Anyone here an LFS owner?

[Russel P]

I might be about to become one. One of the owners of a local fish store here in Asheville passed away last week. His family was going to have a liquidation sale, but I am considering buying it. I am to meet with his sons and look at P&L sheets, etc. and we'll come up with a price. I know the store had been struggling, but it's in a great location and has been in our town for 27 years. A much larger, newer store opened up 5-6 years ago, plus several box stores. I'm not sure how much that had to do with the business going downhill, but I have to imagine it is a factor. The store needs to be cleaned up, a coat of paint, better lighting, a dehumidifier and more merchandise for starters. And it needs a niche. The big store has very nice corals and high-end salt stuff, the box stores have inexpensive tanks and cheap zebra danios. I'd need to find some ground in the middle, I'm guessing. Any advice appreciated.

[Pescaiolo]

As a business owner I can tell you that you need to cater to your customers. Ask for their input and what they are looking for. Make them a part of the store with special member programs or club discounts and clearance sales. You can start with a grand reopening of the place and have some great deals on anything you have a lot of that you need to move. Try to cater to customers personally, especially big spenders! I am sure there is more that I am forgetting, I'll chime in later on it I guess.

As a customer and a former LFS employee I would like to suggest not to get in anything that is hard to keep. I would also suggest to get to know your saltwater customers so you know their tank sizes and a good idea of what kind of livestock they have and want. Quarantine new arrivals and wait a week or 2 before putting them on sale. Don't get anything that is not easily kept in captivity or doesn't have a long life span. Your sales are probably going to come from freshwater since a lot more people keep them. If you run it as a hobbyist and not as a business person, you should thoroughly enjoy your successful store.

[Amphibious]

Russel P,

I've been in this industry in one form or another since 1966. I agree with catering to your customers and everything else Pescaiolo mentioned. However, before you put the cart ahead of the horse their are more pressing issues of great concern. Most people going into business do it with stars in their eyes and ignore reality. So, a dose of reality is in order. Take this seriously but not personally because we haven't had the chance to have a serious talk about your plans. Your asking for advice and what I'm going to give comes from personal experience in this business.

While you are working out details with the current owner, develope a "business plan" for your new venture. There are software programs that will help you with this rather boring but, necessary excerise. You need to know where you'd like your business to go before you plunk down any money. Speaking of money, In starting a new fish/pet store it's long been advised to have at least $100,000 (as a minimum) dollars on hand (not borrowed) to get it up and running. If you don't have it, you're running up hill on an empty stomach. I could name many stores that went bankrupt or out of business because of under funding and/or poor management.

Next, if you plan on paying yourself a wage the first year forget that. You will be lucky to pay your overhead which will include but not be limited to; rent, utilities, re-stocking merchandise, advertising, employee payroll, payroll taxes, sales taxes, and on and on. It never stops. Plus, you'd better have the stomach for filling out and filing government tax and other forms. You will become a bookkeeper for the Gov.

I'm sure there are things I'm leaving out of the equation and others can feel free to chime in. I just am trying to point out that in the "pie in the sky" world there are plenty of stormy clouds. If you can overcome the above obsticles, the best of luck to you. Speaking of good luck, it only comes to those who are prepared and persistant.

By the way, I'm still in the business, even though I've never made much money at it. I've always held a "regular" job until I retired from it, and now my wife supports us, bless her ever loving heart and workaholic attitude. God I love that woman.

Dick

[Russel P]

Thanks, Dick.
Here some more info:
There are only two LFS's in my town of 80,000 (there are a dozen box stores, though.) One is quite large, new and beautiful. The other is very small and has been in the same spot with little updated for 15 years. The owner of that store died tragically last week. I've met with the family about purchasing it. They were going to just have a 50% off sale for a week, then fire-sale off whatever was left. The store had a large service business, which kept the retail end afloat during tough times. The yearly service income + total inventory is a little over $80,000. I asked his widow what she had in mind and she'd hoped for $60,000. I was planning on about a third of that, but may make a counter offer after I get a better grasp of the P&L sheets.
The store is pretty sparse -you could easily double the number of tanks with the floor space. But that might not be wise if sales are slow. I'm torn. I own a small construction business which does fairly well. I'd definitely take a pay cut, but balancing doing what I love vs. working on a roof with rednecks all day is hard to put a price on. I worked most of my younger years at LFS's and had always hoped to open an aquarium store before I retired. I'm 38, so this is sooner than I'd expected -but an opportunity like this isn't likely to come by again. Time is of the essence, they are having to pay to keep livestock cared for and are ready to get this behind them and grieve.

[Amphibious]

Russel P,

I hear you on the doing what you love as opposed to your present situation. This is one decision only you and anyone else in your life has to make. Weigh the pros and cons carefully before making the decision. This is private and I'm not asking you to disclose any information but, do you have a cash reserve to fall back on, live off of, pay bills with???

When you present your offer to the family be sure to emphasize that selling to you may be wiser than holding a 50% sale followed by a fire sale. Selling unburdens them of the responcibility of disposing of the store's inventory and allows them to grieve the death of their loved one sooner.

All I can add is good luck.

Dick

[CarmieJo]

Chuck, I don't know how it would work in Asheville but in Raleigh area we have 4 LFS that are saltwater only stores. Two of the four are new and the other two have both expanded in the last year or so. I don't know if there is a big enough niche for this in Asheville but it might be something to think about.

[Russel P]

I used to work for Triangle Tropical Fish in Durham, Carmie. Ever seen that place? I called the owners to catch up, and they've moved, expanded and grown tons since I last visited. The numbers for this store were taking a serious nose-dive. I've got his tax returns for the last decade, P&L's, and lease info.
The lease can never be matched! The guy sub-leased 1/3 of his store to a Chinese fella to open an Asian food market. The lease was $1,800 and change and he subleased that portion for 15K+. And that store is doing great and wants to keep the lease. So In Asheville, NC (where no one who works here can afford to live here) I could open a store with a $300 monthly lease!
I have everyone I know looking over the books and trying to help me come up with a value for this place. He had a very lucrative service business, but nothing was contracted.
They opened the store yesterday and today to sell off all the merch they could. I bought all the frozen food and the last salt inverts (everything had been cherry-picked, I took rough stuff) before they closed tonight. It'll help them if I don't buy, and if I do, well; I have a freezer full of frozen food and some LPS's to doctor. The previous owner's funeral service is tomorrow. I don't expect to talk business with the family then.

[CarmieJo]

I was in there once. I have a couple of stores I like a lot within 10-12 miles of my house. They have good selections and fair prices so I don't have a big need to travel around. Sounds like the owner was a pretty smart businessman with that sublet. You certainly can't beat the lease price. Keep us posted.

[Amphibious]

Hey Russel P,

The very best of luck to you if you wind making the deal.

Dick

[thecoralreefer]

I have had the opportunity to run a store myself.
I did in fact do ok for 2 yrs here in florida.
Just around Chritmas things went south for me.
I do have the wholesale store sitll in operation and have 28 different lists to pick from so I can help you with livestock. If you pay close attention to what is selling you should be OK
I wonder How is the housing market in your area??
This is a close tie to aquariums due to this is an expesin=ve hobby and
Concidered a luxury item. So pick stuff that is a basic seller. Dry goods comes down to which is more popular at the time.Right now the dot coms say Sps sales are down
Lps And softies sell more and are easier to care for.
Oh yeah,! do not accept posted listings from your dry goods wholesaler!!!
They will bartter down for you on just about everything!!!
As for fish, Tangs sell Some angels, Small ones, Algea eaters, snails blennies stars You know the drill.
Advice should be free! It builds a good relationship. Testing for free will bring em back.
But , hey, Lots of people charge for that. Get a good test kit for Salinity and Alk And Well you know what it takes if you have a tank. Put it to work and use your head.
Learn as much as you can about your product so you give good advice.

Good luck if you do this!
need any help just write!

[Russel P]

Well, this whole thing is moving along. I should have the keys Monday. I am still in a contract to finish out the current job I'm on, but it's almost at a point where I can just send my guys and foreman to the job while I run the store. I also have several service accounts to catch up and need to hire an employee. I hope to open the doors by the 27th.

[Phurst]

Congrats!
Wish I were closer so I could come check it out. We will be expecting a virtual tour of course.

[Russel P]

You got it! Love the flying speghetti monster too, BTW.

[CarmieJo]

Congratulations! Best wishes on your new venture.