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Location, Location, Location

Lorainfurniture

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I thought I would expand a bit more on some of the points in my first entry.  This part will focus strictly on location, and set up of your space. 

 

First, Ill tell you where my store is located.  My place is located on a main corridor; you can drive clear through town on my street.  I am about 50 blocks away from downtown, in a poor/working class urban area.  15 years ago when I started, it was a proper ghetto, however, in the last few years my neighborhood has begun to gentrify.   Ideally you want to find something in a similar area.  Don't forget who will be your main customer, people who can't afford to buy new!   Of course, no two cities are alike, and your situation may be completely different.  Use your best judgment.  Its obvious that you don't want to be in the middle of nowhere, regardless of how cheap the rent is.  Cheap rent means nothing if you can't generate sales.  You also want to avoid getting on the hook for a lot of money every month, whether it be rent or mortgage.  

1. Highly populated area

2. prefer on a main corridor with good traffic, but avoid roads that seem like mini highways. Your customer many never see you!

3. Be close to your target group of customers. 

Great! so you found which neighborhood you want to be in, now time to look for the actual space.  Having a 1k sqft space is just not going to cut it.   You have to understand that operating a store incurs a lot of FIXED expenses.  Rent, lights, gas, insurance, licenses, phones, internet, and employees.   All of this stuff is called overhead ( ill discuss this in more detail in another post).  A smaller store may be a bit cheaper to rent/buy, but most, if not all, of the other expenses will be just about the same.  The amount of merchandise you have on the floor will directly affect how many appliances you sell per week.  

You can make a living selling out of a 1k sq ft store, but at that point, you will likely make a better living just doing service work.  ( less stress too!)

My store is around 5,500 sq ft. 2300 of it is actual showroom, about 800 ft occupies my ebay store, another 600 for my testing area,  and about 1500 is storage.  I have a small office, and a few utility closets/ bathrooms.  My store has physical walls dividing it in to those four quadrants, so I can't really change much about it.  In a perfect world I would have 4000 ft of showroom, 500 for testing/ fixing, and 1k for storage.   

The store you are looking for should have 1 LARGE showroom. You can't be walking customers upstairs and around the corner.  You should be able to have several rows of appliances, every 20 appliances there should be a small isle.  

Refrigerator section: 

I have about 20-25 refrigerators on the floor and they are all plugged in and running.  They seem to instill a lot of confidence in the customer when they see it, feel it cold.  That said, you need to have a double outlet every 36" .  You should try and run as many separate circuits as you can.   You also need to have access to water to test ice/water function.  

Stove section:

Needs to be near (arms length ) to fridge section.  Dishwashers are also displayed here, along with otr microwaves,  table top microwaves. 

Washer/ dryer section:

I like to have stack units in one area, and match set washer and dryers in a section by themselves.  The odd stuff/ budget models are in another area.  

 

Generally speaking, you are looking for a store that is well lit, large space, and has/ is a legitimate storefront with large display windows in front.  Wide doors are a must, a 36" front door is doable, but some of these larger units won't fit unless you strip the handles. Ideally commercial double doors, or a 40" door would be great.  A garage door would be a blessing.   Your location should have easy access to parking, it doesn't matter whether street or parking lot.  If a customer can't easily pull over and browse your store, they won't.  Your location should be easy to find, and have the ability to put a fairly decent size sign up.  

 

Once you find your building you should figure out if the building is for sale.  More often than not, a property owner in the ghetto will bend over backwards to sell a property. They will often finance you, with little or no interest.  The nice thing about buying is that eventually the payment will stop. And then you actually own something equitable.  Rent will continue for eternity, and will go up every year based on your level of success. ( you think landlords are stupid?) 

 

 

 

 

 



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Samurai Appliance Repair Man

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More great info! Detailed, specific and very well written! This post and your last one seem like very comprehensive guidance for starting and running a successful used appliance business. Thanks again for taking the time to write this up.  

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It sounds like we set up our show room in a very similar manner. I don't currently do much with dishwashers, as I've found them to be quite the headache. I ramped them up a couple months back and sold 9 that month but 3 were call backs and 1 was a full refund. We made an extra $2850 (7 out of 9 opted for my $150 install service) but it accounted for 40% of my call backs and 50% my time in the field doing warranty calls for about 20% of my profit. I only see being able to provide them effectively if I can get a full time tech trained up to service them when necessary.

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