Starting your business vs staying in business
So you spent around $70, 000 – $125,000 to start your own small aquarium business and now you feel that you are ready to have a piece of the reefers and aquarists market. You decided on the kind of business you want to be (fresh and saltwater, freshwater only, reef only, etc …), as well as the location for your shop (destination type for intermediate or advanced hobbyists, or prime shopping location such as large malls to attract the newbies whom are usually passersby). You also spent time drafting your business plan, started your own marketing campaigns to notify potential customers “hey I am here! Pass by my store”. Your business has finally started, but the next tough phase comes in: how to stay in business.
The ugly truth is that around 50% of startups end up going out of business within their first 5 years of operation. Let’s rationalize this number into our domain: our hobby is increasing in popularity, the market is growing but at the same time, the number of shops is increasing meaning that the competition is increasing, hence it’s getting harder to stay in business. In few words, you need to be unique to survive. So, we at reefkinetics decided to share the main ingredients of the new shops’ success stories. These are the main observations and trends we noticed the CEOs follow to stay in business.
- Customer satisfaction: that is the most important point to keep your shop in business. In addition to gaining more customers, you need to keep your already existing customers as they are the ones usually leaving positive reviews on social media, hence encouraging more customers to head towards you. One of the ways to do so is through offering cheap or free services. For example, free water parameter testing on the go! Tell them to bring in water sample from their tanks and leave it at the store (be it a physical or online shop), then email them the results accumulated with free advices on how to improve the chemicals of their water tanks, hence improving the living conditions of their corals and fish. Simply add the water sample to the reefbot pro and let it do the rest of the work while you spend your time doing another productive task at the store.
- Cost reduction: the ultimate target of a business is to make profit. Since profit is the revenue minus the cost, an ideal way to achieve more profit is through cost reduction. Automation, improving efficiency and reliability are few examples to reduce costs. Your shop might be offering free services such as water parameter testing to the customers to encourage them to keep coming back. You can automate this service by acquiring our reefbot pro; you can reduce the time spent on water testing by doing it automatically. This will allow more time for your staff to interact with customers instead of spending it on manually testing the water.
- Cleanliness: The first thing the customers notice is your shop cleanliness. They usually correlate the health of the livestock they want to buy to your shop cleanliness. They do not want to assume that they are spending money on getting tired and unhealthy livestock (be it fish or corals). Besides keeping your store clean and smelling fresh will not push the customers out your store out of disgust.
- Easiness: both the staff and the customers need to commute around the shop with ease. The shop should not be overcrowded. Also, the items need to be displayed in a comfortable way for the customers to look at. Besides, the staff need to be able to maintain the store in an efficient way without wasting time getting around the items.
- The right staff: it might be tempting to hire low cost staff. After all, all what they need to do is to sell your products to customers. Wrong! The staffs, especially in direct contact with the customers, need to be knowledgeable when it comes to answer questions arising from the clients. The customers need to feel secure about the people from whom they are buying their expensive live stocks.
- Livestock suppliers: we advise you to diversify your suppliers. Just because you have enough money to buy fish corals, that does not mean that your usual supplier will sell them to you, especially if you have been around for a while and accumulated a considerate amount of customers. You will now be seen as a competitor by your old suppliers, as a result they will try to limit your activity.
- Uniqueness: In order to stand up from the crowd, you need to differentiate your shop. One of the best ways to do so is through investing in acquiring new equipment, fish and corals. Having one of a kind fish or corals will tempt the hobbyists to come to your store to lay their hands on it. So you need to always be on the hunt for such opportunities. The easiest way to do so is to get more involved in social media as they are so many groups related to aqua life. This way, you can get directly in contact with potential new suppliers. That is also a great way to check what is trending, what the customers want.
As always, if you have any questions or feedback, please get in touch with us at [email protected]. We’d love to hear from you!