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The New American Post-Industrial Microenterprise

An extremely niche, direct-to-consumer business model is springing up in garages across the country.

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In a small garage in Cedar Park, Texas outside of Austin, there is the start of a new company that reflects an emerging trend in small business. Russell Andersen is using the post-industrial refuse of America’s computer-aided manufacturing revolution to create a new type of microenterprise–one that is built around aging high-tech tools and very niche markets enabled by Internet-based social networks and GAAP accounting.

He is using a fully-depreciated, 20-plus-year-old CNC (computer-numeric-controlled) milling machine he sourced from Craigslist for less than one-tenth of its cost new, and he’s running it with equally antiquated computer hardware and software. With that minimalist equipment, he builds very specific custom bike components that he sells around the world to a very unique customer.

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An emerging trend in mountain biking is to build bikes with 29-inch wheels (called 29ers) instead of the more prevalent 26-inch wheels. Riders began to discover that the front gears (chain rings) designed for the smaller wheels were not as suitable on the bigger wheels. They needed smaller chain rings which were hard to fit on the crank sets designed for 26 bikes. But this market is so small most manufacturers simply do not make them, so passionate riders got together in bike shops and social networks to discuss this dilemma, creating a convergence of need, demand, and opportunity.

Now, in his garage, Andersen designs and fabricates a range of these specialty gears based on his extensive personal experience and he then sells them directly around the world via several of these social network sites, like mtbr.com dedicated to this type of mountain biking and recently through his own site, AndersenMachine.com.

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Being small and dynamic, he can quickly design or modify a chain ring and he gets direct feedback from his customers. Because he is machining each one, there is no need for special tooling. Effectively, each one is built like a prototype: very precise, very high quality; and about twice as expensive as conventional chain rings–although well worth it to those who seek them out.

There are other examples of microenterprises finding specialty markets via dedicated social networks. There are folks making specialty sports car racing parts, specialty camera accessories, and specialty Jeep parts and more to small niche markets of enthusiasts that all have common and specific needs. There have also been folks setting up little job shops in their garage, bidding on machine projects via other sites. Some of these folks are refugees of America’s industries who are turning to these micromarkets as a means of sustenance.

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Personally I’m fascinated by the potential of this new business model. Extensive ultra-custom manufacturing obviously makes more sense to do in the local U.S. market than it would offshore. And for enthusiasts in the know, they will be able to get that one special piece of racing kit that will give them the advantages over their friends.

Read more of Ken Musgrave’s Think.Design blog
Browse blogs by other Expert Designers

Ken
Musgrave has been building and leading Dell’s Experience Design
Competencies, including industrial design, visual identity, and
usability, at Dell Inc. for the past eight years. The team now extends
globally with creative professionals in Austin, Texas, Singapore, and
Taiwan. For the first twenty years of Dell’s history it enjoyed growth
through operational efficiencies and superior cost structure. Three
years ago, Dell recognized that the principles and process that got it
to that point would not be the same ones that would carry it into the
future. Design has been at the forefront of that cultural shift. Ken
has lead the development of a design competency and design culture
through that transformation–including seeing Dell move from being a
U.S.-centric manufacturer of computers to being a global source for
great product experiences.

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At
Dell Ken has lead design-centered strategies ranging from consumer
personalization to enterprise experiences. Before Dell, Ken led several
design leadership and corporate identity roles at Becton Dickinson, a
medical technology company. While there he led a global program to
redefine the company’s visual, product and global corporate identities.
Ken holds an MBA from the University of Utah, an MS in design from the
Georgia Institute of Technology, and a BS in industrial design from
Auburn University.

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