Livestock Sales are Helping Aquatics Retailers Remain Competitive

While the market for dry goods continues to present challenges for local fish stores, livestock offers rising sales and a competitive edge, industry experts stated.

"Fish sales keep us in business more than dry goods," said Mike Calli, president of Global Aquatics & Pet Supplies in Ontario, Calif. "I’ve survived because I’ve been able to go with the flow. We have the facility, the tanks and the size, and we know how to handle a lot of livestock."

High-end livestock and specialty segments within the industry provide outstanding competitive advantages for retailers.

"Obviously with dry goods, the internet just destroys us," said Glenn Laborda, manager of Absolutely Fish in Clifton, N.J. "Some of the stuff out there is available at our wholesale cost. With livestock, on the other hand, we definitely have a big advantage because we have such cool stuff. Our aquaculture facility helps a lot, plus our buying power for coral is pretty great."

Livestock doesn’t ship well, and often customers are anxious about ordering from online sources. This leaves retailers in the favorable position of being able to provide customers with peace of mind regarding their fish and invertebrate purchases.

"I don’t care how you ship it," Calli said. "Livestock goes through hell during shipping."

Hobbyists are also eager to see specimens in person before they make a purchase.

"People love to buy stuff online because they get such great deals and discounts, and they have it shipped directly to their house," said Krista Bedell, assistant manager at Barrier Reef Aquariums in Renton, Wash. "[But] a lot of customers that order livestock online end up coming to us because they have a lot of stuff they order die off. That’s a big advantage we have over internet livestock sales. Customers can come in and see what they like. They can put something on hold, see how it does when they come back the next day or the day after, and then purchase it."

Most hobbyists don’t order livestock online, and local fish stores are generally superior sources for consumers purchasing fish and coral species for their aquariums.

"Every now and then we’ll come across somebody who has purchased livestock online or thought about it," said Frank Schmidt Sr., owner of the Coral Reef Pet Center in Norridge, Ill. "But the majority are afraid to because they would rather see what they’re going to buy and have it in their hand, as opposed to hoping that whatever they ordered online is going to be what they saw in the picture."

On the Market

An Evolving Market for Fish and Corals

The aquarium industry is dealing with various issues regarding regulations and restricted availability of species and, as a result, aquacultured specimens are increasingly popular, industry participants report.

Many fish species, especially on the saltwater side of the hobby, are becoming reliably available in the hobby.

"A lot of new captive-bred specimens have become available," said Krista Bedell, assistant manager at Barrier Reef Aquariums in Renton, Wash. "Some of our most basic fish, obviously, are all the different designer clowns. The Rainford’s gobies, firefish and algae blennies are really popular. The Banggai cardinals are always very popular. Livestock is the real edge that we have over competitors."

In the case of corals, however, prices are going up.

"With Indo species being unavailable [due to the ban on coral exports from Indonesia], we’re limited to some of the same stuff that’s already available," said Glenn Laborda, manager of Absolutely Fish in Clifton, N.J. "The trend now is, people are into some of these higher-end torch corals, like orange torches or green torches, because they’re very limited in supply. So they’ve become very expensive. For example, something like a single head of an orange or gold torch that used to sell for maybe $100 to $150 now goes for $400 to $500."

The market for frags is also exploding, as coral availability is increasingly problematic.

"Of course, frags are very popular," said Mike Calli, president of Global Aquatics & Pet Supplies in Ontario, Calif. "The average reef tank is now a little frag tank, and there are so many frag guys out there on the internet."

Many local fish stores that cater to reef hobbyists are focused on aquaculturing corals and providing frags for customers.

"We have been trying to work towards growing our own stuff so that we can have aquacultured coral available for sale," Bedell said. "We’re trying to move in that direction."

As wild sources for coral have dried up, providing captive-raised corals is a strong business model for many.

"Frags are super popular," Laborda said. "They’re still one of the hottest items here. Rising costs make the frags that much more appealing because customers can get small pieces for less. … [Concerns about availability] are a big part of why we’re into aquaculture. Besides the store, we have a 5,000-square-foot aquaculture facility where I’ve been stacking corals for years."

Variety Keeps Them Hooked

Stocking a wide variety of species allows retailers to stand out from the competition and offers customers something that few other livestock sources can match.

"There’s a treasure-hunt experience looking for new fish," Bedell said. "That’s even true for us employees. Every time we get new shipments in, we’re so excited to check it out and be able to take stuff home for our own tanks or grow it out for the store."

Barrier Reef Aquariums is currently in the middle of remodeling, Bedell said, and, after the process is complete, the retailer will have a full quarantine system in place.

"We really want to be able to offer a fish for literally anybody, depending on what type of tank they have," she said. "We need to have a large variety and know exactly what we’re selling to be able to help people have the best success in their tanks."

In almost all cases, livestock takes up the majority of aquatics retailers’ show floor space. This is necessary to offer the variety customers expect, but it does come with its own challenges.

"Tanks are big, and large fish take a lot of space," Laborda said. "We’re probably about 75 percent livestock, and then 25 percent dedicated to dry goods. In our main marine section, I would say we have around 55 marine fish sales tanks. And then we have 14 or 15 coral tanks and three or four frag tanks that hold thousands of frags."

Fish and invert sales aren’t just a source of revenue—they drive interest in the hobby overall and help keep retailers afloat in a difficult market.

"Livestock definitely keeps people coming back," Bedell said. "We try to let our customers know in advance what days our shipments are coming in. They come in and look through everything to see if we have anything new. And just because of that, they’ll end up buying some stuff while they’re here."

Responding to Demand

Customers increasingly want novel species for their tanks, and retailers that can meet this demand are seeing success.

"The hobby has changed to be more adult oriented," said Roger Koehn, owner of Aquatics Unlimited in Greenfield, Wis. "People want things that are unique. They’re looking for very unusual fish instead of the average community fish. You have to adapt to that. Nowadays, we’re more likely to sell exotic stuff and a lot more expensive or unusual fish."

Offering a wide variety of options for sale is a big advantage, retailers reported, and moving into new segments of industry may prove fruitful.

"We’ve been in business for 50 years," Koehn said. "At our first location, which we started in 1969, we had 1,200 square feet of space. … Now, in our fourth location, the space that we’re in has 12,400 square feet. … We’ve also added water gardening and koi, which is relatively new for us, but it’s doing really well for us so far."

Driving sales using promotions and social media is also a successful strategy for most retailers.

"We use a lot of social media," Laborda reported. "We also started a reef club, which is kind of like a VIP thing. Members have a plastic card that provides a discount year-round."

Absolutely Fish also offers monthly raffles, seasonal sales and other direct promotions to keep customers engaged.

"We have an email that goes out to everybody, relating what’s new every week," Laborda said. "We have a separate reef club email that goes only to the reef club people where we offer them something crazy. For example, maybe this weekend they can buy three frags and get two free. … We always try to do something creative to get the people in. … We try to get them in and try to use a lot of social media, but, at the end of the day, it’s really our own emails and coupons that we send out that do best."