If you were a new dealer......

Discussion in 'Archived Threads 2001-2004' started by Elmer Millikan, Jan 15, 2003.

  1. Elmer Millikan

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    What product lines would you carry?
    What would make you different than the 'guys' down the street?
    Would you open up in a retail zone (strip mall) or more like a tech center (single story building with cheaper rent and less traffic)?
    What services would you offer?
    What policies have you seen from dealers that you have enjoyed doing business with?

    As you might have guessed I am contemplating a career change from a Sr level IT position to owner of a home theater dealer/designer. I currently have a good job that pays well with multi-national conglomerate. I am at a point in my life were I want to 'build something' and quite frankly I don't trust corporate America anymore.

    I hope you don't mind the questions... they will be seriously listened to and hopefully sometime in the near future you can walk into the store and see and feel something special.

    Thanks.

    Elmer
     
  2. Rob Rodier

    Rob Rodier Supporting Actor

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    You would have to be crazy... IMO


    =rob
     
  3. Elmer Millikan

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    Well that is not beyond the realm of possibility! [​IMG]
     
  4. Michael Mohrmann

    Michael Mohrmann Screenwriter

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    Crazy Elmer's
    Great name for your store! LOL!! [​IMG]
    Michael
     
  5. Elmer Millikan

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    Kinda like Crazy Eddie's.... I like it... Nah, too hill-billy sounding for suburban Chicago . IMO
     
  6. Chu Gai

    Chu Gai Lead Actor

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    sorry, but i couldn't help thinking of the interesting juxtaposition between not trusting corporate america and then becoming a purveyor of audio products where people don't trust you [​IMG]
    i'd consider catering to wealthy people and deal in tubes. i'd also consider making my way over to various asian shows like in malaysia, hong kong, and cut some deals with some of the products over there...kinda like outlaw or red rose do. brush up on technobabble and you're off to the races.
     
  7. Khoa Tran

    Khoa Tran Supporting Actor

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    NAD, PSB, PARADIGM, KLIPSCH, JM LAB, B&K, MARANTZ, DENON, H&K, so many to name! you're gonna have to look into it...SONUS FABER, NILES, THIEL, YAMAHA, ATLANTIC TECH, MIRAGE, FINAL, MONITOR AUDIO, PASS LABS, KRELL, SUNFIRE, B&W, ROTEL, ANTHEM, PARASOUND, oh i dont know!! =) ...you would have a great return policy, great salemans where the salesman builds a relationship with the customer and having the idea to not sell the customer but build around the customer's budget and recommend of the best quality. Not sell because it's last year's model and you want it out of the store. and BARGAINING!
     
  8. DanaA

    DanaA Screenwriter

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    I'd carry all quality stuff, but at different price ranges for different ears and budgets. For instance, I'd choose one of the better quality receiver brands such as Marantz, Pioneer, or Harman Kardon, then step into separates such as Rotel (you could also include Rotel receivers to give a choice), then middle range stuff (Anthem, Parasound, and the like). Depending on what type of area you were situated in, you might also carry a higher line such as Lexicon. I'd be sure to carry at least one brand of small speakers for home theater such as Omni's, then at least two lines of speakers for preferred tastes such as Klipsch and B&K. I'd also carry a very nice line of musical speakers such as Viennas. As for T.V.'s, I'd go with Mitsubishi and/or Pioneer. I don't know enough about the projection, etc. lines to name a brand, but I'd have at least one option there. I'd also carry a nice range of DVD players, perhaps from Panasonic to Denons. Finally, I'd carry at least some specialty type stuff like cables, spikes, etc. Last, but not least, I'd carry at least one line of fine CD players, like Rega or Arcam, as well as a couple of components designed specifically for two channel sound.

    I do hear that a lot of money is made by shops offering custom installation so that is good.

    Just set up a bed so you could sleep there, preferrably a rolling cot type bed so you could move from room to room each night to enjoy your wares.

    Good luck
     
  9. Rich Wenzel

    Rich Wenzel Supporting Actor

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    I think its an unprofitable business...All i hear is that margins in that business are getting viciously squeezed...Also this is not the best market for high end audio...

    Having said that, i think your relationship with the manufactures is really important.

    You want companies that have good products, don't allow internet pricing (so no one comes in and listens to your stuff and then buys on the net), that don't allow real discounting of their products (you don't want all your time dealing on price)...you want manufactures that dont allow too many people to carry their products in the same area...

    you also need companies at the low and high end....preferrably ones that are not sold at best buy, circuit city, etc as you dont want to price compete with them....

    i would look at:
    sources:
    rotel (if you have rotel, you don't get NAD, most likely)
    marantz (of the brands found in mass retailers, this one is least likely)
    one of the full line japanese brands, so the customers have something to start with as a base (compared to their friends or what they hear in the mass retailers), there are a bunch of brands to choose from, yamaha, denon, sony, onkyo, pioneer, kenwood, jvc...if it were me, i would go with denon (cause their dvd's are really good) or sony...possibly pioneer...
    H&K (an alternative to the japanese mass market brands)
    you need a real high end brand or two, like sunfire, krell, lexicon, mcintosh, naim (great if you want a good 2 channel audience), creek & marsh for 2 channel, anthem, balanced audio tech, theta, meridian, etc.


    for speakers
    B&W (they have great service, no internet, no real discounting, and are the most commonly sold high end speakers, however, they are really hard to become an authorized dealer)
    paradigm
    mirage
    revel & infinity (if you can get lexicon etc, makes sense)
    mcintosh (really expensive)
    vienna acoustics
    sonus faber
    kef (kind of hard to have kef, paradigm and b&w though, they have a lot of crossover)
    def tech

    TV's are interesting, i dont think many dedicated AV stores sell a lot of tv's as its really hard for them to compete with the mass retailers...plus their fall rate is high, but you know what i would have really liked when buying my stuff? was some real effort made towards showing the capabilities of similarly priced projectors and rptvs...there are some cheaper projectors made by panasonic, infocus, plus, sony, etc that people should really get to know before buying that rptv...This I feel would be a really good differentiating point. I have not seen a lot of high end stores dedicated to selling the cheaper projectors, there must be a reason. But i think the new lcd and dlp projectors are really worth it to the average buyer if they have the right place. and given that even crt rptvs cant deal with a lot of light, it basically has the same restrictions, even more so given the crt maintenance, size, burn-in, etc.

    Finally, i think service is really key. its one of those things that is much easier said than done. On top of that, you could know everything, be a great guy, have the best intentions of the consumer, and still not do well just because of presentation style. reading people and reacting to them while seeming genuine is really hard to do....

    first things i would do is find out the following:
    demogarphics of the area that you are looking at, average ag and income dispersion, is it well educated? is it older? you may sell more hometheater to younger people and more 2 channel systems to older people...
    i would find out how many dealers are near you, whats the people alternatives...
    i would find out what they carry, and look at what you need to carry to differentiate, then i would contact the firms that i wanted to carry and see what their rules are like, i would try to find out why other dealers dont have them (maybe there is no market for them, maybe they are difficult to work with, maybe those $50k mark levinson systems are too expensive, etc)

    finally, i think its the custom installers that make most of the money these days, you need to sell stuff, but you need to also be the guys that can go in, design a system, and build it for some people...

    i think that is how i would start.

    Rich
     
  10. Shane Martin

    Shane Martin Producer

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    Unless you plan on getting into the Custom Install business I wouldn't bother getting into the home audio business. Custom Install is where the $$ is at.
     
  11. Elmer Millikan

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    Thanks for all the constructive feedback. If I thought there was already an existing store/company in the area that provided AAA customer service and good product at a good price I would not be wasting my time on this idea.

    Does anyone have a truly outstanding A/V store near them that they recommend I visit? I am not adverse to travel so don't let location stop you from suggesting something.

    I am also curious if anyone has heard of, or dealt with, Lifestyle Technologies. They have a presence in Atlanta, in North and South Carolina, Maryland, Houston and Dallas.

    I also understand that the design/installation end of the business is truly the bread and butter... very similiar business model to the information technology companies I have worked for in the past. Buying a 100 pc's or routers is fairly cheap compared to the consulting, installation, administration and maintenance costs.

    One more thing, we all congregate and gain knowledge on these vary web sites... why not take the ideas and lessons learned and educate others to the benefits and advantages and make a buck in the process... ie. HTPC's, webtabets configured to control a theater with good software that is orders of magnitude cheaper than AMX and Creston.

    Thanks again,

    Elmer
     
  12. Elmer Millikan

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    Chu Gai,

    "sorry, but i couldn't help thinking of the interesting juxtaposition between not trusting corporate america and then becoming a purveyor of audio products where people don't trust you"

    It is pretty funny... different kind of trust from my perspective though... they, corp America, will throw me and any one else to the curb when the time and circumstances fancy them.... I need to be prepared.

    To the point of not being trusted as a dealer... why there lays the whole reason I think there is an opportunity here. I recently walked into an av store/installer showroom and was very pleasantly surprised by everything about the place. Great product lines, clean layout, consutling type approach to customer service, nice mix of showcases and such. When I told my wife about how it is how I envision running a shop like that she suggested I buy it... Somehow I don't think that is in the cards.. but I would if I could.
     
  13. Elmer Millikan

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    Rob Rodier,

    Are you speaking from direct experience in the eletronics industry? Or more along the lines of leaving corp America for the unkown?

    Thanks.

    Elmer
     
  14. Mike Matheson

    Mike Matheson Second Unit

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    Elmer,
    There were some threads over at AVS a year or two ago that went into such questions at length. You might dig around and see if you can find them.
    A couple points to consider (all hearsay):
    - some of the better lines may wait a couple years before entering into a relationship with a dealer--they'd like to establish that the dealer knows what he's doing, can stay in business, offers support, etc.
    - some of the better lines may already have relationships with dealers in your area--and may not be willing (legally able, depending upon the agreement) to enter into further local relationships
    - it might behoove you to try and work at a dealer or two, even for short periods (and even Tweeter or similar) to get more of a feel for common customer types, questions, low-end gear, how employees are trained and compensated, etc. The learning curve must be immense (and encompass far more than simply "gear") for new dealers who've not been active in the audio/video retail industry previously.
    Good luck with your idea. It certainly is something a lot of us fantasize about from time to time (oh the discounts! and what I could writeoff!) [​IMG]
    Regards,
    Mike
     
  15. Rob Rodier

    Rob Rodier Supporting Actor

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  16. Rob Rodier

    Rob Rodier Supporting Actor

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  17. Elmer Millikan

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    Rob,

    Well experience only comes with time and EVERY high boutique started somewhere at some point in time..

    I have also considered getting a relationship with a large dealer in the area that would allow me to work with them to purchase gear on a project basis so I wouldn't have to stock gear and carry the overhead of a store until the time was right.

    Thanks again,

    Elmer
     
  18. Harris_M

    Harris_M Auditioning

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    In addition to the advice posted here from others, if your plan includes getting invovled in the custom installation side of the business, you would be well advised to consider joining CEDIA -- or at the very least attending one of their Regional Education sessions. If you are willing to travel, the first one is in Philly in mid-February, followed by Dallas and Seattle in the spring. It's an investment of time and money, but it will not only give you some exposure to the the techniques and technologies you will need to have for that area, it will allow you to meet with many of the key vendors in one place.

    Remember that custom, which is, as noted, where the "action" is, is a combination of both physical and technical skills, as well as aesthetic knowledge from a design standpoint. THen there's the minor issue of how to run a custom business, which has all sorts of surprises of its own.

    Good luck
     
  19. Dan_Whip

    Dan_Whip Agent

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    One thought I had is to have seperate listening rooms that can be reserved for a specific customer. You could set up which receivers/amps they are looking at, and which speakers they are looking at so they can have a personalized audition in a controlled environment.
     
  20. gregD

    gregD Second Unit

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    I occasionally kick around the notion of being some kind of HT consultant, but for the life of me, I canNOT imagine how to make a living at it. But then, I'm not a good businessman. I'm convinced the only way to make a go at it would be the custom installer route as suggested above... at which point the focus moves away from HT to Home Improvement (and the inevitable in-wall speakers). Pass.
    But don't let me dissuade you. To answer your original question, look at this audio emporium here in the Bay Area: http://www.scsoundgallery.com/
    They're not HT, but hi-end audio with a slant toward tubes. Look at the very compelling audition rooms set up in an actual house, with cozy sofas and reasonable decor. I think a similar setup with a range of HT (from budget to elaborate) rigs would be a winner, at least from the prospective customers' viewpoint.
    You'd need some deep pockets, and more insight than I've got to make a viable business of it.
     

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