On Turning My Hobby Into A Thriving Outdoor Knives Brand

Aaron Gough

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Published: October 20th, 2020

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Aaron Gough

Founder, Gough Custom

Founders

Employees

Gough Custom

goughcustom.com

from Toronto

started January 2013

Founders

Employees

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The Design of Everyday Things: Revised and Expanded Edition Don Norman

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My name is Aaron Gough, I own and run Gough Custom where I make high-end hunting, camping & survival knives. My philosophy is to make a small selection of products with the highest possible level of quality and functionality. I also focus on transparency and leadership, trying to do what I can to push the state of the art forward for knifemakers and small manufacturers in general.

I started the business in 2013 as a side project, working out of a shared basement. Being really open about my process and making ‘process documentary’ videos on YouTube quickly drove me to the point where I was able to support myself making knives full time. Being a small manufacturer is not an easy life though, so there have certainly been some ups and downs!

Over time I evolved my focus and realized that the ideal business for me was more of a ‘lifestyle business’ where I freed up as much of my personal time as possible to work on passion projects and learn new things! The business has definitely delivered on that front and I usually spend several days per week working on research and development projects.

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What's your backstory and how did you get into entrepreneurship?

I grew up in a household where entrepreneurship was very much the normal way of life. My father has owned and run his own businesses for the majority of his adult life, and my mother has pursued a variety of hands-on creative pursuits as well as running her own small yoga studio and a bed & breakfast.

Making people’s lives easier and more enjoyable will always be something that they are willing to pay for, and solving a problem you have yourself means that you will have directly applicable domain expertise that others may not.

From an early age I was very interested in computers, and digging into devices and machinery of all types to find out how they worked. My uncle gave me a broken engine from a lawnmower when I was about ten years old and I remember spending many hours in my dad’s shed having fun taking it apart.

I tended to get bored easily though so traditional schooling was not a good match for me. I barely passed high school simply because of a lack of interest and went to college for only a few months before leaving to take a job working as a web developer. After that I bounced around a variety of jobs for a few years: working at a company manufacturing guitars, working in a guitar store, working in a warehouse, and working in internal sales. All these jobs taught me skills that would later be very helpful when running my own business.

At age 21 I moved to Canada and had to start my life from scratch. I initially worked construction jobs and then found a position at a tiny company making websites for small businesses, doing Search Engine Optimization, and some design work. After working there for several years I took six months off to focus on open-source software work, which allowed me to build a portfolio and get a foot in the door at a ‘real’ software startup. I learned a lot there about working in a team and leveraging the different strengths of the people around me. A year later I followed a co-worker to a larger startup and ended up becoming team lead there and helping grow the company substantially.

Having been a part of many small businesses & startups, watching them evolve and grow, I decided that I wanted to strike out on my own. Knifemaking started very much as a hobby, but sharing my work online (mainly through Reddit at the time) proved there was a demand for what I was doing, so I decided to try to start doing that full-time.

Take us through your entrepreneurial journey. How did you go from day 1 to today?

In the beginning, when making knives was just a hobby I made them purely by hand. Over time, as I gained experience, I started utilizing more time-saving machinery, but the majority of the work was still done by hand.

I quickly realized that trying to support myself making knives solely by hand would be pure folly; the amount of labor needed would never decrease and it would lead to a life of relentless work for minimal return. With that in mind, I decided to see what I could do in terms of bringing modern technology and automation into my process.

This approach meshed well with my background in software and allowed me to pursue my interests more widely while also providing the promise of reduced labor and greater returns in the long term. Manufacturing anything to a high standard is a very complicated process and it took many years to get everything reliable and consistent, but it has worked out well.

Today I have a small industrial space with two large CNC machines that I use to make all the various parts of my knives. Space is filled with specialized time-saving equipment that helps with the parts of the process that still need to be done by hand. The amount of manual labor per knife has been reduced by about 65% compared to when I was making the knives purely by hand with minimal tools.

How are you doing today and what does the future look like?

I have just gone through the process of scaling up further and bringing on my first employee, only to find out that I really didn’t enjoy running the business at that scale. It put too much external pressure on my schedule, so I decided to scale back down and focus on the ‘lifestyle business’ aspects of what I’m doing.

I am focusing on further labor reductions through automation and starting the process of designing custom machinery from scratch to automate some processes that would otherwise have to be done by hand. I hope that over the next couple of years I will be able to further reduce the amount of manual labor per knife by another 50% while continuing to drive up to my quality and consistency.

The business has been mildly profitable for the last 4 years, and profits continue to rise steadily in step with the labor reductions as I improve my process. I could likely push things ahead much more quickly if I was willing to take on larger risks and more debt, but I prefer to minimize risk and debt as I find it helps keep my stress levels low and makes it much more likely that I will easily ride out any rough patches.

Sales are still largely driven by YouTube videos, where I continue to document my business and personal growth and to demonstrate the care that is put into each knife by actually showing my customers the entire process. This helps customers have a real bond with me and with the knives they buy from me. Buying something when you know the story of how and where it’s made is much more rewarding than buying something from an anonymous company, made in ‘who knows where’.

Advertising is tougher in my industry than most, as knives of pretty much any kind are classified as ‘weapons’ by Google and Facebook, which means that I cannot place ads on the two largest ad platforms. Before they changed their policies I found that really tightly targeted Facebook ads had an extremely good ROI, but unfortunately, that door is closed now! Knowing your audience is really important for targeting as tightly as possible and keeping your spending low and ROI high.

Over the next year or so I hope to roll out my next knife design which will be a kitchen knife. The outdoors knife market that I currently serve is actually only about 10-15% of the US market for knives, with the remainder being kitchen knives and pocket knives, so I expect that my potential audience will grow significantly as I start to offer other designs that expose me to these different markets.

Through starting the business, have you learned anything particularly helpful or advantageous?

I think that a relentless focus on quality and customer service/satisfaction is the biggest asset that any company can have. An unhappy customer will talk to others about your company many times more and much louder than a happy customer usually will. Treat every difficult situation as an opportunity to surprise the customer with excellent service, and you can help make those people into ambassadors for your brand instead of detractors.

Because manufacturing is such a capital-intensive endeavor I have found that working to keep my fixed costs as low as possible has helped give me extra flexibility to ride out the tough times that would have otherwise sunk the business. Every business has difficult times, whether they are caused by internal or external forces, and planning for them makes sure that you will be able to ride through them and keep focusing on what’s important in the long term.

Running a business is one of the most stressful things you can do. Having good mental health skills and good discipline regarding work time versus family/personal time is very important. Burnout is a huge threat for any entrepreneur and should be treated with the same respect and planning as potential market crashes or recessions. It *will* happen, how well you ride it out depends on whether you saw it coming and planned for it.

What platform/tools do you use for your business?

My main online tools are Shopify, YouTube, Instagram, and Facebook. Out of these Shopify and YouTube are by far the most valuable. I use Shopify largely in its ‘vanilla’ configuration as I have found that it is generally a very well integrated and thought out system. I write a lot of small scripts in Ruby that run against the Shopify API to help automate simple repetitive tasks like coming up with lists of raw materials I need to have on hand to satisfy current orders and so on. Having the programming knowledge to automate tasks like this is a huge time saver.

For designing my knives and programming my CNC machines I use a CAD/CAM product called Fusion 360 which has been a tremendous asset.

I am currently working on a suite of open source tools to help manage various aspects of a small manufacturing business, like inventory management and parts measurement, that will be released under a new brand called the ‘Open Manufacturing Initiative’. Starting a manufacturing business is relatively unusual these days and I want to help make the process easier and more approachable for others.

What have been the most influential books, podcasts, or other resources?

A book called The Design of Everyday Things hugely influenced the way I think about designing both physical objects and software systems. The central premise of the book is that whenever a user has an issue understanding a system they tend to blame themselves when it’s usually the fault of the system or machine itself. Working to make systems that are intuitive and easy to use is much harder than just ‘making something that works’, but I think it’s a really important goal.

For the nitty-gritty aspects of manufacturing, I found the ‘Practical Machinist’ forum to be by far the most useful resource. There are a huge number of people on there who also run manufacturing businesses of various kinds and are willing to lend their expertise and experience to whatever problem you might face.

Advice for other entrepreneurs who want to get started or are just starting?

Pick a problem that you have personally experienced and work to solve it for yourself and others. Making people’s lives easier and more enjoyable will always be something that they are willing to pay for, and solving a problem you have yourself means that you will have directly applicable domain expertise that others may not.

Don’t build out a feature or product too thoroughly before testing it in the real world. Don’t be afraid to give a half-baked prototype to real people and have them test it for you. Real-world feedback will drastically improve the final product and may save you time and money by cutting features that otherwise wouldn’t have been used.

Don’t be afraid to say ‘no’. Adding options and features exponentially increases cost and complexity and makes systems harder to use and maintain. Keep things as simple as possible and add features/products judiciously and in an opinionated way.

Where can we go to learn more?

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