Who needs wholesalers/LFS/etailers, let's do a group buy

[Race]

Hey Mitch,
One more thing that I would like to mention. When I attempted to Join AMDA and even today, I own and operate a nondropshippng, non-etail, fully retail store which meets every AMDA criteria that any lfs would meet. It is 100% walkin. When I explained, I was again told that I could not join even with my retail store. All that I wanted to do was pay my dues and provide the same livestock care as everyone else.
In reality, I had two choices. Either go into a corner or go it alone-- as I was refused representation by AMDA. I chose to go it alone but it was not by choice. Today, I think that we can do better and unify as an industry just as has happened in the rest of the pet trade.

I am hopeful of a new organization, which I do not desire a leadership role in, just a representation.

Race

 

[Kalkbreath]

Race, I think your still missing the basis for the confrontation.

E-tailer's for the most part don't sell to the general public.
They sell to pre conditioned consumers or what we call "hobbyists".
Hobbyists are created by and large from exposure to Brick and Mortars retailers. Tank sales being a good case in point.
Make no mistake, yours is a parasitic relationship.

Yes, so far many of the hosts( LFS) remain standing, a little dizzy(no pun) from the blood letting ... But enough store fronts remain for the e-tailer's to feast upon.
Thats most likely not going to remain true after the next economic turn down in the US economy.
I would venture to say that even a mild recession will fell most of the industry.
I will be surprised if several Lax wholesalers even survive the Summer.
...As many barely made it through 07.

Can any of us on this board name a single LA wholesalers who is doing better this year then in years past?
Is this dismal state of affairs , in spite of the web or because of the web?

 

[dizzy]

Race,
One of things that always plagued AMDA was that some members felt that some of the other members weren't living by the standards of practice. There was even talk about having people go around to check to make sure rules weren't being violated. It was an unrealistic enforcement nightmare and I for one wanted no part of policing members. However even I don't feel like allowing someone to whitewash their entire business practices, by having a small part of the overall operation compliant, was fair to the ones who really were trying to do things by the book. But you are right that was a different time and a different place then we are at now. I kind of like the idea of belonging to a group that has no rules. It sure makes it easier to get along. :wink:
Mitch

 

[Race]

Kalk,
O.K.-- but consumer buying habits will not slip backwards. Gore's internet is here to stay. I am going to cater to the changing buying habit not fight it, that would be futile. I think that you are doing the same with your new website which should be a smart move on your part. I would hope if that portion of your business takes off you would put even more resources there. As far as the parasite thing, well I guess that is business whether two retailers or an etailer and a retailer compete. The only difference is consumer preference in buying venue. It's the same fish-- just purchased differently.

Yes, most, if not all Wholesalers are flat in sales. Consolidation is coming hence my previous post. The same is true on the hardgoods side. I would not boycott anyone at this point as you may not be taken back.

Thanks Kalk-----Race

 

[rudylbj]

Kalk, are you a LA wholesaler, no. So, how do you know they are not doing better this year than last? I don't think they are going to reveal that info to you, in casual conversation some sales reps may say things but do they really know either? Better for you to reveal your sales level because I assume you know that as fact. Myself, sales are about 20% better this year than last, for anyone else I can not possibly comment. Why does it seem you and others have such a stuck in the past mentality about etail? Do you object to the idea of etail out of some moral issue?

 

[Race]

Rudy,
I too am only going by what several Wholesalers have told me. Some are substantially down in sales, some flat, but others may be up. The industry in it's entirety is not well at the moment--- according to APPMA.

Race

 

[dizzy]

Rudy,
I too am only going by what several Whoesalers have told me. Some are substantially down in sales, some flat, but others may be up. The industry in it's entirety is not well at the moment--- according to APPMA.

Race

Maybe the quality of livestock and husbandry skills have improved to point people need to replace less.

 

[rudylbj]

To a certain extent this is true. I have many customers that come in hot and heavy for weeks and then we don't see them again for many months, when we ask them they say my tank or tanks are full and they are not losing stuff.

 

[rudylbj]

Truth be told, if you want to boycott someone (just joking here) it should be reef clubs. Have any idea how much these guys trade among each other? Its huge, and this has made a big impact on retail sales. One guy buys a corals, grows it for months and then cuts it up and trades or sells it within his club, enough of this happens in each of dozens of reef clubs and it adds up quickly to many less sales.

 

[Anonymous]

Truth be told, if you want to boycott someone (just joking here) it should be reef clubs. Have any idea how much these guys trade among each other? Its huge, and this has made a big impact on retail sales. One guy buys a corals, grows it for months and then cuts it up and trades or sells it within his club, enough of this happens in each of dozens of reef clubs and it adds up quickly to many less sales.

My club works very very hard to support and send business to the LFS that sponsor the club to counter that effect.

 

[rudylbj]

If you can tell in all honesty, what do the club folks tend to buy from you? IME they usually are the cheapest customers. Show them a coral over about $30-$50 and forget it, show them the $5-$15 frag and thats what they buy. That is OK, but they almost never buy a lot. Even for dry goods, they get together and do group buys. Some may be loyal LFS customers but for the most part they will drop you for a $.10 better deal, IME.

 

[swsaltwater]

I would also say better tank setups and tech advances in skimmers, lights, etc have impacted sales. This is a good thing and a sign more people can be lured to the hobby as it's no longer for the Obsessive Compulsive only. I never lost much even 10 years ago but I had a good setup and stayed away from poor quality fish. I knew a lot of fellow hobbyist that lost tons of coral and fish though. Very seldom do people use my livestock warranty, so I can conclude they did not loose the animal with the warranty period anyway......My volume has increased a great deal since this time last year(almost double), mostly due to all the tanks I have been installing/upgrading.

I participate in my local reef club auctions, they will not impact business much since most of the times the prices they pay for corals is crazy. 50 for a single PPE polyp is way high for someone that wants a colony. For the most part the auction does not have very good deals for the size of the specimen. I think it is healthy for hobbyist to share coral specimens to lower demand on the wild and make those rare corals less rare. The vast majority of customers want larger pieces then found in these club swaps. The only issue I see with clubs is they are more likely to order online then from a LFS. Rudy is correct they would cut and run for a 10 cent discount. Heck I heard people say they drove 100 miles to phoenix to save 5 bucks on a fish. I get a good chuckle on those since they must have spent twice that on gas.....

 

[sdcfish]

Good points all around. IMO local clubs can only be a good thing for the hobby...I can't imagine we would condemn those hobbyists because some some lost sales....but I do understand how they impact retailers..you just have to learn how to embrace them.

I do believe part of the leveling off of the demand is due to better aquarium management and husbandry practices...healthier fish in general, and many people propagating around the country....frag swaps etc...

As usual, I do my monthly/quarterly reports on our active customer base. I have seen growth in new customers, but lower average orders across the board. It's a good thing and a bad thing....you just have to keep working hard to keep your existing business and try to capture more.

I would recommend the same for retailers...diversify, be inventive, and keep up with the trends.....will keep you growing and profitable. My two cents...

 

[Caterham]

Race,

I am in dire need of a cat. Not just any cat, but an Egyptian Mau. My wife saw one and fell in love with the breed.

Do you have a service similar to the "Divers Den" that applies specifically to cats on any of your websites? Would shipping a cat be very expensive? Would there be a guarantee?

Thanks in advance for your reply!

Caterham

 

[dizzy]

Caterham,
It's hard to tell if you are being sarcastic or not. Why would you want to seek out a middle man, when everyone else is trying to cut out the middle man these days. Get yourself a copy of Cat Fancy magazine and do some research man. (Barnes and Nobel?) You need to find a reputable breeder and may need to get on a waiting list if they are in high demand. Forget about saving money on freight and make sure the cat is shipped in way that gets it there alive.
Good luck,
Mitch

http://www.animalnetwork.com/animalnetwork/

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[Race]

Search Google. Breeders sell direct with a one year guarantee and almost all ship. Breeders have their own WYSWYG with video and pictures. In the end, I will be cut out of the droppshipping fish business as well . The Importers will sell direct. That will be sooner than you think as ERI has already attempted it. I guess it only makes sense that they eliminate me, hence my own operation in Wisconsin. There is no middleman as Mitch pointed out.
What has happened with cats and dogs should be an eye opener. Remember the unregulated cute puppy in the window, now the USDA controls all levels from breeding on up.

 

[JennM]

Last time I looked, unless local bylaws prevent it, full line shops still sell puppies and kittens, and it's amazing how many people will drop $700 on a dog they could probably have found for the cost of adoption at an animal shelter.

When people call my shop looking for dogs or cats, I direct them to the shelter (some folks can't read "Aquarium Services" in my ads...).

And we're coming into the time of year where people will start asking for purple-dyed chicks and lop bunnies :roll: But that's another post...

Wow - Race you've sure changed your outlook 180 degrees if you think that you're going to be cut out of the mix that soon. Somehow that post just isn't very convincing...

Jenn

 

[Race]

Hi Jenn,
I have not changed my view. When the time is correct I will either have to join them or be cut out. Will happen, IMO, within 5 years.

 

[Anonymous]

Last time I looked, unless local bylaws prevent it, full line shops still sell puppies and kittens, and it's amazing how many people will drop $700 on a dog they could probably have found for the cost of adoption at an animal shelter.

I think comparing our industry with that of dogs and cats makes a lot of sense. On this coast, full line shops that sold puppies were few and far between, and those that do stock way fewer puppies and kittens than they used to. Actually, I cannot think of a single full line shop within driving distance that carries dogs and cats. Many people have no problem dropping bucks on a mammal, but they mostly do it through a breeder nowadays, and a lot of that is set up through the net. Heck, adopting dogs and cats over the net is big as well - you can find the animal you want and not have to drive from shelter to shelter (even shelters have adoption websites).

 

[Race]

And the USDA has stepped in. I am one of their trained and certified veterinarians that must examine the pet before it leaves or enters a state. Fish and Wildlife also requires this in game fish. May be just a matter of time in this industry.