Major Decision. Get out or hang on?

[TritonsGarden]

We have been struggling over a major decision the past month and need your advice.
We started a small coral farm early this year. Our business plan had us selling a
few corals next year and ramping up sales slowing over three years. Break even would be year four.
After the downturn in the economy, we now have a doubts about this plan.
Maybe I am just doom and gloom but I have a felling we are headed for hard times.
How do you think the economy is going to be next year? I especially would like to hear from sponsors.
How is business lately?
Do think we should stick to our business plan or sell out our livestock and call it quits for now?

Jack

 

[Garth Schafluetzel]

send everything to me because ive been talking to a few people about starting to try small time while im stil in school seeling to locals and online and would love a store in 5 6 years but i plan on going back to school with a major in mind of marine biology to further my knowledge right now is trail an error and experience. and honestly i think that if more people grew out corals and sold frags from trimming back it would help our natuarl reefs and this is always a topic of every reefer but being a young gun at 19 and finding myself surronded by my elders trying to pry knowledge from them and learning more than i could ever imagine on my own and with allot of help. i realy hope you stick with it and maybe 1 day every one for the most will be on the same page and we can all work hand in hand but intell then we will have to deal with people giving us a bad name and bad buisness men and such. but for the rest stay strong and if all else fails let every thing grow out and give the econmy time and come back with an unreal amount frags available lol
on another note were in south ten r u located i would love to check things out and like i said i can make room for whatever you dont want if you do decide to leave even though i would never want people to leave the hobby

 

[TritonsGarden]

on another note were in south ten r u located

Garth,

We're in Lawrenceburg, about 150 miles west of you. You're welcome to visit anytime.

Jack

 

[NewBeeMommy1]

i'am just a shopper but its hard with gas prices and stuff to even think about buying..then the cost of shipping , and you know those prices will go up to...i dont know,,,i could do it i'd have to bail out

 

[Saltysteele]

well, it's easy for me to say, i have nothing wrapped up in it.

however, i'd follow your business plan, just to follow through. the economy will turn around eventually. i mean, you already planned on not making money at this point, right? i would have to imagine by year 4 the economy would have turned around.

shoot, if you listen to the dem's and obama gets elected, we'll all be eating off fine china with real gold utensils

(that was a joke, please no one turn this into a political thread)

 

[Tankguy001]

Not one us can tell where the economy will be in year 1 , 2 , 3 ,or 4. If you can hang on than stick with it. I can tell you out here in Nevada that we just lost a LFS and many other business of all sorts are closing or barely hanging on. Alot of us have turned our attention to paying for what we need rather than what we'd like to have. Personally I've had to scale back on my tanks due to wife's 5 months of no work along with gas prices , food increases ( 3 kids ) and everything else that has gone up. All that being said do what you feel is right for you. It really boils down to a personal decision

 

[oceaninabox]

Sales are slowing for a lot of us sellers. I think it really depends on what your trying to do. I always try to have a niche market and cater to a specific customer, but everyone is different in there approach. My wife always hounds me about stock piling our coral but she is a pestamist and I am an optimist. As she always says "you cant eat the coral. We have attemted to go full blown and have a storefront to ad to our exisiting lines of business, but I am real hesitant right now as well.

 

[Garth Schafluetzel]

i just hope things work out i plan on selling whatever outgrows my tank and anything else that i get a big piece of and only wanted a frag to grow out but i plan on one day making a living off my hobby but untill then its whatever it takes ya know

 

[Reef Pets]

Sales have slowed down drastically. In some cases people are taking a loss just to move coral to be able to offer something new. So, if you are not in too deep you might want to consider another way to make some extra money for now. But, I do think that the economy will recover sooner than later. When it does people will be more comfortable about spending extra money on there hobby.

 

[GotSalt]

I say stick with it! I dont know if this would work but If you feel that business is falling off why not just hold what you have and not invest in any new coral and that why when business picks back up they stuff you have now will be grown out some and you may be able to frag it meaning that the frags you have now could turn into 2 frags get what Im saying? ha ha So if this happens could you not sale them a little cheaper than they usually go for now that you have 2 and still come out on top? Just my 2 cents

 

[oceanparadise1]

stick with it!!! this economy doesn effect my buying! lol

 

[ahayes13]

i am not a supplier or business but.... i would say to stick it out. if you already planned that the business would prob. not make money til year four then you arent really losing anything. you can just keep all the corals you have and only have to pay for tank maintence until hopefully the economy gets better. you dont have to purchase new corals at this time, like someone else said, you can just let things grow out.

 

[Zombo]

If this coral farm is your bliss, your dream -- stick with it!

 

[EyeCatchingCoral]

Error.

 

[EyeCatchingCoral]

Hey,

Business has no doubt slowed for a lot of people. The media has people afriad to spend money. At the same time, gas prices are falling and it is becoming our busy season. People are afraid to spend money on other things so they are staying home more. That may be our biggest help. As a wholesaler I have insite into several stores. I would say over half have told me it is bad times but the other half are doing better than ever. I personally have never been so busy. Products are selling, the hard part is to make sure they are your products that people want. There are so many new "POP UP" coral internet companys that it is no doubt taking a major toll on the people who have been around for awhile. Overall, I would say business is like it was this summer if not a little better. Hopefully, the economy will come around and we can all have the busy winter we always hope for and count on.

I wish you the best of luck with your coral farm. I love to see this as i know we can not just continue to take and take from the reefs. Four years seems like a long time for your break even point. I know it takes at least that long for a regular business to reach its break even point and get out of the red, but this industry is very unique. I would say you should start out with some faster growing corals so you can start to make money sooner. The hardest part is you dont know what corals will be in demand in four years.

 

[GMaquarium]

This is for sure a hard time for everyone. Even after 11 years sometimes Im not sure if Im in the right business. A side from the hard economic times the pet and aquarium industry is changing and not sure if for the better.
I can't see myself doing anything else. Sure I often regret not sticking with research part of it. But even that is not peachy, hunting for grants all the time.
After all it is your move to make, not sure what you are looking to get out of other replies. But if you are not too deep in and have other options that could give you a better life or at least a better night's rest I say go for it.

 

[EyeCatchingCoral]

This poll is what makes me nervous.

Sorry for the other forum use rev but this is a very important poll.

Taken from reefs.org:
How as the economy effected your reefkeeping habits?
I am spending more then ever.

15.27% (246 votes)
I have not changed my reefkeeping habits.

18.37% (296 votes)
I have reduced my livestock and drygood purchases.

10.30% (166 votes)
I am postponing all purchases of all non-essential items.

21.73% (350 votes)
I am quitting the hobby due to the economy.

34.33% (553 votes)
Total votesThere are 1611 votes on this poll.

 

[Reef Pets]

This poll is what makes me nervous.

Sorry for the other forum use rev but this is a very important poll.

Taken from reefs.org:
How as the economy effected your reefkeeping habits?
I am spending more then ever.

15.27% (246 votes)
I have not changed my reefkeeping habits.

18.37% (296 votes)
I have reduced my livestock and drygood purchases.

10.30% (166 votes)
I am postponing all purchases of all non-essential items.

21.73% (350 votes)
I am quitting the hobby due to the economy.

34.33% (553 votes)
Total votesThere are 1611 votes on this poll.

Those are some scary numbers. Over 1/3 of the people are getting out due to the economy. Gettting the coral to the USA is becoming much more expensive due to fuel cost. Within the last year airline cargo has went up several times!

 

[ahayes13]

wow, that is scary.

 

[AquaWorldPSC]

I say it depends...
- It depends on what you offer and if you can build a relationship with your buyers and supply good healthy coral. I know one of my suppliers tells me "if you don't like it cross it off the invoice and i will reimburse you no problem!" "we work on a 100% trust based policy"
- Also it's not worth it if you are going to start out small. I only have one supplier that farms their corals which is ORA any other supplier either maricultures it or get's it from the wild. Which leads to does your quality and price at the same time match their other suppliers?
-To be successful you have to be able to turn coral out at a large rate to pay for electric, supplies and space if applicable. These all add up, trust me. Our electric bill is $4000 per month. We run 15x400 w hailides, and ever 36x 48" t5ho and vhos, not including 500x 48" double strip lights for freshwater for 12 hours everyday and over 1000 pumps/powerheads. Oh and you don't even want to ask me about my water bill. We make 500 gallons of fresh R/O per day just to top off.

These are the qualities I seek in a good supplier:
-Wide Slection
-Quality
-Good Prices without interfereing with quality
-loyal sales people
-DOAs
-Good packageing practices

Now i read it again you want to break even on year 4, that gives you plenty of time to get established and build the trust with your buyers. But that is a lot of years work to not make a penny. Especially with our economy nowindays.