Online knife business

Shorttime said:
All right. I have no intention of being That Guy, this time. I want to ask a serious question:

Jeff. Do you have any business training or experience?
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Yes I help my parents operate their business as well as my boss right now.
 
Jeff4 said:
Yes I help my parents operate their business as well as my boss right now.
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Good! My opinion (and it's a free opinion, so remember that), you should sit down with your parents and your boss, and get them to help you put together a business case. Doesn't have to be super-detailed, but you need to have some numbers in front of you that you can trust, to tell you whether this is "worth" doing, or not.

This is something you need to be able to sit across a desk and do. Honestly, some blokes and blokettes on a forum are a... less helpful.. source of advice. Not because of any lack of knowledge, but because forums just don't work the same as being in the same room with somebody.
 
Thanks makes alot of sense I really appreciate you taking the time to do this
Shorttime said:
Good! My opinion (and it's a free opinion, so remember that), you should sit down with your parents and your boss, and get them to help you put together a business case. Doesn't have to be super-detailed, but you need to have some numbers in front of you that you can trust, to tell you whether this is "worth" doing, or not.

This is something you need to be able to sit across a desk and do. Honestly, some blokes and blokettes on a forum are a... less helpful.. source of advice. Not because of any lack of knowledge, but because forums just don't work the same as being in the same room with somebody.
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It's tough to get traction in the market, when there are already a lot of sellers online, including brick and mortar stores that do a lot of online business as well. I've been buying online via five different primary sources for knives, two regional knife stores, two outdoors shops, and a general store. I've also ordered from a couple other hardware/general stores and as a last resort on Amazon when I can't get a knife brand anywhere else. Only one of the regional knife stores is practical to visit in person right now and a lot of their stock is only available online.

Early on you probably have to have the money reserves to be able to sit on a lot of stock and try to make good decisions on volume, until knives are sold out elsewhere and people start coming to you. Then you need to do right by those customers so they come back and even better recommend you. You really need to figure out who you're selling to though and get the suppliers that will most appeal to those people. Also, just because you're online doesn't mean you shouldn't also set up booths at events whenever it's feasible. Traction is more than just knowing how to do website SEOs and being on Twitter. Security and insurance are also big considerations, when you have lots of small shiny things that people will want to steal and can be easily sold. If I were starting out a knife store right now I'd try to target at least one supplier that not a lot of other people carry but have some popularity in the knife community, like Joker.
 
Jeff4 said:
Thanks makes alot of sense I really appreciate you taking the time to do this
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No worries! Less than $2,000 is still an awful lot to spend. I know that I couldn't easily recover, if I invested that kind of money in something that turned out to be unworkable. I wouldn't want to see it happen to somebody else.
 
Shorttime said:
No worries! Less than $2,000 is still an awful lot to spend. I know that I couldn't easily recover, if I invested that kind of money in something that turned out to be unworkable. I wouldn't want to see it happen to somebody else.
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But what if u buy it and flip it ughhhh hahahaha
 
Thanks man I
The Grendels said:
It's tough to get traction in the market, when there are already a lot of sellers online, including brick and mortar stores that do a lot of online business as well. I've been buying online via five different primary sources for knives, two regional knife stores, two outdoors shops, and a general store. I've also ordered from a couple other hardware/general stores and as a last resort on Amazon when I can't get a knife brand anywhere else. Only one of the regional knife stores is practical to visit in person right now and a lot of their stock is only available online.

Early on you probably have to have the money reserves to be able to sit on a lot of stock and try to make good decisions on volume, until knives are sold out elsewhere and people start coming to you. Then you need to do right by those customers so they come back and even better recommend you. You really need to figure out who you're selling to though and get the suppliers that will most appeal to those people. Also, just because you're online doesn't mean you shouldn't also set up booths at events whenever it's feasible. Traction is more than just knowing how to do website SEOs and being on Twitter. Security and insurance are also big considerations, when you have lots of small shiny things that people will want to steal and can be easily sold. If I were starting out a knife store right now I'd try to target at least one supplier that not a lot of other people carry but have some popularity in the knife community, like Joker.
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Thanks man I Appreciate it
 
It'll be difficult to beat the half dozen established online shops everyone can name right now. And this is not counting Amazon and their sketchy inventory. Best of luck in whatever you decide.
 
there are literally thousands of members on this site, each of which will spend an average of $200+ a month on knives... some go much higher

the money is flowing, it's out there

the key, like others have said, is to have high quality knives, with high appeal to discerning customers (like the members here)
use the free resources at your disposal on this site - there are thousands of buy/sell posts you can use as research to see the sort of quality we demand

if you are being given a pre-determined stock of '650' knives to sell, that should be a red flag (imho)
which price points are you aiming for (buy & sell), which steel types?, which designs/designers?, which handle materials?

simple point is this:
if they are low cost knives - you will be competing with amazon (& walmarts & dollar stores) -> that is guaranteed to be a loss since you can't compete with those economies of scale

if they are expensive knives - you will be competing with all the blacksmiths and online knife shops that advertise on this forum-> use them as a baseline
you will have to get deep in your knowledge of knives & customers... and try to come up with a valid value proposition

share some pictures, & rough price points on these 650 knives if you can
many members will offer advice on the quality & desirability
 
Most knife manufacturers require a MAP from vendors. Without a reputation to rely on, you’ll have a difficult time getting established. If you advertise below MAP, you’ll lose the ability to sell the affected brand.

Most online vendors have a YouTube/Instagram presence. Do you have any kind of reputation in the knife reviewer world? Do you know anyone who could send viewers to your store?

A 640 knife inventory isn’t big. It’s not enough to establish a working inventory. How much capital do you have to invest in a rolling inventory.

What are your site-building skills?

What do you know/care about knives? Can you assist a customer in becoming a satisfied customer?
 
If you can't differentiate yourself from the larger, well established knife stores, I would say that it's not worth it. They're going to beat you on price, variety and most likely service. So unless you plan on offering something special like anodizing, engraving, etc. then it's going to be a tough business.
 
A few things I would point out that need to be addressed and I'm admittedly not the person to address it.

1. I don't know how MAP pricing works in the knife industry. In these days of supply chain and material sourcing problems, I would guess (just a guess mind you) that stricter MAP rules are in effect. If everyone has to sell knife X for no lower than $100, what advantage do you have? Well, maybe just a lower overhead compared to other folks.

2. Supply chain. Companies are having problems getting supplies. Manufacturing has probably decreased somewhat during the pandemic. If Spyderco makes X number of Enduras, you will probably be behind BladeHq, KC, DLT, etc. (ie. established knife retailers) in the pecking order. Most companies are going to want to deal with established business who they know will pay their bills on time.

3. QC issues. Yes, some knife defects are the responsible of the knife co, but some issues "Hey, I bought a knife, it is scuffed or dinged. I want a replacement!" That falls on you. Are you prepared to deal with that?
 
Put pen to paper and run the numbers to see what the initial investment rate of return will be. Do the research on the knives you plan on moving through your store.
Hopefully, your thinking globally and not just U.S. alone. We truly live in a global mark and that’s not changing anytime soon. With the current state of the economy, both locally and globally, right now may not be the best time to launch a business that is geared toward disposal cash.
IMO, it may take several years to establish a portfolio that would be tempting for someone to buy. Don’t forget, this place only represents about one or two percent of knife enthusiasts that actually know what a good quality knife is. And that’s on a global scale.
 
Shorttime said:
Good! My opinion (and it's a free opinion, so remember that), you should sit down with your parents and your boss, and get them to help you put together a business case. Doesn't have to be super-detailed, but you need to have some numbers in front of you that you can trust, to tell you whether this is "worth" doing, or not.

This is something you need to be able to sit across a desk and do. Honestly, some blokes and blokettes on a forum are a... less helpful.. source of advice. Not because of any lack of knowledge, but because forums just don't work the same as being in the same room with somebody.
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This is excellent advice. I would also ask to see the books for the business you are thinking about buying. You don't have to ask us if you could turn a profit you can see if the business is turning a profit.

If it's not than you probably have your answer. If you think you can do it better you need to ask yourself why and how.

I would also look into the small business administration reps in your area. They often have people who can mentor and advise you for free.
 
dirc said:
there are literally thousands of members on this site, each of which will spend an average of $200+ a month on knives... some go much higher
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Except me. I’m the designated “cheap bastard”. I spend about $20+ a month on scrap steel* and leather, abrasives and propane.

It’s a crowded market, tough for a new guy to crowd his way in. Sure, you can sell some knives, but that’s not enough. You have to sell enough for the margin to pay your hard costs before you even make grocery money, much less any profit.

If you have a good day job and this is gonna be your side hustle, go for it. Your loss will be small (and surviveable) if things don’t work out.

If this thing needs to pay your living expenses from the start, it’s dubious. It’ll suck up more time and energy than you expect, and having your own business creates a long line of people wanting to carve a percentage out of your efforts. The parasites are running our society today, like it or not.

In addition, there are external factors beyond your control that can come out of nowhere and torpedo you even if you do everything right. The road to success is strewn with the financial carcasses of people who were good at (whatever your business is). You have to be smart, determined, risk-savvy, and lucky all at the same time, for long enough to amass enough capital and experience to survive the storms. It’s not impossible, but statistically unlikely. More entrants fail than succeed.

Sorry to be a Negative Nelly, but I just don’t see the odds being in your favor. IMHO you’d be better off investing in your parents’ business, or learning a trade, or develop job skills that can get you a steady and lucrative job working for a boss.

Best of luck to you.

Parker

*Except this month, a neighbor brought me half a rusty crosscut saw blade. That dragged my average down.

Parker
 
Jeff4 said:
No I just need advice on a simple investment buying a online knife store with inventory connections the whole nine
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There is nothing simple about running an online business. For one thing I wouldn’t spend a dime on anything you sell, and it doesn’t matter how cool your site name, how glossy the presentation, how desirable your knives or how low your prices. I have no idea who you are and we have no indication that you know anything about knives. How would any of us know whether you are representing your wares correctly, and not selling stolen goods, factory seconds or outright fakes. You need to develop the right reputation and it will take a lot of slim years to get there.

Further, what’s your plan for dealing with unreasonable customers or outright scammers? What happens when Joe Smith buys 50 knives from you, and 30 days later you find out that he has been using stolen credit cards? Care to guess who is out inventory and funds.

n2s
 
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The biggest issue I see is this; oversaturated market...

You'd be competing with not only the big river site, but a dozen other well reputable knife companies (who are also listed on the sponsors section of bladeforums; knifecenter, bladehq, knifeworks, usamadblade, collectorknives, etc), and at least 2 dozen other non sponsoring sites, some which also have well known branding, massive inventories, exclusives, some with niche holds in the market, and most with reasonably fair prices...
Then there's still the local brick and mortar market which some people prefer where available because they can handle the knives in person.

Plus there's the 2nd hand market like here on BF, over in the Reddit community, the sw desert state site, that big auction site, etc...

So how do you intend to compete in that market and stand out and remain relevant? How do you intend to keep prices competitive and/or hold a niche? Do you have hard to find rare gems that are well sought after to sell? If it's web based, how do you ensure you show up towards the top of the web searches so customers are led to your brand instead of the others, and not falling on page 3, etc...?
 
650 knives for under $2000 is under $3.08 per knife- sounds like junk. Look, there is not a lot of meat on the retail knife sales bone in regards to profit. The way the blade HQs of the world make it is with massive volume. Someone talked about the possibility of selling them cheap to generate interest, but your desirable brands have map pricing which sets the minimum advertised price. I wouldn't touch it with a 10' pole. This is a tough game in a saturated market.
 
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