A laser engraving business plan is mostly a plan for minutes and blanks, not the laser. The machine's time costs a few cents a piece; what costs money is the blank, the design and setup before the first burn, and the minutes of loading and cleaning each piece. So the plan has to show which work pays for those minutes: personalized gifts, which carry all the setup for one piece, or business orders, which spread it over a hundred. In the example below, a laser shop in Oklahoma sells personalized cutting boards, logo boards in runs, slate coasters and logo keychains, and ends its first year about $24,900 ahead on $73,500 of sales, with its own hours paid at $20 an hour. Below is a description example, each part of the plan, the first year month by month, the startup budget, and a free template.
The short version
- Describe the shop in a paragraph: the laser, what it engraves, who buys, the goals.
- Cost a piece: the blank, its share of the setup, the laser's minutes, your minutes, packaging, selling fees.
- Personalized gifts bring the most money a piece; business orders bring the most an hour.
- Keep blanks counted: a holiday rush stops when the bamboo boards run out.
- A laser and an exhaust fan are the big startup costs; blanks are the next.
- TaroStack keeps blanks counted and costs every job from what it used. More below.
Part 1: the business description
Bright Line Engraving, a made-up laser engraving shop in Tulsa, Oklahoma, I use in these examples, writes:
Bright Line Engraving engraves personalized cutting boards, slate coasters and gifts, sold online and at markets, and takes logo orders from Tulsa businesses: closing gifts for realtors, keychains for dealerships, and boards for restaurants.
Part 2: what each piece costs
The laser itself, a $4,000 machine that lasts about 8,000 hours, plus lenses, repairs and power, costs about 88 cents an hour to run, so a 12-minute engraving uses 18 cents of it. The rest is the blank and the minutes around the laser.
| Per unit | Personalized board | Board in a run of 10 | Coaster set of 4 | Keychain, order of 100 |
|---|---|---|---|---|
| Blank | $9.00 | $9.00 | $8.00 | $0.60 |
| Design and setup, 15 minutes at $20 an hour, its share | $5.00 | $0.50 | $0.25 | $0.10 |
| Laser time | $0.18 | $0.18 | $0.23 | $0.01 |
| Loading, cleaning and packing, at $20 an hour | $2.00 | $2.00 | $1.33 | $0.17 |
| Packaging | $1.00 | $1.00 | $1.50 | $0.10 |
| Selling fees: 8% online and at markets, 3% on invoices | $2.94 | $0.81 | $1.94 | $0.07 |
| Variable cost | $20.12 | $13.49 | $13.26 | $1.05 |
A personalized board carries its whole 15 minutes of setup; ten boards with the same logo share it. How each of these was priced is in how to price handmade items, and a shop's rent and tools spread over each piece are in overhead cost per unit.
Part 3: customers and prices
| Product | Price | Variable cost | Contribution | Margin | A month at full speed |
|---|---|---|---|---|---|
| Personalized cutting board | $36.75 | $20.12 | $16.63 | 45.3% | 120 |
| Cutting boards, run of 10 with a logo | $27.00 | $13.49 | $13.51 | 50.0% | 100 |
| Slate coasters, set of 4 | $24.25 | $13.26 | $10.99 | 45.3% | 60 |
| Logo keychain, orders of 100 | $2.25 | $1.05 | $1.20 | 53.3% | 1,000 |
At full speed, the personalized boards bring the most money, about $2,000 of the month's $5,200 of contribution, but they take 42 of the month's 73 hands-on hours, about $48 an hour. The logo boards bring about $108 an hour of hands-on time, the coaster sets, made in runs of 20, about $139, and the keychains about $90, because their setup is spread over the order. That's why a laser shop chases business orders even though a keychain leaves $1.20: a hundred of them take about 80 minutes of setup and loading, and one conversation, not a hundred. How many pieces the laser and your hours can make in a week is in how to calculate production capacity.
Part 4: the first year, month by month
Fixed costs are $875 a month: studio rent ($500), insurance ($60), the website ($40), market fees ($120), marketing and samples ($100), design software ($20), and software and card fees ($35). Sales start at 15% of full speed and reach it in month 11:
| Month | Personalized boards | Logo boards | Coaster sets | Keychains | Sales | Profit | Cash, year to date |
|---|---|---|---|---|---|---|---|
| 1 | 18 | 15 | 9 | 150 | $1,622 | −$94 | −$94 |
| 2 | 24 | 20 | 12 | 200 | $2,163 | $166 | $72 |
| 3 | 30 | 25 | 15 | 250 | $2,704 | $426 | $499 |
| 4 | 36 | 30 | 18 | 300 | $3,244 | $687 | $1,185 |
| 5 | 48 | 40 | 24 | 400 | $4,326 | $1,207 | $2,393 |
| 6 | 60 | 50 | 30 | 500 | $5,408 | $1,728 | $4,121 |
| 7 | 72 | 60 | 36 | 600 | $6,489 | $2,249 | $6,369 |
| 8 | 84 | 70 | 42 | 700 | $7,570 | $2,769 | $9,139 |
| 9 | 96 | 80 | 48 | 800 | $8,652 | $3,290 | $12,428 |
| 10 | 108 | 90 | 54 | 900 | $9,734 | $3,810 | $16,239 |
| 11 | 120 | 100 | 60 | 1,000 | $10,815 | $4,331 | $20,570 |
| 12 | 120 | 100 | 60 | 1,000 | $10,815 | $4,331 | $24,901 |
The year's sales are $73,542 and the profit $24,901, on top of $20 an hour for every hands-on minute, which is in the variable costs. Cash dips only in month 1, but the blanks for a month are bought before they're engraved, so the plan keeps $2,000 of working cash and $1,500 of first blanks. Personalized gifts rise in November and December; this projection grows evenly, so plan blanks and hours for the holidays. How many blanks to have before a market is in how much inventory for a craft fair.
Part 5: the startup budget
| Item | Example |
|---|---|
| Laser engraver | $4,000 |
| Exhaust fan and ducting | $400 |
| Rotary attachment | $300 |
| Air assist and spare lens | $300 |
| First blanks | $1,500 |
| Workbench and shelving | $500 |
| Market tent and table | $600 |
| Website and photos | $500 |
| Working cash | $2,000 |
| Total to start | $10,100 |
The rotary attachment turns tumblers and glasses under the beam, which opens a second line of blanks. Engraving gives off smoke and fumes, which is why the exhaust fan is in the budget; follow the laser maker's guidance on venting and which materials are safe to engrave. At $24,900 a year, the $8,100 spent before working cash is earned back within the first year.
Get the template
Download the laser engraving business plan workbook. Four sheets: your pieces with price, variable cost and a month's volume at full speed; the first year, month by month, with sales, profit and cash; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
Four kinds of bamboo board, two sizes of slate, tumblers in six colors, keychain blanks by the thousand, a dozen business orders open at once and a holiday rush of personalized gifts. A notebook can't say whether there are enough walnut boards for a realtor's order of 30, which business orders are due Friday, or what a coaster set costs now that slate went up.
How TaroStack does it
TaroStack keeps blanks counted and costs every job from what it used.
Blanks as stock. Every blank is an item, counted on a phone or with a scanner, with a reorder list in days of cover, so the bamboo boards are reordered before the holidays use them up.
Business orders. Each logo order is a sales order for its day, showing whether there are enough blanks while you're still typing it, so a realtor's 30 boards are promised against what's on the shelf.
What a piece costs. Each piece is a recipe of its blank and packaging, so a run takes them off stock at what you paid, and the price creep report shows when a supplier's slate went up.
| The job | Notebook | In TaroStack |
|---|---|---|
| Enough walnut boards for 30? | Go and count | Stock on hand, as you type the order |
| Business orders due Friday | A list on the wall | Sales orders by day |
| Reorder before the holidays | When the shelf looks low | Reorder list in days of cover |
| What a coaster set costs now | Last order's price | Each run, at what it used |
Counting, recipes and sales orders are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.