stove shop owners, where do you make your money at?

Not to discourage you, but between competing with an established shop that has been building a reputation for decades and has acquired an experienced staff of installers, as well as HD, Lowes, etc, and internet dealers, I would think that this would be a tough market to break into. I don't mean this as criticism--just wondering what led you to this idea? Do you have a lot of background in this field?

I don't know how shops make their money, but with the internet and the fact that there is always somebody who will ship anything anywhere, I think the margins on stoves must be small. You have to compete with everyone on the continent for stove price. Installation might be more profitable.

I could be wrong. But when I was roofing, and in the body shop part of the insurance business I do now, profits depend on several things rather than one.
Some but not really alot comes from sales of the item.
Next would be the same maybe more in profits towards install labor.
Then last but surely not least is the sale of repair/replacement parts & accessories & service calls.
To truly have a successful business IMO, you need all 3 of these parts equally in play.
If one drops off, you will surely feel it.
Once stop shopping/service is truly a winner in today's business environment.
Just my 2 cents, from lots of observation.

Try asking your questions of the company whose stoves you're considering selling. They must have a lot of insight as to what it takes to succeed. If not, maybe they're not the folks to be staking your future on.

There is not much profit margin is stoves. Like Hogwildz said repair/replacement parts & accessories & service calls this is reoccurring revenue. These are usually multifaceted shops, diversifying anything outdoor living. Selling stoves, grills, outdoor play set, patio bricks

tsquini said:

There is not much profit margin is stoves. Like Hogwildz said repair/replacement parts & accessories & service calls this is reoccurring revenue. These are usually multifaceted shops, diversifying anything outdoor living. Selling stoves, grills, outdoor play set, patio bricks

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x100
Diverse is the key word.
Need to sell for the seasons. Stoves in fall & winter, with the occasional in the warmer months.
Grilles, lawn furniture, wind chimes etc in the warmer months.
Maybe offer spring & fall cleaning scheduled services for the warmer months to assure readiness for the coming winter.
Never put all you eggs in one basket. Cause if that slows or dries up, your screwed.
Speaking of egg, I hear the Green Egg is a big seller.

As everyone has stated, you must have something for the shoulder seasons. You really need to shine and build a big referral business to be successful, which offers great service, installs and expertise.

I comitt upwards of 60+ hrs a week all year round installing hearth, selling it, building and delivering bbq's, running Q lines, servicing fireplaces, doing chimney sweeps and installing outdoor appliances as well.

All the while it not being my business. I just treat it like it is. I even do in home sales calls for the hearth end of things.

You must be a jack of all trades and master them all, because the amount of staff you would need to cover all the bases can be bloody expensive.

It can take a minimum of 100 000 to get the ball rolling, and that is nothing large at that.

Research long and hard and find a target market you can cater to. Have lots of money up front to buy stoves and other products at better discounts like 40 to 50%. Better margins is key.

Treat people the way you want to be treated. Install in their homes like it is your own, and the rest will follow. Price fairly, so when people compare, you are not out in left field. When that happens, you loose almost all credibility with customers.

I live and work by the above statement and am always busy.

HTH.

Despite attempts at diversification, our shop was really never able to make much on the other stuff.
A big rule of retail is that if anyone else (especially big stores) can sell it, you are sunk! Costco, for instance, had very high quality ss gas grills for sale at prices well under the WHOLESALE of what dealers paid.

The big box stores were never competition for our shop(s) in the stove area, because they had no knowledge, limited stock and only had stock in mid-season. Add in that they had no installation, and it basically never hurt us at all.

In our case, ALL the money was made in appliance and chimney sales. Glass doors and toolsets provided some extra income, but nothing worth bragging about.

We built up our business over many years - it probably took 5 years before it was really established at all.

Our business used a model that may be out of reach for many today - since we built up the size of the biz slowly and stayed in business while others around us failed, we were somewhat the "last man standing" for many years. We also had decent capital and a large warehouse...the bottom line being that we were able to buy things at the right prices (most retailers do not) and therefore sell them at the right prices (best prices around) and still make a very respectable profit.

Such a strategy could be tough in Alaska with high freight costs, etc.

Bottom line is that you have to be able to add something....of value to the customer. That could be advise, burning display models, house visits, installation, discounts or a few from that list.

Friendliness is a big part of it. If the other store is known for being gruff to customers or similar, that can help you greatly.

its all about location location....... you do not want to compete with too many same business as you do in the same area....

Webmaster said:

Bottom line is that you have to be able to add something....of value to the customer. That could be advise, burning display models, house visits, installation, discounts or a few from that list.

Friendliness is a big part of it. If the other store is known for being gruff to customers or similar, that can help you greatly.

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The `other store' is known for "advice, burning display models, house visits, installations," standing behind their products and installations, being willing to put things right if there's a problem, friendliness," as well as having been around for decades and likely to be around for a long time (some folks are on their second or third stove from them), a beautiful welcoming store (with a couch in front of the burning BK Princess) in a convenient location, carrying a variety of products across all price ranges (up to a 30K Tevliki masonry stove, with an employee who has expertise in the product), wood stoves, pellet/grain stoves, oil stoves, gas stoves, cookstoves, stovepipe, hearth products, spitters, saws, small engines sales and repairs, woodburning education, providing references for related services, being part of the community including involvement with sports and schools; providing a venue for local artists to display and sell their work, smart, helpful, knowledgable, certified, factory-trained, caring staff who greet customers by name when they walk in the door. . .

Not trying to discourage commerce . . . just sayin' that when it comes to an expensive purchase like that, most folks want to know the people they're doing business with, and know that they're going to be around for a long time to back the purchase. There's a few nightmare stories on here about people who paid down a deposit on the stove and the store went out of business before they delivered--or got their deposit back. You might consider trying the installation/saw & small engine repair part first, and see if you can build a loyal customer base that way.

We have a large closet in the back room at the shop with a pressure latch on the door (really looks like a wall) where we run the printer and do the cutting....OOPS Excuse me, I see you were asking about stove shops, sorry.

Ed

Intheswamp said:

We have a large closet in the back room at the shop with a pressure latch on the door (really looks like a wall) where we run the printer and do the cutting....OOPS Excuse me, I see you were asking about stove shops, sorry.

Ed

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Are you making your own paper too? How are you handling watermarks and other authentication items?

Are the bills easy to pass?

Are you willing to franchise?

Youth wants to know.

Peter B.

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On a more on-topic note...

I wonder if it would be feasible to open a 'cash and carry' stove shop - stipulating up front that no installations would be made, and only stove warranties honored.

Is there enough wiggle room in the wholesale price structure to offer 'deep discounts' on name brands? Would nearby full service shops be outraged? Or might they benefit from increased installation sales?

Peter B.

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As I recall, Fairbanks has an air pollution problem in the winter. Beside all the other good advice you have received in this thread, I would suggest looking down the road at what kind of burning restrictions might be in the pipeline or simply exist as proposals. They could reduce the market for wood stoves. If there are any out there, you will have to make an informed decision on the likelihood of their being enacted. I know Alaska isn't big on regulations in a general sense, but sometimes they happen.

Be cautious.

Pen, you beat me to it. Sell the product but also sell the consumable fuel for said product.

Yeppers. I've gone into said shop and had Kent send me elsewhere for a product at a better price. That's the kind of thing that aquires a customer loyalty that would be hard to compete with. I just hate to see folks going into business for themselves in a tough market unless they have all their ducks in a row and quacking in unison, or the results are pretty painful to watch. And given that these folks have been in business for 20-30 years, get a lot of their business word-of-mouth, and have a remarkably diverse product line for this neck of the woods, it would be tough.

If you could get a guarentee of exclusivity from that specific manufacturer, then you might have a more promising situation.

Pen's notion of a place that sells seasoned firewood is worth perhaps considering? If someone took on a `wood broker' role where the mom-and-pops knew they could market all of their green wood, and the consumers knew they could reliably purchase seasoned wood, I think the middleman would be filling a unique niche. And if that broker had an additional product to sell, each cord could go out with a flyer about it.

AKSHADOW said:

Hi,

I am doing research on opening a stove shop in my town and just wondering where other stove shops are making their money. The biggest one in my town does small engine repair as well and I'm starting to think that's where they make a lot of their money. Feel free to PM me as well. Just trying to see if shops are making a living feasibly just doing stoves and installs. Thanks

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I think it kinda depends on the kind of town you live in. My town is quite suburban and full of upscale retirees and yuppies. (I fit neither category BTW) The stove shop here sells patio furniture and grills but where they put their biggest advertising dollar is the gas stoves, gas logs, etc., which makes me think that's where they make most of their money. The recent radio spots talk about the romance of the gas fire and how inconvenient it is to have to go get wood or clean up the hearth. So obviously they are not pushing the wood stoves, they are denigrating them!

Now it makes sense why they were so unhelpful when I was shopping for a wood stove. I bought from a shop an hour away that had my stove in stock - after doing all my research here.

I wish there was a good local woodstove place, but I guess I would need to be in a different type of town or more rural area.