[Matt Monson]

Having spent a fair bit of time in the "mail order" gearbox industry I will give you my two cents.

Your biggest barrier to entry will not be whether or not someone is willing to ship an engine. People ship engines to Jake Raby and Henry Schmidt all the time. Andial did mail order engines for years. See the caliber of names I am putting out there? Setting this business up as strictly mail order is cart before the horse. You will need to develop a track record before anyone will trust you.

When I left Carquip, after half a dozen years at the helm there, I went off on my own. I started a little cottage mail order operation called Phoenix Rennwerks. I ran the business out of my home garage, and had zero overhead. I went into it with a national reputation from my previous employment and with a nationally known gearbox builder at my disposal. However, if I had not been simultaneously manufacturing special ratio gearsets and other specialty race components for sale at wholesale and retail, I would have failed in the first six months. There's just not enough margins on complete units to survive as a builder unless you've got really high volume. Basiically to pull it off you've got to get fast.

You cite the labor part of it and the perception that labor rates are severely inflated and that you can beat the competition on the labor side of it. The places charging $100/hr in labor have decades of experience to back up that number. Yes, they have insurance, and rent, and payroll taxes and tools. But they've put in the time to learn the tricks, get it right, and not lose money on their work. I do suggest you buy a core engine and rebuild it and see how long it actually takes you. Then compare that to some rebuild quotes from other builders. Keep in mind that to be competitive, you're going to have to quote the same number of hours as other shops but at a lower rate.

I in no way mean to disrespect your partner's skillset or experience, but v8's are way way easier to build than air cooled 911 engines. The 911 engine is 2-3 more times more complicated. No matter how good he is, he's going to have a learning curve. Depending on how smart he is and how many engines you can bring in per year, that learning curve could take 2-3 years before he gets good at it. Can you financially ride out 2-3 lean years with builds going over quoted time without charging it off to the customer?

And don't forget the special tools. Even with a completely outfitted shop, you guys are going to need to invest a couple grand in Porsche special tools. While Wayne's DIY book gives you some ways to cut corners, there's a number of special tools that no professional would want to be without.

Lastly, there is the mail order aspect of it. Figure $500 in freight each way on a properly crated and insured engine. Can you beat the labor of others by $1000 and still make a profit? Because you'll only get the business if you can. Otherwise they'll take the engine to someone local. Even driving an hour or two hours each way with the engine in the back of a pickup truck is better in most people's eyes than shipping an engine. Also don't forget the cost of shipping an empty crate back and forth across the country. Figure $100-150 in dimensional weight each way. If you're going to provide a premium product, you'll want to be providing crates (another overhead cost). Strapping a core engine to a pallet is one thing. But once it's rebuilt and arguably worth $10,000 or more, the ONLY way to ship it is inside of a crate. So either you build crates and provide them empty up front to the customer OR they ship it in on a pallet and you ship it out in a crate, which you will either need to eat or charge a core charge on in able to get it returned to you for reuse with the next guy.

I suggest, as others have, that you start with getting a core and rebuilding. Track everything about the project, time, cost, etc. Then try to sell it. And get another core. And do another one. Start local. Work with guys in your local PCA chapter who you know personally and can develop a trusting relationship with. Again, figure 2-3 years to get known in the region before you even can consider going national with it and doing the mail order thing. Figure in all honesty, the mail order thing is a 5-10 year plan. It's not something you can just start up and people will trust you with their engines. You're going to have to get a reputation first and then the rest will come later.