Thoughts on Garage sellers.... Could it be the death to many LFS?

[gtbarsi]

Most of you guys posting are acting like you are that living room/garage/basement "store". If you sell coral here or there out of your tank to get a new piece of equipment or a cherry coral you have been eyeing up at your LFS that is cool and makes the hobby fun. Sadly I know a few guys who have chosen to buy a business license just to get whole sale accounts and sell straight out of their living room, garage, or basement. Yes they have little overhead so they can keep prices lower but if they aren't reporting sales, paying sales tax to the state, paying for insurance, paying for a separate rent/mortgage how could a LFS compete. They literally order from wholesale, chop it up and put a tag on it. If his illegal business puts down my local brick and mortar LFS I'm not going to be happy. That way of "business" should come with a made in China sticker, they take shortcuts in order to make a quick buck and jeopardize true American business. I can honestly say I have not purchased from that kind of "business" or even online websites because it is hurting the local stores who know your tank and do what they can to help you and keep your business.

- end rant

After reading your post here are my thoughts. If they have a business license then they are a legitimate business. At that point they have the right to buy wholesale and to write off business expenses. As to insurance if they fail to insure themselves that is there choice but a really stupid one, they would be risking there business as well as there home if something were to happen and they were found liable. Still any business could do that legally. If they fail to report there taxes properly, that is illegal and a separate matter. It is up to the IRS audit them, just like anyone else. If it bothers you so much you should be able to get information about there business from public records including there tax returns. After that if you were positive they were not reporting properly you could try and blow the whistle on them. I would think that if the LFS thought a specific garage business or businesses were seriously hurting them they would have already done this. Sales Tax is probably the easiest one to look at as you do not get to deduct anything from sales tax reporting. Annual taxes are much harder to look at and know if they are fudging there numbers.

 

[RalphsReef]

Sometimes a garage seller/private collector is the only way to find a certain coral you are looking for. There are quite a few LFS nearby, but not all carry the high end goods. And then there is the budget factor. I understand a brick and mortar shop has overhead, but I don't want to pay their monthly rent and electricity all at once by purchasing one thumbnail sized frag for an outlandish price.

 

[WesF]

Most of you guys posting are acting like you are that living room/garage/basement "store". If you sell coral here or there out of your tank to get a new piece of equipment or a cherry coral you have been eyeing up at your LFS that is cool and makes the hobby fun. Sadly I know a few guys who have chosen to buy a business license just to get whole sale accounts and sell straight out of their living room, garage, or basement. Yes they have little overhead so they can keep prices lower but if they aren't reporting sales, paying sales tax to the state, paying for insurance, paying for a separate rent/mortgage how could a LFS compete. They literally order from wholesale, chop it up and put a tag on it. If his illegal business puts down my local brick and mortar LFS I'm not going to be happy. That way of "business" should come with a made in China sticker, they take shortcuts in order to make a quick buck and jeopardize true American business. I can honestly say I have not purchased from that kind of "business" or even online websites because it is hurting the local stores who know your tank and do what they can to help you and keep your business.

- end rant

In order to get wholesale accounts you need a business license and a tax id. If you have a tax ID and are not collecting/paying sales tax or not reporting your sales/income, the IRS will catch on very quickly.

 

[Tradewinds]

I'm not in favor of more government regulation, but many municipalities all ready have zoning regulations prohibiting home-based business. As other residents want to maintain the residential character of the neighborhood, minimize traffic, and avoid parking congestion.

I know a few hobbyists who supply LFS with coral frags and captive bred fish. This would seem to be a winning proposition for everyone involved.

 

[Davinci]

is it right?

The main ones I am referring to are the ones that have a business license and think that they have found the "loop hole". They set up several tanks just so that they could cut up coral and sell it for profit. I believe that they take away from the people that fully dedicate themselves to this hobby. I saw that someone mentioned "bigger shop= more discount for bulk orders. That is why not a lot of shops are undercutting walmart". the problem with that statement is that if you have a little shop and you had all your good that were cheaper than walmart, I bet those little shops would ultimately force walmart to dwindle. That is unfortunately what is happening here. And I for one am a person to value local fish stores that will support us with knowledge, water testing and dedicated people that take this seriously. It just angers me that the average person could get a business license and start getting wholesale accounts and get stuff for the same price as LFS. If you are going to have the passion to go into this hobby as a supplier of merchandize and livestock, go all in and do things right.

 

[KoleTang]

I am not seeing the point here. So what if someone chooses to start a business without paying for the overhead of a storefront? There are at least 4 guys near me that do this (ordering from wholesalers as well). I get better stuff and better knowledge from them than from the LFS. The thing that you all are missing, is that not many people know about these basement businesses. Someone getting in the hobby is going to walk into an LFS, not into the basement of some dude's house.

It's not "wrong" or "immoral", it's business and nothing will change it.

 

[CountrySideCoral]

In order to get wholesale accounts you need a business license and a tax id. If you have a tax ID and are not collecting/paying sales tax or not reporting your sales/income, the IRS will catch on very quickly.

I did not know that I can get that kind of information or that it was public. I am more than sure this living room shop is not reporting sales as the few people that do go there say they haven't seen sales tax on their receipt. I doubt he is building it into the price but I could be wrong. I just don't like seeing illegal garage/living room/basement stores taking away from a business owner that is making a living legally.

 

[Mike J.]

Why can't people leave others alone? Why can't people let others succeed where some have failed? If the store is failing and Mr. GarageSeller isn't, who cares? He's doing something right that the business failed to do. I get the sense you're a little jaded because some Jo Schmo bought corals for less than you did. It's the same with yardselling. Should I be required to buy a business license because people buy from me?

New reefers are required to buy a license and take a four hour education class. Now people can't sell things on the side. What next? The law changed so we can marry our fish? *sigh* Enough is enough people. Live and let live, I say.

One more "sigh" here. This is in the general discussion forum, there should be a whining forum. I'm a business owner. Small business owners are what make this country great. Of course small businesses are being run out of business with all the new taxes and the general liberal thought that we owe people who don't work all our money.

I slipped the other day and told my wife, "I should just quit and collect disability and welfare." I can't believe those words came out of my mouth, but that is mainstream thinking.

 

[KoleTang]

What makes working out of your house a non-small business.

 

[Reef Pets]

How legit are garage businesses in this industry? Do they have a business licenses? Probably so, anyone can have one. Do they pay taxes, federal, local and state! Probably not? Have you ever paid sales tax to a garage or basement business? Probably not and that's an indication they are running an illegal business! Are they allowed to run a commercial/retail or agricultural business from a residential location? Probably not. If they live in a neighborhood is it allowed by a home owners association? Probably not. Will an insurance company cover a commercial business out of a residential address? Probably not.
In all, a garage or basement business in this industry is most likely going to be illegal in some way or another. What makes this illegal business any different than others and why support illegal business practices in the reef industry or any other industry?

 

[Moonreef]

One more "sigh" here. This is in the general discussion forum, there should be a whining forum. I'm a business owner. Small business owners are what make this country great. Of course small businesses are being run out of business with all the new taxes and the general liberal thought that we owe people who don't work all our money.

I slipped the other day and told my wife, "I should just quit and collect disability and welfare." I can't believe those words came out of my mouth, but that is mainstream thinking.

I run a small business from my home and also work a full time job. I get aggravated thinking some slob sits back doing absolutely nothing collecting benefits from my money and yours that we earned and had to pay in for earning it. They are entitled to that money because some yahoo says so. The reason most of them don't work....they make the same amount of money or benefit if they work plus they actually have to work to collect it.

This to say, whether you work out of your home or a store front I say good deal. As long as your making it legit does it really matter? Why did the guy start selling it in his garage? Because he got tired of seeing people raked over the coals to get something they wanted or they thought, hey I could do that too. Whatever the reason, thank goodness for the workers in this country, and if the garage guy makes it and the brick and mortar guy don't....I'm sorry, it's just business. Innovate and start something. The saying, you don't start living till you step outside the box...it's true for a business. If you don't innovate and change your going to get stale and nobody wants yesterday's news. Could you imagine if all we still had was wet dry filters? LMBO

 

[jason g]

I sell off CL to help me rid of coral that has out grown my tank. I don't do it to make a living and most of the people I sell to Thank me because they say our local fish stores don't carry them. I don't see nothing wrong with selling to make room or to help a fellow reefer get some cool corals off me. Besides I will always shop at my LFS for saltwater supplies and coral. Either way we all make a $$$$.

 

[Chameleon]

One more "sigh" here. This is in the general discussion forum, there should be a whining forum. I'm a business owner. Small business owners are what make this country great. Of course small businesses are being run out of business with all the new taxes and the general liberal thought that we owe people who don't work all our money.

I slipped the other day and told my wife, "I should just quit and collect disability and welfare." I can't believe those words came out of my mouth, but that is mainstream thinking.

not to get political because i dont think that is allowed or needed, but i love this post

 

[WesF]

Edited: sorry I almost got sucked into a "discussion" about politics.

 

[jackson6745]

I don't think it matters either way. These is some kind of balance to everything in one way or another. Every business has it's "garage seller". Business quality, consistency, and value keep the top guys on top.

 

[Mike J.]

Vivid Aquariums started out with 3000 gallons in his garage. Too late for you to turn him in -- he's one of the largest dealers on the internet now.

Where I Buy My Fish and Coral Online - YouTube

 

[mrcoffee2]

I love it. My LFS over charges. Why would I pay $50 for a coral when I can get it for $10 from another guy? No offense to other business owners out there, I am sure there are some of you that sell the corals reasonably... In my case it seems that my LFS tries to make all of their money back on one sale. Sorry I am not going to fall for that again!

It is a sellers market for sure. I am just glad fellow reefers out there have gotten sick of it and decided to sell it out of their homes. In reality it makes getting into the hobby a lot easier. What beginner wants to pay $50-100 for a coral to lose it in a week. - Not this guy

 

[Lovge]

I firmly believe in the principles of good business. Im totally for garage day vending however, if your going to provide services as a vendor no matter at what level you still need to do things right. Permits, business license ect.. Its just how it goes. Follow the rules and its all good.

Nothing wrong with legal competition. Besides my LFS is a petco who sells sketchy live rock for 20$ a baseball and a "specialty" fish store whom uses tap water for all their tanks.

 

[LPSGUY]

How legit are garage businesses in this industry? Do they have a business licenses? Probably so, anyone can have one. Do they pay taxes, federal, local and state! Probably not? Have you ever paid sales tax to a garage or basement business? Probably not and that's an indication they are running an illegal business! Are they allowed to run a commercial/retail or agricultural business from a residential location? Probably not. If they live in a neighborhood is it allowed by a home owners association? Probably not. Will an insurance company cover a commercial business out of a residential address? Probably not.
In all, a garage or basement business in this industry is most likely going to be illegal in some way or another. What makes this illegal business any different than others and why support illegal business practices in the reef industry or any other industry?

This is a bold statement. How many business owners write off absolutely everything they can to subract from the overall profit of their company...oh about every business owner in the US. Is this cheating? Is this legal, yet all business owners write off absolutley everything they possibly can, some more than others. Same goes for the garage sellers. Some probably have legit business, others do not.

This is America my friend and I personally think there's room for retail, garage, online, etc. It all balances out. The garage seller that can profit $50K a year good for him. The LFS that profits $100K, good for them. It's what makes this country great. And why should I pay $75 for a head of torch from the LFS when I can get it from a garage seller for $20, or from you for $25????

 

[mrcoffee2]

And why should I pay $75 for a head of torch from the LFS when I can get it from a garage seller for $20, or from you for $25????

Amen brotha