The powder coating business is one of those businesses that can be started on a small scale, on a street corner, or on a larger scale from a standard workshop facility. Interestingly, the powder coating business serves a wide range of clientele base.
Statistics have it that the global demand for powder coatings rose to an estimated value of $5.8 billion in the last decade, and it is still growing consistently on an annual basis.
Powder coating simply means covering an object with a polyester or epoxy powder, and then applying heat to enable it to fuse into a protective layer thereby making the object highly durable and rust-free. If you want to join the few people enjoying the huge returns on investments in the powder coating industry, then you must be prepared to budget at least $5,000 to get your powder coating business up and running.
But if you intend to start a standard powder coating business with several business offerings and over a handful of employees, then you can spend over $50,000. In this article, we will look at some major factors that can influence the cost of starting a powder coating business.
Factors that Can Influence the Cost of Starting a Powder Coating Business
Your Choice of Location
Your choice of location is one of the factors that can influence the cost of starting a powder coating business. When we talk of location, we are not just talking of the physical address of the business, but everything that a location of the business brings.
Of course, you know that the location of a business will determine how much rent or lease you will pay, it will determine how much you will spend on labor, operational costs, utilities, etc.
The Choice of Facility
Another factor that can determine how much it will cost you to start a powder coating business is your choice of facility. Although, a powder coating business can be started from a street corner, but in order to start a standard powder coating business, you are expected to rent, or lease a facility or workshop that comes with storage space for your materials, tools, equipment, and finished jobs. Trust me, in order to get a facility that is big enough, you must be ready to spend extra money.
Your Budget for Equipment and Supplies
The fact that you cannot start a powder coating business without having the required equipment, tools, and supplies means that the budget for your equipment, tools, and supplies is a major factor that can determine the cost of starting your powder coating business.
As expected, if you are planning to start a powder coating business, then you must make plans to purchase powder coating booth, powder coating oven, powder coating gun, powder coating system and accessories, pre-treatment equipment (e.g., washer, degreaser), compressed air system, spray booth filters, temperature and time controllers, powder coating racks and hangers, safety gear (masks, gloves, goggles), sandblasting equipment (if offering surface preparation), powder coating thickness gauge, etc.
Please note that the quality and quantity of the equipment, tools, and supplies you plan to buy will impact your budget.
The License and Permit Requirements
Another major factor that can influence the amount you are expected to spend when it comes to starting a powder coating business is the licenses and permits that are required to start the business in your city.
You may need business licenses, trade name registration, zoning permits, environmental permits, health and safety permits, fire department permits, air quality permits, hazardous materials permits (if applicable), building permits (for facility modifications), waste disposal permits (if applicable) and signage permits (for storefronts).
Please note that there might be other permits or licenses that are unique to the city or state you want to start your powder coating business hence you should make your enquiries from the nearest local government or county office.
Your Budget for Training and Education
Powder coating is a technical skill or a trade that requires one to undergo training before they can perform powder coating. The whole idea is that if you are looking to start a powder coating business, then you should have a budget for training and education.
This is so because the powder coating business requires specialized training and skills and the amount you will spend to acquire powder coating skills can significantly influence the overall cost of starting the business.
Your Budget for Insurance
Another major factor that can influence how much it will cost you to start a powder coating business is your budget for insurance. The need for insurance for a business is not just all about complying with state regulations but protecting the business owner, and the business from claims, accidents, and unforeseen events that can ruin the business.
In essence, if you are planning to start a powder coating business, then you must make plans to purchase general liability insurance, professional liability insurance (errors and omissions), commercial property insurance, business interruption insurance, workers’ compensation insurance, product liability insurance, equipment breakdown insurance, employment practices liability insurance, and environmental liability insurance.
Your Budget for Marketing and Branding
Your budget for marketing and branding is yet another major cost that can influence the amount you are required to spend if you want to start a powder coating business. In essence, if you are planning to start a powder coating business, then you must create a robust budget that covers your website, the designing of a logo, printing your business cards, and other promotional materials.
Even though there are no specific costs attached to marketing and advertising a business, the bottom line is that if you want to launch a powder coating business that will win a fair share of the available market in your location, then you must be ready to invest a significant amount to promote your powder coating business.
Your Budget for Staff and Labor
Getting started with the powder coating business means that you must be ready to hire competent people who will help carry out the day-to-day activities. This also depends on the scale at which you want to set out. If you choose to start out small, you might want to hire one person or two.
If it is on a big scale then you might want to higher more hands to get the job done. Take note that on whatever scale you opt to start on, you cannot start out alone. You would always need experienced people or apprentices to work with you.
Lastly, if you are planning to start a powder coating business, then you must create a budget for miscellaneous. When we talk about miscellaneous for a powder coating business, we are talking of a budget that covers your utilities, unexpected expenses, waste disposal, and the transportation of your supplies and finished products.
Although, your budget for miscellaneous might depend on the extra money that the owner of the business has to spare, but it is indeed an important factor that can influence the cost of starting a powder coating business.
All the factors listed above can give you a guide on how much it will cost you to start a powder coating business. If you are a rookie when it comes to the powder coating line of business, then the first rule of thumb would be to read up all you can on powder coating.
You could also get a Powder Coater’s Handbook that would help get you started on the right footings. Do not forget that with loads of information, you can maximize your budget.