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Mechanical engineers are some of the most skilled and highly valued professionals in our society. Found in almost every industry globally, mechanical engineers work, often behind the scenes, to improve our way of life through the design, development, testing, and manufacturing of tools, devices, machinery, and engines.
With such creative and innovative minds, it is no surprise that many mechanical engineers will eventually decide to start their own business. Unfortunately, the technical skills and logical approach required to excel during their education often does not equip engineers with the professional skills and qualities they need to run a business. An engineer may have a design or product which will revolutionize an industry, but without the skills to bring others on board, manage a team and balance a budget (Six Dollar Family), the venture is unlikely to take off.
This guide outlines some tips and advice for experienced mechanical engineers who are considering opening their own business, as well as five business ideas they might want to explore.
Develop your business skills
Launching and running a startup business is well-known as one of the most difficult challenges a professional person can face. While you may have an excellent engineering education, be up to date on the latest industry developments and trends, and have years of professional experience behind you, you may not have the necessary business acumen to run a successful enterprise. To run a business, you need to manage and lead people, create and balance financial budgets, manage multiple projects, solve operational problems, market your proposition, and maintain a high standard of customer service.
These responsibilities should not be underestimated. Many engineers who are planning to take on a more senior position and/or launch their own business complete a Master’s in Business Administration (MBA) or a Master’s in Engineering Management (MSEM). The degree you choose will depend on what you hope to achieve, but you can look at this website for more information.
Differentiate your business’ value
Many engineering businesses are out there, and many of them are offering very similar products or services. If you want to have a chance of carving out your own portion of the market, you need to bring something new to the table. This does not necessarily mean that you need to develop an entirely new business model or product, but your service should offer unique value. What can you offer your clients which your competitors are not?
Of course, your business needs to be viable and profitable, so before you launch a business model that has never been tried before, you must conduct market research. This should investigate what is currently on the market, determine whether there is a demand for your service or product, where your target audience lies, and how to market your business to them.
Write your business plan
With your concept and market research, you can write your business plan. A business plan is, quite simply, a document that outlines what your business will offer clients, how it will operate, how much you will charge for services, how you will market the business, and how you will generate profits. This plan is essential for two reasons. Firstly, it cements your strategy and gives you a solid foundation to refer back to as you build the business. It should be as focused as possible, so you can concentrate on what is key to your business’ success. Find out how to write a business plan.
Secondly, a business plan is often required to secure a bank loan or investment, as they want to see evidence that you understand what is required when running a business and that there is a realistic chance of success.
All startups require funding to get off the ground. Money is needed to cover the cost of leasing premises, equipment, staff wages, insurance, and much more, and unless you have a lot of savings, you will probably need a financial injection. Bank loans are often the first port of call, but they can be challenging to acquire. Alternatively, you might be able to convince an investor to back you in return for a share in the company, or a family member may be willing to offer a loan to help you get the business off the ground.
Build your team
When you have your business idea, have written your plan, and secured your funding, your next step is to build your team. This may not apply if you are working as an independent engineer, e.g., as a freelance consultant, but you might decide to take on staff in the future. Whenever you decide to expand your team, it is essential to take your time and focus on the education, experience, and attitude of the individual. They should be interested in your business idea and motivated to make it a success.
Connect with potential clients
When your business is ready to trade, it is time to attract and engage with potential clients. As an experienced engineer, you probably have a network of professional contacts and previous clients who would be interested in knowing about your new venture, so be sure to reach out. By attending engineering, construction, or design conferences and events, you can also spread the word about your service and grow your contact list.
Printed flyers and business cards still have a place in modern marketing, but it is arguably more critical to ensure you have a digital marketing presence. This includes a company website with a blog (which has been designed and maintained with search engines in mind) and a social media presence on appropriate platforms.
Provide competitive quotes
Now you have some potential contacts, and hopefully, some inquiries asking for prices, it is time to submit your quotes. When you are in the early stages of running an engineering business, it can be challenging to know where to pitch your service in terms of price. You will not know how to price your service until you have researched the market and current industry trends. You should look at what your competitors are offering to find your place in the landscape (Six Dollar Family) and consider your target customer. Charging too much or too little can prevent you from securing business, so some trial and error may be required before you settle on a pricing structure.
Maintain customer relationships
Managing your existing customer relationships should be top of your priority list, even if they are not currently using your service or considering purchasing from you. Nurturing relationships should be a continuous effort through regular communication by sharing helpful content and giving them access to special promotions.
5 Business Ideas for Mechanical Engineers
With the basic principles of starting a business under your belt, your next consideration is the type of engineering business you will run. You may already have a concept in mind, but entrepreneurial engineers will often decide that they want to work for themselves but are not sure how to make that happen. Your education, experience, personal qualities, interests, and skills should feature highly in your decision-making process. Starting any business is a mammoth challenge. Doing so in an alien industry will only intensify this, so it is always better to stick with a field you understand and/or are interested in. Here are five possible business ideas for mechanical engineers that might inspire you.
- Start your own construction firm
Real estate is one of the fastest-growing industries, so if you have experience in construction, it makes sense to consider starting your own firm. You could focus on building residential or commercial properties, or you could look at public construction contracts. The industry is heavily regulated, so you will need to investigate the necessary permits, etc.
- Run a spare parts store
Engines, vehicles, appliances, and machinery all require spare parts, and as a person with an engineering background, you would be ideally placed to recommend and sell the best parts for the job. You could choose to specialize in a particular area or as a general retailer for spare parts and repair services. This business could be run out of a bricks-and-mortar store, and/or as an eCommerce business.
- Become a freelance consultant or designer
One of the simplest types of engineering business is to work as a consultant or designer on a freelance basis. When a company needs a problem to be solved or a product to be designed, they hire a freelance engineer and pay them by the hour or for the project. In this business model, you can accept work from all over the world from a wide variety of different clients and can control both your workload and schedule.
- Offer a maintenance and repair service
Businesses rely on vehicles, engines, computers, and machinery, all of which require maintenance and repairs to keep them operational and effective. You could use your engineering knowledge to start a maintenance and repair business. This could involve carrying out routine maintenance on machinery to prevent breakdowns and responding to callouts for repairs.
- Install and maintain renewable technology
The way we live has to change if we are to tackle the urgent threat of climate change, and renewable technology will have a big part to play in this. Working on the design, installation, and maintenance of renewable technologies such as solar panels and heat pumps is fast becoming lucrative.