Need some advice for opening my own store..

Hello everyone, this is my first post as a FishLore member! I have been reading threads on this forum for almost a year and absorbing as much as I can, everyone seems incredibly helpful!

Just to get this out of the way, I am not the most experienced aquarist at this time. My family have had fish on and off since I was younger, but since going to college last year I began to pursue the hobby completely on my own for the first time. I quickly realized that this would not be a passing interest and that I wanted to continue with fish, in some way, life-long. I am in no way perfect, and as such I apologize in advance for any ignorance I display in this post (any corrections are welcome, actually). Sorry in advance for the long-windedness.

I have done some minor research, including what I might need both mentally and financially in order to start my own LFS. I plan to open it jointly with a close, also slightly fish saavy friend. Between the two of us we plan to save as much as we can in the coming years while we pursue degrees at a local county college. We plan to, over that time, accumulate several tanks and begin breeding fish and selling them from home in order to fund out fledgling operation. We also plan to, over that time period, to eagerly continue learning everything we can about fish.

Yes, we are two college kids with, as of right now, very little experience when compared to the serious aquatic community. At this point we have not researched loans or even a location for our LFS, and to be honest we aren't sure where to start or if there is a "correct" way to go about doing such things. We know that interest rates will vary from bank to bank, and that private investors will probably not be a possibility for us considering both of us are relatively young. You can't exactly convince someone to give you money based on telling them that you're a fast learner and that you have high motivation.

Our biggest questions, sadly, may also be the most obviously answered to those who know. My apologies. I don't mean to overwhelm everyone with questions, but any feedback for any of these questions would be greatly appreciated.
1. Which fish would be the best to start breeding? From our research, guppies do not seem to be very difficult, but we thought that a healthy stock of cichlids might be a better way to start, due to the fact that they seem to be the best parents. I hate to bring this up, as it really isn't about the money, but we also noticed that cichlids fetch a higher tag price.
2. What size tanks would everyone recommend to breed these fish? Filters, lighting, heaters would also be appreciated recommendations in this department. We have an idea as to which brands are made with higher quality, but I honestly value person-to-person recommendations more than what I can read on the side of a box.
3. How much should we plan to be spending on a mid-size shop? Rent, lease, or buy? There are several main roads where we live, but there is a (shabby) general local pet store, a petco, and a petsmart all within a 10 mile radius. Our town has many buildings and lots where it would be perfect to set up shop, but we are worried about the pull of the big box stores in the area.
4. Better to build the tanks ourselves, or to buy pet store display systems? We aren't afraid to get our hands dirty if it means we could save even a little bit of cash.
5. We know that we will need loans, after all we're just a couple of kids (and not rich ones...). How much can we expect to be able to borrow? We plan to borrow some money from our parents (if they can be convinced that we can actually succeed) and save a lot ourselves, but this won't get us all the way. We were thinking that we might be able to pester the bank for 30,000 if we were lucky but we know nothing about business loans....
6. One thing we noticed with the big box and local store here is that their tanks are not very well kept. Dead fish, algae build-ups on filter outlets and intakes, and just blatent overcrowdedness. I'm not talking 20 guppies in a 10 gallon, I mean 15 medium sized tiger oscars in a (maybe) 20 gallon space. Yikes. We do NOT want to EVER do such things. Given that there are probably 30-40 kinds of fish that we want to stock our store with to start out, how many tanks should we be aiming to buy? And should we do sectioned area filtration, single filtration, or mass filtration for the whole system? We want healthy, well kept tanks. If single filtration is the way to do it, then so be it, but we just need to get a general idea of the -->correct<-- way to raise healthy fish to sell.
7. We find that there is not a very good way of educating customers in the big box stores. The salespeople (on the wholefront) have only a basic knowledge of the animals that they are responsible for, and we want to make it quick and easy for customers to learn valid and in depth information about the fish that they plan to buy. Ideas on the web such as an encycopedia-type binder with all the fish and all information seemed like a good idea, anything else that could help us help the customers easier? It will only be myself and my friend for the first few years (we assume), so we just want a way for the customers to window shop while learning about the fish if both of us are dealing with other sales or something at the time.
8. Oh dear this post is long.... final question for the post, I promise. We noticed that some stores have stuck to selling only one brand of food, treatments, and decor. Should we go this route? Or is it better to have a wider selection of manufacturers? Again, sorry if this is one of those durrrrr questions for LFS owners.

Sorry again for the length of this post, but we have so many questions. Apologies, again, for any ignorance. Any answers, advice, suggestions, or general feedback would be awesome Until the time comes to open up shop (oh, it's going to happen.. eventually...), we will continue to do our research and gain experience in fish keeping! Please do not under-estimate us just because we are young. We are going to go all in on this, and we realize that experience is the best teacher. It probably won't be next week or even next year that we open our doors, but we want to be as well-learned about everything that we can before we do. Thanks for the support and information that I'm sure we'll gain over the next few years from all of you!

 

Here is a recent post that should help.

When I was looking at doing the same thing, I was looking at closer to 500,000$.

Glad to have you posting!

 

I recently thought of something similar, having gotten into fish keeping and loving it.

Guppies are easy to breed, hence they do not fetch a high price.

In my area the local small business is AWFUL. I walked in and there were fish in 5 gallon tanks with lots of algae buildup and visible sores.

Petco is much better.

If you look at Petco's operation more, you will realize that they actually do a very good job at keeping fish. The tank you see is not the full tank...they have extremely good filtration units that keep everything good.

The disparity between the local pet store and Petco is so great that...I would hesitate before shopping at a small business.

The one good idea that I had in thinking about the topic is this: focus on high end aquariums and custom installations. Do some fish breeding on your own land, but don't necessarily open a retail store. You probably can't compete with Petco or Walmart for stuff like filters.

You might consider "gifting" a high end tank to a local establishment in order to get people interested in what you have to offer.

 

I would suggest starting with a home business. Greatly reduces the overhead and still allows you to get your feet wet. Otherwise, to purchase tanks, equipment, fish and other items to sale, you will need half a mil as Dino stated.

 

Just to clarify, I spent three years working on this, before deciding to stick with breeding rare fish to sell to serious hobbyist.

 

I agree with the above, opening a store (or any business) is a risk.

You may want to check out harpua2002 Fishroom thread:

harpua has made a little business out of her garage

Greatly reduces the overhead and still allows you to get your feet wet.

No pun intended hey Dena

 

Agreed. I've already started my little home business. That's how I intend on expanding my stock and offerings that will hopefully eventually end up in my store.

 

Thanks for the quick feedback guys! I intend to make several threads to further break this post down, but the advice was awesome!

We will most likely run this operation out of our home(s) for at least the next few years, and we'll see where that takes us. We did not realize that this may be a 500k venture, we were thinking around 200k to start considering we don't want to do anything large-scale for the start. Thanks for the wake-up call though! In any case, that dream was absolutely fantastic..

Yes, this could be a risk, but it is one that we are willing to take. We love fish and everything about them, and we think that we can do a better job better educating customers before they buy fish so that they can care for them properly. (That's kind of our goal of this, the money factor at this point is simply an obstacle -.- )

The fishroom idea is awesome, we'll probably use that. It's exactly what we had envisioned when we thought about breeding fish from home. We just are at a loss as to which species to start with for the breeding process..

 

What fish are you most interested in? That's where you start.

For me, it is angels. After losing most of my fish stock to columnaris I've spent a few hundred purchasing juvies from different breeders. Once they mature and pair off I will be breeding them.

 

You should also visit a ton and a half of fish stores in and out of your immediate area. Travel to reach popular ones. Visit low end, visit high end. See what the difference is. I wouldn't bother with the chain stores but would check out all of the mom & pop ones. See which stores appeal to you. Ask yourself why.

Research, research, research. You'll have to know not only how to keep fish alive, but how to make them thrive. You'll have to know about the various diseases, growth rates, compatibility, environmental needs, etc.

My very fave lfs is actually now starting to ship fish to his customers that require it. It's allowed him to build up his business and add to his customer base.

Good luck in your brave adventure...... better you than me.

 

Funny that I should log on and find your post Lynda, because Wednesdays happen to be our (my friend and I who are braving said adventure) day off from classes. So we actually spent today looking up all the LFS's within reasonable driving distance and checked them all out! We even stopped in with a buddy of mine who is losing interest in the hobby and bargained with him to get him to come down on price for his old 250 gallon

In any case, I agree that research is key! We spend half of our time doing homework and eating and such, and the other half all over this forum and pouring over online articles about fish. The amount of information available at the touch of our fingertips has been absolutely astonishing. That shipping idea is awesome, I don't think that we'd be able to pull something like that off right away since we would have to make a reputable name for ourselves, but that's a sweet way to build a larger customer base!

 

I'm not a business person in any way but here's what I think...

If opening a retail fish store, I do not think there is much money in fish. Take your tank for example, how much did you pay for all the fish in it? And remember, the price you paid for the fish wasn't 100% profit. Most stores order fish from breeders, rather than breed them themselves. I gotta think it is because it is far more cost effective to buy and resell. But even at that there is the initial cost of the tanks, heaters, lights and filters, plus the cost of operating the equipment.

So I believe that the money is really in selling the equipment. Once again look at your personal set-up. If you add everything up, you will see that you spent far more on equipment than you did on fish. Then there is always the sale of fish food, test kits, meds etc.

 

The money is in the supplies, not the fish.

 

Agreed, 100% without a doubt there is double or even triple profit in the equipment vs the fish themselves. I don't know if I would continue to breed the fish once I had established my business and gotten the store opened and such, but I figured that not only would breeding fish lower the overhead for opening up but that breeding fish would be an awesome way to gain knowledge about different kinds of fish and how to care for each individual breed.

But no doubt, especially after opening the store, there isn't a ton of profit coming from the fish themselves.

 

One thing also... You asked about how a lot of stores stock one brand specifically. This only typically applies to small businesses and big brands, but...
When you want sell a product, you first have to sell yourself to THEM, not the other way around. They're already big and well known with a good seller base. Yes, they want to expand but they want to know that you're going to be someone actually getting a decent turnover on their product and not just having it sit there for ages. If a brand considers you to be in a niche market, then yes they may send you a letter offering you a contract, but otherwise it will be the retailer bowing to the brand store.

Also, due to competitiveness, a lot of brands will not accept you as a retailer if you stock their competitors goods. A good example is Coke and Pepsi. A store that sells coke, usually doesn't sell pepsi, exactly for this reason. Coke will say "We will let you sell our goods, but you can't stock any pepsI products.".

 

One thing also... You asked about how a lot of stores stock one brand specifically. This only typically applies to small businesses and big brands, but...
When you want sell a product, you first have to sell yourself to THEM, not the other way around. They're already big and well known with a good seller base. Yes, they want to expand but they want to know that you're going to be someone actually getting a decent turnover on their product and not just having it sit there for ages. If a brand considers you to be in a niche market, then yes they may send you a letter offering you a contract, but otherwise it will be the retailer bowing to the brand store.

Also, due to competitiveness, a lot of brands will not accept you as a retailer if you stock their competitors goods. A good example is Coke and Pepsi. A store that sells coke, usually doesn't sell pepsi, exactly for this reason. Coke will say "We will let you sell our goods, but you can't stock any pepsI products.".

Respectfully - I agree that turnover is a consideration when dealing direct with suppliers, however many also deal through distributors. Nothing stops a new customer knocking on their door asking to sell the products of that vendor. The vendor may tell you that they have licenced distributors that you can buy from, or they may advise that their dealership/retail outlets are selected and controlled (a few that come to mind are Apple, Hewlett Packard) where some parts of the range are available to all, but others are only through licences.

Seachem is one brand that controls it's distribution/retail outlets and who can sell what, retailers are graded from dealer, silver, gold, platinum. There are a number of LFS that have Seachem products, but not all will have the AquaVitro range, or Prime, or their test kits, but the Flourish line is generally available everywhere. Eheim is another one.

The practice of Vendors requiring exclusivity in an outlet is also not very common, and is in fact protected by Trade laws (in Aus anyway). Coke and PepsI can be bought in most supermarkets, service stations, milk bars etc, more often than not, it's the retailer/outlet that chooses to only stock one brand. The exceptions would be fast food chains whereby Burger King/Hungry Jacks - Coke, McDonalds - Coke, KFC - Pepsi, Red Rooster - PepsI (from memory) all have exclusive rights to the brands.

More common is the restriction of trade by suppliers/vendors to chain stores, where the vendor protects 'the little guy' and only deals with niche/specialist stores that have the expertise to properly market and sell their product.

Note: the above comments are based on 15 years experience in the retail and FMCG industries.

 

Ryanr: Thanks for the further/better info Edit: MORE ACCURATE! I couldnt think of the word before and it was bugging me. Fridayitis.

 

Agreed, that was an awesome clarification. So, as a startup LFS, would you recommend trying to stock several brands or just try to focus on one?

 

Agreed, that was an awesome clarification. So, as a startup LFS, would you recommend trying to stock several brands or just try to focus on one?

That's where trying to get market data would help, and stocking/ranging decisions is an entire book on its own

It also depends on your target market, are you targeting high-end fish keepers who are only interested in quality equipment? Or are you appealing to the more budget conscious who just want a solid product that's reliable and value for money?

And the live stock you want to sell etc. Your hardgoods should be reflective of your live stock, no point selling the fish if you can't provide the equipment to support them.

Choice is important to a consumer, so I think you'd want to stock 1-3 brands. A Good/Better/Best approach.

Width of range is also important, do you want to stock pH Up/Down and products we don't recommend on Fishlore? My opinion is yes you do, in limited quantities, some fish keepers are adamant on using these products. It's hard to argue against a product you don't stock, and if you don't stock them, customers will go else where.

It's a fine line between "Don't go there, they have nothing" and "Great LFS that has the normal products but properly advises on their use".

Competition - Can you compete with the petsmarts etc? Do you want to compete with them? Typically chain stores buy in bulk, in the vicinity of 100's if not 1000's at a time. A little LFS cannot compete with this buying power. That's where buying groups can help.

And finally stock-turns and cashflow. You need to be able to keep your stock turning over to pay the bills. Buying stock that just sits there only costs you money to initially buy, it ties up cashflow, floor space, and costs you money when you have to quit the stock.

Like I say, it's an entire book if not many books on the art and science of retail.

 

I would try to have an assortment that would satisfy the most customers. You don't want to kick business away by being too upscale. Plus, customers will grow in the hobby if they're really interested. Part of your job will be to gently move them along until they will only accept the best. Carefully listen to their situation and address it in the best way. Trust in you will be why customers come back. All that being said, the most important things are learning how to run a business, how much of a market there is, how much money do I need to make, and all those other buzz killers. I hope your dream comes true. Best of luck.

 

Actually, that's a good point. Most of the LFS stores are fairly a-typical around here. Some might have a decent range, but they have no knowledge and are mainly "turnover" based. "What? 20L tank? Put 5 goldfish in it, come back in a week and get 5 more!"

The LFS that I prefer though, is a small dingy one that has a small range, a moderate amount of knowledge, but mainly the attitude that anything you want, they will find and get for you. "Rare fish? Okay, we'll find a breeder." Not having the biggest range, but instead having good contacts that allow you to obtain rarer fish on request is a great thing (especially here where importation laws are horrid).
That's the main reason why I shop there, even though my water conditioner is a few $ cheaper at the major store.

 

I have to agree, you may be better off starting on small scale breeding and owning(say 3-10 tanks) Getting used to different fish species and learning to breed and care for the individuals, while the money is in the product, stock loss isn't going to exactly tickle the wallet . Just take it a few steps at a time. There are many fish you can learn to breed that can also bring in some revenue.

One in particular that I can think of is Meteor minnow, Long finned white cloud mountain minnows. These guys fetch a fair price, easy easy fish to breed. Anyone whose owned them can tell you that they spawn regularly. Also, barbs, many different species can be worked with to bring in money, barbs are also(in my opinion) good if you want to develop your own line trait or color morph, they seem to be easy to mold.

 

I look at your question from a purely business standpoint (keep in mind the ink on my degree is still wet ). The advice you have already gotten is very sound but I think you and your friend need to focus on 2 things: experience and a business plan. I know you said you don't plan on opening for a while but in that time do as much as you can in the field at home and possibly working at a fish store.

As for the business plan, you need to look around you and decide who your customers will be and how you will reach them by asking yourselves lots of questions. Open a physical store or an online shop? Will you be offering things you want to offer or find out what your customers want and meet their needs? Who is your competition and how will you be different from them to make customers come to you instead? For the things you plan on selling, is there enough profit margin for you to earn enough (as others said large companies can buy in bulk to save $)? Are their any liabilities for the items you sell (ie - you may be sued for the tank you sell that springs a leak) and how to protect yourselves by incorporating.

I hope I don't sound like a buzz kill but these are just some of the things to think about.

 

Ryanr, the good/better/best is a great idea. I think that not only will it allow the customers decide on the spot what they want to start up their tank, but it gives them room to grow into the more expensive product. I didn't even think of that. I(we) want to try and compete with the big box stores. At first, yes, this will most likely prove difficult. But I want people working at my store who know their stuff, and I want customers to return to my store because they received quality service, quality advice, and quality products. I have never heard of a buying group but it has been placed on a sticky note on my desktop I want to focus more on the quality of the store vs the quantity of our inventory, I would much rather have to order a customer a quality product (at less profit to me) and have that customer return than to sell them a product and have that customer not return.

As for the chemicals... I have always used plants, a good filter, and a reasonably stocked tank to control pH and the like. However, you do have a point in that you can't argue with something not in the store. ...debatable haha. As for turnover, I'm no marketing wiz. I have to research a lot on business structure, management, and marketing. But solid points, sir!


Fish monger, I completely agree. Customer satisfaction is the key to any business, and trust will no doubt play a huge factor in getting customers to return. Good listening skills is a must for any retail position, and I'm hoping that my (slow -.-) research on the fish that I definitely want to carry and the knowledge I'm gaining through this website and other sources will put me in a position to make an informed decision for a customer every time with no excuses. The market is there, money comes from passion and expertise, and learning to run a business successfully is a necessary evil. I shall conquer said evil!

Research, research, research, that's where I think the key in opening an LFS or any small business is at this point. I've barely broken the surface of what needs to be done, but thanks again to everyone on this thread who's helped so far. I would still be completely lost without you guys!

 

You guys check out The Fish Hut in Saddle Brook on rt46, Just opened like a month ago pretty nice store.

 

A nice surprise to see that there are now two pages on this thread hahaha! Didn't even see the posts from lilwyst, solitarian and aquatic. Sorry!

Lilwyst, that's exactly what I want my store to be like, but I want employees with a vast knowledge of fish. I definitely DONT want the 20L throw some goldfish in it approach to go on at all, I want to help customers make informed decisions on what is right and wrong to do with their tank. I want to maybe only carry 10-15 (kickass) breeds of freshwater and 10-15 (kickass) breeds of saltwater, with various live rock and inverts. I want to have the ability to order fish from contacts (who are out there waiting to be found ) when customers have a custom request.

Solitarian, I have been thinking the same thing. 3 tanks to start, then bump to 5-6, then to 7-8, then to 10 tanks with different species. I want to thoroughly understand the breeding process of the fish that I decide to breed, and honestly I've been having some trouble choosing which breeds to start. Guppies were an obvious choice for one, white clouds have been recommended to me several times, I thought maybe convicts or JD's once I bump to 5 tanks?... I'm not sure yet. Barbs would be interesting, although it would take some thorough research to feel confident doing it (I feel like I need to know everything about fish....).

Aquatic, no buzzkill at all. Research, research, research; and a job in a fish store seem to be a must. Business degrees are in the works, so we may find ourselves a little less lost with the business plan in a few months once we... know.. where to... start... ehhem! hahaha. Liabilities! I didn't even think of that. Does anyone know if major brands have some type of universal warantee on products? I've seen them on tanks before but nothing else.

Again, thanks/cheers!

You guys check out The Fish Hut in Saddle Brook on rt46, Just opened like a month ago pretty nice store.

No, I've never heard of it to be honest. But, tomorrow is wednesday, and wednesday is no class day for us so it may or may not be time for a field trip! Thanks for the heads up chuck!

 

This should get you started:




Like I said, there are books, books and more books about successful retailing, and everyone has their own spin on it, but Dan's books are pretty good (I actually know Dan, and have been to his seminars)

How my company operates is proprietary, but the fundamentals are common practice. We survive on stringent inventory management, which allows us to effectively manage cashflow, so much so that we don't need to rely on creditors (we are in the black!) [That said, I do work for a multi-billion dollar national retailer ]

 

Cool. Check it out. Its on rt 46 east bound. Very nice store, lots of African Cics. No saltwater section yet, but looks like one might be coming in the future. Good deals on tanks, esp. the 125gallon one. Good prices on all the fish.

 

Ryanr, I might actually spend 50 dollars on amazon now and actually have something worthwile come from it... this is a whole new feeling hahaha. I trust the advice on this forum and any edge I can get on anything business related is a win. Definitely going to look into scrapping together 50 bucks for those.

Hopefully my business (though probably never multi-billion dollar worthy) will begin to thrive on its own as yours does! It seems that strict inventory management is a recurring theme here. I knew that it would play a role but I think that a system will have be put in place (preferably computerized ) so that I (we) can manage it more easily. Thanks for the links!

Chuck, you had me at good deals on tanks I happen to be in the market for a larger tank..... and several breeder tanks. Good stuff! I'll let you know how it turns out!

 

Thinking of getting the 125 gallon myself. Would make me a great discus tank. Just have to get it past the gf first.

 

Good luck!

Just remember, running a business (in any industry) is not easy. If it was, we'd all be doing it

Be prepared, the average new business take about 3 years to turn a profit.

 

well I don't know a single thing about running a lfs....but I do run a small business. A very successful small business with a lot of big competitors in the area. The few things that I know that I can share that make this venture successful are....

remember that no matter what product you are selling, you are selling yourself first. The customer has to buy in to you.
give them what they aren't getting from the competitions namely service, knowledge, and the cleanliness you already stated.
finally, you are your biggest marketing tool. Network and market yourself. I send out hundreds of letters and fliers etc every month. Sure that costs time and money, but if your doing all of the above, you will create a returning customer out of them, and then its well worth it.

just my 2 cents

 

After reading Dora's post it gave me an idea for you to offer something I wish my local places did; used tank & equipment sales. You could grab used stuff pretty cheap from customers/craigslist etc and clean and resell. You could even take in leaky tanks and practice repairing seals and/or frames as a future service offering.

 

Thinking of getting the 125 gallon myself. Would make me a great discus tank. Just have to get it past the gf first.

...isn't that the truth my friend, isn't that the truth.

 

Ryanr, we thought about the 3-year-before-you-profit problem. We figured that saving a lot on startup could help us save a bunch of money to keep ourselves going for the first few years.

Dora, awesome points! Both myself and my friend are people person people (say it ten times fast) so once we figure out sales and get the knowledge of each fish that we need, I think we might be ok. Hopefully. 2 cents from on fishlore is worth its weight in gold

Aquatic, good idea! The tanks we start breeding with will probably be bought off of craigslist or another like source, and we were thinking that if we could find a cheap supplier that we might even try our hand at making custom tanks (eventually....). The used idea is going to stick though, thanks!

 

If your intrested in learning about business, no time like now to try college for a business degree...

 

It might be happening sooner than I thought. This has all went from 'thinking about doing' to 'probably what we want to do with our lives' pretty quickly

 

Not really much advice I can offer, but good luck to you! Not enough good LFS around

 

My thoughts exactly! And at least for our little area of New Jersey, we want to try and change that!

 

If you are the only one in a large area, less competition.

Are you looking at an online component as well, or just brick & mortar?