For cabinetmakers, subcontracting out door construction is a major question that comes up during the course of doing business. It is not an easy question to answer as it depends on many factors. If we first understand the process of constructing a wood door yourself, then maybe it will be easier for you to make a decision.
Advantages of Outsourcing Cabinet Doors
It sounds simple, but the construction of a door takes many steps. First off, you will be designing the door. Not only the size of the door, but the frame width, router profile, panel profile etc. Unless you had many different bits and profiles, you would only be able to offer a limited number of styles.
Outsourcing the doors to a specialized manufacturer would allow you to give an enormous amount of choice to your customer.
Having the solid wood on hand to make the doors is another consideration. If you already have the machinery capable, (jointer, planer, router/shaper) then this is in favor of you building your own doors.
However some cabinet shops who deal with melamine cabinets do not even have these primary woodworking tools. They construct boxes out of melamine sheets and outsource everything else. (Many times their doors will be of made of melamine as well.)
They find that the space needed for these tools, as well as their maintanance, makes it more cost effective to outsource the doors. Hiring better skilled workers at a higher wage is also another cost of this kind of shop.
You also have to order, store, and mill the wood. Then you have to setup for the cuts, setup for the profiles, glue, and sand. How many hours of time does this take per door? Also take into account time wasted on mistakes and errors. Now, take your overhead shop rate plus employee time and determine how much it really costs you to make your own doors.
Disadvantages of Outsourcing Cabinet Doors
Despite the numerous advantages, ,there are downsides to outsourcing your own cabinet doors however. You are potentially giving away to another company the profits that you could be putting in your pocket. Normally you should be making a profit off the work any employee does for you. By subcontracting, you are losing this extra potential income.
In addition, when you outsource, you still have to give that order to the other company: calling it in or faxing paperwork, etc. This adds a source of potential errors. One that you may not catch until days later when the shipment of doors arrives in your shop. Then you get to spend time discussing with the subcontractor whose fault it was.
In the meantime the shipment of your job may now be delayed as the doors are remade, which means that you must call the client and spend more time in addition to looking bad because the installation is later than you originally planned.
Other issues concerning outsourcing of wooden doors is that the wood they choose may not match the color and/or grain that you are using for the rest of the job. This adds time for the finishing department.
Although the subcontractor may be specialized and would be much more efficient than you at building those doors, the cost of the doors may still be high. There is a lot of non value added cost such as packaging and delivery charges. You also get to spend time unwrapping and measuring each door to verify the dimensions.
Ultimately, you are losing control over the doors as you subcontract them out. You put in the order, and hope that when they arrive they fit your cabinets properly. Outsourcing is a great way to keep your shop specialized, however a reliable subcontractor, one that delivers the quality you desire in a timely manner is of utmost important. Sometimes it takes time to find and develop this relationship.
Outsourcing Doors: Comparative Example
It may seem contradictory but you might hear that by not building your own cabinet doors, you are giving your profits away. While at the same time, others say that they can make more money by making their own doors. Actually, they may both be right.
In order for you to really understand which is better for you, you need to analyse the numbers. How much would it cost you to build your own doors, taking into account all of the factors like increased overhead, machinery, employees, etc? Determine the cost per hour for an average door that you are selling to your customer.
Compare this to the price that you pay for subcontracting, taking into account that you will now be able to be building something else with the time that you are not building doors.
Here is a very simple financial analysis:
Assuming a shop rate of $45/hr:
1) An average cabinetry door you build takes about one hour, and you can sell it to a client for $60. This gives you a profit gain of $15 on that hour (including the cost of materials of the door).
2) You outsource the door, it costs you $60 that you take no profit on. However, with that one hour you have freed up, you build a cabinet that costs you $30 in material, but you can sell for $110. This gives you a profit gain of $35 on that hour.
As you can see, if the doors are of similar quality, it would be better to outsource the doors as you would be making $35/hr building cabinets instead of $15/hr building a door. In this case it would be more profitable use of your shop time to stay within your specialized area of cabinet building, and have someone else build the doors for you.
Obviously, there are many more factors involved in this decision (which are discussed in my other articles about this subject), but it gives you an indication of the kind of comparison you should be making when trying to decide to build your own cabinets doors or not. However, pure cost is not the only factor. Quality of the doors and deadlines are also very important considerations. Here is a quick break down of many more of the advantages and disadvantages.
Outsourcing Cabinet Doors Summary
Building Doors Yourself:
- Choice of wood
- Make more profits off a job
- Errors can be caught while in production
- Can make patterns more suited to clients need
- Need more equipment and space
- Costs more in overhead
- Employees must be skilled for making doors
- Less choice of profiles if not fully equipped
- Need to order, unload, and store wood
- Lets you focus on more profitable tasks
- Less equipment & space needed lowering overhead
- Less employee cost
- Have preset samples to show clients
- Less profit on a job
- Less quality control
- Can't finish before assembly
- May be delivered late
- Mistakes are known only after they are delivered