Business idea - comments and suggestions welcome

Industry Talk
1

Around here we have two (possibly three??) ‘surfshops’. The selection of surfboards are usually something like 10-20 funboard/beginner board, 5-10 shortboards, a couple of longboard and about 10 boards on the used board rack. I’d say 50% are surftechs and 50% are PU/PE. Prices start from $500 + taxes for a PU shortboard, $750 for a surftech shortboard. You can get custom boards but it’s limited to one or possibly two brands/shapers, the waiting time is long, they seldom arrive at the date they were supposed to come, they are known for screwing up the orders and quality is IMHO not the best. There are a few other action sport stores around the country (surf, snow, skate) that sell surfboards, I’m guessing they have 5-10 boards in stock at any given time. Number of surfers are ever increasing, however it’s not a huge market (as you can see from the numbers of boards in stock).

My initial idea was to make an online surfshop and compete on price only. However there are a a few cons to this, mainly the initial investment to build up an inventory of surfboards and marketing. The risk is your stuck with the inventory and do not sell any boards at all.

Idea: Surfboards direct from shaper

Instead of setting up a regular online shop, we set up a shop where you can order surfboards directly from shapers around the globe. There is little to no initial investment except for website development as there is no stock. A short bio for each shaper is placed on the website. The boards are ordered through website forms, advice and support are given on the site as FAQ and by email. To make sure we don’t get a lot of bogus orders we’ll require that a deposit for the board is paid for through paypal when the order is placed. The orders are placed once a month, boards are shipped once a month. Depending on shipping cost, to be competitive we might decide that we make little or no money on a single board from a shaper(or region). Once we sell several boards at a time from one shaper we save on shipping cost and start making money. To ensure we actually do save on shipping, we either try to ship several boards from shapers in one region in a single box some way or another, or keep the number of shapers low (a handful) to make it likely there are several boards ordered from each shaper every month. However, the main focus should not be to be competitive on price, but to offer high quality and offer unique boards as apposed to off-the-racks. We might also offer custom composite surfboards and balsa boards. Boards can be picked up at our location when they arrive or be delivered locally to the doorstep for a small extra charge($15 or so). Marketing would mainly be by word of mouth and maybe a few ads on selected websites.

What’s in it for the customer:

  • Custom, unique surfboards from top shapers
  • High quality compared to what is offered in the local surfshops
  • Less risk than ordering internationally(due to local laws and regulation)
  • Less hassle than ordering internationally(as we will do the import paperwork and taxes)
What's in it for us:

I’m not quite ready for quitting my day job. However, there would hopefully not be all that much work to it, except when orders arrive when it will be a bit hectic. With any luck we’ll have some stoked customers and make enough money to take a few days off work once in a while and go surfing.

What do you think?
2

assuming that you could ship boards in at a reasonable price, i’d say go for it.

be careful, though – credit card and web fees can add up quickly.

3

Hi Haavard,

it seems to me you should try to keep it as local as possible, in terms of resources.

if your customer is educated enough to want a custom board, he’ll understand that it makes more sense to buy from a respected european shaper than to order a board from across the globe. you don’t have to deal with customs, shipping will be faster and cheaper. product quality just as good. Fewer cargo polluting the oceans.

Then, if somebody really wants a webber, or a merrick, or a rusty, it seems to me you should be able to arrange a deal with some european giant distributor, so that you don’t have to carry the inventory yourself.

That way you can tap into their warehouses and have a much richer catalogue.

Don’t forget that you need to sell gear too (at least wetsuits, and they better be thick there), if you want to have a slight chance of making a profit.

this way smaller margins for you, but less risk, you’re basically just providing the “buy” engine and dressing up your website.

A friend of mine did something similar in Italy, mostly based on Kite-surfing, and he’s doing great. he generated so much business, he ended up opening a real store too.

good luck

d

4

Hi,

we would try to avoid brands like rusty, ci, lost, etc. and stick to smaller shapers where we can have direct contact with the actual shaper. If someone wants a particular brand I’d direct them elsewhere. I’m actually considering putting my list of surfboard manufacturers on the links pageof the site. I’d use the swaylocks network for building a ‘quiver’ of shapers for the business. It makes a lot of sense to go for European shapers, however since Norway is not part of EU we still have to deal with taxes. Secondly, I think some customers would actually think a board made in the US or AUS is better than a board made in Europe(or China, which is the case with a lot of the boards on the racks here). With the little checking I’ve done for shipping blanks, the shipping cost may be just as high or even higher for shipping from the UK f.ex compared to both US and AUS.

regards,

Håvard

5
Quote:

I’d say 50% are surftechs and 50% are PU/PE. Prices start from $500 + taxes for a PU shortboard, $750 for a surftech shortboard

That’s your competition…what can you do that they can’t or aren’t already? And since the surftechs are already built and sold on the business model you are thinking about (except not custom), why are they so expensive over there compared to the regular boards?

Quote:

Instead of setting up a regular online shop, we set up a shop where you can order surfboards directly from shapers around the globe. There is little to no initial investment except for website development as there is no stock. A short bio for each shaper is placed on the website. The boards are ordered through website forms, advice and support are given on the site as FAQ and by email. To make sure we don’t get a lot of bogus orders we’ll require that a deposit for the board is paid for through paypal when the order is placed

Generally people already can order directly from shapers around the globe. The exceptions would be from guys who aren’t on the internet or in magazine ads, or who are totally underground. Those people are hard to contact…and you as the business owner will be a long way away from them yourself, but responsible to your customer.

Quote:

The orders are placed once a month, boards are shipped once a month. Depending on shipping cost, to be competitive we might decide that we make little or no money on a single board from a shaper(or region). Once we sell several boards at a time from one shaper we save on shipping cost and start making money. To ensure we actually do save on shipping, we either try to ship several boards from shapers in one region in a single box some way or another, or keep the number of shapers low (a handful) to make it likely there are several boards ordered from each shaper every month

What can you do better than your existing competition? The model described above probably means lead times of 2-4 months if you really want custom boards and want to consolidate shipping.

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However, the main focus should not be to be competitive on price, but to offer high quality and offer unique boards as apposed to off-the-racks

To me that would mean high $$$ on your products, which may be fine. You have to add your overhead to the cost of everything you do that doesn’t include the price of the board that you pay the manufacturer. If you don’t, or try to play that too close, you can get into financial trouble quick.

Quote:

My initial idea was to make an online surfshop and compete on price only. However there are a a few cons to this, mainly the initial investment to build up an inventory of surfboards and marketing. The risk is your stuck with the inventory and do not sell any boards at all. … then

What’s in it for the customer:

  • Custom, unique surfboards from top shapers
  • High quality compared to what is offered in the local surfshops
  • Less risk than ordering internationally(due to local laws and regulation)
  • Less hassle than ordering internationally(as we will do the import paperwork and taxes)

You have two things going on there…“what’s in it for the customer” seems like a good business plan or sales plan or whatever…but to do that I don’t know how you would be able to compete with local shops on price, even if you eliminated the custom aspect. You would be able to offer things they could not though, which has the potential to not only make some money but significantly contribute to your local surf culture and experience.

Quote:

However, there would hopefully not be all that much work to it, except when orders arrive when it will be a bit hectic.

Okay…my W.A.G. (Wild Ass Guess) is that you are wrong on this…unless nobody is interested and there is nothing to do because you don’t get any business.

Ask yourself “What business is it I’m starting?” You may say online surf shop…primarily surfboards. But you won’t be making them, running a shop, all that…you’ll be taking orders, giving advice and support, handling the overseas communications, shipping, paperwork, taxes, duties…what you are offering your customers is customer service!

You will be the face of the surfboard manufacturers, the shipping companies, the customs department…the delivery service. You will be responsible to your customers for what may or may not happen thousands of miles away, the possible mistakes in production, delays, shipping damage. I would plan on it to be a lot of work if it is successful. Which is a good thing, yes?

Nels

6

Ask yourself “What business is it I’m starting?” You may say online surf shop…primarily surfboards. But you won’t be making them, running a shop, all that…you’ll be taking orders, giving advice and support, handling the overseas communications, shipping, paperwork, taxes, duties…what you are offering your customers is customer service!

You will be the face of the surfboard manufacturers, the shipping companies, the customs department…the delivery service. You will be responsible to your customers for what may or may not happen thousands of miles away, the possible mistakes in production, delays, shipping damage. I would plan on it to be a lot of work if it is successful. Which is a good thing, yes?

very good point here Nels.

however, don’t forget that European customers, in general, aren’t as spoiled as the US ones. Returns are unheard of in many stores, and normally the best you can aspire to is store credit.

this is just an indicator of how, in general, a European customer thinks twice before he(or she) buys, but then handles things by his/herself, without xpecting the store chain, or the manufacturer, to do much (unless, of course, there’s something defective)

7

The main focus would be someone wanting ‘something special’. Since people are buying the surftechs over here I think that’s the yardstick for what a board could cost. On the other hand, I’ve already been in touch with a few shapers and I know if I order ‘a few’ boards at a time I can beat the surfshops on price on PU boards and still make some money. If I do I can also easily beat the price of a customer ordering a single board direct from shaper as we also save on charges for handling taxes by doing several items in one go.

The shapers we’d use would have to be a selected few that we can work with and thrust. If there are (repeated) problems with a particular shapers orders, we will not be able to work with that shaper anymore.

2-4 months for customs would actually be far better than our competition in many cases which is indeed one of the reasons I started thinking about this… However I think our slogan would be “worth waiting for” or something like that. We might have to require that the shapers have a turnover of less than four weeks so a order makes it on the next shipment.

A big part of it would actually be to contribute to surf culture here as you say, and offer a selection of boards that you won’t find on the racks here in addition to the typical boards, retro fishes and single fins, classic longboards, hulls, resin color work like swirls, custom sandwich boards, balsa guns, you name it. The one part I worry about is as you describe, it might be a lot more work than I intend and what to do when things do not go according to plans. So we really need a plan for how to take care of customers when things do not go as planned(board do not arrive in time, something wrong with the order, the boards sucks, etc.). I think the customer should get the choice of having the deposit returned or wait if it takes too long. If there is something wrong with the order choose the deposit back, reorder or a discount. If the boards is damaged, again money back, reorder or discount. A lot of this will be regulated by law which we have to account for. I’m really not the sales pitch kind of guy, so I’d much rather return the money to the customer than have an unhappy customer.

8
Quote:

however, don’t forget that European customers, in general, aren’t as spoiled as the US ones. Returns are unheard of in many stores, and normally the best you can aspire to is store credit.

this is just an indicator of how, in general, a European customer thinks twice before he(or she) buys, but then handles things by his/herself, without xpecting the store chain, or the manufacturer, to do much (unless, of course, there’s something defective)

I’m just thinking “custom”…it’s hard enough to please people given the difference between what they see in their heads and how someone else sees it…and surfers are surfers ;-)…if the customers aren’t all that picky then the rough equivilent of stock boards ought to satisfy them. Maybe especially if they are coming from overseas. I realize people have been surfing for a while in Norway and other places off the well-beaten track, but I think I can safely assume surfing is still considered a fairly new activity there among the local populations?

Media gets information everywhere, but to be able to see something in person, to hold something in your hands made by people half a world away…some of you guys remember the first time you saw a thruster? A shortboard? Reading about v-bottoms, and then actually seeing one? Or just seeing a Brewer…

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The one part I worry about is as you describe, it might be a lot more work than I intend and what to do when things do not go according to plans. So we really need a plan for how to take care of customers when things do not go as planned(board do not arrive in time, something wrong with the order, the boards sucks, etc.). How these cases are handled should be in an agreement which the customer signs when he orders a board and clearly described in FAQ on the website. A lot of this will be regulated by law which we have to account for.

The “world surf culture” is dumbed down to the point of thinking the logo is the thing…but it isn’t so with boards. Maybe, Haavard, maybe mixing it between orders and a few stockers…you could blow minds in Norway and avoid potential cash flow problems. Don’t worry about potential problems, plan for them. Workload is one thing…if you have partners you share, if youa re on your own remember it won’t always be that busy. I’ve always found that good, timely communications works wonders. Never let a customer “dangle in the wind” not knowing if or when his order will be filled…this is what kills so many surf businesses.

Shoot…this whole thing is getting me exicted…

Nels

9

I believe you have a interesting idea. It kind of sounds like a “shapers collective” to me. Price to me is always the key to good sales closely followed by quality. I’m embarking on a same quality cheaper price mission myself as I’ve being doing all the work myself. So please keep me up to date on new developments as it sounds quite interesting.

10

I’ve also considered carrying a ‘house brand’, either our own brand made to our specs by an OEM manufacturer at low cost, a low cost brand or popouts. I’d keep an inventory of 5-10 boards, especially in summer season. I would however reserve this for entry level/beginner surfboards and try to keep the price as low as possible. If/when the customer returns for another board I’d advice them to go for a custom. The con with this is higher initial investment and I think it may hurt the credibility of the business as a customs business.

As I said, I’m not ready to quit my day job. If we’d sell one board one month, five another and none another month that would be just fine. If the business is ‘too successful’, I wouldn’t know what to do.

For those who want a board just now, we will not be the place to come to. However if after a waiting time the customer can hold in his hands a board he would otherwise only find in surfmags or when traveling and knowing this one was made especially for him, I think we can be successful.

11

the generic learners board can always be the box filler too… to help keep the freight price down for custom boards

12
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the generic learners board can always be the box filler too… to help keep the freight price down for custom boards

That is actually a very good idea, thanks!

13

this is a business. In order for you to ‘pull it off’ you’re going to have put more than a part time effort.

Ask any successful business owner . . . they didn’t have their weekends for themselves for years. A few have likened to to raising several kids at different stages, you got toddlers, newborns, teens, preteens, young adults and they keep on coming.

You can’t go part time on this.

The rule: If you can make it past one year with your business, you’re doing well!! Being in red or black doesn’t count, you have to make it neutral or with some profit. Most biz fold in a year.

It will take time and effort to build relationships with shippers. To get some insurance going, shipment insurance. Since you’ll be doing alot of this, you going to need to be strong and put effort into getting shipping down. Yoou can use freight airlines to drop it off to local airports.

It will take some people to run the websites, and maintenance / security. How about the computer guy to make sure your tools, the web server, computers and electronics are working? This is your portal to the world, your front door. Make sure no one or their dog sh!!s on it.

You’ll need someone to keep track of office stuff, bills, whats due, whats going on w/ this order, oh shaper X and glasser Y are taking a month long holiday to go wave hunting. Also you need to renew your business license is up and you need to review the contract for this year with Fed Ex. Oh and Detective Jones waiting, he wants to know information on The Mark (your best sander, you let go a few months ago for messing up your show piece Balsa by the Genius when he had a moments lapse of judgement by stepping on the gas when it should have been the brakes . . . and the white dust in the mini ziplock wasn’t cabosil).

YOu’ll have to handle book keeping, and keeping a strict lid on your accounting is tough. Financial planning and also figuring costs / outlays, and effects of volume and depreciation on equipment. being able to manipulate books to give you some cash when necessary and when not to make the most interest of money beign stored without stepping into illegal bounds is an art itself.

Pricing w./ shippint that competes with local prices . … that will get people in for sure. Amazon sells but the guys that don’t buy because their local book store offers the same but w/out extra shipping cost or wait.

You’ll have to do marketing and research in the industry / over lappign industries to go into. Plus you have to have a strategy and tactics to execute both your short term and long terrm goals.

In this you have to cover what other similar biz have, but something that differentiates you from the rest.

And what do people want? Some people will go to you because they’ve been to 10 other shops and they ain’t got the silver diamond nose guard, but you do, or you’re the only shop that has RR epoxy for a good price.

Or maybe there’s that awesome flash game on your site, that gets posted on to -ER mag’s forum and half the working populace on that forum gets fired for playing it. But word spreads, dude, go to Haavard.com, they have this Sick sick surfing game, dude you won’t regret it.

It doesn’t matter they’re on just for the game. Eventually one of them will realize, Oh snap I can get a hand shape by Lob, glassed at moonlight, for $500!!! and guys get free Mallorca girls calendar! Word!! In only 2 months!!!

S&M sales and marketing, not the other kind . . . this needs to be top. While you won’t be utilizing a sales force, but you will need to get some ads out there, get yourself known. What about a designer / graphics gal? You can’t have crappy ads that look like neo fusion 70’s and 80’s that bring chuckles in the American Midwest by posers who really think they know about surfing (surfers won’t make you most of your $$, consumers will)

You have to keep relations and watch on your shapers, glassers, sanders / polishers . . . just ask anyone in the surf industry who’s been burned or what not. Remember surf industry isn’t regulated like regular business / retails are. You’d have to check out how the surf industry works, what rules they play, what unofficial stuff goes down. What can they and you get away with and what not. Also remember to keep an open eye for the good people, because you’ll want them to be at your back when its turned.

Also relations with wholesale surf accessories and T’s. I’d suggest patagonia’s goods. You want the goods to draw people in, and run into your awesome selection of boards or to the customer counter.

Regular customer service is tough enough. HOw about ‘special’ customer service? Prepare for a mighty battle! But this is key, you win here, and people will pass on a good word. Unfortunately, many are wired to remember the bad stuff. You can offer 10 years of good service and good products, one screw up and some will always default to that one negatory moment. Also being able to read the individual customer . . . some like a mommy to hold their hands, others just want information, others don’t care as long as they get someone with a pulse, and few may respond better if she sounds hot, while others may want a guy with cali surf slang accent.

Also there might be unorthodox ways to give csutomer service.

I sent an to RR a month ago, no reply asking about a ? about RR. Nothing on their site about this. I got nathang (nothing). But I found my answer here on sways. And it was legit because it worked. RR may not answer their emails but Greg’s posting about his resin sparked enough Q & A, so that I was able to get my question answered. I got what wanted, indirectly, so hey I’ll use RR next time!.

There are posts in the archives about how to start a surf shop or how to run a surfshop. Look for those. Lots of gold in there. Because this is what you are getting into, a surfshop. I think there’s one by Doc . . .

It doesn’t matter if its online or brick and mortar, you’re getting into a surf shop.

http://www.swaylocks.com/forum/gforum.cgi?post=209086;search_string=business;#209086

http://www.swaylocks.com/forum/gforum.cgi?post=140469;search_string=surfshop;#140469

http://www.swaylocks.com/forum/gforum.cgi?post=137006;search_string=surfshop;#137006

14
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It will take some people to run the websites, and maintenance / security. How about the computer guy to make sure your tools, the web server, computers and electronics are working? This is your portal to the world, your front door. Make sure no one or their dog sh!!s on it.

You’ll need someone to keep track of office stuff, bills, whats due, whats going on w/ this order, oh shaper X and glasser Y are taking a month long holiday to go wave hunting. Also you need to renew your business license is up and you need to review the contract for this year with Fed Ex

I’ve thought about this idea last night and part of the morning…by keeping it small-ish and focused mostly/entirely on surfboards…by researching and minimizing the variables - as mentioned here by being able to use/open an account with ONE shipper like FedEX or DHL (check for area coverage as well as the customs stuff, because some of them are better than others and some would really make it easy for your contracted shapers)- I don’t see why this idea couldn’t work. Especially if you are targeting the low numbers of boards mentioned earlier.

The website thing is easy - Yahoo! for just one has easy simple packages that are dirt cheap, some include your own “storefront” (which I haven’t investigated). Figuring out your methods of costomer payment may be the hardest part. ANYBODY can make a decent grassroots website using their software and digital cameras or net photos (with permission). Add to that the general discussion thread about tracking orders…

Nels

15
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The website thing is easy - Yahoo! for just one has easy simple packages that are dirt cheap, some include your own “storefront” (which I haven’t investigated). Figuring out your methods of costomer payment may be the hardest part.

Payment would be through paypal, it’s the simplest option. I would not run online store system, I’d make an online form that end up in my email. The server I would run myself, I have fiber straight through my wall, dedicated IP. I would like to have a professional made website, but very very lightweight, mainly text with a few photos(No flash, no nonsense). Need to be easily editable so you can add some news and photos of boards.

For small business a license is actually free here. To do the accounting to be on the safe side I would have to hire someone which is not free.

One idea to draw the crowd to the website, put a webcam on the top of the hill nearby. It would overlook ‘a few’ breaks, however not the major ones. I’ve been thinking about that anyway.

I really do not want this to be more than part time business. If it expands to becomes more than I can handle, I’ll quit one way or the other.

regards,

Håvard

16
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The server I would run myself, I have fiber straight through my wall, dedicated IP. I would like to have a professional made website, but very very lightweight, mainly text with a few photos(No flash, no nonsense). Need to be easily editable so you can add some news and photos of boards

Havard,

Seriously, take a look at Yahoo small business solutions…for $20 USD a month or less you use their servers, their website creation software (includes graphics) (no need for html coding), several email accounts, access 24/7, incredibly simple to upload your photos and make changes. Their more recent software (Sitebuilder, I believe) allows video etc., and none of it precludes your own html work. It’s as simple as logging in…from any computer anywhere in the world.

I have friends here in the States who have paid “professionals” to create their business websites…they may know website creation but not the business they are creating it for. It seems to average about $400 USD for the site creation, plus the regular costs, plus more $$$ for content changes. With my bad math that seems to me like they could have done the same thing themselves at a fraction of the price, plus had total control of their site.

Website cost and creation is something you have to figure in as part of your overhead.

You are in a unique place and time, and this seems like a great opportunity.

Nels

17

Hello

we are a surfboard company based in france and currently shi boards across europe.we would be more than happy to work with you

here are a few problems we see based on our experience

1 shipping needs to be at least 3 boards at a time this saves on cost and makes sense

2 beware some shipping companies wont allow surfboards and some only ship by road so it ends up taking time

3 make a good order form so there can be no grey areas when ordering

as for usa or australian boards being better mmmmmmm well we ship to the usa so we cant be too bad

the idea of stock boards was a good idea too

if you want to see more mail me

we make all types from stock production models through retros acid washed resin tinted beasts longboards and original balsas made the old ways

plus bags and wax

we believe strongly in keeping the chineese in china

thankls

David

www.utopiasurf.eu

18
Quote:

as for usa or australian boards being better mmmmmmm well we ship to the usa so we cant be too bad

the idea of stock boards was a good idea too

if you want to see more mail me

we make all types from stock production models through retros acid washed resin tinted beasts longboards and original balsas made the old ways

Again this thread…back around the early 1980’s…1983-ish if I recall…there was some great small-tiny wave surfing being done in places like Florida. Photos existed. Visits back there showed fairly unique homegrown equipment. I toyed with the notion of selling some Florida board lines in California…figured repping them to existing surf shops would be the low cost way to do it (the internet being in the future)…preliminary inquires to California shops showed near-Zero interest as Australia was the rage, everybody was going pro, blah blah…

But the idea was a good one…expand outward now to other surf locales…some say the battered soul of surfing may well be regenerating… in the UK…an International Surf Emporium somewhere? Still hard to make happen in a place like California, so jaded, so commercialized. That’s where Havard has such a nice deal…at this stage it should be wide open there.

Nels

Edited to add:

Another night gone by, still with thoughts on this…my bit about Florida boards back then…in historical context there was still West Coast USA lack of acceptance of East Coast boards…for no good reason…there were great surfers back there then but this was before an East Coast dominance of world surf contests…my thought was cross-cultural stimulations with board designs…very much like what Havard could potentially do in Norway right now…but as a business model…holy crap…that’s what Surftech and those guys are doing…

So to stand out from that I guess the boards would have to really be “hands on” from the shapers…getting too complicated for me…

Nels

19

I dunno… I hear people talking about how much stuff they’re going to sell over the internet. I’ve been asked many times to write business plans that show internet sales. I can’t do it.

Some things lend themselves well to online sales - like books, DVDs, tee shirts, toys, etc. Surfboards? I don’t think so. People want to touch them before they commit. Even when you order a custom, you want to see an example first. Boards sell in surfshops because people fondle them and just have to take the new object of their desires home with them. You don’t get that on the web. And there are a thousand other guys competing with you.

Good luck though.

20

Hey Haavard, I’d been looking for this site for you the longboard room. These guys import US longboards to the UK. I don’t know what size their outfit is but they seem to be doing a pretty similar thing to your plan.

Tom