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Starting a business,,, becoming a dealer.

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  • Starting a business,,, becoming a dealer.

    I know many among you are involved in different facets of pro-audio; whether it be running sound for local and regional events, system installations, service and repair, and gear rental and sales; or perhaps, all of the above.

    For quite some time now, I've been questioning my own involvment in pro-audio, and I'm trying to assess and determine a path to future involvment. Either I remain an amateur enthusiast, or, I commit to some sort of self-sustaining commercial enterprise. The passion and interest is there, but the path forward is not so clear. At the moment, I'd like to consider the possibilities of becoming a dealer, and possibly, starting a gear rental service.

    Obviously, many will see this situation from differing perspectives, especially those who are younger, or those who live near large metropolitain areas. I'll be 65 in a few months, and the population here is 10,000 people. There simply are no dealers nearby, because the market is simply too small. The closest "larger" town (70k pop), is 40 kilometers away, and as far as I know, there is only one very small gear rental place in that town. (music store). I have more gear stacked in my livingroom, than that guy has in his entire stock-room. Our local bands and DJ's, have to drive into Montreal (1 hour each way), to get to a decent gear-rental outfit. I see a bit of an opportunity there, and the possibility of assosciating myself with local hotels, reception halls, and small municipally sponsored events. One example, is our annual blues festival, where small duo/trio set-ups are scattered at various locations downtown, playing on the street. That festival lasts a week. and there might be 50-60 "shows" in that 1 week period. The larger shows are held at the local bars, and fair-grounds. Those fair-ground shows are large productions however, handled by large sound-co's from  Montreal.

    As I mentioned earlier, I'd be interested in developing a "self-sustaing" small enterprise,,,, I'm not looking to "get rich" here; just a one-man operation that can comfortably cater to the needs of the local and regional market, and providing gear for everything from back-yard get-togethers, to corporate parties/events, to more ambitious outdoor events of 500-1000 or so people.

    Essentially, what I have to determine is, how much business volume must I do, in order to be accepted by a gear manufacturer, as a "dealer". I realize that many have a minimum initial opening purchase, plus, a yearly sales quota.

     

    Any thoughts? Have any among you considered similar endeavors?

    Veni, Vidi, Velcro;

    (I came, I saw, I stuck around)

  • #2

    Most you just have to buy two or more of something. "Dealers" are so plentiful here it isn't worth it - plus if you're mostly renting you can usually get good prices from whoever you normally buy from. I know some of you "north of the border" guys have stuff shipped up to mail and package holding services just south of the border and go pick it up to save a few bux?


    "We Have Met the Enemy and He is Us" - Walt Kelly​

    Comment


    • Bobby1Note
      Bobby1Note commented
      Editing a comment

      The cross-border shopping thing still holds a lot of attraction, especially with the strong CDN dollar, but recently, I'm seeing "some" really attractive buying opportunities up here. They are few and far between however.

      Frankly, I could quite easily be up and running, with little or no further expense. I have enough gear as it stands, to be able to rent out two or three small M.I.-grade systems simultaneously. My main issue is, I'd like to advance my interest in pro-audio, beyond where I am now, and I'd like to do that in a self-sustaining fashion. I'm not looking to earn a living at this;,,, I'm comfortable as it stands. I'm simply looking at expanding my horizons as I go into retirement. I just can't do things in a half-a$$ed way; I have to be fully motivated and passionately involved,,,, otherwise, it's off to the pasture for me...

      One of the paths I've looked at lately, is forming alliances with small-time local sound-providers/DJ's, and bands, etc. Many of these guys have at best, a pair of compact subs, and a pair of 12" mains. They're limited in the size of gigs they can take on, and they often don't have the financial wherewithall to justify buying larger systems for their personal needs. This is where I could come in. I'd be providing access to larger capacity, harder hitting, and higher resolution gear, so they could take on those more ambitious gigs that they're currently walking away from.

      The main advantage I'd provide is, local access (no need to run a trailer or van into Montreal, to pick-up and return gear), and, I'd have very little in the way of overhead costs. I've got the storage facilities, but I would need a better trailer/towing capacity.

      One main concern for me would be finding someone to service the gear that gets returned in a damaged condition. There may be ways to circumvent that issue however. Some companies offer varying warrantees for residential VS commercial applications. It may boil down to simply turning over my rental stock once a year, or every two years, to avoid or reduce service costs.


  • #3
    Rather than becoming a factory direct dealer, consider finding a distributor that carries many of the lines and skews you're interested in. The pricing may or may not be as aggressive as direct, but I've found that a terms are easier to get and you have access to more lines without opening order numbers or minimum sales numbers. As you find yourself selling more of particular product lines you may find it worth the trouble to go courting somebody like Harmon, who covers a number of common and familiar product lines.




    I love to sing, and I love to drink scotch. Most people would rather hear me drink scotch.

    Comment


    • dennis a
      dennis a commented
      Editing a comment

      trevcda wrote:
      Rather than becoming a factory direct dealer, consider finding a distributor that carries many of the lines and skews you're interested in. The pricing may or may not be as aggressive as direct, but I've found that a terms are easier to get and you have access to more lines without opening order numbers or minimum sales numbers. As you find yourself selling more of particular product lines you may find it worth the trouble to go courting somebody like Harmon, who covers a number of common and familiar product lines.





      I find very few manufacturers deal direct to their dealers. They usually make use of various rep firms in different areas of the country and these firms are listed on the manufacturers websites. You will end up with an account from the manufacturer but you will deal with the rep. The rep firms will represent several manufacturers but all prices and invoices come to you direct from the factories. There might be a time when you can't afford to do a minimum order and your rep might suggest using one of the distributors you speak of for that order. The distributor will probably do single unit dealer cost but unlikely to do end column pricing for quantity. 

      The following link is to SF Marketing which is a large Canadian rep firm (They use the term "distributor" but are factory reps)

      http://www.sfm.ca/index.php


    • Bobby1Note
      Bobby1Note commented
      Editing a comment

      trevcda wrote:
      Rather than becoming a factory direct dealer, consider finding a distributor that carries many of the lines and skews you're interested in. The pricing may or may not be as aggressive as direct, but I've found that a terms are easier to get and you have access to more lines without opening order numbers or minimum sales numbers. As you find yourself selling more of particular product lines you may find it worth the trouble to go courting somebody like Harmon, who covers a number of common and familiar product lines.





      Those are excellant suggestions. I'll look into some of those possibilities.

       

      That said; I was speaking to a young up and coming sound guy yesterday. The guys' in his early 20's, and he's already got a thriving local business going. He operated 20 gigs in the month of December alone. He's doing mostly DJ work lately, because that's where the demand is (locally). He started out doing "Live", but 90% of his business is DJ gigs. We've talked about the possibility of forming an alliance, where I'd supply him with gear that he doesn't stock.

       

      He was going to be an EV rep, but I'm not sure he's going to proceed in that direction. The DJ thing, has thrown a curve-ball into his original plans, and he's going with the flow at this stage. It will evolve where it wants to go. I'm really proud of what that young fellow has achieved, and I'd be more than happy to contribute to his success. I really admire these young go-getters.

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