A few weeks ago I spent some time with a small, family-owned powder coating shop that opened its doors not all that long ago.
Sandee KaplanLike most young shops, they're surviving one day at a time. Car parts come in, fence sections go out, and the margins on that work are paper-thin. There are no documented processes to speak of. Every job gets done the way it gets done that day, depending on who's standing at the booth and how the morning went. If you've ever run a shop in its early years, you know exactly the kind of controlled chaos I'm describing, because you've lived it too.
Then something happened that most young shops only dream about. An opportunity landed in their lap to bid on a large municipal job. Real volume, real money, the kind of work that could change the trajectory of their business. And they had no idea how to pursue it. They didn't know what the bid process required, what documentation they'd need to produce, or whether their shop could even handle the work if they won it. So they reached out for help.
Sitting in that shop, listening to them talk, I may as well have been listening to myself thirty years ago. I know what it feels like to be so consumed by the heaviness of today that tomorrow is a luxury you can't afford to think about. I know what it feels like to look at an opportunity and feel equal parts enthusiasm and worry, because deep down you suspect your shop isn't ready for it. And I know what it feels like to have no idea where to start.
Not Just Struggling, But Circling the Drain
It matters to convey where my shop was at this stage. We weren't simply struggling. We were circling the drain. Our financial problems were serious enough that our legal counsel sat us down and advised us to dissolve the corporation. Walk away. Shut it down. That's not a conversation you forget. When the professionals you pay to protect you are telling you the most responsible road forward is to stop existing, you've hit a level of trouble that no amount of hustle on the shop floor can fix.
We didn't dissolve. We dug in instead. And after several more painful years of scraping by, I finally learned the lesson that changed everything for us. We needed to grow to survive. Not growth for growth's sake, the way business books talk about it, with hockey stick charts and Fortune 500 dreams. Growth for everybody's sake. For my sake, for my family's sake, and for the sake of every person who clocked in at my shop and was counting on that paycheck to clear.
That was the moment I knew we had to diversify into different market segments, and we had to do it deliberately.
The lesson didn't come from a seminar or a book. It came from watching my competitors die.
I started paying close attention to the other shops in my area, especially those that appeared to be doing well, and I noticed a pattern that alarmed me. Several of them had built their entire business around one big customer. Eighty or ninety percent of their volume came from a single account. From the outside looking in, they looked healthy. The trucks showed up every day, the line stayed full, and the owners probably slept just fine.
Then that one customer hit a rough patch, or moved the work, or got acquired, and those shops were scrambling overnight. I watched them chase any job they could find, slash prices to keep the lights on, and burn through whatever cushion they had. One by one, it ran them out of business. These weren't bad operators. Some of them ran cleaner shops than I did at the time. They just had all of their eggs in one basket, and when the basket dropped, there was nothing left to catch them.
One shop took it a step further, and I remember thinking at the time that I was watching someone make a deal with the devil itself. They moved their entire operation onto a property owned by their largest client. They became a captive shop for that client, coating parts on the client's own land, while still trying to service job shop work on the side. I understood the appeal. The volume was steady, the arrangement must have felt like security, and I'm sure it looked brilliant on paper. But when your landlord is also your biggest customer, you no longer have a business. You have an arrangement, and arrangements end on the other party's terms. I suspected it was a harbinger of things to come, and it was. It took years to play out, but that company eventually filed for Chapter 11 protection, the filing collapsed into full bankruptcy shortly after, and today the shop no longer exists.
That was the moment I knew we had to diversify into different market segments, and we had to do it deliberately. I sat down and mapped out twelve distinct market segments we could serve, and I set a rule for myself that no single segment would ever consume more than ten percent of our portfolio. Twelve baskets, and no basket gets overloaded. It took years to build that out, and we didn't get there in one step. But that one decision, made because I watched other people lose everything, is the reason my shop survived long enough for me to sell it eventually.
Why the Pursuit of Growth Matters
Growth has become one of those words that get thrown around so much that it's lost its meaning. So I'll explain why I believe pursuing it isn't optional for a shop that wants to be around in ten years.
First, the pursuit of growth shores up your business's foundation, whether you intend it to or not. You can't chase a municipal contract, an architectural account, or an aerospace customer with a shop that runs on tribal knowledge and good intentions. Those customers are going to ask you questions. How do you control your pretreatment? What's your process for handling rework? Can you show me your records? The first time a serious customer audits your shop, you find out very quickly how much of your operation lives in someone's head instead of on paper. Working toward growth forces you to mature your processes, document how work gets done on your floor, build repeatability into your line, and learn your numbers cold. Every one of those things makes your business stronger even if the big contract never comes through. The pursuit itself is the medicine.
When you own a shop, you're too close to it. You spend your days running the day-to-day, putting out fires, covering for the employee who called in sick, chasing the customer who hasn't paid. You don't have the time, and frankly you don't have the objectivity, to step back and evaluate your own operation the way an outsider can.
Second, growth into new markets is how you protect yourself from the fate my competitors suffered. I'm not knocking car parts or patio furniture. That work kept my doors open in the early years, and I was grateful for every wheel and every chair frame that came through the shop, but retail work alone is a fragile foundation. It's seasonal, it's price sensitive, and it dries up the moment the economy sneezes. When you diversify your revenue across multiple markets, you build shock absorbers into your business. When one sector dips, another rises. Architecture slows down, and the military picks up. Consumer work softens and industrial holds steady. You stop living and dying by the mood of one market, and you start sleeping better at night.
Third, growth creates opportunity for your team. When you move into a new market, somebody on your floor has to learn the new spec, master the new pretreatment requirement, or figure out the masking on a part nobody in the shop has seen before. That's not a burden. That's a gift. People want to be challenged, and they want to feel like they're building skills that matter. Some of the best ideas in my shop came from employees who got handed a new problem and were given the room to solve it. A shop that never grows is a shop where the best people eventually get bored and leave, and the ones who stay stop bringing you ideas. Growth keeps the whole building alive.
And finally, growth improves profitability, and profitability is what funds everything else you say you care about. It's what lets you replace the oven that should have been retired five years ago. It's what pays for better benefits, so your lead line operator doesn't leave for fifty cents more an hour somewhere else. It's what brings new technology into the building and gives you the breathing room to make decisions from a position of strength rather than desperation. A healthy, growing shop takes care of the people inside it. A shop that's barely surviving can't take care of anyone, including its owner.
So How Do You Grow?
Start by getting an outside perspective on your business. It could be a consultant, a mentor, or a peer owner you trust enough to let inside, but you need another set of eyes that sees your business in a way you can't see it yourself.
For me, that meant hiring a consultant. I hired mine long before I ever became one, back when my shop was in trouble, and I was out of ideas, and I'll tell anyone who asks it was the best money I ever spent. He stayed with me for many years, and my company grew rapidly under his direction. I don't believe we'd have gotten there on our own.
Here's why. When you own a shop, you're too close to it. You spend your days running the day-to-day, putting out fires, covering for the employee who called in sick, chasing the customer who hasn't paid. You don't have the time, and frankly you don't have the objectivity, to step back and evaluate your own operation the way an outsider can. Everything in your shop looks normal to you because you've been staring at it for years. It took someone walking through my building with fresh eyes to point out problems I'd stopped seeing and opportunities I'd never considered. More importantly, it took someone outside the daily grind to help me build an executable plan and then hold me accountable to it. I've never seen an owner pull a struggling shop into a growth path entirely alone, and I include myself in that.
If you're reading this from inside a shop that's surviving one day at a time, I'm not judging you. I was you. The day-to-day grind is real, the margins are real, and the exhaustion is real.
The second thing I want to review is to be deliberate about the markets you pursue. This is where a lot of shops stumble, because they treat new markets like a sign on the door. You can't just decide one morning that you're now open for architectural clients and expect the phone to ring. Every market has its own players, business models, certifications, and expectations about how a coating shop operates. Before you chase a segment, you need to understand what success in that segment requires. Who are the customers, and who already serves them? What specifications will you be coating to, and can your line hold them? What certifications are available, what can they do for you, and what will it cost you in time and money to earn them? Do you have anyone in your network who can open a door, or are you starting cold? I built my twelve segments by answering those questions one market at a time, and some markets I looked at hard and walked away from because the math or the fit wasn't there. Saying no to the wrong market is just as much a growth decision as saying yes to the right one.
And the third thing is the oldest advice in the book. How do you eat an elephant? One bite at a time. You don't need to remodel your shop this year. You need one new market, pursued seriously—one certification earned. One process documented well enough that the next one comes easier. My twelve segments didn't appear in a single planning session and roll out the next quarter. They were built bite by bite over years, and every bite made the next one easier to take, because the discipline compounds. The shop that documents its first process discovers the second one takes half the time. The shop that survives its first audit walks into the second one prepared. Start small, start now, and keep chewing.
Back to That Family Shop
So what happened with that little family shop and their municipal bid? The truth is, I don't know yet. We gave them some direction, pointed them toward the first few steps, and the rest is up to them. Maybe they pursue it and win it. Maybe they decide they're not ready, and they spend the next year getting ready, which would be its own kind of victory. Growth is a decision an owner has to make for themselves, and nobody can make it for them. I learned that the hard way, sitting across from a lawyer who told me to dissolve everything I'd built.
If you're reading this from inside a shop that's surviving one day at a time, I'm not judging you. I was you. The day-to-day grind is real, the margins are real, and the exhaustion is real. But survival mode has a shelf life, and the shops that stay in it too long don't get to choose how their story ends. Somebody else chooses for them, whether it's a customer who leaves, a market that turns, or a lawyer with bad news.
Growth is how you take that choice back. Not for the sake of a bigger building or a bigger ego. For your sake, for your family's sake, and for the sake of every person who walks through your door at six in the morning trusting that the place will still be standing. That's what I mean by growth for everybody's sake. There's a lot more to say about picking your markets and knowing your numbers well enough to price the work, and I'll get into that in the months ahead.
For now, take the first bite.
Sandee Kaplan is an Operations Leader and a former owner of a manufacturing and finishing business. Visit https://k2operations.com or email her at Sandee@K2Operations.com.
