Music/Audio Store Concept

[Early B.]

A friend of mine are contemplating pursuing a retail store that sells CDs. It will be a small store in an eclectic "village" area of metro Atlanta. We want to specialize in jazz and blues CDs to create foot traffic. We're thinking about specializing because we don't want to become a full range CD retailer. Our main interest will be in selling mid-fi tube audio gear. In the front of the store we'd sell CDs, but displayed in the back would be a handful of reasonably priced tube audio setups with exotic speakers. Lots of audio eye candy. Maybe some Jolida and ASL components or others in a similar price range. By exotic speakers (mostly bookshelf), we mean something other than the standard box speaker. So imagine coming into a CD store and hearing this beautiful music being played through tube gear along with some funky looking speakers.

Just wanted to get some feedback from you guys. Can a store like this one be successful? Why or why not? More importantly, what would entice you into a specialty music store? What music genres would you recommend? How would you suggest that we market the store?

Thanks.

[brettw22]

If you're target demographic is too specialized, you severely limit your profit potential. I unerstand the intent and desire, but many of those 'mainstream' releases are going to pay your rent.........

I'd approach it more from the angle of being a specialty audio shop that demos music that shines on the equipment, and the music also for sale.......

[jdhdiggs]

I think it would be a cool store and I would at least look around. However, I can't see many people buying base on foot traffic. The biggest problem is limited market. Sure, there will be tons of guys looking and thinking how cool something is, but you will have a horrible time educating them that a $1K 2-channel tube rig will sound better than the $1K HTIB 7 channel 1400W whizbang that he can get from BB.

I think you might need more than jazz CD's to support the store and to enable you to sell what you want. Unfortunately, I can't give you a solution.

[madmax]

Would this be used equipment or new? Personally I would sell either but would put my effort towards classy looking used. Is it a good idea? I think you would turn a lot of people on to tubes the first time they see them. You would get a following of tube newbies. I can see many people getting hooked and you would be the only pusher in town. While I would not stock tubes I think I would have plenty of info on where to buy them. That way the customers would know that if you went out of business they would not be stuck. Great idea! I hope you go fore it!
madmax

[scottnbnj]

the last 3 audio component purchases i made were at stores i wouldn't have known existed until i searched for authorized dealers on the manufacturer website. along the way i also visited a couple other stores to demo competing equipment that i found the same way that i wouldn't have known existed otherwise also. they were all within a half hour to an hour, but not on my beaten path.

stores that sell hard to find music, odds and ends small hardware or used gear are also a good excuses to make a trip that i probably wouldn't make just to browse what's new in hardware.

)

[Early B.]

Like most ideas, this concept isn't entirely original. There's a store in Atlanta that sells musical instruments, but in the back of the store are a couple of rooms devoted to high end audio. The proprietor said most of his high end business is sold via the Internet, which we would also set up. Instead of musical instruments, we're thinking about CDs, but not every genre. We're trying to capture those consumers most likely to buy high end gear. We're not necessarily interested in the pimple-faced tenth grader looking for the latest Ice Cube CD. We're deliberately considering shrinking our market as a specialty CD store by focusing on a handful of genres. Thanks for the comments thus far.

[audiobliss]

Sounds like a great idea to me. And if it materializes, You can bet I'll come visit! However, my interest would be in the tube gear instead of the CD's, given the genres you'll be selling. I personally don't care for jazz or blues.

I agree with the others that you probably won't have a lot of customers given such a limited genre of CDs. I do understand your goal of limiting your potential customers to those who would have a respect and appreciation for your gear and the audio reproduction it affords. However, I would consider adding some other genres to your offering. I'd personally be interested in classic rock, whatever Bruce Hornsby is, some music like Jack Johnson and Norah Jones.

At any rate, it sounds like you've got a great idea, and I'd love to see it work out.

[TroyD]

Hmmmm...we have a couple such places in Charleston. I guess it would depend on what your expectations are, you know? Agree that limiting you demographic TOO much is a bad thing. However, I DO know from talking to the folks at local record shops, the demand for used CD's (and to a lesser extent, LP's) rivals demand for the new stuff. Food for thought. If you go that route, a good demo setup would be nifty cool.

BDT

[Early B.]

However, I DO know from talking to the folks at local record shops, the demand for used CD's (and to a lesser extent, LP's) rivals demand for the new stuff.

OK, thanks. That's a very good idea. I'll do some research on this one.

I also like the classic rock idea. Maybe even classic R&B, too. We're certainly open to other genres; we just don't want to fool around with hip-hop, pop, country -- you know, the standard stuff you can buy virtually anywhere.

[TroyD]

Only thing that I'd say is, some of that new stuff will bring people in the door.

BDT

[audiobliss]

I also like the classic rock idea. Maybe even classic R&B, too. We're certainly open to other genres; we just don't want to fool around with hip-hop, pop, country -- you know, the standard stuff you can buy virtually anywhere.

I hear ya on that. You certainly don't want to attract us 'pimple-faced tenth-graders' :p. Perhaps you could venture into some of the mainstream genres when the album is recorded unusually well and so would be more popular among audiophiles/better for showing off a high-end system. Also, SACDs and DVD-A might be something you want to think about.

I like Troy's point about used CDs, too. That could be a great market.

[Demiurge]

Anything can be successful if you do it right.

Also, I wouldn't sell used CDs if you're going to sell medium to high end tube gear. People don't generally sell the gems in their collection, so you'd have a lot to wade through...and if you're overly picky people won't come there to sell. We've all been to used CD/DVD stores. Who is your clientele? People who want to buy CDs for $8 and sell them to you for $3? Or people who are going to plunk down a couple grand on your audio equipment? Not exactly the usual mixed bag with those two extremes.

You have a decent idea, but you need a focus.

[Early B.]

Who is your clientele? People who want to buy CDs for $8 and sell them to you for $3?

My thinking was not to buy used CDs from customers. To me, "used" in this case are CDs that may be brand new and shrink wrapped, but could be overstocks, closeouts, etc. that, for whatever reason, can no longer be sold as "new."

I see the sale of CDs as the "bread and butter" of the business -- the merchandise that generates constant cash flow -- and the high end gear as the "gravy." If we did the high end gear by itself, it would probably be a very costly operation at start up with slow initial sales. In other words, it would be a high cost, high risk venture.

[Dennis Gardner]

High cost, high risk....................... hobby.

I would have a great time visiting and running that type of store front simply because it is so "down my alley' of interests, but trying to make it work as a business would be so frustrating that I might end up hating jazz and tubes simply due to noone getting the joke. They always say to find something you love to do and make that your career, so I'll drink one to your idea.

[organ]

If you pick the right location (I believe this is the most important place to start), I don't see why the business wouldn't bloom.

There used to be a similar type of store about 10 minutes drive from my house. It's called Laser Land. They specialized in Laser Discs (remember those giant CD's?) but they also carried some great HT/music gear including projectors. So it was pretty much a video store that also sold audio/video gear. They were always busy. They've moved out of town many years back to re-locate in a larger location and I've yet to visit the new location.

Here's something VERY interesting. Once a month, they would send out their own magazine (much like Polk's Speaker Specialists) to the customers called "The Source". On one issue, it had a pic of one of the employee in his home theatre. Guess what mains he was using? One of those giant SDA's! Sorry, can't remember model# but it was the one with 8 mids, 4 tweets and a PR in each cabinet.

So if your friend really wants to start that shop, he should go for it. But at the same time he must know, just like starting any business, that there are a lot of risks involved.

Maurice

[Tour2ma]

What about vinyl?

Seems that a modest selection of LP's would compliment your plan. Obviously then you'd throw a TT or two into your equipment offerings...

[heiney9]

My thinking was not to buy used CDs from customers. To me, "used" in this case are CDs that may be brand new and shrink wrapped, but could be overstocks, closeouts, etc. that, for whatever reason, can no longer be sold as "new."

I see the sale of CDs as the "bread and butter" of the business -- the merchandise that generates constant cash flow -- and the high end gear as the "gravy." If we did the high end gear by itself, it would probably be a very costly operation at start up with slow initial sales. In other words, it would be a high cost, high risk venture.

If the cds are your bread and butter, you'll never be able to make a sandwich. The big box stores use cd/dvd as loss leaders to get you in the door. Cd's, wether popular mainstream or specific genre, are available everywhere, especially in larger metropolitian areas. I don't know your specific area where the store will be, but in order to make any kind of money you will need to sell a sh*tload of cd's. Not the close-out overstock type, those are usually low selling mostly unpopular titles regardless of the genre. Christ, even stores like Tower Records can't make it and they sell almost any title imaginable. Your bread and butter needs to be the equipment sales and the gravy is the cd sales.

I had a friend who in 1986 opened a cd only store in town here called "Digitals". He did extremely well in the beginning because cd's were just hitting the mainstream and there were very few outlets to purchase them. Purchasing on the internet was unheard of back then. He carried varied titles, genres, etc. including major releases and he made a lot of money until about 1989-1990. More and more "big box" reatilers came to town and started undercutting his retail price by about 20-25%. He moved away from mainstream top 40 releases and focused on rare imports, collectibles and concentrating on specific genre's of music. He instituted a cd rental program so you could take cd's home and listen to see if you wanted to purchase. Eventually a year or so later he ventured into the used cd market, which was profitable for a short time.

By about 1992-93 he was getting killed by numerous retail outlets and their low prices and then the advent of buying on-line. He added 5 tanning beds to the back of the store and called it "Tan & Jam" where you could tan and select any cd(s) from the store to listen too while you tanned and then consider purchasing it. His selections were becoming less and less mainstream and by about 1995 he was out of business.

If your going to make it with cd sales, the mix of artisit/genre has to be correct and you have to do a huge volume to support the type of store you are contemplating.

I know nothing about the geographic or demographic area this will be, but this is just my opinion.

H9

P.s. of course if this just a hobby and you don't need hardly any profit....go for it. But if you need to support the store, yourself and a partner I don't see how you could generate that kind of cash. Again, IMHO.

[Early B.]

If the cds are your bread and butter, you'll never be able to make a sandwich. The big box stores use cd/dvd as loss leaders to get you in the door. Cd's, wether popular mainstream or specific genre, are available everywhere, especially in larger metropolitian areas.

Yeah, I hear ya. This is the main reason why we would specialize. If you go into most big box stores, the selections for some genres such as a jazz or blues are very small or non-existent.

In response to your friend's experience, there are also lots of mom & pop music stores in my area that are still flourishing. In fact, there's a store outside of Atlanta that only sells specialty new and used CDs and a handful of DVDs. I like to go there because he has a few portable CD players in the store, and you can listen to them before you buy. (His sales would probably increase if customers listened to music samples through tube gear.) He has a great location, his prices are reasonable, and you won't find most of his selections in a big box store. BTW, he blasts music throughout the store with Polk Monitor 10's.

We're not fixated on selling music CDs. In fact, it could be a major pain in the ass to sell them, manage inventory, forecast demand, etc. Are there other products we can sell to attract potential aduio component buyers into a store?

[Dennis Gardner]

Are there other products we can sell to attract potential aduio component buyers into a store?

Body Shots!:D

[opus]

Early, You initially asked what would entice me into your store. Body shots notwithstanding:D I am a supporter of service and attitude. Sounds simple I know but here's what I mean. Localy we have two high end shops, one is mostly tube gear and the other is mostly high quality home theater. The tube shop is owned and staffed by two of the nicest, most knowledgable people I ever met. They give off the vibe that they are happy you are there and couldn't care less if you bought something. Here is some cool music and neat gear, lets just sit here and listen. Don't get me wrong they get real happy when you pull out the benji's but their focus is on building relationships, finding out what you need and quite often offering up less costly alternatives that will suite you better. This store is good.
Store #2 is owned by a jag, staffed with dopes and its all you can do to get a demo. They spend most of their time putting down every brand they don't sell and every other store in town. This store is bad and they get none of my cash.
People/customers will reward businesses that go above and beyond. You have to be honest with yourself and answer if you can provide the service, exude the attitude and extend the technical know how.

Best wishes kevin

[Polkersince85]

Rule #1 is "Don't quit your day job." Be prepared to lose money for a couple of years. But honestly, there have been many small outfits that have done quite well, picking up the fringe business. All the big boys are chasing the home theatre market and have left the 2 channel market. a "Tubes & Tunes" store may have a place but don't expect huge profits to start. Franchise fees, rent, licenses, and TAXes will eat you alive. Put it down on paper. If it won't work on paper, it won't work in reality. Don't run from it, but look at everything up front.