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This discussion has been pretty interesting to me as I also have thought about opening a hobby store. Now right off the bat I'll let you know I have more experience with 'gaming' hobby stores than trains, and you will never become rich beyond your wildest dreams opening a hobby shop. I do think the key to everything is being able to answer the basic questions of: 1. Why would people come to your store? 2. Why would they come to your shop rather than order on-line? 3. If there is more than one shop in your area why would they come to your's rather than the other one? Personally if I was going to open a shop I wouldn't specialize in just one genre, but would try to appeal to a wider audience. As some people have mentioned, planning is one of the most important keys. To really be successful you will need a lot more capital than most people would think. As it was mentioned; from day one you pretty much need a fully stocked store. You have to be able to buy all of the inventory and then wait it out until it begins to turn over. I also agree that in today's age you really are going to want a web presence also: increasing your market base, an outlet to push inventory that isn't moving, and over all helping you churn the inventory turnover. I'm going to have to argue it is the business savvy that is going to determine if you are successful or not. There have been too many stores over the years that just 'didn't get it' and were doomed to failure before they even started. I think Cash Flow, Unrealistic Expectations, and Apathy to Customers are the top killers of the hobby store. The 'Value-Added' is the key to compete against the mail order companies. Key points there is: 1. You have to demonstrate the product and encourage customers to use/play/try the product. One of the main advantages you have is that people can physically touch the product. Have trains, operating stock, and accessories out and working in the store. 2. Be knowledgeable of the product that you sell. How does it work, how do you get the most out of the product, how do you fix it, etc. It is all great and fine to buy that DCS system on the Internet, but if you can't get it to work what good does it do you? 3. Be willing to share your knowledge. If I'm going to spend hundreds to thousands of dollars in a hobby I want to be confident that I'll be able to build the infrastructure to enjoy the hobby. I can get a starter train set and run a train around a loop of track pretty easy, but where/what do I do when I need to take the next step. Is there someone who can take a look at my proposed layout and offer suggestions or advice, help me understand wiring, what types of product is out there and how it works? I think clinics and how-to demonstrations are great. The key, as someone has already pointed out, is to make them 'real'. When I watch someone showing me how to do something, I need to be confident I could go home and to some reasonable level do it too. You also need to make sure you keep your objectives in mind and adapt your game plan as things evolve. The idea of having the coffee pot and lemonade flowing is a good idea, as long as you don't end up with 4 or 5 coggers standing around your store all day shooting the breeze, drinking your free coffee, keeping customers from being able to get to the product, or even worse driving your potential customers away. Always determine who your customers are and tailor your retail to them. The concept that 80% of your sales come from 20% of your customers is pretty accurate. Make sure you're top 20% customers are happy! I know this is too long already, but one last thing is if this is truly your dream and what you want to do... Once you have a solid game plan and the funds to make it happen don't let people persuade you not to follow your dream. Remember there have been lots of people who were told they were crazy to try and start their business and drove on to be highly successful. Dave Thomas was told by almost everyone in the industry that he was crazy to build a hamburger chain because there was no way he could compete against McDonalds and Burger King. The founder of FedEx got a D- from a Yale professor for his business plan because "there was no way he could compete against the U.S. Post Office". There are hundreds of similar stories I'm sure. Good luck in your endeavors and remember, we are all pulling for you.
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