Expanding my maintenance company
3/7/13
Hi,
First, I'd like to thank you for this platform you have provided for me
and other aquarist to ask questions and get answers.
<Welcome>
Background:
I own an aquarium service company. It started as a side job while
working at a LFS. The store doesn't offer this service so they gave the
accounts to people at the store.
<A win win for all>
Over time I have built up between 40-50 accounts, some I service weekly,
others I service monthly. As I got more and more accounts I formed a LLC
to protect myself and do things the right way. Things have been going
very well and I'm enjoying what I'm doing, although stressful at times.
<I did this for 19 years; can/do appreciate>
I am faced with a few decisions to make.
1. I am still working at the store and would really like to break away.
I am making enough on my own that I don't need the paycheck from the
store. I wouldn't lose any customers but I highly doubt I would gain
anymore from them either.
<Mmm, I would discuss w/ the owner/s, manager/s re... Perhaps you can
pay for their leads, installs? Some few months equivalent of the monthly
charge. Or some (less likely) commitment to continue to buy drygoods,
livestock through them>
This is a major concern of mine but I feel like if I continue to work at
the store, I will not be able to grow my business any larger.
<I assure you this is not the case. In fact, there are many "other"
customers/accounts that you can/will generate that won't/don't actually
go to stores... You should expand your marketing possibilities. We can
talk over, or you can begin by just reading the business subweb on WWM>
I want to take it to the next level. If I leave the store, this will be
the first major career risk that I have taken in my life. I will be
depending solely on myself.
<This is all you've ever had>
2. I do not have any opportunity to set up holding tanks at my house
<Really? No room at all? Maybe you can/should move to a larger
residence; maybe one w/ a garage or even separate structure>
so I was considering looking for a warehouse to set up a few tanks to
start bringing in my own coral. I already have wholesale accounts set up
and I have an outlet (my maintenance customers) to get rid of the coral.
<Good>
While searching I found a very small location, 250 sq.ft. I would be able
to sell retail
<... don't do this. Not worth the time, headaches>
from this location if I wanted to, but this isn't my plan. I would start
with one tank, large enough to hold about 50-100pc of coral. Having a
commercial location will also allow me to receive deliveries from many
of the major distributors that only sell to stores, this way I will be
able to get aquariums, filters, and other dry goods. Rent is very cheap
for my area, under $500 + utilities.
<Ok>
My main concern is that I will overextend myself.
<You are wise here. Most businesses fail from one of two causes:
Undercapitalization or poor management... both symptomatic of
"over-extension">
Even though the rent is cheap, as of right now I have very little
overhead.
<Again; does it make more sense to "put the rent/$500 into a better
combo.
living and business place instead? The time not lost from driving back
and forth is of major importance>
If I decide to sign the lease, I would have overhead, but Also an
opportunity to make even more money since I would essentially be
breaking away form the store and any profit they were making off my
sales will be mine.
How can I decide if this is a risk worth taking?
<Only you can decide... but there are tools that can help you... See
here:
http://www.wetwebmedia.com/AqBizSubWebIndex/bizloc.htm
for a brief review of decision making/selecting location/s...>
What am I overlooking or have not taken into consideration?
<Just data you may already be aware of, a plan of decision. Not to
worry, you're apparently doing most all fine.>
Thanks for you time.
-Richard from Florida
<Glad to assist your efforts. Bob Fenner>
Re: Store Location Question
6/3/10
Hi Bob, I have a follow up question if you don't mind. There is a
cluster of four fish stores within a fifteen mile radius of each other.
Of all, only one is a really nice, well operated store. Would it be a
good idea to open a new store in close proximity to this one? if so how
far away should we locate it.
Thank you,
Joe
<Hey Joe (where you going with that net in your hands don, tah don
tah don don). I'd rather be closer to good competitors than bunk
ones, but still be a couple, three miles distant if possible.
BobF>
Re: Store Location Question
Thank you.
<Welcome Joe. B>
Store Location Question -- 03/18/10
Hello Bob,
<Hey Joe>
I have an important question to ask and whom better to ask than someone
with your expertise. From reading your post I understand you're
against opening a fish store.
<Au contraire! I am all for opening new LFSs! As a matter of fact,
I've helped design, build-out and run quite a few myself. A good
part of all I've done writing wise, including WWM is directed to
helping folks be successful entrepreneurs as well as aquarists>
My friend and I are considering opening a mostly marine fish store with
a small selection of fresh water fish. I've been running an
aquarium maintenance business for ten year. He volunteers at a fish
store.
<Good backgrounds>
I've heard and am guilty of this myself that people will travel
great distances to go to a good quality fish store.
<Within reason, a reasonable statement>
My question is, is it better to locate the store on a high traffic
highway which means high rent or a more secluded location paying less
rent?
<A matter of balance here. You don't want to be so inaccessible,
invisible, hard to get to that folks won't find or drive to get to
you... and on the other hand, depending on you two's customer
base/target consumers, you
don't want to spend inordinate sums on rent et al. to be in a
regional super mall...>
Also, how important is parking for the customers?
<Can be absolutely critical. We built a few stores in K-Mart
shopping centers and had the Dickens of a time convincing them to
re-stripe their parking so people could park right in front of the
stores (vs. walking a few more tens of feet from the lot). There are a
few fantastically successful stores that almost lack parking (House of
Fins in Greenwich, CT, Olde Town in Chicago...) but it's a
tremendous disincentive to not have adequate parking, signage,
accessibility...>
Thank you,
Joe
<Anytime. Bob Fenner>
NNN Lease 8/18/09
Mr. Fenner,
<Nate>
Thanks very much for the data section on the sba website!
<Welcome>
So far things are looking good at signing a pretty nice contract to
open a 1200 sqft store. I will be bringing along the local Petco's
fish dept manager to share the work with.
<Ahh! Am hopeful you two have very confluent value systems,
goals>
He has maintained the highest salt water sales in all eastern seaboard
Petcos for a few years now. Im really very excited to see what he can
do with 3000+ gallons of salt water. :)
<Me too!>
I would really prefer not to sign a NNN lease...Are there any allowable
parts of my contract that are OK to lack in promise when I have a much
better lease? Any suggestions on how to go about not having to pay for
Utilities?
<VERY important to get as much "help" as reasonable in
negotiating your lease... I cannot emphasize enough how critically
important this is at this juncture... DO chat with other tenants at the
strip mall, setting... even properties nearby... Re what they pay, what
the history of the triple net has been... DO have someone familiar with
leases, leasing assist you here... MUCH that is proposed initially, in
"boiler plate" agreements IS negotiable. Is the landlord or
their agent offering incentives, such as monies for TI's (Tenant
Improvements)? Any allowance/free initial rent for your signing? What
is covered in the NNN? When's the last time major improvements such
as sealing, striping the parking was done? What sort of reserve funds
does the property cover? Demand to see records of all.
Believe me, "it's your money" and will be for years into
the future. Know where it's going, and limit your costs,
exposure>
I will be using all Reeflo dart gold pumps, Aquactinic fixtures on reef
tanks rather than halides, EcoTech MP pumps to add flow where needed(or
just Koralias), I've already got a 4k Deltec to use on the main
reef system...but in theory, with all of the energy efficient and low
heat products along with central air, I may not have to worry too much
about having to chill the systems.
<Good. Better to "condition" the air space by far>
I've already got some great account set up for the equipment side
of things.
For livestock I really only know of FishHeads and pacific island
imports.
I plan on doing more frequent smaller orders rather than fewer larger
ones.
Do you know of any other livestock dealers that tend to prefer the
smaller orders? And the occasional very large orders?
<Much to state here... could you give me some ideas, quality,
quantity and organism group-wise of what you think you will use? You
have surveyed your closer competitors I take it... Do you live near by
one of the major import cities? You list LA sources... if distal
sourcing will be your general practice, DO come out, visit the major
wholesalers, to establish contacts, ideas of who you will be dealing
with. I make occasional forays up north (live most of the year in San
Diego)... and can/will help to introduce you if you'd like>
Thanks again,
-Nate
<Welcome. Bob Fenner>
Re: NNN Lease 8/18/09
Mr. Fenner,
The landlord wanted $18 a sqft plus $4.5 in CAM plus NNN!
<What?!>
Hahaha pretty comical imo. That's about 325k a year before
operational costs! Next!
<Ah yes>
So I've located a few other potential storefronts perhaps not in
the most ideal of locations. But id be looking at more like 30k a year
vs close to that a month. A few of these listings do not charge CAM,
just rent and utilities..not too shabby.
My buddy from Petco was my mentor when I first got into the hobby, so I
share his personal goals/values vs the other way around. We are pretty
pumped to go forward with this.
<Very good>
"Much to state here... could you give me some ideas, quality,
quantity and organism group-wise of what you think you will use? You
have surveyed your closer competitors I take it... Do you live near by
one of the major import cities? You list LA sources... if distal
sourcing will be your general practice, DO come out, visit the major
wholesalers, to establish contacts, ideas of who you will be dealing
with. I make occasional forays up north (live most of the year in San
Diego)... and can/will help to introduce you if you'd
like"
<I will be in San Diego from Sept 2-7, so if you have the time, id
love to take you for coffee?
<Ahh, am down in Bonaire currently and w/o my "calendar"
(analog... sigh)... but I think I'll be in SD during this
time>
I live in Manchester, NH. About an hour north of Boston. I had a nice
chat with Frank from FishHeadsInc.
<They are fine people in my estimation. Competent and honest>
Which I'm sure I will be quite pleased with, but I know that I will
need at least half a dozen good CONSISTANT livestock sources. We will
be dealing solely with marine aquatics. As far as WHAT, everything we
can responsibly get out hands on. Is pacific aqua farms any good?
>
<IMO, yes... not for everything... but their "corals" are
excellent>
So I'm in the midst of putting together a killer business plan. I
downloaded a mock plan from businessplans.com for an aquarium store. It
isn't quite on par with descriptions/numbers etc, but it at the
very least a great mold to what I need to create. But I'm still
having a great deal of difficulty projecting my monthly/yearly expenses
on top of being able to project gross profits. I have still been
unsuccessful in digging up any useful balance sheets. Thoughts?
<... Best for you to find out, generate the hard and variable costs
yourself. Being given such figures you will not "learn" (take
in) their importance, lessons. B>
Thanks again!
-Nate
Question regarding business location
06/03/09
Dear WWM Crew,
<Service to you Adam>
I would like to get your opinion on the best place to open an LFS typed
business if I may.
<Ok>
I would like to open a shop with a shop front, just like a regular LFS,
but with an off-display area where I can culture and propagate marine
organisms.
One of the focuses of my proposed business would be selling cultured
livestock where ever possible.
<Sounds good>
Now I could either lease a shop in a retail strip, or near the entrance
to an industrial area (ie a factory bay). Both would cost approximately
the same, however the industrial area is more then double the size of
the
retail shop.
<Hence it costs about half as much>
Both obviously have their benefits and shortfalls. The retail centre
will attract more people who may be visiting neighbouring shops,
however I'll have half the space and wont be able to do as much
breeding and
propagating. The industrial area will give me a lot of space to do
whatever I want, but I'll need to spend more on advertising to make
sure people know I actually exist!
<Takes time to be recognized in either case... How will you go about
this?
And... will you have to generate customer base outright? I.e., are
there folks already in the interest you can attract? How so?>
Would you please, in your experience which is greatly more than mine,
be able to point me in the direction I should be going?
Thank you immensely,
Adam
<Much more to consider. Read here:
http://www.wetwebmedia.com/AqBizSubWebIndex/bizloc.htm
and the linked files above. Bob Fenner>
Interesting idea.... store may open MUCH sooner!!! Please
advise!! Hey again! I was not going to bug you again for
a while lol, however a couple days ago I found out that a LFS was up
for sale. I had called on it and found out all the
information. My partner and I made plans to meet the
"real estate agent... broker?" at the store today at
5pm. Both my partner Shaun and I have been into the
store. Its not HORRIBLE but its not good
either. There are many good points but a couple bad as
well. I will do the bad points first. BAD: 1.Location...
while it is in a good location in general the actual building is in
towards the back of a plaza, and not in plain view from the major cross
streets. We found out that some years back this was the
"Location to have a business". It is on 2 major
cross streets and about a mile or so from a major freeway the
I-17. So there are goods and bads to the location, but I
wonder if being recessed back is THAT big of a deal. Keep in mind both
my partner and I have degrees in marketing, and we plan to have a nice
flow of postcards and such going out. There is a small sign
on the major street but is it small. The location is closer
to AquaTouch, one of our main competitor (Michael is gonna be pissed at
me :( <Mmm, not so much if you'll be a "good"
competitor... "do the job", charge fair prices... All genres
of business tend to be clustered... think about this> That worries
me a bit. There is also another store that has SW but is
HORRIBLE! So not to worried about them. 2. Its going to
need some work.... maybe more than some. The store is a
general pet store and they carry mice and feeder rats,
YUCK. So the place is a little
"gamey". They also carry reptiles and a few small
animals. These will all be sold at low prices so we can focus on the SW
of the store and get them out ASAP. The floors need to be redone as its
laminate tile. And a little bit of updating and LOTS of cleaning. 3.
Because of the location taking this store leaves the room for another
LFS to move in farther west (as we were thinking of being farther west)
and competing with us that way. If that happened we would be
in between 2 competitor, AquaTouch and store X. This could
be bad and good. We are realistic, and doubt anyone will use our store
exclusively for their tank. Were hobbyists and we know
that's probably not gonna happen. <... visibility and
accessibility are always important issues of retail... You don't
mention the "bad will" of buying this/an existing business...
this can/does operate in the exact, but opposite way as "good
will"... Can be VERY important> Those are the major concerns
that we have. On the plus side, there are a few nice
things!!! GOOD 1. The size is NICE! its 4,200 sq ft, and
the rent is $2600.00 a month. That's WAY cheaper than
anything we found, including my dream spot booo hoo. <DO have
someone negotiate the lease for wherever you end up... again... Better
money not likely spent> 2. The store already makes an
income. Last year was a not so good year, as they made net
some $140,000, I think that's what he said. Sales were
somewhere in the $250-$300,000 range. <... there is no way this is
the net income from these gross sales... as you will find in time>
With the break even point being about $7,500 a month, with
2 PT employees. (Does that seem cheap to you????)
<This/these figures are fallacious... Have your accountant look over
their data> 3. There is a HUGE selection of fresh water
fish! This guy has TONS of tanks all full of healthy stock.
<Not impressed... this can all be purchased...> I
didn't see any sick fish but they could have cleaned up
lol. I will attach some pics so you can see just how many
fish were talking. They probably have some 200 tanks maybe
more! The salt water section is VERY small. The owner said
he just doesn't know how to do salt water very well. So there are
only like 12 SW tanks, and none look very good. 4. Dry
goods. He carries a nice selection of dry goods (some are
for reptiles and small pets that will need to go) but there is quite a
bit of sock already including quite a few tanks, stands, canopy's
etc. And a decent selection of skimmers, pumps, filters,
lights and such. 5. The store is sectioned off, it is actually 3 suites
of the building into. A dry goods section then a FW room and then a
SW/FW room. Makes it easy for us IMO. <Yes> 6. We will
have income right away, <Minus the expense of buying...> and a
client base already established. All we would have to do its
clean the heck outta it, make the SW section the BEST in Phx, with our
"reef lounge and killer livestock" and go from
there. Endless possibilities with this and the option to
move later is always there also. These things (besides the flooring)
can be done wile the store is open. Seems like a good
situation. 7. The owner also breeds and sells fresh water
fish wholesale. He also owns another suite 3 doors down,
which is his breeding building. So we will be able to get
many of our FW fish from him 2 doors down. That's a huge
deal IMO. They are asking a price of $175,000.00 for everything in the
store. I am pretty sure we can come up with that capitol,
and the Woman's Bus. Association, has grants out that I have filed
for. Love being a chick! Free money has a good ring to
me!!! They have a cash price of $150,000.00 , and while I am
not relying on the grants if they come through it will total about
that. <Mmm, reserves? I would have available about twice whatever
you're going to have to spend to open...> Shaun is super
excited, <... W/o knowing folks this is hard to express, but I
encourage you to wait till all are not excited... Very important to go
into such ventures totally dispassionate re their business aspects>
and I am as well, but having a "idea" of how it will look,
and then realizing its not possible is frustrating. I am
referring to a large opened up building, with only about 10% Fw and %90
SW. He says he makes LOTS of $$ from fresh water as they are
so inexpensive to rear. <Yes... contrary to what many folks think,
SW is more expensive per unit... yet sells less, with lower margins,
requires more space, feeding... dies more...> He has been doing this
at this store for over 20 years and seems very nice and
personable. I think he is just burnt out, and said "Im
old" and "having health issues" so I gotta
retire. Well check out the pics I attached hope they work
ok. Tell me your thoughts, Shaun and I feel like its a great
idea just if it was more on the west side. :( Thanks for
reading my book lol, and would appreciate any feedback you have oh wise
one! Adrian Poe Pictures attached. <Again... worth considering...
BobF> Re: your ol' buddy from the west Texas desert...
Wasn't demeaning PetCo as a chain. This specific store has a bad
showing for Saltwater stuff. The supply of books and reading material
is abysmal and the livestock selection is very small. The tanks are
okay but not great. I blame it on the management of the store not
PetCo. I should have made that more apparent. <No worries... the
chains have their shortcomings for sure... space enough for all
currently. Bob Fenner>
Re: your ol' buddy... TURNS OUT I misstated the name of
the store. I went over there at lunch it is a PetSmart store NOT a
PetCo. That could be part of the problem. Sorry for any hard feelings
my original email may have caused my friend. <Again, no
worries. Both chains have their strong/weak points... I don't take
any of these personally> I still do not blame the chain, but rather
the local management for the lack of interest in Reef Aquaria. There
are several people here, even in my own business, that are clamoring
for a store 'of our own' where people can learn and start on
this hobby. For now, I have brought in my copy of your book and have
highly recommended it. <Ahh, glad you find it worthy> Regards
Rick <Perhaps someone there will realize the opportunity, the
challenges, and open an independent shop... Bob Fenner>
Locating A Store My name is Alfred and I am looking a store
in L.A. named Southland Aquatics, Inc. Did You know their phone
number? I have the address to be at 3948 W. 132nd Street
Hawthorne, CA Thanks for Your response. <Well, Alfred, I have not
heard of this particular store/business. Short of calling information
for the 310 area code or Yahoo! Yellow Pages, I'm not sure of
another source for this. I did find a thread from Reef Central
regarding some major fish stores in the LA area. Maybe this will help
locate others in the area: http://reefcentral.com/forums/showthread.php?s=&threadid=333762
Sorry I could not be of more assistance. Regards, Scott F>
Question about the fish market 9/14/04 Hi Bob, <Anthony Calfo
in his stead> Do you think Pennsylvania has a good fish
market? <hmmm... compared to less populous states,
perhaps... but really no, in contrast to many other regions/states.
Pittsburgh only has about 1 millions residents... the state capital is
in a similar ballpark. Really small cities compared to Houston, New
York, the Bay Area, Miami, etc> I plan to open a retail front in the
future, and I just wanted your input on what states would have the
largest market. I'm looking for maybe a top 5 or top 10
places to start a retail front. Thanks. Lan Tran <my
advice is to subscribe to some food industry trade journals for
demographic information to start with. Find such publications with some
keyword/key phrase searches on a good search engine like google>
Aquarium store locations Wet Web Media;
My question concerns the best location to set
up a moderate sized aquarium/pet store on the eastern
coast. Are there any web sites that you recommend for
demographic information or "trend" information concerning
where the industry has a high demand and low supply for a
retailer? Thank you in advance. <We have a brief survey
article:
http://www.wetwebmedia.com/AqBizSubWebIndex/bizloc.htm (and see the
linked FAQs) on the subject. There are agencies, companies you can use
to help you in your location search... but I encourage you to
"look around", make your own set of criteria up (proximity to
competitors, visibility, accessibility, traffic, economic make-up of
travelers, folks who live proximally...), rank them (give them relative
point value), and score the various possibilities... to gain a FIRM
understanding of what's available and what you're looking
for... A very worthwhile exercise. Bob Fenner> Neal Isaacs
Pet Shops in Virginia Bob - After so many years on wanting an
aquarium , I finally decided to take the plunge. Of course, I am diving
in head first into marine. <Like the allusions to diving>
Do not be alarmed since, I typically read and educate myself as much as
possibility in all my endeavors before I start. <A good, sound
approach to all life's doings... I would aspire to St. Peter's
overall stmt. here: "Know thyself, then love".> I started
with your book - the conscientious marine aquarist - I intend to be
very careful about this and go slowly - even to the point of having my
tank running for a couple of weeks if possible to make sure it is
stabilized in every aspect before even introducing any fish. <Again,
you are to be congratulated; congrats!> My question is, I can't
find a good shop here in Virginia for my supplies. Youstress the
importance of the condition of the fish and even how they are
harvested. I have found just one main supplier ( Wally's Aquarium)
here in Fairfax, Virginia <I see> Do you know of any place where
I can get quality stuff around here ? Thanks for your time.. <No,
but I do know where I would ask next. Try our chatforum:
http://wetwebfotos.com/talk/ and others (Reefs.org, reefcentral) on the
Net. Scanning their archives with just this question, or joining
(they're free) and querying ala Consumer Reports tm, what there is
to be had in your region. Bob Fenner> Victor
