'm working on now!! :)
Thanks,

The bad thing about that is of course it costs money to test your designs, that's part of the startup cost. The good thing is that you get to fly a lot... in the name of business. Pretty good gig if you can get it.
 
That is so true! I've brought prototypes to launches where about 20 people say they would buy one on the spot if I had them ready to sell. So the next time I don't make that mistake and tell them I have about 20 kits ready to sell in the back of my truck. And then everybody just shuffles away looking at their feet. People will have you running in circles if you let them.

Just last week I pulled the Stealth and Devastator off of my website. The only Stealth I've sold in the past two years was to Scott Binder, lol. Within days I have customers coming out of the woodwork saying they always wanted to buy one. So I tell them, "No problem, I'll kit one up for you right now if you place the order.". Again crickets.

So predictable.

I know a vendor very well. I am in real estate. I share my ideas with him on marketing, sales, costs of business, etc. It's a tough business.
I also dragraced motorcycles off and on since 1985. In the 90s you couldn't get in the gate there were so many bikes. Vendors were at each big race by the handful. Now there's the internet and $14,000 bikes off the showroom floor that make as much power as I spent $$ to build one back then. People try to find thousands more to go faster.

Whether you buy race products or light fixtures: everyone shops you to death. Everyone wants 20% off but they dare not ask the lady that at the Walmart register.

I bought a lot of racing parts from a big distributor in Ohio. He has a wonderful website. He had a big truck and 28' trailer at every national event. He told me 7 years ago he concentrated on web sales and marketing customers. He said traveling all across the east coast with living expenses and fuel was killing him. He sold the rig and never looked back. He makes a good living with the web sales, flies to 5 or 6 races a year, shakes hands and meets racers while his son designs new products.

NOTE***:Unless you can have a diverse and somewhat large inventory AND a marketing strategy to "stay in front of the customer" AND provide excellent service, you will not make it in any business, especially rocketry. If you have any 2 out of the 3, you are an average company.

Motorcycle racing requires initially buying a $5000-6000 used vehicle and all the little stuff that goes with it. Rocketry can get you started with a $60 kit and a $10 motor. But no ones stays there very long, they want more. They want FG kits and all the bells and whistles...."oh, I want my Level 3 next year."

My vendor and I did come to a few conclusions:
1) Most folks want 20-25% off after you drove 8 hours, burning fuel, food, hotel, etc.
2) A lot of rocketeers never plan well, no matter how many email blasts you send. There are dozens of vendors to order stuff but they scream at the club president when the vendor is not there.
3) We have a fair amount of folks, in this hobby, that cannot afford it, I have seen it.

It's a tough business, want to succeed? Read NOTE*** above.
 
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Yeah, if I my tests go well, I'll plan it out, and stock up with lots of parts & packaging. It could take at least 1 year just to get everything ready. Lots of planning, researching, getting tips from you guys, & getting prepared.
Thanks,
 
Sounds like you got a plan, good luck with your venture!

And, I may even put together a few this summer to sell. I have one kit ready, and working on my 2nd.
IMG_2706.jpg
The D fin:
15 inches tall
29mm diameter
elastic shock cord
12 inch parachute
1/8 plywood fins
strong cardboard tube
handmade balsa nose cone
____
Flies on D-G rocket engines
_
What do you think?
Thanks,
 
Do you have pictures of the nose cone, built rocket, or any of the other components?
 
I use a sander, a knife and some sand paper for the finish. It's a lot of work, it'll take me 45 minutes to an hour just to make one. But, that is what makes this rocket special!
Thanks,
 
I hate to break it to you, but if the result is the same, whether it's handmade doesn't matter to the recipient unless the recipient is the one who handmade it.

I care about whether it's round, whether the shape is right, whether the shoulder fits well, whether the wood is of good quality and smooth, and whether the tip is centered and present. If the handmade cone satisfies the criteria (to the quality of a decent lathed cone.) and isn't more expensive than the lathed cone, then it doesn't make a difference to me as a buyer who doesn't know you personally.


EDIT: See if you can find good quality and inexpensive balsa nose cones, if you don't have access to a lathe or similar labor saving machine. (such as a drill press)
 
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