Is money holding you back from starting your own engineering firm? New technology to the rescue! Advanced tools like 3D printers and collaborating via the cloud have reduced the money enterprising spirits need to get started.
Costs are significantly lower today for an engineer who wants to start his or her own company. Cutting-edge equipment and advanced technology is making the dream of business ownership feasible.
Save Money with the Cloud
Project management apps make collaboration easy. Users can leverage the power of engineers working in other parts of a building, other cities, and even other continents through the cloud. All of this brings big-firm capabilities to one-person operations on a shoestring budget. Out of necessity, small firms often need to partner with other engineers for expertise and to handle concurrent projects and deadlines.
A few clicks on a management dashboard are all that is required to schedule a task, check where it is in the timeline and assign new tasks. These apps are generally affordable, even for one-person operations.
Communication costs can also be minimized through the use of email, online video conferencing, instant messaging, tools like Skype, and social media. The days of exorbitantly priced long-distance and international calling plans have gone the way of the Dodo bird.
Collaborative, robust design tools make it simple for engineers and others on the project to work on jobs together in real time wherever they live. With all collaborators seeing the same design version at the same time, accuracy improves. Through cloud-based apps using a SaaS model, even engineers with tiny budget can afford them.
Engineers can also independently create prototypes using 3D printers. These printers are somewhat costly, but online services such as 3D Hubs allow users to find local 3D printing resources from around the world.
Best Practices for Starting Your Engineering Firm
Here are tips for controlling costs in the early days of start-up engineering company. Finances will be tight, but by budgeting carefully and taking advantage of advanced technology, success is attainable. As one mechanical engineer articulated in a recent article about her experience when leaving a salaried position at a large firm to start her own engineering consulting firm, mitigating some of the stress of having variable income is important.
Being a freelance engineer means you get to pick your clients and projects and be flexible in how you spend your time. But being a freelancer also means that you don’t always know when your next paycheck is coming. That stress aside, you can make your freelance life much easier by following a few simple rules.
As stated in the comments above, a few simple rules can save a lot of headache and money when starting a new business independently. Consider the following suggestions that have been cultivated from a variety of engineers who have pursued their entrepreneurial dreams.
- Make a list. Every business and every engineering firm needs certain basics. Check out the lists here on the forums of Engineering.com when figuring a budget. Put everything needed on one list, what’s wanted on another, and what would be ideal on a third. Start by buying only what is needed.
- Keep overhead low. Don’t rent a fancy office. Embarrassed by the bargain basement look of your office? Then arrange face-to-face meetings with clients at a local café or restaurant. Alternatively, handle them via email or video conferencing. Buy second-hand office furniture. Put money into necessities, not surroundings made to impress.
- Pay for good tools. Get a top-of-the-line computer, a 3D printer and high-speed internet. Invest in the right equipment and materials to make prototypes. Money spent on these items helps to deliver a finished product that will help facilitate an excellent reputation and more clients.
- Consider co-working space. Check out co-working setups that have the necessary equipment and machinery for your specialty. Typically, the rent paid includes the use of on-site equipment.
- Find a good accountant. Interview accountants to do the books and taxes. If you don’t have a handle on your money, you won’t be in business long.
- Take classes. Graduation from college doesn’t mean that education is over. Take an accounting class. Find courses on how to put together an accurate quote and how to manage a project from end-to-end. As a business owner, skills are need beyond those strictly related to engineering.
Learn from Mistakes Made by Others
Like most industries, there is a significant rate of failure for start-up engineering firms, and the path of independence is certainly not an easy one. Consulting other engineers who have already been through the experience of starting their own firms (especially those who have failed) is invaluable to understand some of the pitfalls that may await.
Consider some of the lessons learned by an engineer named Brandon Lee, who formed a start-up LLC with two partners in Southern California in 2008. After a strong start to the company, the loss of one partner due to personal issues threw the decision-making dynamics off, and the results were hugely damaging to the business in the long run.
With two partners left, the falling apart of the LLC began. Now there wasn’t that third opinion, that we originally had, on what we would charge or how we would approach projects. We decided to drop a couple of large Downtown Los Angeles projects, and then began to proposing prices that were too high for new work. This approach quickly reduced our income! This is where I learned that not all engineers make good business-people. We basically ran ourselves into the ground even though we had this great reputation and client base. Not to mention the Architects we were working with preferred us to competing civil engineering companies in the area.
Ultimately, launching a new engineering firm will simultaneously be scary, thrilling, and liberating. At times, entrepreneurial engineers question why they ever chose to leave a stable and salaried job to instead spend nearly every waking moment worrying about business administration, licenses, rent, and a litany of other issues beyond their old job responsibilities.
However, the freedom that eventually comes with having no one to answer to but one’s self is unique to the entrepreneur. For many, it makes all the blood, sweat, and tears associated with the start-up years very worthwhile.
[Image Credit: 123rf.com / szefei]