How Hard Is It To Open A Hobby Store.
09-26-2002, 06:01 PM
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How Hard Is It To Open A Hobby Store.
HOW HARD IS IT TO OPEN A HOBBY STORE.
I AM THINKING OF OPENING A HOBBY STORE IN MY AREA HOW HARD IS IT TO DO..ALSO HOW DO I GO ABOUT GETTING THE STOCK AND SETTING UP EVERTHING.
CAN SOMEONE GIVE ANY INFO OUT THERE.
[email protected]
I AM THINKING OF OPENING A HOBBY STORE IN MY AREA HOW HARD IS IT TO DO..ALSO HOW DO I GO ABOUT GETTING THE STOCK AND SETTING UP EVERTHING.
CAN SOMEONE GIVE ANY INFO OUT THERE.
[email protected]
09-30-2002, 02:06 AM
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How Hard Is It To Open A Hobby Store.
It's not hard... and you can make a small fortune at it.
Just be sure to start with a LARGE fortune. You'll end up with a small fortune, in no time flat.
Seriously... if "running a hobby store" is a hobby for you, go for it.
If you want to try to make a living at it, I wouldn't suggest it, but good luck if you try.
You have to buy from the Empire if you want to sell the popular brands.
You then have to compete directly with said empire's online outlet, which sells
things for barely more than you can buy them for as a hobby store.
Then you have two choices:
1) Sell at magazine/online prices, and lose money or break even.
2) Sell at reasonable markup, and lose money or break even.
(#2 is because you'll lose all the short-sighted folks, when you don't sell at magazine/online prices)
Just my $.02, after seeing the demise of one formerly awesome LHS,
and the impending demise of yet another, if things don't change for the better, soon.
Just be sure to start with a LARGE fortune. You'll end up with a small fortune, in no time flat.
Seriously... if "running a hobby store" is a hobby for you, go for it.
If you want to try to make a living at it, I wouldn't suggest it, but good luck if you try.
You have to buy from the Empire if you want to sell the popular brands.
You then have to compete directly with said empire's online outlet, which sells
things for barely more than you can buy them for as a hobby store.
Then you have two choices:
1) Sell at magazine/online prices, and lose money or break even.
2) Sell at reasonable markup, and lose money or break even.
(#2 is because you'll lose all the short-sighted folks, when you don't sell at magazine/online prices)
Just my $.02, after seeing the demise of one formerly awesome LHS,
and the impending demise of yet another, if things don't change for the better, soon.
09-30-2002, 12:02 PM
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Hobby shop
If I had a choice of 20 businesses to go into, a hobby shop would be last choice.You will soon find out how loyal your customers are when they come in with an ad that has an item selling for less then you pay for it Go over the posts of people wanting to buy something. They want to know who has the cheapest price or who has the best price. If you stay open Sunday you will get some people to come in for glue and other nickel and dime items. As the previous post stated you can make a small fortune with a hobby shop, but only if you start with a large fortune
09-30-2002, 05:50 PM
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How Hard Is It To Open A Hobby Store.
Originally posted by C_Watkins
Then you have two choices:
1) Sell at magazine/online prices, and lose money or break even.
2) Sell at reasonable markup, and lose money or break even.
(#2 is because you'll lose all the short-sighted folks, when you don't sell at magazine/online prices)
Then you have two choices:
1) Sell at magazine/online prices, and lose money or break even.
2) Sell at reasonable markup, and lose money or break even.
(#2 is because you'll lose all the short-sighted folks, when you don't sell at magazine/online prices)
Business is business and price is a major factor for most of us.
If you want to open a hobby store or for that matter any other business keep that in mind.
I now of a very successfull LHS that stocks just about everything has prices that match mail order or beat them on most items.. Wonder how they do it!!!
Just a thought. Kits, Radios, Engines draw customers in and pricing seems very competitive but what about all the "extras" seems like selling a kit at the "street" price and making up marging on the extras is the way to go.. I know I don't like to pay 15.00 shipping on a 5.00 order so if I'm at the LHS and I get a "Deal" on the Kit usually buy it all there..
09-30-2002, 06:18 PM
#8
Opening a Hobby Shop
I have given this subject some thought myself recently but always come to the same conclusion. Probably a fun "part time" endeavor but I wouldn't want to have to support my family on it.
I travel frequently and visit hobby shops all over the country and I will tell you a few things I have learned.
First you must have minimal overhead. Forget the mall and instead look in the industrial parks. Don't worry we'll find you.
Second you must carry car stuff. Just think about it when a plane breaks, you buy a little balsa and glue it back together: total repair cost is minimal. BUT if you wreck your car you have to buy expensive car parts. Same with helicopters.
You have to provide a reason for people to visit your shop. Sure they might come every now and then to buy something but you want them to come more often. You need a DRAW. Sometimes it's an indoor dirt car track or maybe a ton of planes hanging from the ceiling or maybe a corner that has nothing but used stuff. Maybe some space to hold club meetings. The point is you must give people a reason just to swing by and check the place out.
There used to be and probably still is a very famous hobby shop in Van Nuys CA where a person worked behind a small glass partition and built planes in full view of all the customers. People came from miles around just to see what was on the building table that day. Beginners would see how easy it is and modelers would remember the part or the glue they forgot to buy. Everyone leaned new skills and saw new tools and materials in use.
This gives you an opportunity to build a relationship with the customer. This relationship is what makes them not mind too much when they pay a little extra for a fuel pump.
Finally, very few hobbyshops these days actually help people. They sell the stuff but not many will actually help the beginner put it together and teach him to fly it. They just pawn the poor guy off on the clubs. Take an interest and build that friendship.
I think it is possible to make money and maybe even feed your family but their are probably thousands of easier ways to go about it.
Good luck and let me now where it is so I can swing by for a look!
I travel frequently and visit hobby shops all over the country and I will tell you a few things I have learned.
First you must have minimal overhead. Forget the mall and instead look in the industrial parks. Don't worry we'll find you.
Second you must carry car stuff. Just think about it when a plane breaks, you buy a little balsa and glue it back together: total repair cost is minimal. BUT if you wreck your car you have to buy expensive car parts. Same with helicopters.
You have to provide a reason for people to visit your shop. Sure they might come every now and then to buy something but you want them to come more often. You need a DRAW. Sometimes it's an indoor dirt car track or maybe a ton of planes hanging from the ceiling or maybe a corner that has nothing but used stuff. Maybe some space to hold club meetings. The point is you must give people a reason just to swing by and check the place out.
There used to be and probably still is a very famous hobby shop in Van Nuys CA where a person worked behind a small glass partition and built planes in full view of all the customers. People came from miles around just to see what was on the building table that day. Beginners would see how easy it is and modelers would remember the part or the glue they forgot to buy. Everyone leaned new skills and saw new tools and materials in use.
This gives you an opportunity to build a relationship with the customer. This relationship is what makes them not mind too much when they pay a little extra for a fuel pump.
Finally, very few hobbyshops these days actually help people. They sell the stuff but not many will actually help the beginner put it together and teach him to fly it. They just pawn the poor guy off on the clubs. Take an interest and build that friendship.
I think it is possible to make money and maybe even feed your family but their are probably thousands of easier ways to go about it.
Good luck and let me now where it is so I can swing by for a look!
09-30-2002, 07:48 PM
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How Hard Is It To Open A Hobby Store.
I ran a very successful model business for a number of years and here are some thoughts. You will never be able to make money from the local hobbiest. They are your friends, so don't even try to make money off of them. Instead, consider starting a mail order business that sells worldwide. Here's the formula that worked for me:
Now - you must come up with a list of items that "only you" are selling, something that they can't get anywhere else. That means you must be very creative, and have the ability to manufacture or get manufactured those special items that will lead customers to your door. In my case, I was the first dealer in the US with the Quadra engine. I sold hundreds of them before others caught on. I had special large diameter propellers made for these engines before Zinger/Top-Flite etc. got into the market. I manufactured the first 1/4 scale kits. I had a line of cockpit kits for my own kits, as well as kits already on the market. I manufactured two sizes of WW-1 wheels, 1/4 and 1/3 scale to fit the Balsa USA Pup. I sold over 2000 pairs of 10" diameter wheels - delivered to most every country on the world map.
Next - be prepared to purchase in large quantities. Establish yourself as a "distributor" rather than just a hobby shop. I did this by first becoming a manufacturer (made kits). This allowed me to purchase balsa, wheels, props, - you name it - at distributor prices - but be prepared to purchase at distributor quantities - which they will identify to you.
Now about the local modelers: Everyone that walked through my door knew they would get a 20% discount on all items, excepting gasoline engines that didn't carry a regular 40% mark-up. There were no exceptions. If Tower sold it cheaper - encourage them to go there and get it - and don't be mad about it if they do. Make it a rule to make your money off the mail order business - and let the local business break even.
Overhead: That is a big item. Forget about a big storefront. I operated out of the basement of my home and it was stacked full of inventory items. One thing for sure - you must never allow yourself to be out of inventory. You must be able to ship every item ordered - there should be no such thing as a back order. Operating out of my home allowed me to deduct a certain percentage of household expenses like gas, electric, insurance, etc. from income tax calculations. These were expenses incurred no matter what - so take advantage of it in your business. Pay all of your inventory orders by cash - it's the easiest 5% you can make.
Next - I shipped every order the same day as received. Nobody will do repeat business with you if you delay their shipments for any reason. My business went on for twelve years before I decided to retire, and in that time, I had garnered well over a thousand customers that purchased ALL of their supplies from me. I sent a "thank you" note in the mail along with every invoice. Once I got to know a customer, usually by phone as they often phoned in their orders, I placed them on "open invoice" - meaning that I shipped - and they paid the invoice when the stuff was received. This was kinda "gutsy", but I found out that serious modelers were to be trusted, and my losses only amounted to about one-half of one percent each year. There were dead-beats, of course, but over all complete trust and friendship was established in one another and the orders just rolled in every day. We went into six figures within six months of going into business.
I had a repair service for customer engines, $10.00 plus parts, and I can't tell you how much this contributed to getting repeat business. I kept repair parts "reasonable", and returned engines like new to the customer. It became a two-way street - I liked my customers, and they liked me.
Now all you have to do is go out and dream up something that will sell so that you have complete control over the pricing; get advertised, and wait for the orders to come. And remember this: How much it costs to manufacture an item has no bearing on the selling price. Like the 10" wheels mentioned above, the cost to purchase the wheels, and make the covers was about $5.00/pair. But Williams Bros tiny little WW-1 wheels were already selling for $25.00/pair, so I priced my big ones for $29.95/pair and they sold like hot-cakes.
Next - be prepared to work like crazy.
Now - you must come up with a list of items that "only you" are selling, something that they can't get anywhere else. That means you must be very creative, and have the ability to manufacture or get manufactured those special items that will lead customers to your door. In my case, I was the first dealer in the US with the Quadra engine. I sold hundreds of them before others caught on. I had special large diameter propellers made for these engines before Zinger/Top-Flite etc. got into the market. I manufactured the first 1/4 scale kits. I had a line of cockpit kits for my own kits, as well as kits already on the market. I manufactured two sizes of WW-1 wheels, 1/4 and 1/3 scale to fit the Balsa USA Pup. I sold over 2000 pairs of 10" diameter wheels - delivered to most every country on the world map.
Next - be prepared to purchase in large quantities. Establish yourself as a "distributor" rather than just a hobby shop. I did this by first becoming a manufacturer (made kits). This allowed me to purchase balsa, wheels, props, - you name it - at distributor prices - but be prepared to purchase at distributor quantities - which they will identify to you.
Now about the local modelers: Everyone that walked through my door knew they would get a 20% discount on all items, excepting gasoline engines that didn't carry a regular 40% mark-up. There were no exceptions. If Tower sold it cheaper - encourage them to go there and get it - and don't be mad about it if they do. Make it a rule to make your money off the mail order business - and let the local business break even.
Overhead: That is a big item. Forget about a big storefront. I operated out of the basement of my home and it was stacked full of inventory items. One thing for sure - you must never allow yourself to be out of inventory. You must be able to ship every item ordered - there should be no such thing as a back order. Operating out of my home allowed me to deduct a certain percentage of household expenses like gas, electric, insurance, etc. from income tax calculations. These were expenses incurred no matter what - so take advantage of it in your business. Pay all of your inventory orders by cash - it's the easiest 5% you can make.
Next - I shipped every order the same day as received. Nobody will do repeat business with you if you delay their shipments for any reason. My business went on for twelve years before I decided to retire, and in that time, I had garnered well over a thousand customers that purchased ALL of their supplies from me. I sent a "thank you" note in the mail along with every invoice. Once I got to know a customer, usually by phone as they often phoned in their orders, I placed them on "open invoice" - meaning that I shipped - and they paid the invoice when the stuff was received. This was kinda "gutsy", but I found out that serious modelers were to be trusted, and my losses only amounted to about one-half of one percent each year. There were dead-beats, of course, but over all complete trust and friendship was established in one another and the orders just rolled in every day. We went into six figures within six months of going into business.
I had a repair service for customer engines, $10.00 plus parts, and I can't tell you how much this contributed to getting repeat business. I kept repair parts "reasonable", and returned engines like new to the customer. It became a two-way street - I liked my customers, and they liked me.
Now all you have to do is go out and dream up something that will sell so that you have complete control over the pricing; get advertised, and wait for the orders to come. And remember this: How much it costs to manufacture an item has no bearing on the selling price. Like the 10" wheels mentioned above, the cost to purchase the wheels, and make the covers was about $5.00/pair. But Williams Bros tiny little WW-1 wheels were already selling for $25.00/pair, so I priced my big ones for $29.95/pair and they sold like hot-cakes.
Next - be prepared to work like crazy.
09-30-2002, 09:06 PM
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How Hard Is It To Open A Hobby Store.
I don't live in the US but often travel or know people travelling to the US.
I usually buy mail order and collect in Miami.
My last trip I visited a few shops in S.Fla.
On 2 occasions in different shops I heard telephone conversations asking the price of some item and in both cases the conversation included some talk with respect to Tower.
This is something to keep in mind with regards to "the competition" and pricing.
On the other hand this can be one of the most expensive hobbies in the world and many rc fliers are not poor by any stretch,
so there must be some market and possibility for making money.
I usually buy mail order and collect in Miami.
My last trip I visited a few shops in S.Fla.
On 2 occasions in different shops I heard telephone conversations asking the price of some item and in both cases the conversation included some talk with respect to Tower.
This is something to keep in mind with regards to "the competition" and pricing.
On the other hand this can be one of the most expensive hobbies in the world and many rc fliers are not poor by any stretch,
so there must be some market and possibility for making money.
09-30-2002, 11:12 PM
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My question is concerning starting a hobby store out of your basement or garage like Jim Messer suggested......How do you get around the requirements of a copy of you lease and photo of your storefront in order to be a distributor for products from companies like Great Planes, Ace/Thunder Tiger and Horizion?? They require you to be in "retail" space...so how can you run a business out of your basement and still have their support???
10-01-2002, 12:46 AM
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How Hard Is It To Open A Hobby Store.
To rcflyertim:
You have to understand that my business started in 1976 with the Quadra engine. Then I made kits. There were no 1/4 scale kits on the market at that time. This established me as a legitimate manufacturer. I primarily sold "mail-order" - thus no need for a storefront. Because I included many items in my kits like a prop (Zinger), and spinner (CB ASsociates), hardware & wheels (DuBro and SIG), and other items (ACE) - that opened the doors for me. I sold a lot of stuff - not only in kits but from customer orders stemming from my catalog. I was able to negotiate distributor status from all above, and I moved a lot of stuff. I was able to purchase balsa at distributor pricing only because I was considered a manufacturer - not just a retailer.
Later down the road, I had others manufacture for me a line of balsa gliders that I distributed back thru SIG, Horizon, and others.
So it can be a two-way street. You need to be ready to take advantage of all opportunities.
So the key is to "make something" where you have control of the pricing. You will go broke trying to be just a retailer of items that a modeler can purchase from Tower any day of the week.
You have to understand that my business started in 1976 with the Quadra engine. Then I made kits. There were no 1/4 scale kits on the market at that time. This established me as a legitimate manufacturer. I primarily sold "mail-order" - thus no need for a storefront. Because I included many items in my kits like a prop (Zinger), and spinner (CB ASsociates), hardware & wheels (DuBro and SIG), and other items (ACE) - that opened the doors for me. I sold a lot of stuff - not only in kits but from customer orders stemming from my catalog. I was able to negotiate distributor status from all above, and I moved a lot of stuff. I was able to purchase balsa at distributor pricing only because I was considered a manufacturer - not just a retailer.
Later down the road, I had others manufacture for me a line of balsa gliders that I distributed back thru SIG, Horizon, and others.
So it can be a two-way street. You need to be ready to take advantage of all opportunities.
So the key is to "make something" where you have control of the pricing. You will go broke trying to be just a retailer of items that a modeler can purchase from Tower any day of the week.
10-01-2002, 03:35 AM
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Starting a hobby shop is the easy part..you just need a pile of cash. However, staying in business and being profitable is the hard part. Mr. Messer makes quite a few valid points but is is easier said than done. It would seem to me that to be able to manufacture model airplane kits you must need some engineering skills to design planes. Perhaps you could find a foreign company that needs an importer for their products. Starting a business in the mid 70's was considerably easier than starting one today. There is much more government intervention and rules that the small business man must deal with. Being a distributor sound well and good but in order to distribute anything you need to have a considerable amount of money. Even if you were distributing items that cost 10-20 dollars a piece, and you had to have several thousand in inventory you'd need some serious money. Running a business on cash rather than credit is very difficult in this day and age. I run a liquor store and paying for 30k cash or more for inventory on a weekly basis is almost impossible. You'd need deep pocket to pay for everything in cash. In some cases, in order to become an exclusive distributor for some items you need to purchase a years worth of production from the manufacturer. Mr. Messer is correct that you need to establish a niche for yourself, finding the correct product is the hard part.
10-02-2002, 12:34 AM
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How Hard Is It To Open A Hobby Store.
Make trips to Asia or Eastern Europe and buy quality kits or ARFs (many quality sailplanes come from the former Soviet block countries) and sell them on eBay.
Recently, a fellow from Austria visited our field (working to install a new turbine in a dam in our area) and he said some of the sailplanes we were flying cost less than half (in US dollars) over there than here.
Sell just a few of these, and at least your trip was paid for...
Recently, a fellow from Austria visited our field (working to install a new turbine in a dam in our area) and he said some of the sailplanes we were flying cost less than half (in US dollars) over there than here.
Sell just a few of these, and at least your trip was paid for...
10-02-2002, 12:37 AM
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I managed in a hobby store for quite a while. Starting one is easy. Making money is tough. Us airplane guys wont let you make a penny. We will want you to stock everything, We will then want only what you do not have in stock. We will bring in our special catalogs with discount coupons and free shipping and expect you to beat that price. Try to charge us tax and we will have a heart attack on the spot. Charge us 2 dollars over the catalogs for an item and we will talk bad about you at the field. We will drive 50 miles to save 50 cents. AND if thats not bad enough you will have to order your stock thru a distributer who then comes out with the same product in it's own brand name and sells it cheaper than your wholesale cost. Oh and lets not forget how they sell you product and then lower the retail price....once agian....... below your wholesale cost. And last but not least you then have to help, for free!!!! the steady line of potential customers who show up with their mailing order product and ask you to help them get it flying. You will then spend hours with them fixing their mistakes. Hooking them up with clubs and instructors, hoping for some loyalt....forget it.. they will cont. to buy product online because it's cheaper. They then try to return to your store defective stuff they bought from the catalogs (thats my favorite).................Do I sound bitter ??? YES I AM !!!! Don't do it !!
Enjoy the hobby. I left the store and this hobby for 7 years it beat me up so bad.
My 2 cents
Brian
Enjoy the hobby. I left the store and this hobby for 7 years it beat me up so bad.
My 2 cents
Brian
10-02-2002, 01:42 PM
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How Hard Is It To Open A Hobby Store.
Big bri "you are absolutely correct"!!!!!
I also put in many hours at a LHS on a part time basis and I can
validate your position.
I've said this before and I'll say it again
"unless you have been on both sides of the counter,
you don't have any clue what this hobby is REALLY like"
Regards,
Roby
I also put in many hours at a LHS on a part time basis and I can
validate your position.
I've said this before and I'll say it again
"unless you have been on both sides of the counter,
you don't have any clue what this hobby is REALLY like"
Regards,
Roby
10-02-2002, 05:39 PM
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we had a guy that was a member of a club that started a big model show. the traders liked to keep on his good side so he mannaged to wangle 20% off trade price. he used to buy stuff ( for his own use 
) and didnt advertise, this was club use only, you could ring him, and pop round for 4 clevises at 20% off trade price. he didnt make money out of it, even if he did we wouldnt hold it against him. he did it for the love of the hobby. now hes passes away we've lost that, and its made a big diffrence. now we have to wait till sunday for the guy 30 miles away to drive to the field with a car of stuff, tho thats just bits and bobs. the UK tower, Ripmax has an outlet ( kinda ) 10 miles away, the prices are high, and few bother to make a special trip for bits. we've learnt to buy in time and in bigger amounts.
a few club members still buy X amount of wood and sell it at price. some of us thought about buyign a large amount of stock, storing it and selling it at price. but its never happened.
) and didnt advertise, this was club use only, you could ring him, and pop round for 4 clevises at 20% off trade price. he didnt make money out of it, even if he did we wouldnt hold it against him. he did it for the love of the hobby. now hes passes away we've lost that, and its made a big diffrence. now we have to wait till sunday for the guy 30 miles away to drive to the field with a car of stuff, tho thats just bits and bobs. the UK tower, Ripmax has an outlet ( kinda ) 10 miles away, the prices are high, and few bother to make a special trip for bits. we've learnt to buy in time and in bigger amounts.a few club members still buy X amount of wood and sell it at price. some of us thought about buyign a large amount of stock, storing it and selling it at price. but its never happened.
10-02-2002, 08:34 PM
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How Hard Is It To Open A Hobby Store.
Brian: I love your reply to this thread because it is so true, and it happens everywhere. We lived in a small town, and at the most there would be maybe 25-50 local customers. For a few years I only sold to these few people, and often got stuck with a lot of inventory that became obsolete when newer products hit the market. In the end - I made absolutely nothing off the locals. That's when I decided to change directions and go world-wide by mail-order, and that's also when I established the 20% discount rule for the locals that came into my store. It worked well, and I made no exceptions. They knew I wouldn't be mad if they went to Tower, because they soon learned that whatever monies they spent was only a small fraction of that rolling in every day from the mail-orders.
I think the original thread has been answered - Owning and operating a local hobby shop in a small town is a good way to get ulcers - and who needs that. Better to build, fly, and enjoy!
I think the original thread has been answered - Owning and operating a local hobby shop in a small town is a good way to get ulcers - and who needs that. Better to build, fly, and enjoy!
10-03-2002, 11:47 AM
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Shop
Gotta Giggle at whats bein' said here.... Why?? Hehe..
My shop opens tomorrow. 2 years of thinkin' about it, with a lot of research on the side. Running around like a headless chook to find "The" location, Y'know.. Must have parking, rents the right price Et cetera. Fit shop out over a 2 month period, while building a relationship with the suppliers. "Man i need a holiday".
Fruit of my labours...shop opens tomorrow.
If ya gotta do it, do it.
coo-ee
CP
My shop opens tomorrow. 2 years of thinkin' about it, with a lot of research on the side. Running around like a headless chook to find "The" location, Y'know.. Must have parking, rents the right price Et cetera. Fit shop out over a 2 month period, while building a relationship with the suppliers. "Man i need a holiday".
Fruit of my labours...shop opens tomorrow.
If ya gotta do it, do it.
coo-ee
CP
12-19-2002, 03:49 PM
#22
How Hard Is It To Open A Hobby Store.
I had a hobby shop for many years. It was in the back of our Office supply store, so it didn't have to make money. It was just that, a "hobby" shop. Did a heck of a lot of business, sold a ton of stuff. There is no way I could have made a living at it. Lots of fun though. Mail order kills you. The other problem you will face that we have here is, if anyone else in your town already has dealerships with the larger dealers, you will not get a dealership from them, even if they don't use it. I was trying to help set a friend up with a shop like I had, and there is a hobby shop here that doesn't stock anything for RC but we can't get any of the needed dealerships because they have them and don't use them. They will special order for us, but only at list price on everything. Needless to say, we all get together and place large orders from other places. Sure would be nice if they would figure it out and stock at least things we need like hinges and nuts and bolts and stuff like that. They could make it work if they really wanted to. They already have all their fixed costs taken care of with their craft shop.
12-20-2002, 04:11 AM
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How Hard Is It To Open A Hobby Store.
> Forget about a big storefront. I operated out of the basement of my home <
That may be illegal in many communities. You must have commercial zoning to run a retail business usually.
Dave Segal
That may be illegal in many communities. You must have commercial zoning to run a retail business usually.
Dave Segal