Becoming an AV entrepreneur

[srinisundar]

I think starting a manufacturing business would probably be more rewarding than being 'mere' a dealer. Outsourcing the manufacturing part in China and then probably shifting off to India later is the current trend. Just take the example of Norge. You can make similar products and probably sell better than Norge if you concentrate on why Norge is not so big than what it can be. Like someone said in an earlier post, Audiophiles would always be interested in a unknown brand/product..... more the unknown ... more exotic it becomes

Already "hariiyer" has told to exclude "audiophile" to satisfy and not to waste time with them if you want to start AV business It is true.

Just to quote known DIY kit suppliers are going away from business. Establishing an brand with an "10L" budget may be tough and time consuming.

 

[cha_indian]

arre bhai ... i am not asking him to get into HTiB 5.1 systems....I want him to start a Norge clone business by focusing on Norge's weaknesses. What Hari Iyer said is Not to target Audiophile .. while i want him to get into niche audiophile segment which is more rewarding.

 

[avidyarthy]

Norge has NO weaknesses ....
It is an individual's choice of running the show as he wishes. Mr. Bajaj is and has been satisfied with keeping his business the way it is for the last 3 decades.
Don't you see something .... even after keeping his business @ very less growth ... the brand still stands out ........ has survived this long ...... while many have come and gone .... much bigger guys, with more working capital at disposal required for growth, technology and what not .... why?
Because he knew and knows 'his' customers quite well. Knew it 30 years back and knows it still. He knows what 'his' customers seek and at what price, for 'his' quality. Thats the key!
In a nutshell, one has to know his customers before venturing out. Period!

 

[entsurgeon]

I think starting a manufacturing business would probably be more rewarding than being 'mere' a dealer. Outsourcing the manufacturing part in China and then probably shifting off to India later is the current trend. Just take the example of Norge. You can make similar products and probably sell better than Norge if you concentrate on why Norge is not so big than what it can be. Like someone said in an earlier post, Audiophiles would always be interested in a unknown brand/product..... more the unknown ... more exotic it becomes

Beats the point of passion that op mentioned.

 

[srinisundar]

arre bhai ... i am not asking him to get into HTiB 5.1 systems....I want him to start a Norge clone business by focusing on Norge's weaknesses. What Hari Iyer said is Not to target Audiophile .. while i want him to get into niche audiophile segment which is more rewarding.

I dont think so a passionate guy(Jayaraj unless as stated later) can start an manufacturing unit unless otherwise he is also an qualified electronics(may be) engineer or completely thorough in circuits and basic theory + enough bank balance to test and develop each product to audiophile taste.

Nobody is here to do service, passion combine with money to survive:licklips:

 

[pupupuchi28]

@ Nagaraj S: Please try to read through your first request till latest one and even the suggestions, very minutely. The trend is from being subjective and emotional to objective and well thoughtful. Precisely what Hari has consolidated in his lovely post. Passion is good but mixing passion and profession is not a cakewalk. Think and plan logically before you jump into it. I dont intend to sound pessimistic but workout your plan of action and then go for your passion. Wish you best of everything!

 

[thatguy]

I have never owned an iPOD . But you have asked a crucial question "What problem are you trying to solve that the current breed of AV dealers aren't solving?"
Unfortunately, I don't have "The Idea" that many entrepreneurs are usually excited about - something unique, and has a lot of potential. I am trying hard to figure out though, what and how can I add value to customers instead of merely selling some huge gadgets.

Since you are in Bangalore, there is at least one successful model in Bangalore you might want to study.

If you talk to anyone who is interested in Bicycling, they will tell you about BOTS (Bums on the saddle). This was started by a small group of cycling enthusiasts as a weekend business and (I believe) they are now contemplating getting into it full time. Their *shop* is located on a third floor in a Jayanagar building and opens only on weekends. However, since they themselves are very passionate about their hobby (and were willing to help even when it didn't involve money), they have managed to get quite a following. While it is still a shop, it has also become a meeting place for people who want to talk about cycling. I have been to one of their bike repair workshops, and loved the experience.

It doesn't take much to see what is broken in the current AV gear distribution model. Even scouring this website will give you an idea of the pain points people face. Which battles you want to fight is really up to you

Good luck.

 

[msagar]

Nagaraj,

Follow your passion, it works.
I personally feel Nelson Pass is a good example in audio industry.
Good Luck.

 

[gopib]

Nagaraj,

Been reading all the posts here. Having been involved with VC;s for some time and assessed quite a few budding entrepreneurs here goes my 2 bits...

1. Since you are in a job now stick to it till you are clear about where you want to go and how you want to do it.

2. "Socialize the idea" with Family and Friends..like what you are doing now.

3. Gather all data on the area of interest - meaning numbers. Everything works
on numbers. You need to look at markets, peoples likes and dislikes and everything else around your area of interest. Going through the data will enlighten you and throw up a host of opportunities....and make you at times change course.

4. Prepare a plan, when still in your job. As then you wouldn't have the pressure to keep the home warm. Planning under pressure is tough.

5. Determine how much risk you want to take in your venture. In terms of time and money...of course times is money.

6. Read up on as many successful and failed ventures that you can find. Fast Company and the likes are useful....

7. TIE Bangalore chapter membership may be useful..


I guess you would have got the drift by now...

Good Luck...

Gopi

 

[vktyagi]

Some of my thoughts,

1. If you have enough money as backing to take care of the first six months to a year.
2. Buying an AV product is a long term affair for many people and are not in a hurry to decide. People always settle for best bargain and not the quality of the product. More over buying a AV product is not always a priority for many of the visitors. Hence it could be frustating in the intial period unless you have many people walking in your store.
3. Trend is towards home theater for the novice and you can hardly sell any high-end towers even on a weekly / monthly basis.
4. You should have some winning product to keep the ball rolling as you are going to do this for a living and now its not going to be hobby or passion anymore. Its a different ball game to do a hobby and being a enterpernuer. You need good support system from family and friends (both moneterialy and emotionally).
5. You will need good contacts, good marketing person (direct & indirect) who can sell your products. Just having the best products will never help you to get customers towards you. You need to make noises about that too.
6. Never try to satisfy a audiophile, because he is not your customer. He will always find a excuse evertime you fulfill his need. Your customer should be common man who walks in the street and not the one who will fill you with lots of technical jargon who himself does not understand. Else you will waste time doing a lot of demo and the end result is no sale. This is kind of a important tip that i am throwing at you. The audiophile will always take pleasure in wierd brands and which you will not be able to display.

Wishing you all the best and take advise from like minded people before you quit the job. I do belive that you should have some concrete business plan in terms of short, medium and long term and some cash flow scenarios though i am not experienced as an enterpernuer.

Cheers,
Hari.

I strongly support the point no. 4 (that does not mean I disagree other points). Passion is good and works as a catalyst but it is profit that is the most import in any business to keep the business afloat. So keep the business viability on top while considering all the aspects.
Regards

 

[marsilians]

Nagaraj - Pls. accept my advice in a healthy frame of mind as it may sound discouraging in someways. I used to work in record and AV stores for about 5 yrs as a hobby and passion in the US & Canada though not in Bangalore. This was mostly on weekends and some evenings before I had a family.

Believe it or not, its a very hard game to break into. At the end of the day, your revenue and income should be healthy for you to sustain even your noble ideas unless you have a pot of money without much use for it. Now, you could be a very friendly proprietor vs. some below par ones that have no clue about the products or customer relationship.

Irrespective of the type of business, you need to have a reasonable buisness plan and some type of investment (except in case of pot of rupees scenario). Normally for small ventures as you are thinking, its your savings or angel investors (family friends well wishers...).

Do you have the stomach for not seeing consistent sales? Do you have the will to be a differentiator, if so what is that going to be (Venkat can help here as he has offered to be a mentor).

Positioning of your services and products and marketing in whatever form.

Think this through and once you feel real good, document as much detail as possible. Leave it alone for 3-6 months and revisit. If it still makes sense, then go for it.

Good luck and let me know if I can help in any way. It brings me back very fond memories of years past when I used to walk around the store in awe of the products around me as a 'helper'.

Integration is a very different business line and you have more chance to succeed as an individual than a store. The benchmark is to get CEDIA certification. With this under your belt, you can make a difference in the service vs. someone who hasn't.

 

[anm]

how much you want to earn from your venture, for next 6 months, 1 yr, 5 yrs? Getting this expectation right is very important, otherwise you may end up winding it up earlier than you imagined.
Are you married? Parents to take care of? School fee of kids to pay?
Cash flow is very important to keep the family running.

 

[Nagaraj S]

Nagaraj - Pls. accept my advice in a healthy frame of mind as it may sound discouraging in someways. I used to work in record and AV stores for about 5 yrs as a hobby and passion in the US & Canada though not in Bangalore. This was mostly on weekends and some evenings before I had a family.

Believe it or not, its a very hard game to break into. At the end of the day, your revenue and income should be healthy for you to sustain even your noble ideas unless you have a pot of money without much use for it. Now, you could be a very friendly proprietor vs. some below par ones that have no clue about the products or customer relationship.

Irrespective of the type of business, you need to have a reasonable buisness plan and some type of investment (except in case of pot of rupees scenario). Normally for small ventures as you are thinking, its your savings or angel investors (family friends well wishers...).

Do you have the stomach for not seeing consistent sales? Do you have the will to be a differentiator, if so what is that going to be (Venkat can help here as he has offered to be a mentor).

Positioning of your services and products and marketing in whatever form.

Think this through and once you feel real good, document as much detail as possible. Leave it alone for 3-6 months and revisit. If it still makes sense, then go for it.

Good luck and let me know if I can help in any way. It brings me back very fond memories of years past when I used to walk around the store in awe of the products around me as a 'helper'.

Integration is a very different business line and you have more chance to succeed as an individual than a store. The benchmark is to get CEDIA certification. With this under your belt, you can make a difference in the service vs. someone who hasn't.

@marsilians, thanks much for your advice, (which is actually very probing questions), and your kind gesture to help. What I gather now is that I need to think long and hard. Talk to people and keep in constant touch with my mentors (I am lucky and grateful for all those who have agreed to chip in their time), and as you said review what my plan once every few months.

However, do the challenges you mentioned apply particularly to AV, or could be for any business?
And would you think (and as other members too have mentioned), that AV integration is totally out of my league even if I happen to be in the AV business for some time, say for 5-7 years?

 

[marsilians]

Hi, the challenges I speak about apply to any business inlcuding AV. For AV, the field is pretty crowded and it takes a bit of work to establish an identity. Again, this does not mean that its impossible, just that it will take effort, and money to break through. Also, the margins between electronics and speakers are quite different.

Also, in general, quite a few audio stores are closing down in the US. The economy and niche customers are making it hard to survive for some of them.

Re: integration, its a very different ball game. Advantage is that you can get the certifications without as much investment as a store. Disadvantage is that you need to get the customer base and also capable guys to support your work.

I personally think that with dedication one can get the right type of certificates for intergration. Try to understand from other posters as to why they think its out of your league.

 

[Thad E Ginathom]

Mr Richer began with just one small shop, piled high with boxes, hardly enough room to walk in between the piles. He bought up stock from failed businesses and left-over stock of last-year models from manufacturers. He employed a few staff who knew what they were talking about, and would not try to tell you that a higher-wattage speaker goes louder. He sold only hifi separates, and invited those who wanted midi systems, boomboxes, TVs or fridges to go elsewhere. It was a wonderful shop, and I bought my first hifi there. You can tell from the website that some of the "finer" principles have been left far behind: TVs and Home Theatre systems abound, and they even brought up a company selling, yes, fridges!

However, even before that happened, their one shop had become quite a few branches across UK. They never wasted money on prestigious sites or addresses. You won't find them in a big shopping centre: they'll be in a small shop a couple of streets away --- and the shop will be packed.

They always maintained a customer-centric approach. Every customer has the option of filling in a customer feedback form. Nobody (unlike certain much older but less popular UK chains) will try to force an extended warranty on you, but if you want one, Richer Sounds has a scheme which not only gives you warranty, but ensures your equipment has a residual value when you want to exchange/upgrade. Been there, done that, it works!

It's not necessarily a model that could be replicated in India (although many of us would love to be able to visit a Richer Sounds here!) but it is an example of how one man can be an AV entrepreneur and make it big.

Whilst Mr Richer's business has been growing, and, as far as I know, continues to grow, both established chains and speciality shops have been closing their doors. Dixons/Currys (who have been around all my life) continue to struggle, and, in the few years I've been out of UK, some American-based companies have set up shop, and closed down again.

I'm not an entrepreneur, or a business specialist, but I suppose the secret of Mr Richer's success was to do something sufficiently different, and, to spend capital only where absolutely necessary.


It might also be true that names count! :lol: