Thoughts on turning hobby into petstore?

[SherrodSerpents]

At the moment, I’m a small time breeder of snakes and geckos, and I do it in addition to a full time job, as a hobby. While in college, I worked at a mom and pop type pet store, and I received a call from them asking if I would basically want to take over the business. They aren’t actually selling the “business,” but they do not want to continue when their lease ends soon. They are trying to sell all of the supplies and inventory (basically everything but the business name) at once.

I have toyed with the idea in the past thinking that it would be fun to turn my hobby into a full time business but didn’t ever think anything would truly come of it. Now, I have all the sudden been presented with it, and I’m curious what others’ thoughts are on this. While the idea of turning my hobby into a business seems glamorous initially (working full time with something you love!), I know it comes with a huge responsibility, and I don’t want to ruin my love for it, either. I’m also a bit worried about the timing of this in my life, as I have a toddler and baby that I already don’t feel like I have enough time for. Plus, I do have a decent job, which can be hard to find in this economy! It’s scary to think about giving that up and taking a chance with something new. However, I have to consider that this may be the kind of thing that presents itself once in a lifetime.

I have weighed several pros and cons already, but I would love to hear what others have to say that have maybe been through this or just have thoughts on it in general. I appreciate it in advance!

 

[radera5]

Follow your heart! As long as it is not complete financial suicide, and you think you would/could enjoy it....I say do it!! You only live life once....you do have babies to think about so if it seems entirely unreasonable I would stay away, but if you believe it to be plausible....Do It!!....Good Luck!!

 

[Lucille]

Well, there's finances- you need cash to order stock. Talk to your insurance person. You might consider incorporating.
Here's a site to look around: http://www.governor.state.tx.us/ecodev/business_resources/sba/

My advice? Don't be corralled into the 'once in a lifetime' mindset. Learn what you need to know and do some soul searching as to the time for your family. Be comfortable with your decision and research the 'what ifs'.
If you give up your job and the store doesn't work, have backup plans.

It's an exciting thought though!

 

[deborahbroadus]

Business-wise, unless you have a huge financial outlay to invest and can keep it going without having to go into debt, I wouldn't bother. Taxes eat up a large chunk of finance when doing a petstore. Then unless you are versed in the business laws/taxes, another chunk of cash goes out yearly to those "people" that do this for you. Then there's those that you may have to hire, and whatever benefits that will entail...

Some of us have been able to do it without having the PETSTORE and then "get out" when it's no longer finacially of physically feasible for us to continue. But some have gotten out with LARGE DEBTS that they have yet to pay off.

There are other avenues that can be pursued before jumping into this? Such as, starting as a hobby-breeder, getting your name/brand recognized, etc doing this for a few years on a small scale (but large enough to make it worth it).

#justsaying.

 

[SirenSanJose]

Now, everything I"m saying I'm saying from the perspective of someone who just quit her job to open her own store. And these are all things that were pointed out to me, and as harsh as they seem, you've GOT to take them into consideration.

In no pariticular order:

1) it's often cheaper to start up a store from SCRATCH than to buy an existing one. Even in the Bay Area of California, I'm looking at about $50k-$75k to get my doors open, fully stocked (and that number *includes* 3 months of "padding" in terms of bills, salaries, rent, etc. )

The existing stores in my area that are selling or have lately sold have been asking between 80k and 200k, yes, fully stocked, but often with old, out of date fixtures, inventory that hasn't moved in years, etc, and are often tied into high-rent leases. Run the numbers for yourself.

And take a close look into WHY the current owners are selling. If it's that they're not doing well? overhead's too high? economy in you area sucks? That's not a good store, or a good time, to buy.

2) Unless you can afford to run the store for 2 years without turning a single bit of profit, don't take the risk. If it's your sole income and you don't have a backup (savings, or partner/spouse, or second job) you won't be bringing anything home for the first 18-36 months. That's how long it takes at least 75% of businesses to start turning a profit.


3) This is NOT a once in a lifetime opportunity. If now's not the right time, it's not the right time. See point 1, you can likely open from scratch for less, at any time in your life when it REALLY suits you. If you have young kids? Probably not a good time. Take, at first, however many hours the store's open and multiply that by 1.5 -- If you're open 8 hours a day, you personally, as the owner, will probably have a 12 hour workday the first few months, or years. If the store's open 6 hours, count on working 9.

4) You said you worked the stores in college -- did you ever manage? If you've never taken a part in a management role, think very long and hard. Handling staff, salaries, payroll, taxes, inventory, scheduling, is a LOT different than just cleaning cages, feeding the animals, and selling reptiles. Unless you actively enjoy the managerial duties, owning is probably not for you.

A lot of small businesses fail because the owners enter into them with the mindset of "I will do the same job I did, as an employee, I just won't have to answer to anyone!" and unfortunately, that mentality, that you just want to be a really good sales clerk, or hobbyist, or breeder, does NOT make one a good manager.

5) If you buy the inventory, then what happens? You have no guarantee of location, no lease, nothing tied down -- what if you can't find a good location you can afford, and get stuck with a garage full of dry goods and no store? Inventory and fixtures are the last, and easiest, part of the equation.

6) Do you already have a good idea of help you can trust? Staff isn't cheap (although compared to rent or bills, it's a tiny expense for a part-time helper.) But the fastest way to burn yourself out is to think "I am gonna save money, not hire anyone, and do it all alone." It gets really hard to do all the product ordering, call the vet, tend the animals, AND deal with customers. You really need someone to delegate some of the daily chores to (cleaning, and sales), so you can focus on the "owner" aspects no one else at the store can do.

7) You've got to have a backup plan. What happens down the road if the business fails? How are you going to start paying the loan and any existing debt back, if you borrowed? If you used all your savings, how are you going to get back on your feet again?

Just my (very well pored over) $.02