Want to Open a New Hi-Fi Dealership

[rohit4165]

Hi guys,

I am planning to open a new authorised dealership in my city. Currently there are no dealerships dedicated to such hi-fi music and home theater systems. I am looking to store Denon, Yamaha and Onkyo's basic and mid range AVRs.

What should be my first steps and things to look out for? What infrastructure should be maintained? What should be the budget? Any additional inputs on other topics would be welcome.

Regards,
Rohit

 

[Sunderpalanivel]

You can go to individual brand website and contact for dealership , only they can give you all the detail.

 

[rohit4165]

I have spoken to the respective dealerships. But I wanted to hear from the audiophiles in this forum on their personal experiences of buying from various stores and showrooms, incorporate all those thoughts in my venture to help me exceed my customers' expectations.

 

[miroflex]

Hi Rohit,

You will be successful in Bhopal where there is an unfulfilled demand for such products and many potential customers with good purchasing power.

To boost your sales you will need to provide at least one well designed and well furnished listening room. This will enable you to allow customers a good demonstration of your products.

It may well be the most costly investment you may have to make in terms of space and the rent to be paid. Rents will be exhorbitant in a commercial area like MP Nagar. You could start in a residential area.

Best of luck to you in planning and implementing your new venture.

 

[just4kix]

I have no experience in these matters but speaking from logical point of view:

• Often the desire to start a venture is because one faced difficulties in such matters. But you should also do a market survey of what you are planning to start. For example, in your case, you wish to start a hi-fi dealership. It will be invaluable to know how much market exists. Now this is easier said than done. Perhaps a research agency may help. There may be upfront cost involved but it is better to take "calculated risks" rather than "unforeseen risks".
• you should guage the exact nature of goods that is likely to sell in your city. Also note that you may have to invest in other electronic equipment that helps make you a sale. For example, you may not be wanting to deal with TVs and Projectors but to sell a home theatre, you may need these video devices. This is sort of a dead investment necessary for business.
• the next thing will be the location of your showroom. This is very important and your showroom should be accessible to the upmarket community - since the merchandise will be as such. Check the availability of the space and the going rates, etc.
• next will be the size of the showroom and the cost of interiors, including air conditioning, lighting, special listening rooms, accoustic controls, counters, machinery/computers, etc. These are mostly one time costs.
• you might have to enquire with various manufacturers for dealership details. How much cash will be required to stock goods, credit policies, average lead times for procurement, etc.
• you will have to take into account the number of salesmen and workers required for your business, consider their salaries, PF, etc. You should hire a CA for creating the proprietorship business need, make yourself familiar with shop-act laws, liabilities, insurance needs, etc.
• you will have to draw out a financing plan, how much you will put up, how much loan will be required, which bank will provide you the same and at what rate of interest, etc.
• finally you should chalk out the total cost of ownership (TCO) and return on investment (ROI). Your CA will help you with this.

Others may contribute. HTH.

 

[Ashenden]

Very well summed up by Just4kix.

I would like to add that if you are able to provide home demo to customers taking a fixed payment for the same will be a lot more effective, since it'll give them [customer] a real acoustic performance in their home environment rather than in the acoustically treated demo room. Also in the case of accessories like interconnects, speaker cables etc, if you can give a return policy stating that if the customer doesn't find any sort of improvement over his existing set up with the upgrade, he can return the purchase, it'll prompt more customers to visit your store.

Most of the manufacturers provide demo pieces against a dealership deposit, so you need to factor that too into your costing.