Crain's Small Business - "Jobs That Time Forgot"

Crain's Small BusinessIn an age of silicon chips and high-speed Internet, these craftsmen embrace the processes and products of the past.

By Margaret Littman

Posted Sep. 10, 2001
©2001 by Crain Communications Inc.

David Cooper isn't an average mechanic, but that's not because he has a degree in political philosophy from the University of Chicago and a decided lack of motor oil under his fingernails.

As the owner of Cooper Technica Inc. in Chicago, he's a restorer of vintage European automobiles, pre-1968 Land Rovers and Campagnolo bicycles, a self-described "champion of obsolete technology."

"I'm keenly aware of the loss of the art of making fine mechanical things," he says. "In the 1920s and 1930s, cars were not appliances. They were, at best, the finest work inspired mechanical engineers could devise."

Mr. Cooper, 45, is part of a tiny but devoted community of detail-obsessed craftsmen. Instead of looking for the next software upgrade, these small business people are committed to techniques and tools used generations ago.

They endure skinny margins, hefty insurance premiums, a shortage of committed workers and the tedious, time-consuming search for parts. Still, they turn a profit, albeit one so modest that financial concerns frequently lurk in the background.

Jeff Cappelli"I worry a lot," admits Jeffrey CAPPELLI, 43, president of Renaissance Craftsmen Restoration Inc., a Forest Park piano restoration firm. "Most of my friends are highly successful and I feel like the little guy."

Nonetheless, they have a steady stream of customers drawn by their ability to make old things work. They spend little or nothing on marketing because most business is generated by referrals from previous customers, architects and appraisers.

"What these guys do really well is exploit a niche where they do not have a lot of competition," notes Andrew D. Keyt, executive director of the Loyola University Chicago Family Business Center. "This is the same thing that family businesses are really good at, because big companies do not have any interest in things that are this labor-intensive, even if they can be profitable."

But there's a limit to how much and how quickly the craftsmen can cash in. Many report lengthy backlogs of work, often a year or more, because the traditional techniques they employ are so time-intensive.\

At Mr. CAPPELLI's firm, for example, where 25 to 30 pianos are worked on each year, rebuilding a vintage grand piano typically takes four to six months. He generally charges about $15,000 to $25,000 per restoration, depending on how complicated the repairs will be, but concedes costs are rising faster than his rates.

"It seems like a lot of money to me until I remind myself of how hard we work to provide [our] quality," Mr. CAPPELLI says.

And while the 21-year-old Renaissance Craftsmen Restoration has been profitable for years, Mr. CAPPELLI still augments his income by running a 400-student, 16-teacher music school in Oak Park, where he can be found many nights teaching piano.

When stone carver Walter S. Arnold, 47, opened his Skokie studio in 1985, he was determined to have a three-month cushion of cash in the bank to buy marble and limestone, as well as three trucks, stone-moving equipment and blacksmith equipment for forging tools. It took a decade to build his nest egg.

"When I set up the studio, I had saved what I thought was enough to last the first year," he recalls. "That lasted just seven months." It took years to reach an income he now describes as "comfortable middle class, working class."

But it's hard to put a price on the pride Mr. Arnold felt when he was hired to repair damage to the ornamentation on the exterior of Tribune Tower. He used the same tools the sculptor who had mentored him used when crafting the original designs 76 years ago.
The unusual nature of their enterprises creates other financial headaches for craftsmen, since their businesses don't conform to normal models.

For example, because Mr. CAPPELLI's hand-restoration work is classified as manufacturing work, his workers compensation insurance bills are significant: He pays $4.36 per $100 of payroll, compared with 57 cents per $100 at the music school.

Disaster coverage is another expense: Renaissance Craftsmen Restoration often has $500,000 of equipment in the warehouse at one time. And Mr. Cooper carries an umbrella policy on his garage, but requires clients to insure their own vintage cars, which are sometimes valued in the mid-six figures.

Those are expensive but necessary nuisances to traditionalists who would rather focus on the nuances of wood staining or metallurgy.

"A lot of craftsmen get so engrossed in their own handiwork that they don't see the big picture," says Harold P. Welsch, professor of management and Coleman Chair in Entrepreneurship at DePaul University. "If they can combine the artistic with the business, that is an ideal combination and they'll be profitable. But it is a major issue for them to find balance."

The craftsmen aren't Luddites. A bright green iMac sits on Mr. Cooper's desk; Mr. CAPPELLI uses a personal digital assistant, cell phone and Dell laptop every day.

Indeed, they've embraced the Internet, which in recent years has played a growing role in linking collectors to craftsmen. Mr. Arnold, whose resume includes original architectural stone carvings in the House of Blues Hotel in Chicago and the University of Chicago Lab School, estimates 60% of his stone carving business now comes from his self-designed Web site.
Customers who have an affinity for old cars, musical instruments and other antique artistry are willing to pay — often far in excess of the object's estimated value — for them to be saved.

Car buffs spend $30,000 to $150,000 for Mr. Cooper's services, depending on the time it takes him to create parts and restore the machinery. Several of his finished restorations have been auctioned at Christie's in New York, fetching more than $440,000.
Other restorations are a labor of love for the client and Mr. Cooper, who charges just $78 an hour. On average, his bills are 58% labor costs, with the remainder covering supplied parts and outsourced work, such as upholstery.

Because the process takes years, and is often put on hold as the customer comes up with another round of cash to finance the next stage, Mr. Cooper screens prospective clients as carefully as they screen him, making sure they share similar objectives, something all craftsmen say is essential.

Mr. Arnold agrees. "It took me a while to learn that it is important that I select my clients, and not just work with any clients who select me," he says. "Too much of our culture is educated and directed toward seeking the best deal and the quickest solution."
Meanwhile, Mr. Arnold supplements his high-end custom work by making smaller gargoyles and lawn ornaments, selling them for $75 to $395 on his Web site. "I enjoy doing those little things, but also, they help keep money coming in so I can do things like pay the utilities," he explains.

Custom work, which accounts for 35% of Mr. Arnold's total revenues, is bid based on a formula of 20% for materials and the rest for time. Clients are billed directly for shipping because those costs are difficult for Mr. Arnold to predict.

Finding skilled workers willing to invest in painstaking tasks is always a problem for the craftsmen. Mr. Arnold uses an informal network of stone carvers, who often work together on large projects. He's also found young sculptors willing to labor in his shop, doing everything from sweeping the floor to learning design to carving stone.

Mr. Cooper keeps a skeleton crew on flexible hours, often relying on other craftsmen to work part time.

Current Renaissance Craftsmen Restoration employees help Mr. CAPPELLI find other workers interested in restoring pianos, which is complicated and often requires a large number of laborers. One piano soundboard, for example, required 42 clamps to help it dry flat.

The hours of labor add up, in part because the process of determining what parts are needed or what systems might work often drags on. Business owners must eat the costs of their own mistakes.

"There aren't any Cliffs Notes to this," says Mr. CAPPELLI. An incorrect order on, say, a custom piece of replacement glass lowers profit margins, as do additional repairs when an original cast iron part crumbles during restoration.

Mr. CAPPELLI was drawn to his field while a piano performance major at Indiana University. He took a course on piano maintenance, primarily to learn how the instrument worked, and was as fascinated as his peers were bored by it. Repair work on hundreds of pianos on campus cemented his interest.

Mr. Arnold decided on a career as a stone carver after watching workers labor on the stone walls of buildings at the University of Chicago. At 20, he flew off to Italy to learn the trade first-hand.

A fascination with mechanical devices was a natural for Mr. Cooper, whose family was in the sewing machine business. He walked away from sewing machines and into automobiles, restoring and racing vintage Porsches and Sunbeam Alpines. Eventually, with the help of an older mechanic who showed him the ropes — "There's no good school for vintage car mechanics," Mr. Cooper says — his hobby evolved into his business.

Though the craftsmen harbor real affection for the things they help bring back to life or keep running, they care little about owning them.

Mr. CAPPELLI recently bought a vintage grand piano, but sold it because it didn't fit into his modest home. Mr. Cooper drives a less-than-pristine Land Rover and has no desire to own a vintage, exotic European auto.

"For me, this is not about ownership," Mr. Cooper says. "That's not how I derive pleasure."