Coral farming Buisnesses

[Troy V]

Yeah thats what I was thinking is as well. The LFS in the bay area are very competitive and if i were to sell to them it would be hard to beat wholesale prices especially since they get in wild caught.

This is true for many coral. But Xenia doesn't ship well. So that could be an avenue you could use to get your foot in the door. Right now that is my main cash crop. From a 17"x16" area I can consistently make at least $300+ a month.

 

[ZoWhat]

For me. I've found the easiest way to make money in the hobby is by developing a good relationship with your LFS. Then start selling frags of the staple fast growing corals like Xenia, metallic gsp, mushrooms, zoa's, and leathers just to name a few. Only sell to the LFS and agree to split the profit with them.

Troy V?.....What-The-Fish?.....and you've done this with your local LFSs?

I've mentioned this concept in passing with LFSs in my area...Everyone of them said "ABSOLUTELY NOT" for two reasons:

1) they are already making a 300-400% markup on coral snd fish ..... and paying me any consignment % is WELL ABOVE what they can just buy it alone wholesale. Example: after selling a $100 coral, they pay me $50? they say they can buy the same coral wholesale for $25 and keep all of the $75 not involving me. So "noooooo way" is their answer.

2) they also all said they CANT TRUST corals or fish coming out of a hobbyist tank with potential diseases and/or pests. One frag from me could wipe out their entire inventory and insurance wouldnt pay bc they bought from a hobbyist and not a legit biz. If a legit wholesaler wiped out their inventory there could be some legal$ coming to the LFS if it can be proven. Coming from a hobbyist? They're S.O.L.



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[BoomCorals]

Troy V?.....What-The-Fish?.....and you've done this with your local LFSs?

I live in Cincinnati and there are about 4 legit LFSs for reefers.

I've mentioned this concept in passing...Everyone of them said NOOOOOO for two reasons:

1) they are already making a 300-400% markup on coral snd fish ..... and paying me any consignment % is WELL ABOVE what they can just buy it alone wholesale. Example: after selling a $100 coral, they pay you $50? they say they can buy the same coral wholesale for $25 and keep all of the $75 not involving me. So "noooooo way" is their answer.

2) they also all said they CANT TRUST corals or fish coming out of a hobbyist tank with potential diseases. One frag from me could wipe out their entire inventory and insurance wouldnt pay bc they bought from a hobbyist and not a legit biz



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I think the key point of part 1 is that they can buy it at wholesale for $25 so why buy from you at $50. If you could match or even beat their wholesale price, then I don't see why they wouldn't just buy it from you. Part 2 is nonsense, they have just as much chance getting pests from wholesale as they do a hobbyist. Wholesale doesn't QT anything or treat anything. I have gotten pests from every wholesaler I've bought from, which is why I have a strict QT system.

 

[Troy V]

Troy V?.....What-The-Fish?.....and you've done this with your local LFSs?

I've mentioned this concept in passing with LFSs in my area...Everyone of them said "ABSOLUTELY NOT" for two reasons:

1) they are already making a 300-400% markup on coral snd fish ..... and paying me any consignment % is WELL ABOVE what they can just buy it alone wholesale. Example: after selling a $100 coral, they pay me $50? they say they can buy the same coral wholesale for $25 and keep all of the $75 not involving me. So "noooooo way" is their answer.

2) they also all said they CANT TRUST corals or fish coming out of a hobbyist tank with potential diseases and/or pests. One frag from me could wipe out their entire inventory and insurance wouldnt pay bc they bought from a hobbyist and not a legit biz. If a legit wholesaler wiped out their inventory there could be some legal$ coming to the LFS if it can be proven. Coming from a hobbyist? They're S.O.L.



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I understand the scepticism. So much of this is based on your relationship with your LFS. It your job convince them that they could either get half of something or none of everything. So many hobbyists are selling on Facebook and other social media, leaving out the fish store from potential profit. My offer is to just include them on the profit. If someone gave me a dollar and I made 2 dollars with their dollar, and all I have to do is pay them back their dollar it would be an awesome deal wouldn't it? Also remember that you will cover all coral loss. That is something most suppliers won't do.

 

[Dennis McGrath]

Me opening a coral biz and competing with LiveAquaria and the like

Would be like...

Me opening a 800 square ft Thrift store next door to a Super Walmart

This sums it up perfectly.

 

[Gareth elliott]

My lfs does trades for clippings on occasion. Bring your frags, get new ones. Not going to make you rich but lowers the costs you incur as a hobbyist.
I have mostly kept freshwater so dont have the experience of selling saltwater fish but...
Certain fish are also sellable. Ive sold piranha(lfs) and koi(golf course). Not enough to retire lol but can buy a spare pump or new livestock. Often times buying small, keeping healthy and letting it grow. You can sell at a price much higher than purchase price. Baby arowanna cost $35-50, at 2 feet its now worth $300-500.(still requires a substantial investment up front they do require a 300 gallon aquarium at 2 feet.). But easier than a rack of breeding tanks imo.

 

[ZoWhat]

Now, I've traded with a coral shop before but they were getting a majority of the benefits

You go into any LFS asking for them to "share profit with them".....90% of them will prob immediately walk away. They have a biz-model that doesn't include profit-sharing with customers.



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[Servillius]

Yeah, my recommendation is to not haggle price, especially initially. I went with “here are my corals. Get what you can for them and just give me a credit for whatever you think is fair whenever you’ve gotten them sold.”

If you then provide amazing corals on a regular basis, you’ll find your negotiating power going up on its own.

 

[Servillius]

Yeah, my recommendation is to not haggle price, especially initially. I went with “here are my corals. Get what you can for them and just give me a credit for whatever you think is fair whenever you’ve gotten them sold.”

If you then provide amazing corals on a regular basis, you’ll find your negotiating power going up on its own.

One additional piece of advice. Don’t be a bad customer. That’s just a general rule. Don’t be whiny, don’t haggle for everything, don’t Complain incessantly, interfere with their customers, or complain about where you can get things for cheaper.

That’s just general advice, but it’s even more true if you want the guy to buy your stuff. Respect the business and understand their challenges. They’re much more likely to take you seriously.

 

[Sailingeric]

If you want to go into business, make beer. It is fairly easy and if you are not too successful, at least you got beer to drink.

 

[Dr. Dendrostein]

If you want to go into business, make beer. It is fairly easy and if you are not too successful, at least you got beer to drink.

10000 monks, beer from India. I'm not beer drinker, but this beer , man, drink it all day long. I can taste the smoked oak barrels. Smooth taste beginning to end.

 

[kdino]

interesting read for sure! I've often contemplated it, but alas, have not done so for some of the reasons laid out above. With that's said, if i win the lottery, you know what ill be doing!

 

[rkpetersen]

That's very cool your lfs was buying from you.

Seems like it's pretty common. One popular LFS here has ongoing relationships with multiple local hobbyist coral farmers. And because these sometimes rare frags are often sold at less than typical prices, everyone wins.

 

[ZoWhat]

Seems like it's pretty common. One popular LFS here has ongoing relationships with multiple local hobbyist coral farmers. And because these sometimes rare frags are often sold at less than typical prices, everyone wins.

That's bc you're on the West Coast in Seattle.

On the East Coast, not only do LFS owners NOT want to do biz with hobbyists....

if you look around for more than an hour they'll come up to you and say. "You gonna buy something today or what?!? Museum's down da street"



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[Reef Lounge Coral]

Have to agree with @BoomCorals here. This hobby will definitely not make us rich, but for us that have businesses in the hobby we love what we do; and thats why we stay in this business. We have been fortunate enough to do the business for almost 30 years and we have seen a lot of fish stores in our area (Southern California) come and go, which is very sad to us as store owners but it is just the harsh reality of the business. It is not cheap at all, and as @BoomCorals has said there's a lot of hidden costs. We even have a coral farm in Indonesia and to buy that land and facility can rack up to a $100,000 easily. We like to see a lot of fish stores open around us, because it keeps people interested in the hobby but since the Indonesia ban a lot of stores are suffering.

 

[Sage]

One local Florida coral grower recently lost several thousand dollars in corals due to a minor plumbing mishap that happened during the night. In one night he ending up with a 5 gallon bucket filled to the brim with dead coral frags. Yes, a years worth of profit can disappear overnight. Coral growers can make a decent living, and they deserve to, but its a lot of time and work and a bit of good luck avoiding the mistakes everyone makes. Its also fixed costs, marketing, loans, frag swaps on weekends, paying for those frag booths just to be able to sell frags, etc.

You talking about reefers direct?

 

[Elgringodiablo]

That's bc you're on the West Coast in Seattle.

On the East Coast, not only do LFS owners NOT want to do biz with hobbyists....

if you look around for more than an hour they'll come up to you and say. "You gonna buy something today or what?!? Museum's down da street"



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That same attitude is what will alienate hobbiests and push them to other sources.

Only LFS I’ll even go to anymore are ones where I like the owners/employees and feel a sense of loyalty. It sure as heck isn’t for their prices or quality. Can find better online on both accounts.

 

[1810]

While it's not his full time job, @BoomCorals would be a great guy to ask

Thanks for this info, going to pm him as well for advice. Been considering it as well for some time since my area is still developing. Not full time of course. I just need to wrap myself with a solid plan, absorb much information I possibly can and surround myself with good people.

Subscribing to this.

 

[ZoWhat]

We even have a coral farm in Indonesia and to buy that land and facility can rack up to a $100,000 easily.

That $evaluation seems really low....I'm sure the Indonesian Gov wants a good cut of any $profit leaving their country heading to the evil capitalists of the West.

I would have guessed a coral farming biz in Indonesia would run investors 7figures easily....

Idk. Above my pay grade



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[Reef Lounge Coral]

That $evaluation seems really low....I'm sure the Indonesian Gov wants a good cut of any $profit leaving their country heading to the evil capitalists of the West.

I would have guessed a coral farming biz in Indonesia would run investors 7figures easily....

Idk. Above my pay grade



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I wasn’t saying for our own coral farm, just a basic one. Didn’t want to get too specific with how much we spent on a farm in Indonesia but yes you are right; it is a few hundred thousand dollars to get a quality farm and facility. The coral and fish industry is obviously HUGE in Indonesia so yes they will charge a fortune for any type of investment.