Do you want to build trailers as a business?

[David Grason]

I recently got an email from another forum member that told me that he knew of a guy wanting to buy a teardrop. The other forum member gave me an email address so I sent off the following email:

My name is David Grason. I got an email from an internet friend of mine that said you are interested in buying a teardrop trailer. Of course, I don't what you're looking for exactly, but here's a link to the teardrop trailer that I've been building and maybe it's along the lines of what you're looking for:

http://pg.photos.yahoo.com/ph/grason_da ... /my_photos

A little about myself and this teardrop. I'm 49 years old and I've had a lawncare business for the last 15 years here in Nashville, Tn. I have arthritis in my knees and I'm a tad overweight. As a result, I've been needing to find another business that would allow me to keep working but isn't nearly as physical and mowing folk's yards. And at my age, aint NO ONE offering me a job so I've got to do it myself. I've had a lot of construction experience, cabinets, hardwood flooring and the like so I thought that I would build this trailer on "spec." I'm cutting back on the yards that I'm taking care of this year in order to focus on building these little trailers. I have no plans whatsoever in cranking out tons of them. My goal is build 8 - 10 of them per year and no more. The particular trailer in the yahoo photo album should be completed within the next 2-3 weeks.

About the trailer itself. This design is based on the "Trailer for Two" article in the September 1947 issue of Mechanix Illustrated. I had found the article in PDF format on the internet. Then I found Kevin Hauser's adaptation at the following website: www.kuffelcreek.com He calls it the Comet. It's 4' wide by 10' long. It has a Dexter Torflex axle. It will be finished in aluminum and the fenders will be painted black. The floor is a true linoleum product that was chosen for its "retro" look. I didn't want any modern vinyl and its formaldehyde smell. This stuff is made from wood dough, flax and linseed oil. Anyway, it may be that this trailer is NOT what you have in mind. That's ok, but take a look and if it IS what you want, let me know. Keep checking my yahoo photo album because as I go farther and farther, I keep updating the pictures.

I'm going to ask $8000 for it and will deliver for $1 per mile based on mapblast.com my zip code to your zip code. Mine is 37221 Also, when we deliver it, it will be wheels down meaning that it will roll on its own wheels and not on some fancy enclosed trailer. I hope that's ok.

thanx for reading down this far and here are the info vitals. Feel free to call me and we'll get to know each other. I'm just an ole Tennessee boy.

David Grason

This morning I got this email back from the prospective buyer:

David,

Thanks for the email. It looks like your project is coming along well. A couple of things, I am actually looking to get a trailer 5 x 10. This is the biggest issue. Also, what features will the trailer have....e.g.. galley set-up, sink, a/c, inverter, etc?? Depending on the feature list, I think $8,000 may be a little strong for the trailer. Just giving you my honest opinion here.

I am actually not only looking for a tear for myself, but am looking for a small group of quality tear builders, to begin marketing and selling their teardrop trailers. Since most individuals will only be able to make 6-10 per year, I think 3-4 individuals will work out great. I have already talked with two people who are possible willing to undertake this venture. Another person may only be able to produce 4-5 one-off custom trailers per year (real high quality/feature-list).

David, there is definitely a market for your tear, and maybe even at $8,000. If you are interested in perhaps having me market and sell your tears, please let me know. I am in the website design/creation stage right now, with a mid-July goal of getting up and running. This will not be the same weak and outdated type of website currently being used by ALL manufacturers. This will be a modern, feature rich site, professionally built. When people search for teardrops, they WILL come across our website through a very aggressive marketing campaign.

Again, if you are interested, let me know. If so, we can talk and go over a couple of issues. I have a few questions on your build too.

Thank you again for the informative email.

Kindest regards,

Chad

So I sent Chad back my reply:

Chad

Thanx for replying.

I also appreciate your telling me what you're looking for. As far as my feature list goes, I simply haven't made all the decisions yet but I do know this for sure. It WILL have A/C. It will NOT have a sink. It seems silly to me to go through all the hassle of installing a sink with its corrosponding drain system when a Tupperware pan on a picnic table will actually work better - easier to use. I had not planned on installing an invertor. After all, this is for "camping." < big grin>

I've already made this teardrop 4ft wide. I personally like the 4ft wide because it's lighter and much easier to tow. You can pull it with a small car and still see traffic behind you in your mirrors. I had not even thought about making a 5ft wide tear until I saw my fellow forum members talking about the differences on the internet. But that's easily correctable with future tears. In the end, I'll probably offer both because each has its own advantages. I like the idea of an icebox as opposed to a cooler. That makes a lot of sense to me. However, it does look like I'll have to build my own iceboxes because there don't seem to be any available that will fill the bill. Also, the cabinet work will all be made of fine hardwoods and not some cheesy paneling and/or MDF. The exterior will be polished to a high gloss and every effort will be made to have it looking like it came straight from 1947, i.e. wide whitewalls and moon hubcaps, old style lights, etc. That's the look I'm after.

I arrived at the $8000 figure based on a time and materials estimate. I'm using the same formula I used for decades when building furniture, cabinets and hardwood flooring. One of the things I do NOT intend to do is get into any kind of price war over these things. I want top dollar .... period. For fear of seeming rude, please let me explain why.

I've been trying to find a niche market in the trailer industry for about 5 years. I've built mostly utility trailers and boat trailers. There's no money in these because the competition is frigging incredible. And all these marketing geniuses out there that are building trailers figure that they can build their product cheaper, cheaper, cheaper and they can. Now they have to crank out 400 units per week making $20 profit on each one. The dealers in turn, buy a utility for example for $400 and turn around and sell it for $550. So why should the dealer make so much more then the builder when the builder takes all the risk and has so much invested? The answer is because the builder is basically a moron. He has no confidence in his own ability to produce a fine product and he doesn't have any faith in his own ability to market his product. He thinks he has no choice but to sell through dealers so he lets the dealers make his business decisions for him. I agree that if I had a dealer network that could move 400 units per week, I could certainly lower price but I don't want that much cash flowing through my books and not be able to pocket any more than that. It's also a case of diminishing returns meaning more and more work, more and more money spent on materials from various suppliers, suppliers raising prices while the dealers refuse to pay more and the builder gets caught in the middle. Nope, I'm not doing that.

Also, my utility trailers were definately a higher quality than any other trailer in Tennessee. But the dealers didn't care. They only wanted to sell what would move the fastest. That meant that my trailers sat on the back lot never being featured because in the time the salesman could convince a buyer to pay more for my better one, he could sell 20 - 30 crappy trailers. This is a game I don't even want to start playing with teardrops. There are those on the internet that have already started the price strategy baloney.

In my honest opinion, the teardrop market has not even begun to blossom yet. The faster everyone jumps in and uses price slashing tactics to bribe customers into buying, the faster the entire market will be ruined and then we'll all be looking for yet some other way to make a living. I just don't want to be a part of that.

The fact is, much like a fine Gibson, Martin or Taylor guitar, my teardrop is made by hand one peice of wood or metal at a time. It is lovelingly put together and taken back apart and then put back together until the fit, finish and end quality is absolutely perfectly flawless. The last thing that I would want to do after that is to turn around and give it all away by lowering price. That would send a powerful message that I had no confidence in my own talents and abilities. I also know that while their are gazillions of people that will shop based on price, there have always been a small percentage of people that will pay more to get more. They don't care what it costs, they just want it right and that's the person I'm looking to find.

Since the teardrop market has not even begun to expand yet, from what I can see, there are 20 to 30 prospective buyers for every teardrop available. I only need to roll my uncompleted tear out of the garage and people driving by will pull in to inquire. For a long time to come, folks are going to be willing to pay the asking prices on these tears simply because they will have no choice if they want one. Hey I'm going to bite the bullet and pay more to get my Harley Davidson because I don't want just any motorcycle. If a man wants a Harley, he needs to pay more. It's as simple as that. Now is the time to actually obtain "strong" prices. Besides, if we set a benchmark now, we'll have that much more of a foot in the door when the price slashing really starts to effect our market.

With all due respect, I didn't know that you were looking to become a teardrop dealer. I wish you all the success in the world. However, I don't mean this as any kind of put down toward you personally, but I've had plenty of experience with trailer dealers and it has all been negative on my end. I will do my own marketing. I hope that makes sense to you and that you understand.

David Grason

So the reason that I put all this up on the boards is because if there are other forum members here that are thinking in terms of building tears for profit, maybe it will give a little insight into the business world.

[David Grason]

Well, no one has posted any replies to this thread, but I HAVE gotten a number of Private Messages about it. No, I'm not going to reprint them here. I figure that if they wanted EVERYONE to read their private stuff they would have replied to this thread.

Anyway, I discussed this with a couple of members and I've got some ideas that I'd like some feedback on. Also, it seems that several members have been in touch with Chad and they've all basically given Chad the same response as I have and that is that they're not interested in producing trailers if there is no money in it. It would seem as though Chad is looking to get trailers for darn near free if he can. I assume he'll use price as a selling point and make the QUICK money. I don't know. Maybe if Chad sees this he'll respond.

So here's my idea. I personally see nothing wrong with a man wanting to set himself up as a dealer. That's just good business. But if a man is going to want me to build trailers for him at a discount so that he can make money too, he needs to commit to minimum orders and have the good faith deposits up front to prove that he's serious. For example, if I decide that my trailer needs a retail price of $8200 but a prospective dealer wants me to sell one to him for $7000, he should be willing to buy like 5 units. If I knew that one buyer was taking 5 trailers, I'd be happy to sharpen my pencil a little. Then if sold for the same $8200 that I was selling for, we wouldn't be cutting each other's throats. If he can sell it for even more, more power to him.

But the point is, if I have to cut price, I need a really, really good reason to do so - multiple units.

[madjack]

...David, a very successful business model is to look at how Camp-Inn has done it. I don't see them discounting units for volume sales and they have done quite well for themselves without a dealer network. I feel that I would go that way also unless someone was willing to do as you say and put up the money for multiple units.
madjack

[purplepickup]

David I agree with your opinion that you should market your own trailers...and market them as a fully handmade trailer, built to the customer's specs if they want, and priced accordingly. In your last letter to Chad you justified the cost very well by pointing out how each piece is hand fashioned and the fit and finish are a labor of love. In fact you could use parts of that letter to use for marketing purposes. You could run an ad to that effect on ebay similar to what Len does. A $3 ad with nice clear pictures of some of your work gives you exposure to millions of people who are looking for your product. Once you build a few and the word gets out that your tears are quality and made with tender loving care, I'll bet that you'd have enough work to keep you busy and make decent money.

There are a lot of people that have money but don't have the time, skills, or patience to build things. They are willing to pay for hand built quality if it is good quality and nicely styled. I think it has a lot to do with us baby boomers reaching the age that we are spending our money on things we couldn't afford in our earlier years. Proof of that is everywhere....handmade guitars, streetrods, motorcycles, furniture, cabinets, houses...the list goes on and on.

I've got a gunsmith friend that makes black powder guns from scratch and without advertising he has so many orders that he has to turn work down. He builds them completely by hand and they are extremely well made and gorgeous. He is amazed at the prices people are willing to pay to have him build a gun for them. Most don't even care what the cost is as long as they can have one of his guns. He built a couple for himself and people saw them at events and his quality spoke for itself. People wanted him to make them one and his business grew.

Teardrops are really taking hold right now and if you have the skill and ambition I would think that now is the time to get out there and make a name for yourself. Just remember that dealing with the public isn't always what you would hope. Keep the business terms very clear so that there are no misinterpretations.

Good luck

[DestinDave]

I agree - there will always be a niche market for high-quality/high-dollar items and word of mouth will carry you far. I believe if you build a finely crafted teardrop and sell it, the new owner will send you 2 more customers and so on... Craftmanship sells itself!

[MeTrO]

David,

You should remind everyone, you contacted me about building trailers. I didn't contact you. You wanted $8,000 for a 4', bare bones trailer based on photos of a 1/10th finished teardrop and no completed units. I politely said, no thanks. I have a plan and a business model for what I want to accomplish.

There are people on the board who I have contacted because of their obvious building ability, you were not one of them. I have been fortuante enough to speak with some forum members who have some amazing talents and abilities.

You have chosen to make this a public issue, so don't get your feelings hurt. You wonder why you went out of business making utility trailers and why they were left on the "back lot"?? I would say your "business experience" has left you looking for additional employment. Not a good model in my book. Maybe your attitude was the reason dealers didn't sell your product.

You continue your pouting and spreading your "knowledge". I will continue trying to create a stronger TD market and bring quality, affordable products to it.

Good luck with your trailers David.

[David Grason]

I've got a gunsmith friend that makes black powder guns from scratch and without advertising he has so many orders that he has to turn work down. He builds them completely by hand and they are extremely well made and gorgeous. He is amazed at the prices people are willing to pay to have him build a gun for them. Most don't even care what the cost is as long as they can have one of his guns. He built a couple for himself and people saw them at events and his quality spoke for itself. People wanted him to make them one and his business grew.

NOW THAT'S WHAT I'M TALKING ABOUT!! There is a fella here in my area that makes cigar humidors. He gets $4500 a pop for them.

Yesterday, I went to the Hunter's Custom Auto Show at the Tennessee State Fairgrounds. I was looking among the vendors for a certain set of tailights that I've been wanting to use on my teardrop and I found them, BTW. They're from a 1950 Pontiac and they're being reproduced so supply will not be a problem in the future. Anyway, I'm digressing.

I met a guy at the show that had IMO, the very best '32 highboy roadster in the show. The car was magnificent! This guy's name is Burt Litton and he's from Marietta Georgia. Burt and I talked for a good solid 45 minutes and you can just tell that he's a very straight up guy. He has a business building hot rods and he has a lot of faith in his own ability to please his customers. And that gives him confidence. Now, all my life, I've been in love with Duece coupes. I'd rather have a slick Duece coupe than a Ferrari. So Burt and I talked about how I would like to have my coupe built and he was very attentive and listened to my ideas rather than trying to tell what he thought I should have. That was a big plus and very rare to find these days. In fact it's a HUGE problem among the custom motorcycle builders.

Me: "I'd like a wishbone frame with a springer front end."

Custom Bike Builder: "Naw, you don't want a springer. They're way too heavy. And those wishbone frames were way too weak. You want a straight legged frame."

Me: "I really like old panhead engines."

Custom Bike Builder: "Those #%&@ panheads were the biggest peices of #$&^* that Harley ever made. You don't want one of those."


At this point, I'm deciding that this guy is not going to build me MY bike, he's going to build me HIS bike."

Not so with Burt. Burt listened and paid attention to what I wanted. So I described the engine, frame, wheels, tranny, upholstery etc. I asked what Burt would charge me to build that. Are you ready?

$140,000. Yes, count the zeros. I said it right. That's 140 BIG ONES. And yet, the guy's doing good business. And guess what else?! I figure if my business grows well enough, Burt's going to be building me that Duece coupe because I don't have the time for it. And I can build teardrops faster and sell them better than I could pull off and build a Duece coupe myself, even though I could do so for a lot less than 140Gs. I really believe that when you step into this custom building realm, you step into an entirely different world where the old traditional thinking simply does not apply. In other words, it's a new world.

However, the key to getting there is to convince people that you can deliver the goods. That's what Camp-Inn has done and that's why they're so successful.

But, getting back to Burt Litton and his highboy roadster. If Burt hadn't had that highboy at the show and it hadn't been such an absolutely superb flawless machine, he would never get any business. That roadster is his resumé. Without it, he's nowhere.

It's the same with my teardrop. I've had a couple things go wrong on this project that I could have let slide because I could have reasoned that it wasn't that big a deal. But instead, I've torn out the bad and kept working with it until I got it fixed. Then in the future, I'll know not to let that happen. But I'll never be able to sell a teardrop without having this one to show. That's where I'm going right now. My first teardrop has to be extremely good because it's my resumé.

I figure to put this tear in every RV and outdoor show I can. I'll put it in some hot rod shows and I'll make a couple of rod runs with it and we'll see. Then I'll hand out cards with my website on them and if that don't get it, I'll try something else. But darn it, I'll figure out how to market it one way or another.

[David Grason]

You have chosen to make this a public issue, so don't get your feelings hurt. You wonder why you went out of business making utility trailers and why they were left on the "back lot"?? I would say your "business experience" has left you looking for additional employment. Not a good model in my book. Maybe your attitude was the reason dealers didn't sell your product.

You continue your pouting and spreading your "knowledge". I will continue trying to create a stronger TD market and bring quality, affordable products to it.

Good luck with your trailers David.

As I prepared the above post, this got posted. So I'll respong thusly.

I most certainly did NOT intend to ruffle feathers. However, it looks like the 2 of us have 2 different opinions as to what kind of market there is out there and what it will take to tap into that market. So why don't we each give it our best efforts, following our own paths and let's see who's ideas pan out. Let's remember this thread and check back in say ... a year? 2 years? What would you like?

[emiller]

Here in Phoenix our club builds 4x8 tears starting at $3,500.00 dollars when someone want's one also do 5x10 stating out at $4,500.00 we don't advertise but the word gets around.

[Guest]

As far as teardrops go... the quality of your product could be all you need to market it. Word of mouth travels very fast. I think the big issue for someone to consider, is being able to stay on top of supply and demand. People will wait for a while, but you need to be able to strike the iron while it's hot. (Especially with clients that buy on emotion) My advice to anyone contemplating going into the business of building teardrop trailers by themselves is, high end-low volumne unless you want to become an employer also.

Another important issue to investigate is, find out what liabilities you assume as a manufacturer in your state.

[Arne]

One of the biggest selling points to me is if I leave it sit in the driveway for 8 months a year, I don't get all fidgetty. If I had a $75,000 motor home doing the same, I certainly would...

Also, if you buy a tear and sell it in a couple of years and take a 25% hit, you're only talking a couple of grand... not so with the big boys.

Small is beautiful... hey, maybe that will be my motto? Or, good things come in small packages?

[campadk]

The Little Guy people seemed to put a lot into marketing last year... and they were everywhere.. about the only teardrop that I've seen that was marketted. I guess though that at least Camp-Inn is present at various shows and such.

Would be great if Hunter promoted their tear more.. mind you the Eddy Bauer contest must have helped a lot.

We didn't have any tears (although we did ) at our local RV show the other week, just mega RV's and popups.

They is nil to no awareness of tears here in Canada although a lot of people are interested when they see ours.