something i've never understood about most retailers....

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Anonymous

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and the retail industry in general


here's how i've always seen things...

the livestock part of a store is the most labor intensive, expensive, time consuming part/aspect of running an lfs(assuming it's done responsibly and morally :wink: )

a can of fish food, filter pads, etc. have the highest profit margins

someone who doesn't have to keep on replacing dead fish will keep buying food, and filter replacements, etc

someone who does have to keep replacing fish will ultimately stop buying it all

i've always approached my sales tactics with trying to ensure the success of the hobbyist so that that's what will happen-it also happens to make the most business sense, to me

cuts my losses/efforts, gains customer loyalty, and is the best word of mouth advertising possible

also gives me the largest chance for long term cash flow from a customer

mebbe i'm kookoo, but it seems that most storeowners don't see things that way

i could never understand why

are they as stupid as i think they are?

or am i really kookoo?
 

John_Brandt

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"a can of fish food, filter pads, etc. have the highest profit margins"

Putting aside potential for mortality, livestock always has the highest profit margin.
 
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John_Brandt":3swvpltd said:
"a can of fish food, filter pads, etc. have the highest profit margins"

Putting aside potential for mortality, livestock always has the highest profit margin.


:lol: :lol: :lol: :lol:

really? in which universe do you live?

i guess you haven't though about equipment overhead, utilities, employee costs/maintenance, and the amount of time needed to spend selling/explaining to customers about the two seperate categories, returns-compatibility complaints,and the amount of cubic footage vs. cash a filter/filterpad makes as opposed to a tank of guppies/day :lol:

show me one store that can 'put aside' mortality issues, john- all stores have mortality issues

livestock may have the highest markup-it never has the highest profit margin-that's why it's markup is often so unnecessarily high

again-if i have to sell any fish to a customer only once-and then only keep selling him dry goods- i'm far better off, financially-even w/the 3-5% mortality rate i usually bring a fishroom operation to :wink:
 

John_Brandt

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Vitz,

You really do seem to have a nasty person hiding inside you.

I've been 23 years in aquarium retail, and I think I'm in the same universe.

You didn't mention net or gross profit, you just said margin. Fish always have a higher profit margin. When Nemo costs $4.95 and sells for $29.95 you've got a hefty profit margin. A can of flake food that costs $4.95 retails for $9.95.

The same rents, expenses, payrolls etc. must be covered by the flake food too.
 
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John_Brandt":1lbyrp0o said:
"a can of fish food, filter pads, etc. have the highest profit margins"

Putting aside potential for mortality, livestock always has the highest profit margin.

Heh potential implies there is only a mere chance for mortality - in the real world one must account for a certain percentage of mortality in their pricing and thus adding in the factors of heating/cooling, feeding, lighting - it's difficult to do much more than break even on most livestock sales. Sure the margins are higher, but rarely does that translate into profits for the majority of stores out there.

The majority of stores out there still have their main products coming from large known names that I will refrain from using but have been around for 20-30+ years but are still making the same variations of the crap they sold back then. They get their education from the fish rags and their company reps and thus sell the same garbage over and over again - their customers fail and they perpetuate the rumor that SW is "hard".
 
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i can't understand why you either seem to keep missing my point, or confusing it with something else

a square foot of fishroom costs more to operate than a square foot of a drygoods area

a square foot of drygoods area generates more net profit than a square foot of fishroom

(cubic foot, even)

doesn't it make more sense to invest more in drygoods repetitive ordering, than in livestock repetetive ordering?

if i empty a freezer full of food every few days- to customers, wouldn't it make sense to keep him in the hobby so he keeps buying that food, as opposed to having him drop out of the hobby, due to frustration and boredom from repetative failure?

my point has to deal w/the lfs that just concentrates on the pure selling of livestock only, w/no concern as to the success of the consumer, vs the lfs who, through education of consumer/care of livestock- accomplishes something different, and more lucrative, ime-due in part to the seperate natures of live vs. non live, stock, and the expenditures required to make an equal amount of profit from each dollar invested in those respective areas

at least i thought that's what i posted
 
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but then again- i really didn't think it would have been necessary to ask me about the lifespan of that hypothetical fish, either

i figgered it didn't really need to be implied/addressed for you to get the gist of the question :wink:
 

John_Brandt

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vitz":2m6ubhhq said:
but then again- i really didn't think it would have been necessary to ask me about the lifespan of that hypothetical fish, either

i figgered it didn't really need to be implied/addressed for you to get the gist of the question :wink:

It does matter Vitz. Because if that hypothetical fish has a natural lifespan of 18 months I'm going to seriously question if it's unsuitable for captivity. It could also have been that that fish even spawns in aquariums, dies after a year in captivity, and has a natural lifespan of a year and a half.

I just think about things harder than you do :wink:
 

John_Brandt

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vitz":2q5se2bg said:
i can't understand why you either seem to keep missing my point, or confusing it with something else

a square foot of fishroom costs more to operate than a square foot of a drygoods area

a square foot of drygoods area generates more net profit than a square foot of fishroom

(cubic foot, even)

doesn't it make more sense to invest more in drygoods repetitive ordering, than in livestock repetetive ordering?

if i empty a freezer full of food every few days- to customers, wouldn't it make sense to keep him in the hobby so he keeps buying that food, as opposed to having him drop out of the hobby, due to frustration and boredom from repetative failure?

my point has to deal w/the lfs that just concentrates on the pure selling of livestock only, w/no concern as to the success of the consumer, vs the lfs who, through education of consumer/care of livestock- accomplishes something different, and more lucrative, ime-due in part to the seperate natures of live vs. non live, stock, and the expenditures required to make an equal amount of profit from each dollar invested in those respective areas

at least i thought that's what i posted

Oh I know all of that, and all of that makes sense to me.

My only point was that the profit margin on a fish is higher than on a can of flake food. But even after all of those expense calculations, the profit margin of a fish may still be higher than a can of flake food.
 
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we certainly think differently :wink:

harder doesn't necessarily mean better :p

so lets take the sw equivalent of an african killifish-many of which have a lifespan of a yr-and whos eggs can even be mailed to other hobbyists in some sphagnum moss in a petri dish, and kept there for a long time...

the fish dies after 10 months-lets just say for the sake of argument that the fish spawns at the age of 11 months

so we now have a fish that even though it's collection has no discernibly obvious environmental impact as a result of its mass harvesting, still cannot be kept successfully by a hobbyist to the complete fruition of it's natural lifespan, and purpose(which-like all animals, is to reproduce)

i see this as a fairly b&w no brainer clear issue of it being an unethical species to keep in the trade- at least not w/out efforts made to figger out how to keep it 'correctly'

environmental impact, imo- should not be the sole determining factor in what makes an animal suitable for captive husbandry-the result of that husbandry for that particular individual animal is equally important

i think that this is one of the reasons the industry/hobby as a whole, has done so much damage to the reefs, why bird species are slowly being decimated,dalmatians being sent to shelters, etc.

i told a customer yesterday-never buy ANY animal until you are absolutely certain you're environmental conditions are correct and proper for that animal

do you know how many iguana are slaughtered every year?

mebbe if folks were more concerned about the care THEY provide for their charges- we wouldn't be where we are today, re: the situation of our hobby's 'contribution' to the environment? :idea:
 

John_Brandt

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"so lets take the sw equivalent of an african killifish-many of which have a lifespan of a yr-and whos eggs can even be mailed to other hobbyists in some sphagnum moss in a petri dish, and kept there for a long time...

the fish dies after 10 months-lets just say for the sake of argument that the fish spawns at the age of 11 months

so we now have a fish that even though it's collection has no discernibly obvious environmental impact as a result of its mass harvesting, still cannot be kept successfully by a hobbyist to the complete fruition of it's natural lifespan, and purpose(which-like all animals, is to reproduce)

i see this as a fairly b&w no brainer clear issue of it being an unethical species to keep in the trade- at least not w/out efforts made to figger out how to keep it 'correctly' "


In this scenario, a fish that naturally lives 12 months in the wild, but only lives 10 months in captivity (and doesn't spawn), does not go on my USL. There are other details to consider like...does it thrive during those captive 10 months?

Vitz, the fact that you and I might disagree on a USL just demonstrates that there is an emotional (or ethical) component to formulating the list. If the list were a matter of fact there would be no debates on it by anyone.
 

John_Brandt

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"environmental impact, imo- should not be the sole determining factor in what makes an animal suitable for captive husbandry-the result of that husbandry for that particular individual animal is equally important "

I want to make sure I'm understood here. Virtually all of the members of my USL list are there because of issues relating to how they adapt to captivity, not on their ecological impact. Truth is, I have few facts at hand about the ecological impact of harvesting reef fishes (other than the harm of cyanide). But I have lots of facts at hand (from mine and shared experiences) about how fish adapt to captivity.

One of my sincere concerns is that species that we would never dream of putting on an USL, might have real negative ecological consequences based on their harvest levels. IOW, it might be more ecologically-damaging to remove bunches of Sailfin tangs from a reef than a few Orange-spotted filefish.
 
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John_Brandt":3foh1o4l said:
"environmental impact, imo- should not be the sole determining factor in what makes an animal suitable for captive husbandry-the result of that husbandry for that particular individual animal is equally important "

I want to make sure I'm understood here. Virtually all of the members of my USL list are there because of issues relating to how they adapt to captivity, not on their ecological impact. Truth is, I have few facts at hand about the ecological impact of harvesting reef fishes (other than the harm of cyanide). But I have lots of facts at hand (from mine and shared experiences) about how fish adapt to captivity.

One of my sincere concerns is that species that we would never dream of putting on an USL, might have real negative ecological consequences based on their harvest levels. IOW, it might be more ecologically-damaging to remove bunches of Sailfin tangs from a reef than a few Orange-spotted filefish.

well said :)
 
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but now back to my original point- why do so many retailers take what seems to me to be the long term(imho) road to failure, or at the least-the least efficient way(imho) to long term success?
 

JeremyR

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Because simple business tactics & rules are too much for them to grasp. If you put morality aside (you shouldn't) it still makes BUSINESS sense to keep the fish alive in the store, and eductate customers into keeping them alive at home.
 
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vitz":28z631ef said:
but now back to my original point- why do so many retailers take what seems to me to be the long term(imho) road to failure, or at the least-the least efficient way(imho) to long term success?

They are more concerned with inventory turn than why it's turning :wink:

as one customer gets frustrated and leaves, 1-2 more arrive to take their place

however you give them too much credit - in that they actually think this through - they aren't making a conscious decision about this - the fact is they operate on ignorance and that fact that a newbie is always there to walk in the door - their ignorance doesn't affect their bottom line.
 

Kalkbreath

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vitz.........lets put it to a test..........list ten {SW}fish that you feel are "suitable" for the hobby to offer as pets. Then I will give you ten ecological reasons as to why the reef might miss them more then your list of ten unsuitable fishes.................It matters more to the reef {what }you take ..........then {why} you took it .............. In the end I have yet to see a truly "suitable" species list ..........Well maybe the "crown of thorns" and Vibrio....... :wink:
 

JennM

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John_Brandt":2kp1o2xg said:
You didn't mention net or gross profit, you just said margin. Fish always have a higher profit margin. When Nemo costs $4.95 and sells for $29.95 you've got a hefty profit margin. A can of flake food that costs $4.95 retails for $9.95.

The same rents, expenses, payrolls etc. must be covered by the flake food too.

Whoa John -- wait a minute... Sure the "Invoice" price of "Nemo" is $4.95, but have you forgotten air frieght (or Fedex if it's from ORA...), box charges, heat/ice packs, your time and gasoline and wear and tear on your TRUCK (had to buy a truck for the biz...) to go fetch the order at the airport, or paying a courier or staffer to fetch it at the airport? Suddenly Nemo's base price is $8.00 or $10.00 or more. I don't know anybody selling percs for $30, but perhaps the market is somewhat different where you live? I've seen the ***co sell them for $8.00 each. Most independants sell them for $15-20 each. Add to all that, Nemo's upkeep - electricity to run the pump that keeps his water flowing, water, salt, food (but comps are wonderful!), lights, staff to keep his tank clean, and yes, the mortality factor of any other "Nemo" that didn't make it to sale day, and gee there's a lot more work to keeping Nemo saleable, versus that can of cat food that arrived with the rest of my order with no charge for shipping, or at best, a small fuel surgcharge of a couple of dollars for the whole order...it just needs to be put on a shelf. No extra electricity, water, upkeep, and minimal staff to manage it. Gross or net is irrelevant, because at the end of the day NET is what the shopkeeper has left. IF he/she has anything left.

Vitz - you and I are of like minds on this issue - we see the 'big picture' but all too many see the dollar in their hand today, and don't stop to consider the dollars in their hands in the future. Those people usually fail at business sooner or later - I don't think this problem is unique to this industry, by and large customer service has gone the way of the dinsaur anymore - but when I do get great service somewhere, I'm sure to tell the people providing that service, and I tell my friends, and I keep going back...

I think a LOT of people enter this industry (fish especially) because they catch a glimpse of a fish invoice, or better yet a transship list, and they see that infamous coral beauty for either $0.93 on a tranship list or $9.00 on a wholesaler list, see the fish for $30 in the store and that's ALL they see -- "OBSCENE MARKUPS".... they have no idea that the tranship deal has huge miniumus to make freight, huge freight charges, huge mortality (depending on the sender....), rebox/rebag/reox charges, or if it's from a wholsaler/importer, they don't see the box/packing/air freight etc., OR the upkeep and overhead. Just read any general reef discussion for a week or so and you'll see somebody go off on the "ripoff LFS", and the ridiculous prices they charge, yadda yadda... It is that narrow and incomplete view that has done a lot of damage to the honest mom & pop place that only charges what they need to, for their livestock and dry goods. I always chuckle when somebody buys something "wrong" online and either want me to fix it (in the case of hardware) or trade it in (in the case of livestock)... I simply ask if they cannot return it to where they bought it? :lol: Perhaps with hardware it can be done (although it's a major PITA) but livestock is a whole different ball game - so it's back to the mom and pop shop (most of the big chains won't generally take in foundlings...) to clean up the mess....

Profit margin.... uh huh.

I'll place my money on the filter pads and salt and fish food any day, and hope to have the customer for a very long time.

Jenn
 

John_Brandt

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In Chicago, we have the luxury of several nearby wholesalers. We can go and hand-pick Nemos without freight or box charges tacked on. The disadvantages of having a specialty marine shop a distance from a brick & mortar livestock wholesaler are apparent. Locating a marine shop far from a center of high-income individuals is dangerous too.

There is great negativity in this forum on starting retail operations. But properly located and planned stores are often very profitable. I would never locate a shop in an area with extreme price sensitivity. Highly-profitable LFSs are commonly in areas where residents have larger incomes. I can imagine a highly-polished marine specialty shop making a killing in Buckhead. I continually hear you say that your customers will run to another shop to save $2 on a $25 fish. I could not deal with much of that. It's unfortunate that you are forced to face that frequently.

I always understand what Vitz and yourself are speaking of with profitability factors. I have also worked for a good number of retail owners who have become quite wealthy from their shops. And they don't often sweep and close the store at night, their on-duty manager does.
 
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