Starting an Aquarium Business

[DitchPlains2]

Antee, thanks as always man, very interesting, many things I didnt know, well atleast its not top secret the way some people have made it out to be. It's funny now when I think about their behavior, obviously not the most up and up if they wont even mention the name of their wholesaler. funny...

I guess their just protecting their contacts and relationships.



I will definately look into the trade magazines, I was thinking whilst teaching over the summers, I could work on a small short season grow out plan, to harvest and sell locally some specific corals, perhaps just a particular species. I was hoping for something that hasnt been sucessfully grown in captivity, something unusual. do my research pioneer a little.


Just some thoughts, but right now, back to getting my 55g working right lol...... Mental note, buy long not tall...lol Overflow problems and water parameter, eeek. lol

thanks again man!!
Dave

[Anthony Calfo]

No worries, bro Quite welcome.

You bring up another interesting point for me to mention in this thread (reinforcing the need for good business and business sense in the industry).

So many merchants in our hobby industry are, again, hobbyists without good business sense or skills of any kind. And so... they make ascinine mistatements about wanting to have "the only store in town" or by starting new shops as far away as other competitors... being upset, jealous, etc when another moves into their territory... not sharing info with other merchants at trade shows, etc. It's truly ignorant... just an ignorant mentality that hurts their business and our industry.

Case in point... when you see a Home Depot, is there not always a Lowes or the like nearby? McDonalds across from another burger joint... Starbucks/coffee houses within sight of each other (even two Starbucks on opposite corners!), etc.? Always.

This is not a coincidence folks! It is good business and it is deliberate. Two (good) hamburger stands (fish stores, etc) in the same area can forge a larger market and get larger individual shares than either standing alone in the same niche. They exploit each others advertising and pull of traffic into the same region, etc.... and its good for everyone as long as they truly are good services/products. Good (competition) is good business!

Its a shame to see really... so many basement coral farmers and wannabe business folks just hurting themselves and doing bad business by talking smack on competitors, being narrow minded about giving good business information though that readily take it from others, etc.

A shame.

[watchdr]

I agree with you Anthony. Competition is a great thing for your business. Many times you can learn things from your competitors.

I mean good and bad things. The good you can use. The bad is money and time you don't have to waste.

Competition can be good for friendships as well. In my business I have only one competitor in town. In the whole US I have only about 500. I am good friends with every competitor I meet. Especially the one here in town.

I even send him some work and he sends me some work. His prices are lower than mine but I have more business than I need. I can hardly keep up with all the work as it is. He is busier than I am.

I make a little more than he does on the services. I charge more so do very little less work than he does. He charges less and works more.

The goal in business is to make money. There is nothing wrong with that. After all if you have a job why are you there? To make money.

I like working less and making more money. So I charge more and there are those people that won't pay a couple of dollars more so theygo to my competition. He works harder than I do and makes as much money as I do.

I actually like the situation because if he raised his prices then my work load would increase.

Now watchmakers are no where near the same kind of business as the pet industry. There is not the extreme discounting and giving things away for free and minute profit margins in watch repair.

I have owned about a dozen businesses in my life and a business plan is very important and schooling is important. Experience is vital and competition is vital so you can learn, copy and take advantage of opportunities.

I can go on and on.

[Anthony Calfo]

watchdr... excellent points/perspective. Thank you for your comments my friend!

It is so true.

It really gives me great personal pleasure/interest to see good business conducted.

And professional businesspeople really often do have fabulous relationships/friendships because they understand how to finesse the market so that not only each other can survive... but thrive! Much as you state... in some cases, one chap may prefer selling drygoods, while another will focus on service-oriented tasks. Or one wants to do higher volume lower priced sales, while the other spands more time on individual higher priced sales, does less of them, but makes the profit goal just the same. But in all such cases... the good competitors that have learned to compliment each other understand that they NEED each other! Because if the other merchants go out of business or do bad business... the reality is that many of those lost customers not only might not like the style of business of the remaining merchants (the different price, service, location, whatever...) BUT... the fact that those customers are no longer being served means they are no longer participating in that market as consumers... and therefore not likely giving/making referrals! And that is what really hurts the remaining merchants. The opposite of it being the very thing I mentioned above... synergy(!)

Multiple good competitors (local, regional and national markets alike) have a synergistic effect on each other. They forge a bigger market together than can be had or served by any one single merchant.

So yes... two or more good watchmakers, pet shops, etc will benefit by the mere existence of another competitor in their market.

And when such competiters can be friends... even better. In the aquarium industry... that can mean two or more shops co-op'ing to make bigger livestock orders from the same suppliers to reduce freight costs or even individual fish/coral costs for bulk orders. Or they can simply reduce shipping expenses by consolidating freight from various shippers (all drygoods from the opposite coast getting sent within a X week period to once consolidated shipper with maked boxes and sent at the same time to your home town). There is a HUGE freight savings this way for shop owners to help each other from the same town/region.

I could go on...

In time I will here

[watchdr]

Anthony,

Any time I can chime in.

I wish I knew as much about reefs as I do about business. I don't think that will ever happen though.

Reef technology seems to grow as fast as computer technology!

I can't keep up with either one

[watchdr]

Flame,

I had a thought about your question. If you say you won't be starting out with big tanks then aren't you getting ahead of yourself?

The requirements for a small tank are different than a large one.

[flame83]

Watchdr,

Most definitely you are right about the size difference. However, I currently run two tanks totaling 130 gallons. I'm looking for advice on large systems. I know what all the requirements for smaller tanks without large amounts of water being taken out continually thought the week. The main reason for the smaller tank size is to, get all my husbandry coral skills to the best of my ability with each species before I sell or house these on a large scale basis.

I also posted this question in another forum and received various pet store owners that use quite different techniques. This is in part is why I’m asking before I go into this. I intend to gain all the knowledge, professional advice, research, and first hand experience before I attempt a large scale coral farm.

I believe I would be getting ahead of myself, if I were to buy everything and then try and make it work. I'm getting ahead of the game by preparing myself. Just as any good business plan you must know what the requirements will be up front and analyze it down to the very last detail. You must always be on top of the game or your business will not survive.

I'm a president and officer in two student organizations, and you will always catch me prepared and quick on my feet to improvise when need be. I believe the only way for a business to work is: being prepared to the furthest extent possible, and being able to improvise as there will always be issues that you cannot total prepare for.

I hope that I answered your question, and clarified my position on how important it is to prepare before entering any certain market as I'm sure you know.

[flame83]

Anthony,

Just curios, you sound as you have may business related courses?

Honestly you sound exactly like my Retail Management professor.

Again good advice right on the dot, and exactly what i just finished studying for my exam yesterday

[Anthony Calfo]

flame83... heehee... thanks kindly

I must admit, whatever "skills" I have in business I think I simply have a natural talent for. I personally enjoy studying business models and reading economic topics, but I've never taken formal studies on the matter.

My majors in college were English and Russian literature... minors in Cinematography and Studio arts

I read a lot though. And I like to make money... like to see other people make money too and try to understand why/how.

[watchdr]

Flame,

Ok, I understand. I agree you need to be able to plan ahead. I didn't realize you already had a smaller operation going.

Also, are you sure filling the tanks to their max is a good idea? It seems to me good on the one hand where you can keep more livestock in less space so it reduces your costs.

However, You will be riding on a knife edge and if things go south you could loose a lot of livestock and money.

Just a thought to consider.

Maybe you mean you will fill the tanks full, but 'full' means there is a cushion to keep from being on that edge.

Glad you got some pet store owners helping you.

It sounds to me it is like setting up a small tank. Everything depends on what you are comfortable with. That doesn't make it easy but if you do your research as you are, you can come up with a system you are comfortable with and that may need a little adjustment after setting up but one you would be happy with.

One thing I would say is talk is cheap. Everyone can say I do this and it works or I do that and it works. But go to the places and get a tour and see the problems they aren't telling you about.

I find the local pet stores, unless they are very educated about keeping fish, they have problems that you would not know about until you see the setup and see what is going on.

Just some thoughts. I am sure you have already thought about that and maybe have planned on doing that or have already.

Just like to help. If I am not helping let me know and I'll stop!

Ken

[flame83]

. Ken,

No not at all your advice / information are gratefully appreciated!

"Stock Full" at this point it's still up to debate on how exactly this will be setup.

I'm watching a few other people, especially a gentlemen in central Illinois that is doing a plan similar to the plan I'm thinking for this coral farm, minus the greenhouse part.

Also the LPS, SPS, and softies will all run on separate systems to prevent chemical warfare between corals. However I still need to research more and see if there are any documented cases where individual specie within a species benefits from being separated, and having a specific colony per system compared to the species family in one system.

If I able to get my hands on "rare corals" there will definitely be at least two tanks to prevent total lost AKA Crisis Management.

But as evident there is much more research on my part that needs to occur before I attempt this endeavor.

Auh yes “talk is cheap" I could not agree more with you on this. I usually give my fellow members a chance to prove them self responsible to handle a committe. However if they cannot, I make a motion to remove this individual for another individual that can talk the talk, and walk the walk.

As I'm sure you know to many people talk there business plan up and yes it sounds good. However, too many of the individuals are no where near dedicated or organized enough to handle the described task that lye’s ahead.

[watchdr]

Flame,

Great. If I think of anything else I can share I will let you know. In the mean time good luck.

Also, if you have any other questions I'd be happy to help if I can.

Ken

[SaveOurReefs]

Hey, my freind just showed me this thread because he knew that I once "wanted to make money off of corals", and I really think that most of us go through a stage like this. To make money off of something fun, but I have worked in lfs before and I got burnt out on the whole hobby. People say to find a job that you like and enjoy such as a hobby like this, my saying is dont turn your hobby into a job. Like I said I have been there and done that with the lfs. If your looking for fun, then keep it as a hobby, if your looking for money you might as well just do maintence bc thats were the money is in the business aspect of aquariums. Ok well its past my bedtime, if you decide to do it , good luck we still need good quality stores, I dont want an online petco to take over the hobby like the lowes and home depos mentioned in this thread do in our towns lol (nothing against lowes or hd, I love both!).

"Dont turn your hobby into a job"

-

[Anthony Calfo]

intersting point/reminder...

if you ask me (and I know or think many other industry folks would agree) that if you are looking to make the "best" money in the aquarium hobby with all things considered (start up capital, risk, job security, etc.) it is categorically in aquarium service and installation. Far and away the fastest, safest and best paying jobs in the industry. And affordable too for young folks or others with limited capital to get started with.

And to paint the picture crystal clear... I know waaaaaay more aquarium service folks making over 100K per year than I do LFS owners. Yes... you read that correctly. And I am not exaggerating in the least.

For newbies that want to get into the biz and are thinking other categories (farming, LFS owning, import/export... whatever), then aquarium service is a fine way to get your feet wet and learn a bit about all of the aforementioned. Very good industry job experience.

[Marc Daniels]

Anthony-

Do you know of any insurance companies that will provide liability insurance to the service industry?

[Anthony Calfo]

Hmmm... its really not much of an issue. I have not heard of anyone really struggling with this. You can get an insurance company to insure most anything.

I recall aquarium service folks regularly citing very low fees for business insurance since most of your liability is property damage (versus bricks businesses with slip & fall issues, electronics mfgs with great liability, etc).

My suggestion is to PM some of the service and installation/design professionals that are here on RC. Perhaps Mr. Steven Pro will chime in (else you can PM/e-mail him from here on RC - check out his authors forum on RK mag or just do a member search).

[Marc Daniels]

Here are some links to the industry related sources that Anthony mentioned.

Pet Business Trade Magazine
http://www.petbusiness.com

Pet Age Trade Magazine
http://www.petage.com/index.asp

Pet Product News
http://ppn.magserv.com/cgi-bin/subscribe?qt=new

The Center for Tropical and Subtropical Aquaculture
http://www.ctsa.org/

This is a publication put out by the public aquarium industry, and is always a great read. This was a monthly at one time, but now it's an annual. It has a great article from the Shedd Aquarium in the 2005 issue for acclimating Blue Spot Rays to captive life.
Drum and Croaker
http://www.colszoo.org/internal/drumcroaker.htm

[Marc Daniels]

Regarding the insurance, a service company locally put out that they couldn't secure insurance and was having trouble finding a new company.

[Anthony Calfo]

great thanks for the links Marc

no worries on the insurance either. I am certain is is easy and affordable to secure. There must have been some other issue at hand with your local company.

For perspective, most service folks can get business insurance for well under $1,000 per year as I recall. Let's chat with Steve and others and see what some going, current rates are.

[Steven Pro]

I got my insurance from the same agent that covers my home and cars. It is through Nationwide. They didn't have a little box to check for my business on their forms, so I believe they put me in as a cleaning business with a further explanation. I carry two million of general liability for less than $500 per year.

[Marc Daniels]

Steven-

Thank you for the info.

On another note for Anthony and yourself, looks like Joe Pa has the Lions into the top 5. I'm a life long fan, and even looked into finshing my Masters there.

[Anthony Calfo]

Heehee... indeed he has A fine school too (Penn State)

[flame83]

Saveourreefs,

I don’t intend to make this my primary income. I have much more interest in two other businesses that will pay themselves off fairly quickly and only continue to grow in value.

This is just a side hobby I would like to do and work up over a large time period to several systems. However stay small enough that I alone can handle the work load each evening.

Also I have no high hopes of profit. So long as the sells each month cover all cost then it will be good enough, although a little bit of extra cash to buy some new coral / or take the family out for five star dinner would be nice.

I want to basically help out local or regional reefers. The lfs around my area charge up to $75 for a single toadstool frag which is absolutely ridiculous, nor do any of them keep their systems properly kept.

In this endeavor I hope to make available top quality frags at a reasonable price. Since I could only manage to get frags from friends and the great online forums, I would like to help and continue in this hobby.

In short when I started this thread I was mostly concerned with the vast amount of water export / bio load management it will take to safely operate these types of systems compared to the home aquarium.

Thanks again for all the great response that have surely helped.

Ohh yeah Anthony good idea on the coral fragging technique I’m definitely tagging along!

[Loco179]

Thank you all for the amazing imput. I was thinking of doing the same thing as a part time job. I have a full time job that permits me to have massive time off. I am working a parttime job that is simular to my full time job. So I am getting burned out on that so I figured I would go into something I really enjoy.

My ultimate goal is to see if I can support my own LFS. Here in Indy ( with exception of one ) do not even come close to what I would consider "the full package". I think folks become frustated because they cannot find good advice, healthy livestock, and quality dry goods. I worked for PetSmart for years as a part time job. I saw this first hand as being many folks came to me and only me asking questions.

Enough of me on this soap box. Thank you for your honest opinions and showing me the direction. Also there is no way I would leave my full time job. Due to my work schedule I could manage full time hours at my "part time" job.

[reeferX777]

IMO, you are hard pressed to find the "full package" in most places. From my experience you either have stores that are dedicated to serious hobbyists, or beginners... rarely do the two meet. Now I'm not saying that they don't exist, but you would be hard pressed to find a store that focuses on high end SPS selling $5 dollar GSP frags... I have seen it but very few times.

-Justin