business

As the fumble-fingered husband of the only woman I know with her own miter saw -- and a few other tools I'm unable to identify -- I have long stood in awe of folks who know how to work with their hands.

But Keith Johnson is in another category altogether: With little more than two years as a hobbyist to qualify him, he dumped a promising career as a CPA in 1997 to start his own woodworking business.

A decade later, with a growing reputation for custom design and production of high-end cabinetry, he has built a business that has been growing at a 28 percent annual clip since 2001 -- despite flat revenue for past three years.

Given orders already on the schedule for 2008, he figures to restart the growth trend this year with sales of more than $1 million, a 20 percent gain. And this at a time when the housing industry is suffering from the worst recession in decades.

"I can't believe I did it," Johnson, 39, said of his decision to start Minneapolis-based Wood Works Fine Custom Cabinetry Inc. "It was crazy; it made no financial sense."

But he was young and unmarried at the time, "and the job was becoming less interesting," he said. "I figured it was now or never; I could always go back to accounting."

Johnson, who works primarily for area homebuilders and remodelers, specializes in elaborate designs involving dozens of customized features.

We're talking arched doors and raised paneling surrounded by detailed trim molding, not to mention dozens of styles of crown moldings.

And there are inset cabinet doors flush with the frame to hide the hinges -- or old-fashioned barrel hinges if the client wants them to show.

In short, it's a business that demands precise engineering and a labor-intensive production process that adds up to some eye-fetching prices: Johnson said the cost of one of his larger cabinetry projects averages about $40,000 and can range upwards of $80,000.

But it's worth it, said Johnson's largest client, Rick Hendel, a Twin Cities developer of luxury homes that often sell for seven figures: "His [Johnson's] are the nicest cabinets, structurally and functionally, that I've ever seen."

Johnson wasn't exactly a woodworking virgin when he plunked down $200 in 1995 for a table saw and router and started working as a hobbyist. His father also had a woodworking hobby, and Johnson spent many hours as a lad hanging around his dad's shop.

The idea behind starting his own company was planted by a friend for whom he'd built a dining room table. Impressed with the workmanship, the friend persuaded Johnson to start Wood Works, which he installed in his brother's garage.

Johnson started out running ads in suburban weeklies, which attracted enough homeowners to force him out of his brother's garage and into a 1,200-square-foot shop in north Minneapolis. He later moved to a 4,500-square-foot location nearby, and has since enlarged that space to 9,000 square feet.

His focus on custom-designed cabinetry for area contractors began in 1999, when a friend introduced him to a Minneapolis remodeling contractor looking for someone to design and produce high-end cabinetry. Struck by the opportunity, Johnson began cold-calling other contractors.

"They didn't know me," he said. "But all I'd ask them to do was look at the photos we had on our website to get an idea of what kind of work we do."

It clearly was an effective strategy: His annual revenue has climbed from $155,000 in 1999 to $830,000 last year, most of it from work done for homebuilders and designers. About 80 percent of the volume is repeat business, Johnson said.

The growth has come despite his aversion to debt: "My goal is smart, conservative growth, not rapid expansion," Johnson said. Thus, his $250,000 investment in sanders, saws, shapers and spray equipment, much of it used, was made without borrowing. "I don't like debt," he said. "Obviously, there's a place for borrowing, but I like to be in a position where, if things head south, I'm not going out of business."

Johnson's revenue slowdown in the past three years, during which sales bounced between $813,000 and $839,000, undoubtedly reflects the slowing housing market.

But his introduction to Hendel, the founder of Wayzata-based Hendel Homes, last year landed him a large project that provided an opportunity to demonstrate the quality of his company's output. That, in turn, led to Johnson's plum assignment to provide cabinets for five luxury homes to be built this year by Hendel, who remains busy despite the housing slump.

There was a taste of serendipity behind their budding partnership: A friend of Johnson's wife who was a member of Hendel's church had this vivid dream one night in which she saw Hendel and Johnson working together.

Struck by the notion, she invited them and their wives to dinner, where the two men "realized almost immediately that we spoke the same language," as Johnson put it.

Dick Youngblood • 612-673-4439 • yblood@startribune.com