You might not know this, but most companies that manufacture stuff don’t keep spares. At least, not for an indefinite period! Each firm will have a process called “planned obsolescence”. They will only keep spare parts (or the tooling to make them) for a while.
When they are no longer available, consumers often have no choice but to upgrade to a newer model. That’s fine if we’re talking about things like cars or refrigerators. But what happens if the product is relatively current and the company goes bust? Or what if you need spare parts for something from a vintage era?
As you can imagine, getting hold of such spare parts can be a daunting task. And it can get further complicated if the price demanded for any available parts is high! Because of those reasons, there is a demand for companies that can build obsolete parts.
If you’re looking for a new business idea, here are ten reasons why you should start making such items:
Competition will be low
One of the main bugbears of starting a new business is dealing with competitors. Most markets are quite saturated with business, and setting up a new brand will often be a struggle.
If you manufacture obsolete parts, you will seldom have any competition worries. If you’re building parts for vintage products, it’s likely you won’t have any competitors!
As you can imagine, you will be able to maximize your profits by charging a higher but reasonable price.
The Internet offers a global marketplace
An interesting fact you will discover is that people from all over the world will want to buy your parts. Let’s say that you want to build metal parts for classic automobiles. As you may know, people often import and export cars around the globe.
One day you might have an enquiry for parts in your hometown. Another time you might have an email from some far-flung corner of our planet! The Internet will make it easy for you to cater to an international market.
You won’t need to spend a fortune to start up
By now you are perhaps wondering where the money will come from to set up such an enterprise. After all; you’d have to lease warehouse space, hire staff and buy machines to make parts, right?
The truth is you can keep your costs down to an obscenely low price! For example, there are large CNC machine shops you can use to build your parts. All you need to do is design and sell them!
You can diversify
Perhaps your idea is to make parts for a specific make and model of product. But, did you know that it’s just as easy to cater for other products and brands too?
Sure, your expertise might lay with one product or brand. As your business grows, you can hire people to help you cater for other markets too. There is plenty of growth potential in such a niche industry as this one. It’s worth considering where else you can offer your services!
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There will always be demand for your products
It’s easy to assume that we live in a throwaway society. However, more of us want to reuse and recycle existing products and goods. Instead of scrapping them and buying new ones, they’d rather repair what they’ve got.
As a business that builds obsolete parts, you can cater for such markets. It might surprise you to learn there will always be a high demand for what you make!
You can make improvements on existing designs
Of course, your business doesn’t have to be about making “pattern” parts. You can use your knowledge and expertise to create better parts that are more robust. That way, consumers won’t have to fix things so much. And you’re more likely to get new business through word of mouth!
If you create a vastly different product, you should consider applying for a patent. That way, no-one else can steal your new design and claim it as their own.
You will be selling to a premium market
Just because you want to make discontinued parts doesn’t mean you can’t make a profit! In fact, your customers will be happy to pay a premium to get the parts they need.
One thing that most people accept is that hard to find parts will attract a higher price tag. That means it’s possible for you to cater for small volume orders and still make a profit.
You could supply companies that use your parts
Car makers, for example, don’t build their parts themselves. They outsource the development and production to third parties. Let’s say a firm that built a particular car model’s parts has gone out of business.
You could step in and agree to manufacture spare parts for the car maker. They agree to buy a particular amount from you, and motorists now have an easier supply of parts for older cars. It’s a win-win situation, as you can imagine!
Your business will experience phenomenal growth
Your niche is an exclusive one. And that means you won’t have to worry about other firms taking your business. As you can appreciate, such a business model means you can experience unprecedented growth.
In a world where austerity is the order of the day, your business will still survive. Or, to put it another way, your company won’t go bust even if many others around you do so! You may even reach levels where you could expand to other areas and open regional facilities.
You won’t find it hard to get funded
Of course, setting up such a business means you may have to borrow some money to start up. The good news is that you’ll find it easier to get funding. You’ll still need a solid business plan, as would any startup company.
But, you are more likely to get offered funding so that you can set up your business sooner. Good luck!