Alright kids, here’s the bad news–you can’t start a skateshop without a bunch of money. I know someone who started a shop with $40K that he put on credit cards, but that’s pretty risky. Not only will that not be enough money for most of you to successfully get a shop up and running, but putting it on credit cards is going to ruin your credit and you’ll be stuck with some outrageous interest rates.
The cost of starting a skateshop depends a lot on how you want to do it. Here are some things to consider:
1. Retail space. Nice space or barely adequate? Are you going to have to build it out, redo it, or can you use it as it is? Small space or large? Where’s it going to be located? If you want a nice store in a nice place it’s going to cost you. You could easily spend $100K just building out a place. If you can find a space that some other retailer just moved out of and that works for you then you can save a ton of money that you can put into inventory or something else.
Even if you think you can just move into a space without spending anything on fixing it up, I’d put at least $10K in your budget just in case. Trust me, you’ll find things you want to change and you’ll be surprised how much it costs.
And then there’s the monthly rent. This can vary a lot depending on what neighborhood in what state you’re in. Around Salt Lake City, Utah, a nice spot costs between $3-6K per month, and that’s not in the mall. What it costs where you are I can’t say, but call a few real estate people and you can find out quick enough.
I would plan on having 6-12 months of rent saved up just in case you need it. If you only have 3 months of rent you might go out of business not because your shop isn’t doing well and progressing, but because you didn’t give yourself enough padding to pay the rent long enough to get established.
2. Inventory. If kids are coming to your store and you don’t have anything, telling them “I’ll have more stuff soon” isn’t going to do much. You’ve got the best chance for success if you can open the doors and it already looks like the place is bangin’. That means somewhere between $50-100K worth of inventory. Anything under $50K is going to look slim.
3. Employees. Employees are expensive, especially if they steal stuff or don’t work hard, two problems you’ll likely experience if you’re running a skateshop. Sure, you can be the only employee all by yourself, but how long do you want to do that for? Don’t think you’re only going to be working at the place while it’s open. You’ll be there before and after for a while, especially when you’re just starting. And at first you might not be making a lot of money so you’ll need to have a few months worth of payroll saved up. Even if you’re the only employee, you probably can’t work for free, so plan on being able to pay yourself something.
4. Utilities. It might cost $25/month for your apartment, but electricity and gas can cost $500 per month for a retail space. Then you’ve got phone, fax, internet, etc. I’d put somewhere between $500-$1,000 per month in your budget.
5. Fixtures. Shelves, display cases, tables, clothing racks, etc. That stuff ain’t free. I’d recommend picking it up used or have a friend who knows how to weld or make nice things out of wood make some for you. The stuff you buy brand new is overpriced for sure.
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All told, if I were starting a skateshop I’d try to start out with about $300K. Considering that some people have made it work with $40K you might think that’s over the top, and you might be right, but I’d rather have too much money and not know what to do with it than not have enough and end up going out of business. That said, if you’ve only got $100K I would say you’ve got a chance of making it, $200K gives you a good chance, and $300K would give you a whopping good chance unless you mess it up somehow.
Or you could sell out of your apartment like a common drug dealer.Very low overhead.Straight cash ,homey!(No R.Moss).
I should have mentioned that most companies won’t sell to you if you don’t have a retail space already up and running. Volcom, for example, won’t even talk to you until you’ve had your shop open for over a year. Most others won’t let you place an order until you have photos of your shop with the sign and such. And most of them require a minimum order. In some cases that is as low as $500, but in other cases it can be $5,000.
Well nearly any business, apart from the ones you can work at home from, cost a lot of money. A skate store is no different, but like you said, can be more pricey then others – it’s up their with the clothing stores who also go through the problems of minimum orders, open stores, and what not, but they usually do need a bigger space.
I would love to have my own skate store one day, but it’s second to having my own design firm, after some experience and finished school, maybe then.
Great blog, has some very interesting articles.
darn, seems like i’m doomed then, hehe. I started out in june 2006 with ca. $17000. But seriously, I’m still around, it all depends on how big your scene is, how many copmetitive shops are around etc. and how much you’re willing to work. Be creative, that’s what skateboarding is all about (yes, i know business is business, but being creative gets you a long way). It’s important to have a nice/cool website in these digital days, that can help a lot. Have contests, put together a team of the local rippers and if a kid breakes a kingpin, have mercy on the unfortunate and give him a new one. Next time he needs new shoes he will remember who’s who in the skateshop-jungle.
I have a well established skate shop in Iceland,due to health problems im forced to sell, its been open for 4 years, and does very well,i have good realations with alot of distributers as well as being a distributer myself, if anyone is interested in buying or knows someone interested please get ahold of me. Thanks
I have a well established skate shop in Iceland,due to health problems im forced to sell, its been open for 4 years, and does very well,i have good realations with alot of distributers as well as being a distributer myself, if anyone is interested in buying or knows someone interested please get ahold of me. Thanks
Hey Michael,
I am doing my research to start up a skate shop in CA. Sounds like it might be difficult to get most companies to sell to you if you don’t have a retail space already up and running. Volcom won’t talk to you until you’ve had your shop open for over a year? How accurate is that. That makes it impossible without the right connections. Since you are a distributer yourself or know other distributers, how accurate is this and what are your guidelines? Would love to talk to you. Thanks.
Me and my friend are going to open a local skateshop next year. we already talked to the Attorney this week to set up our Co. first. please send me email so we can ask you more questions about starting the business. because we really feel that there is nobody can give us good advices. thx
Maybe you need to ask for the advice the right way. You see, asking someone to contact you to give you advice isn’t the most tactful way to go about it. I mean, I get tons of emails all the time and don’t have time to answer all of them seeing as how I’ve got a job and have to support a family and all that.
But there is a way to get what you’re after. You already can see that I have a blog, so I must enjoy writing. And I’ve already written some tips for opening/running a skateshop, so I must enjoy writing about that stuff. So why not just ask me the questions and say something along the lines of “If you need some inspiration for future posts on your blog, here are some questions we’d love to hear you answer…” That way, you’re helping me to come up with more content for my blog and I’m much more likely to respond to your questions that way.
Also, if you ask the questions on the blog, there’s a good chance somebody else who’s reading can respond, and then you’ll get two opinions instead of just one.
If you need some inspiration for future posts on your blog will you talk about how to get the money. like how to get a loan to start . its near impossible to save up that much even with a very good job.
My long term goal is to start my own skate shop. Right now I work at a snowboard/skate shop, but one day I want to own my own.
Your tips are inspiring, but the 300K price tag is definitely a high one. A good, sobering thing.
At work everyone I tell about my dream says the same thing:
Skateboarding doesn’t make you money. The mark up on skateboards is so low that at my company they support snowboarding way more than skateboards and accessories.
Its sad.
i have been working for the last 4 years , for my dream skateshop but i have 200k and i am still not sure if thats enough and i dont know i can get the numbers of brands and such. What do u think i should do? thank
I’m pretty close to starting my own skate shop. I got 50k. Right now I’m trying to find the right companies to buy from. Is there anything you could suggest…. Thank you!
Start out with what is popular first. You can’t afford to have a bunch of inventory sitting around. Talk to the kids who are going to be your customers and find out what they’re most interested in.
My husband and I are already in the process of planning to open a skate shop. I am a marketing consultant so I feel I have a leg up in the planning stage. We live in a rural area and there is no competition in the market for boards or accessories here (unless you count Wal-Mart, and I do not). My brother-in-law has a clothing company ( I Love Cops) so we have that advantage as well. My questions is, with not needing a massive amount of inventory (because of some what limited customer base) what are the regulations for purchasing surplus inventory from an established shop or one going out of business? Will we still need to be registered as a distributor to carry certain brands?
I wouldn’t be too worried about any sort of regulatory issues brought on as a result of reselling surplus inventory from another shop (there really aren’t any). What I would be worried about is whether you can sell the stuff. By definition, surplus inventory is inventory somebody else was unable to sell, so what makes you think you’ll be able to sell what they couldn’t?
The fact that we live in an area that is considered rural and people who are commited to the scene have no other option, they seem really excited at the prospect of decent name brand merchandise, regardless if it might not be the newest item on the market. I believe it will also allow us to be slightly more affordable for the young people in the community who are trying to make purchases by scraping together their allowances. Ideally, we want to carry only the best products in time, but this area is growing and we’d like to establish our niche now.
Ok let me be point blank, starting a skateshop is a worthwhile cause. The low markup and 0 customer loyalty is a lose lose. Kids will always be on ebay or internet buying 10$ blanks and cheap skateboards online. As soon as you buy your first 100 decks for your shop they are stale in 2 months and kids want to know why your not buying new stuff. The skateboard business is the worst business ever and i wouldnt recommend it to my worst enemy. Its long hours and unless you like chatting with chatty kids all day and stinky bo ridden groms who hang out and dont buy dont do it. Youll open your doors and soon realize you worked 10-8 and sold a packet of hardware and 1 sheet of grip to a grom who bought a 34$ bam deck on eBay. TRUST ME DONT DO IT!
Whoa Chad, it sounds like you had a bad experience. I have only had one bad day working at my shop. I understand there are a lot of kids out there that come in and ask you every question they can think of, but most likely it’s because they don’t feel comfortable asking anyone else, and if their not distracting you so their buddies can steal stuff then they just want to pick you brain. The question that kills it for me is when the kid says “How much do you pay for it?” it’s always the kids, the parents know better. Yeah I get a lot of kids that buy stuff online, but you need to address it. My business philosophy is simple: Every problem that presents itself to me is an opportunity to improve the way I do business.
If you hate chatty kids hire a hot girl and they will talk a lot less because they don’t want to look stupid, or hire a chatter guy that fills his head with all the latest info on everything skate related, make sure he can multi-task. Sure it’s long hours its a retail business, hire some employees and take a break every once and a while, just make sure your store is covered.
Yes, it’s true this business has a low markup similar to wholesale, good thing you’re in it for the right reasons. Seriously your customers are teens and the parents of teens, chances are they have a limited budget and need to bargain shop. You need to offer everything you can to ensure that they will shop at your store over the internet or a mall chain. Good friendly informed staff can do a lot to aid your business and service is always a top priority at my shop. You’re going to have a hard time paying the bills if you try to beat every price on the market so don’t focus on something that will cause you grief and stress, there is a reason why people buy online and there is a reason why people would rather go in to a shop. Offer everything that the online shops can’t and you’ll be just fine, besides you really don’t want someone in your shop complaining about prices and telling everyone about this website they found etc. It’s lame and annoying and of course their not going to buy anything, but for some reason their at least propelled to visit your shop so take it as a good indication that you’re on the right path.
So think it through, be very critical or yourself, your skills as a salesman, shop owner, board tech, etc and if you can’t do something then either learn or hire someone else to do it. I’m not going to try to encourage someone to do something they don’t feel comfortable doing, so if you don’t think you can run a shop and deal with cheap chatty kids and still break even after a year, then don’t. I can tell you this at least, your shop will make an impact on the town, the kids, you family and your sanity, but no matter the outcome you’ll make at least one person happy if you open up your shop and that’s what it’s all about.
Good luck out their, don’t get discouraged with the way the market is and stay positive, remember a lot of people are counting on you and want you to succeed.
Chris
Indoor skatepark and skateshop for sale-N. Florida location, great following. email for specifics
What is the standard markup for skateboards and accessories for both online and retail shops in Southern California? Just trying to get an idea of what my average net would be if I sold 100 boards, 100 trucks, or 100 wheels not counting any other costs.
This is such @#$@#$#! If you have a tax id you can order from any vendor. Plus you don’t need that much money to start up a shop! sure it’s nice but you spend 6k a month on a retail space as a skateshop owner that doesn’t have space for a skatepark….your just plain stupid! I started my shop/park up for 86k Ramps,partition for the shop space. Everything the whole shabang a bang!!! with only 15k in inventory and have been open for 7 years. since then sure i’ve increased to about 120k in inventory and new park designs. But this isn’t rocket science people! If your hiring people to outfit your skateshop retail space before getting out there and painting and fitting it yourself for a budget! You are in the wrong buisness my friend!!!!
me and my 2 bro opeand a shop in los anglies by the beach it a surf/skate shop and we sell snow boards there too. we have 150k in stuff and our rent is 4000k a month also w
There’s a local shop near me and they’re so unprofessional it’s embarrassing. I actually made a conscious decision not to do things with them anymore based on how bad they are at business stuff. If you walked into a store and saw someone wasted drunk at 3 in the afternoon would you buy from them? Doubt it. And they leave unprofessional and childish sounding messages to reps and are shocked when they don’t hear back. Their response is “I guess they (the rep) don’t want to make money!” But when they do get a rep that calls them they get caught slipping and don’t know how to act. You should do a post about not letting your shop be a clubhouse. And making sure you have a competent and professional employee who cares about the business even half as much as you do.
Grafjam,
Didn’t see your e-mail address listed. Please post it so I can get in contact with you.
Hey my name is joe, thanks a lot for the tips! im looking into opening a shop in brooklyn in about a month. i was just wondering how much profit on average shops make? how much inventory cost compared to what its sold for, for example how muchwould 50 pro decks cost?
thanks a lot
Thatslifeskateshop.lefora.com
myspace.com/crazyskatesomerset
I am looking to open up a shop in Long Island on the North Shore where there is hardly any shops or skateparks for that matter. Although there is a lot of bored suburban kids and skaters. I think a skatehop could add a lot to the community here. I was wondering if it is a good thing that there is not a lot of competition here or a bad thing. I am in it because I love skateboarding and want to support it as an outlet for kids but I am also wondering if I can in turn make enough money in order to survive?
yo how the hell u exspect teen agers like me an all the other kids who just wana sk8 and have something to do with skateboarding to make 300k befor we go homless like for real any sugestions ???
Sure, here’s a suggestion, why not get approved for $50K in credit cards and max all those out, borrow another $150K from family and friends and spend it all, fail to pay rent for several months and rack up another $30K there, fail to pay your suppliers and rack up $70K of debt there, and then go out of business and have to work three jobs the next 20 years of your life to pay off the debt you owe to everyone? Or…save up the $300K first and then if you blow it all, at least you don’t spend the next 20 years living through hell on earth. Plus if you spend your own money rather than that borrowed from others, you tend to make better decisions and you might end up being successful instead of going out of business.
i want to opening a retail boutique specializing in the sale of athletic footwear/state style and street wear fashion for the young and young at heart. This store will be like no other store located in ‘spoiler’. It will be the only true lifestyle stores in ‘spoiler’. The store will emphasize the sale of limited athletic shoes and an assortment of men’s and women’s clothing and accessories. We will provide consumers with technical aspects on the proper make, model, fit and style of athletic footwear for their various needs. The store will be the only street wear boutique of it’s caliber with quality, and knowledgeable sales help in this city of 2.2 million people. Our goal is to be the headquarters for the cities street wear, lifestyle fashion and art. being one of the largest city in the U.S, which has over 2 million people within a 600 sq area, fashion and a sense of identity plays a major role. Alongside having a strong business plan I also have a superb marketing plan that spans across the state.From being in the fashion industry for over 4 years I have learned the interior and also exterior of the industry. I am certain this would be a prosperous and lucrative venture for the investor and myself.
1.i have such a solid idea but no money really.how in the world do i get a loan/money for 120-300k
with nothing to offer?everyday i wake up with this idea and people saying i should do it,but i don’t have they money.it’s as i created the wheel or the ipod,but don’t know how to get the funds to produce it.thanks in advance
To save a little extra money is it legal to live in the shop for a while,? For example, if you have a little extra room in the back, and the other basic necessities. At least until your established and start making a good profit?
I’m currently the buyer for a skateshop that’s been open for 14 years, and I’m about to open my own shop.
Here are some things you should all know:
Don’t just jump into a shop, work somewhere in the industry first. The relationships you build with reps are what’s going to make it/break it for you. Shoe minimums are rough. You need to know people who are willing to break some rules for you.
If you’re trying to keep a low inventory, or can’t open accounts with companies, try to open up with a middle-man style distribution i.e. eastern or south shore. Your margins won’t be as good, but at least you will be able to get pretty much anything. And as long as you’re willing to pay the shipping you can special order stuff for people, and you’re able to say “we don’t have that today but I can get it for you in 5 days”
Order less and order a lot! People love to see new shit. Small frequent orders are the best way to do it, even if that means you’re taking a hit on the shipping. Pay attention to your reps emails and build some good relationships, you’ll probably get free shipping here and there anyways.
That being said, building relationships is a recipe for success. Loyalty in the skate industry is a pretty big deal, and reps are usually real nice guys. They will take care of you.
the guy who wrote this is such a fag
u dont need 100 thousand dollers to start a shop u need a business loan of like 25k
u dont need shit to bepacked ur first day and people dont expect it to be
I’m trying to start a shop in salem oregon in about 3 years. I’m getting out of the army and I’m getting a veterans loan of about 150,000. But I don’t know were to go to buy all the boards in mass amounts. Any tips or tricks please email me. I want to be the best…
I correctly marketed my shop BEFORE ever opening. To the point that kids at skate parks were talking about my shop and brand before i even got the website up. Then i got the site up and store open, and all for under $5k and i have more customers and celebrities wanting to back our brand its overwheming.
Its not about 500K its about brains, and using them.
No offense, Sir Real, but you don’t seem to carry much stock of any note. No ‘brand name’ decks, 2 types (not brands) of wheels & 3 truck brands. You seem like the furthest thing from a core shop and much more like a mall one.
Where is that ‘celebrity backing’ also? Just because you call yourself “Mr. International”…doesn’t mean you are.
So here is the deal, I am looking into starting a skate/longboarding shop near Cal Poly Pomona. There are no other skate shops near by but neither are there any skate parks. The biggest customer base is the college which is less then a half mile away. However, I frequently ride in at the college and on a weekly basis I figure that there are about 400 people who skateboard and longboard per week. I have already spoken with the land owners of the retail space that I was looking into and there price per month is roughly 1,500 dollars. I figure to add 500 per month (at most) for electricity and another 2000 for an employee (part time) and another 500 for insurance. Now I realize that I have padded these costs against my favor but thats ok I am just trying to do a sanity check. That comes out to be 4,500 a month. So, before I get too serious I was looking to find statistics for price markups on skateboards and clothing sales to figure out who much inventory I would need to move to break even. Does anyone know of such a sight I have been having so much trouble finding these numbers and they are the next step for me in this venture. any help would be much appreciated
This article is so absurd. It really depends on the size of the skate shop. Commercial space is cheap as heck if your looking to open a small skateshop that has a stock of 50 decks, accesories like trucks, a few clothing racks, some hats, and about 30 shoes, some skate dvds, sunglasses etc. the store does NOT have to be huge. If you fill a small space with a lot of stuff, its better then having a large store that look empty.
My point is: you can obtain a nice commercial space for 1000/month ..I’ve seen some for 700!
And when the article said you have to pay for advertising- like posters, signs etc. thats BS. your venders WILL love to hook u up with posters, signs to help u advertise because it also advertises there company.
I’m 24 years, graduated last year in Finance, and obtained a 35k loan, and I have been in business (I own a skate shop) for almost a year now, and I have had NO issues when it comes to selling products/making my quota. If you love skateboarding then you know what’s popular and whats in demand… If you dont know anything about skateboarding then maybe you should open a business that interests you/you know something about.
KIDS, dont let this article fool you. Obviously the person who wrote this had either a bad experience, has felonys and cant open a business(LOL), or is in need of an education
You CAN open a skateshop and be successful with…35k…bottom line..Im proof.
Good Luck
Where’s your shop located, Stephen? Location can make a lot of difference in the cost, but if you got started with $35K more power to you. My friend who has a successful shop (and therefore knows what he’s doing) spent $300K opening a second one and went out of business during the downturn. His rent was over $5K per month. It wasn’t a huge location, but it was new, and in a good spot, and therefore a bit pricy. So apparently sometimes $35K is enough, and sometimes $300K isn’t enough.
Come to think of it, I actually know 1, 2, 3, 4…maybe more shops that have gone out of business in my area in the past few years. And they all had a lot more than $35K to get started, and they all did well for a while, but the downturn put a lot of people under. But if you’ve got enough money, then you can ride bad times out and come out on top once it passes. So again, having “enough” money, whatever that means for your situation, is a good idea.
who ever wrote this article is an IDIOT!!!!!!!!! $50,000- $100,000 just for inventory??? are you nuts??? i couldnt even fit fifty grand worth of merchandise in a regular shop, thats a load of shit, dont let this article discourage you. A retail space for $3000-6000 a month??? i can rent a 10,000 sq ft space for that but why in the hell would any one need a space that big for a skates shop??? $400-1000 a month for a space is perfect. this article is a crock of shit.
Maybe where you live real estate is a bit cheaper than here in Utah, although I can’t imagine Utah is anywhere close to being the most expensive market. Perhaps in some parts of the country you can get a hole-in-the-wall place for under $1,000/month. Here in Utah you can’t even get a hole-in-the-wall place for that cheap. Even now in the midst of the recession it would be hard to find a decent spot for less than $2,500. Before the recession, when this post was created, it would have been difficult to find a good spot for under $5K/month. A prime location would have cost $6-7K per month.
As for inventory, let’s do some math. If you think you can start a shop with 10 decks on the wall, fine, that’s only $450 worth of inventory at wholesale prices. But if you want to look like you’re a real shop, you’ll want to have 50-100 spots for decks, with each spot having 2-5 decks. That means 100 to 500 decks, or $4,500-22,500 worth of inventory in decks alone.
Shoes? You’d probably want 20-50 different models of shoes, each in 5-10 sizes, and probably 3-5 of each size of shoe. At a minimum that means 300 pairs of shoes, and if you’re going all-out you could be getting 2,500 pairs of shoes. Assuming a wholesale price of $30/pair, you’re easily in at least $9,000 for shoes, and possibly as high as $75,000 if you were starting a fully-stocked, larger shop.
We’re already up to $14K with just two types of products. Then you add in shirts, hats, pants, wheels, bearings, tools, stickers, dvds, trucks, grip, hoodies, and you can get up to $50K pretty quick, and still have an inventory that leaves half the kids coming in saying “You mean you don’t have the plain Zero t-shirt with the white letters and nothing else on it?”
Now if you can start a shop paying $400/month for rent and with $20K of inventory then more power to you. Based on my experience and those of other shop owners I know, I think you’d be setting yourself up for failure. But hey, my experience is limited, and I’d be happy to be proven wrong.
This is abunch of bull you only need like 50k. 10 for inventory, 12k for a year of rent maximum, like 10k to start in like buying the place and painting and stuff and like 5k to hire ppl for like 2 months see you dont even need 50k and yes opening a sk8 shop would b fun and want to do it also
I think all of these arguments depend on your location. You can battle back and forth on prices to start a shop all day. But the fact is, if you start a small shop in a small town in the middle of a cheap state, then the numbers are going to be pretty low…. But if you want to start a larger shop, on (for example) Sunset Strip in Hollywood, in CA, then your numbers are going to be pretty damn high !! So take this article with a grain of salt and just consider the size and location before you start getting upset at people. just my opinion.
I just wanted to let you all know that have a dream can make it happen with very little money if you do it just right. A little over 1 year ago I was shopping in an old walmart store that was made into a Market Place for people wanting to open there own business but did not have a large sum of money to do so. These places are now popping up all over the place from what i hear. I rented a small space of 10×10 at $120/month and bought some peg board, found 3 glass cases on Craigs list (free) and wala i opened up on October 1st, 2010 with 3 blank boards hanging on my pegboard. Those blanks were ordered off of ebay.
Oh, i forgot to tell you that i am a single mother of 4 sons with 3 still living at home and i support everyone and get paid salary at my day job as a nurse. With my next check on October 14th i had sold those three boards so i took that money and a little bit more from my check and bought some more blank items. I took pictures of the small shop and within a month i started buying from 2 different distributors. Slowly taking my profits and adding just a little bit of my pay checks from nursing i kept adding. In 6 months i rented a space twice the size and also got a shoe deal. For the shoes i had to have a 2,000 order to place my first order so i did have to put a little bit of money back every month. Now it has been one year and i sell shoes, everything you can think of for skateboarding, and now i am adding long board items slowly. I pay 280.00 month rent and buy new products with the money i make from the shop to make it bigger. My goal is to open my own store on the highway at my 2 year anniversary but this was a great way to start. Most of the time i have kids help that need decks or whatever and my sons will help for less that others. I was paying someone to work weekends that was not related for a while but he was ripping me off blind! So this is just to let you know. You can do it. Just find the right place and love kids! They will know it and will love shopping with you. Good luck.
MG
MGboards@gmail.com