Does anyone have any advice they would like to share with someone preparing to open a dive store? What I really need is hard information like a P & L statement (with any identifying information removed) so that I can plan properly. I plan to open a 2,000-2,500 sq ft full service dive shop with 3-5 FT employees and as many PT as needed, offering PADI classes, retail sales, equipment rental & repair, air/nitrox/trimix fills, and limited travel sales. If I can get the information I need to build a solid business plan and acquire financing, the plan is to open in the spring of 2014. I would appreciate any advice beyond "don't do it" and "the quickest way to make a million is to start with two"
Opening a New Dive Store
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Not into rental, but wanted to say best of luck with the shop!
Hickdive
Contributor
First of all, find out what dealerships are available to you and what their initial order requirements are.
Manufacturers, not surprisingly, like to protect their existing client base. Supporting you might lose them long-standing retailers; so find out if your proposed location is one you'll receive manufacturer support in i.e. there's no point in applying for a dealership in Acme Regulators two blocks from Billybob's Dive Emporium if Billybob has been selling Acme Regulators since 1963. If Acme haven't got any retailers within, say, 50 miles you'll stand a better chance.
Be wary of initial stock orders. Some manufacturers will require surprisingly high minimums. You may well be able to afford them but you might end up, in order to stock a range of brands, doubling or even tripling on stock lines. That ties up a lot of cash and floor space. Contrarily, it would be very courageous to go with one manufacturer and stock only their products. For one thing, not every manufacturer is great at making everything, there are inevitably items in their inventory that suck and won't sell. For another, divers tend to be educated shoppers; think how rare it is to see a diver wearing a single brand of everything. If you stock only one brand then you're excluding all the customers (and there will be many) who don't rate your particular brand.
Also, be aware that you'll probably be invoiced pro forma, at least initially, very few distributors will give you a credit account until you've built up a trading history with them. That will impact your cash-flow for Year 1.
The final point that springs to mind is don't underestimate the cost of your air/gas infrastructure.
Best of luck.
Manufacturers, not surprisingly, like to protect their existing client base. Supporting you might lose them long-standing retailers; so find out if your proposed location is one you'll receive manufacturer support in i.e. there's no point in applying for a dealership in Acme Regulators two blocks from Billybob's Dive Emporium if Billybob has been selling Acme Regulators since 1963. If Acme haven't got any retailers within, say, 50 miles you'll stand a better chance.
Be wary of initial stock orders. Some manufacturers will require surprisingly high minimums. You may well be able to afford them but you might end up, in order to stock a range of brands, doubling or even tripling on stock lines. That ties up a lot of cash and floor space. Contrarily, it would be very courageous to go with one manufacturer and stock only their products. For one thing, not every manufacturer is great at making everything, there are inevitably items in their inventory that suck and won't sell. For another, divers tend to be educated shoppers; think how rare it is to see a diver wearing a single brand of everything. If you stock only one brand then you're excluding all the customers (and there will be many) who don't rate your particular brand.
Also, be aware that you'll probably be invoiced pro forma, at least initially, very few distributors will give you a credit account until you've built up a trading history with them. That will impact your cash-flow for Year 1.
The final point that springs to mind is don't underestimate the cost of your air/gas infrastructure.
Best of luck.
Go to padi.com and click on the Open a Dive Shop link: Open a Dive Shop or Resort with PADI - Guide to Success Operating a Business in Scuba Dive Industry
Thanks for the information guys. I have looked at the PADI info and I have been working them. Right now I'm just trying to figure out the numbers and see if the numbers support me making a go of it.
HickDive what do you think gas infrastructure would cost? I am budgeting $15k
HickDive what do you think gas infrastructure would cost? I am budgeting $15k
Hickdive
Contributor
From your suggested number of employees and floor area I think for US$15k you'll be able to buy one new compressor of sufficient capacity to service your gas infrastructure but nothing else.
It's hard to be specific because prices will undoubtedly be lower in the US but you'll also need a charging panel, storage bank and all the plumbing and gauges to connect them. Here in the UK a new two-outlet charging panel will cost the equivalent of around US$4.5k alone. New storage cylinders cost around US$500 each, you'll need at least three if you're going to supply enough air to employ 3-5 FT instructors and their students. That's only the air side too; add in the cost of nitrox and trimix infrastructure (and I really wouldn't open a dive shop of your suggested size without offering those gases) and things go even higher.
Remember too that some of your budget will have to be spent on consumables like oil, filters and maintenance. I don't know what your local legislation is like but I have to have my gas analysed quarterly before I can sell it. If you're wise, you'll have a back-up compressor too because not having compressed air available will stop you running classes and stop customers coming in.
Gas infrastructure cost is the hidden thing that costs the most, is the most essential part of a dive shop (you can't be a PADI Centre without the ability to give air fills and, commercially speaking, PADI status is a must) and yields the least return. It is the tail that wags the dog.
TBH, I'd either at least double your budget for compressors etc. or reduce the proposed start-up size of your operation.
tech_diver
Contributor
The fact that you are asking advice puts you way ahead of a lot of other business people. I've seen so many stores that came to the game with the ideology that they have some secret bullet that will revolutionize the industry and they wouldn't listen to those who went before.
I would suggest a good way to start is to tabulate the monthly expenses of a hypothetical store in the area, then calculate the sales volume you need to cover the expenses and have a profit left over. Then survey the local scuba market to see if it might support such a sales volume. Geography can dictate how much potential sales a dive store could do ( a landlocked, rural, small town vs. big city on the coast).
Just a rough generalization based on some undocumented numbers (a personal guess) based on the number of employees you are looking at, you'll need to sell around a third of a million retail dollars per year just to cover your planned payroll dollars. Is that realistic for your market? There are stores that survive on a couple hundred thousand sales dollars a year and stores that do a few million a year.
Being in the dive industry may not make you rich, but it has rewards found in no other career.
Best of Luck!
ScubaBoard - Scuba Diving Forum - Diving Social Network - So you want to be in the dive business
I would suggest a good way to start is to tabulate the monthly expenses of a hypothetical store in the area, then calculate the sales volume you need to cover the expenses and have a profit left over. Then survey the local scuba market to see if it might support such a sales volume. Geography can dictate how much potential sales a dive store could do ( a landlocked, rural, small town vs. big city on the coast).
Just a rough generalization based on some undocumented numbers (a personal guess) based on the number of employees you are looking at, you'll need to sell around a third of a million retail dollars per year just to cover your planned payroll dollars. Is that realistic for your market? There are stores that survive on a couple hundred thousand sales dollars a year and stores that do a few million a year.
Being in the dive industry may not make you rich, but it has rewards found in no other career.
Best of Luck!
ScubaBoard - Scuba Diving Forum - Diving Social Network - So you want to be in the dive business
Ricardo Pedraza Guido
Registered
Hello!
My name is Ricardo Pedraza and I am SEAC Sales Representative I will gladly put you in contact with the representatives of our brand at your location so we can help you with your start of operation.
If I can be of help please let me know and enjoy the BODI (business of diving!)
My email ricardo.pedraza@seacsub.com SEAC website SEAC SUB - HOME PAGE
Scubaboard is a great community and people help a lot so as someone said before, you are ahead of many people by asking for advice.
Take care and have a great week!!!
Ricardo
My name is Ricardo Pedraza and I am SEAC Sales Representative I will gladly put you in contact with the representatives of our brand at your location so we can help you with your start of operation.
If I can be of help please let me know and enjoy the BODI (business of diving!)
My email ricardo.pedraza@seacsub.com SEAC website SEAC SUB - HOME PAGE
Scubaboard is a great community and people help a lot so as someone said before, you are ahead of many people by asking for advice.
Take care and have a great week!!!
Ricardo
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