Well...
we have gone through all the precursors so far, my love of music and bass and long-time tinkering with systems. My obsession with car audio, all the subscriptions, systems, becoming an IASCA and USAC addict, getting a new carreer I could fall back on in medicine, gaining experience building interiors, former jobs at shops and apprenticeships, getting a new car in '94 and going crazy with it, the friends who wanted systems built on the side, the new group of friends made at the competitions and how I studied their installs, becoming an IASCA certified SQ and install judge, studying rulebooks, building a collection of tools, trial-and-error practicing of new install techniques, etc. etc. MAybe I didn't *exactly* mention all of these, but they all played a part in this.
> then we talked about the signing of the shop lease and moving in and getting set up. We also talked about getting an occupational license filed with the County, setting up an EIN with the IRS, and setting up a Sales Tax Account with the State of FL department of revenue. These are essential, as NO business may operate legally without these items. BTW..my initial cash investments were first months rent and security deposit ($900), license fees, lumber and building materials for the shop set-up, and turing on the phone, electric, and security monitoring set up. In all, I'd say it was roughly $2000.00.
We talked about setting up our first accounts as an actual "shop" with Stinger, Select, Oz. I also grabbed the Snap-On and Matco tool men when they came to the car lot on a weekly basis and I set up an account with them for tools. Was this necessary? Not really, b/c you can get MUCH cheaper tools from Wally World or Harbor Freight any day of the week, but nothing beats the convenience of them bringing the tool truck to you, free replacements if you break them, and being able to pay on your acount a little at a time over time, NOT all up front Needless to say, those two guys made me very happy---I got a plasma cutter, MIG welder, spray guns, air fittings and moisture filters, roll-around carts, sockets, gear-drive wrenches, impact wrenches, air saws, 3" polishers and sanders, etc. While all these tools are not necessary for some shops, I can tell you I use them often now.
So, back to the story- We are about two months into it, Bobby and I have done a few smaller systems and I have gotten us business cards and audionutz stickers made and we are putting them on the cars we do. I have reinvested most of the money taken in by placing small COD orders for install supplies and slowly building an inventory (this includes dash kits and wire harnesses). The way I worked it with my other job was like this> I switched my shift at the hospital to the 6PM to 4 AM shift, and myself and another guy would rotate that shift. One week I would do Mon Tues Fri Sat and Sun, and he would do Wed THurs. The next week, I only did Wed Thurs and he did the rest of the days. THis is one of many 80 hour flex shifts that we do in the medical field. I know that seems like a lot of hours, but I was free every day during the daytime hours, and every other week I had 5 days off! It worked out pretty damn good. I would sleep until 11 or 12, come in and open the shop up, Bobby would get there at around 2 or 3, then if I had to work I'd go in a 6 and he would close up about 8. I know, you are saying "Shit dude, thats like 100 hrs a week" or something. I say yes, you are right! BUT, when it is yours, you have this perpetual adrenaline rush and sleep seems to become far less important to you. Over time, I got accustomed to 6 hours a night. Also, I would get done early at the hospital and duck out at 230 or 3 AM instead of staying the whole shift, which was cool.
Next order of business was a big one...what do you think that one of the most important things was to a guy who spent the last several years travelling all over the S.E. competing at local and regional shows all in the name of going to Finals every year??? That's right, pilgrim. HOSTING SHOWS!!!! I contacted Terry Floyd of Soundoff Technologies, an IASCA affiliate for this region, and devised a plan. I not only wante to host shows, but I wanted to host ONE a MONTH! The only other store doing this was, say it ain't so, my old friend Sound Advice. They had a different show scheduled each month at different stores around Florida, and their shows were always held on Sundays. Wel, Terry and I decided we would do audionutz shows on the saturdays before the SA shows since he would be in FL anyways for the weekend. Coolness!
We really put a lot of effort into putting on great shows (see also GOOD FORM OF ADVERTISING, Kimosabe!), even though they werent that big. We advertised online (surely some of you recall seeing posts), on the IASCA site, and locally using word of mouth and flyers. I always had refreshments and several times had the BBQ grill going with burgers and dogs (even steaks a few times )and we did a raffle sometimes for subwoofers, and sometimes we just gave products away as prizes for the highest SPL or the highest SQ score.
Well, after the first couple shows, the turnout grew, and then people from other cities were coming to the shows, then *reps* for other companies were coming, bringing their demo cars to compete and display. We even got other local shops to bring their projects over and display them. As luck would have it, I met several reps for audio companies at our shows and scheduled appointments to meet with them discussing us carrying their lines. They were very impressed with our work, and the shows allowed them to see our demographic and see that we were on a side of town that no other stereo shop was located. THey witnessed our dedication to the sport and basically all of them wanted to do business with us.
Enter Arc Audio, Rainbow, and Crystal Mobilesound. The first rep I met with had these three lines, and they were all available in this area as exclusive lines for the taking. I jumped at the chance to be the exclusive dealer for several reasons at the time. 1) exclusive dealer means no other shop in this county can carry the lines 2) they were quality products and had high-end lines 3) all of the companies had great reviews in the tests I had seen 4) after the first three months of dealing with actual customers, there were those that wanted to purchase equipment from us at discounted prices rather than spend an arm and leg elsewhere and they wanted stuff other people didnt have. So I jumped on these lines. The rep had us fill out a credit app, which basically I used my own personal information on and included a bank account statement (since audionutz was known as a "sole proprietorship" and not a "corporation", I basically was my own credit reference). <<
The credit apps for these companies also needed copies of our business (occupational ) License, Federal EIN number, and State of Florida Resale Tax Certificate. They also wanted credit references from other companies we did business with. Well, I of course put Oz Audio on there, and used the Stinger COD account and Select acct as references. All three of them gave us good reports, and we were granted a dealer account! WOOHOO!!!
I guess this would be a good time to go in depth about being a dealer for an audio company eh? Well, these two companies were Crystal Mobilesound and Arc Audio, importer of Rainbow into the states. I was set up on 30 day terms with these guys, which means audionutz had 30 days from the time the products shipped to the shop to pay for them. This is how a shop is extended credit. The company ships you the product, then sends you an invoice for said product that you need to pay for by the due date. Now, these two companies didnt issue us an astronomical credit limit, but rather a smaller one since we were in our infancy (totally understandable and normal). Crystal initially set us at $1500 and Arc at $2000. Crystal did not require a minimum "buy in", but Arc wanted $1000 if I reall correctly, dont quote me. So, we placed modest opening orders for amps and speakers, thus beginning the actual retail side of Audionutz.
I sense some of you raising eye brows with silly little looks on yer mugs, so here's more explanation. A "buy in" is a minimum amount that a company wants your shop to purchase as the initial investment into carrying their line. Some companies want this opening order to be paid for up front or will ship it COD so you will have to pay for it when it arrives. Other companies will let you pay for your opening orders on normal terms that they set for you. In my case, we had to pay for the opening orders in 30 days, which was cool b/c of the extra time it gave us to sell some stuff. Some larger companies have seriously LARGE buy ins, ie: Sony, ROckford FOsgate, Alpine, MTX, etc. THese companies require like up to $10K to open, but they make it ultra hard for the small guy to deal them b/c they require you to order items from all their "sku"s (a sku is a barcode number for different products) with each order. THis means you cant just order Punch amps, you have to order some Power series amps, Punch subs, Power subs, entry level speakers, midlevel, highend components, even their head units. Furthermore, they have minimum requirements for their dealers based on yearly quarters (that's 3 month intervals, dickfor!), and if you do not order a certain dollar amount of product during that quarter, the rep can, at his disgression, offer the line to another shop so that it ensures Huge Mega-Brand X hits the company wide goal for the year. I know, you are saying "Damnit man! That's a lot of cheddar for a little newby shop to cough up" and I totally agree. THe quarterly requirements are different depending on your location in the US, but around here the RF and Alpine dealers have to do $25K/quarter MINIMUM and the Sony ES dealer has to order at least two items from every category Sony makes with every order! TO me, that's just ridiculous, but the bigdog companies have such a large corporate structure that they are based on projected goals (I guess that's why they are as big as they are, eh?).
How does this relate to audionutz? Well, it explains why we are NOT Alpine, RF, SOny, or MTX dealers, doesnt it??? Remember, audionutz was starting SMALL, and sales of that magnitude would require a big showroom and a large staff with mad advertising---thus these products do NOT fit into the audionutz business plan of starting small and going S L O W . I fugired let's leave those huge audio companies to the circuit city's and the best buys and the other larger, better established shops to fight over. We would focus more on the lines that we could ensure exclusivity with in this area as well as offer the customer products that were truly "high-end" and not every swingin johnson on the street had in their ride.
DAMNIT! This is taking forever. Sorry for the longwindedness, but it's a testament to my virtues of doing everything to the best of my capability no matter what. If youre bored, sorry. I just dont want to miss any aspects of my story here b/c that would not be the TRUE story, would it?
Part 4 to come folks!
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