Musical Instrument Store Business Plan

MusicWest

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Executive Summary

An exciting opportunity currently exists for a full service musical instrument retailer in Albuquerque. Although there are a number of musical instrument retailers in this city of over 500,000 people, there are currently only three very small school band and orchestral instrument dealers; these stores have small selections and short hours. At the other end of the spectrum (stores with a more guitar and electrical focus), big chains are competing on prices at the expense of customer service.

MusicWest will offer the buying public a superior shopping alternative, with a huge selection of school band and orchestra instruments, plus guitars, keyboards and accessories, at reasonable prices. Our products will be supported by skilled repair services and a knowledgeable and friendly staff, as focused on educating the customer as on closing the sale. We will exploit our competitors' weaknesses by offering ongoing music community events, from free lessons, to music clubs, to after-sale follow up to turn one-time shoppers into lifelong customers. Our unique marketing schemes include "You Play, We Pay" (whereby a portion of instrument sales and rentals are donated to local school band programs) and "100% Money Back" trade up programs, where customers receive 100% of their purchase price toward upgrading their instrument within one year.

MusicWest will focus on the novice, hobbyist, and semi-professional musician; these three groups are seeking value, customer service, and knowledgeable assistance in making what can be a rather significant purchase. MusicWest will gain a reasonably large percentage of market share in a short period by immediately differentiating ourselves from our competitors. We will establish our branding with our superior service and selection, the excitingly modern look of our retail environment, our "hands on" merchandising approach, and a series of ads with our motto: Stop Dreaming, Start Playing. Once in the store, our clients want to come back often for the special treatment they receive here and nowhere else.

The co-owner of MusicWest, David Moore, has over seven years of experience as the store manager at two successful local music stores. He has seen firsthand where opportunities are missed through lack of follow-through or careful planning, and knows what local customers are looking for.

Based on his experience at other local music stores, David Moore conservatively projects sales of over $500,000 in the first year, increasing to almost $700,000 by year three. We will start generating a profit in September, and profits will increase steadily thereafter.

Although MusicWest may not become the biggest, our intention is to become a "Must-Shop Destination"  for those looking to buy a new or used musical instrument in Albuquerque!

1.1 Mission

MusicWest provides musical instruments to the community.  We separate ourselves from our direct competitors by paying intense personal attention to our customers, and educating our clients about the products they need or desire before, during, and after the sale. We offer creative programs to reward customer loyalty, and we provide on-site repair services for the items we sell. We consider our staff our partners and insist they prosper equitably with the growth and success of the company. We will have the largest selection of School Band and Orchestral instruments  in New Mexico, and will use that advantage to separate ourselves from the competition.

1.2 Keys to Success

  • Establish a well-respected music lesson department and start a rapport early with school band and church music leaders.

  • Offer extended hours to serve a larger portion of the buying public than our competitors do.

  • Educate the buying public by merchandising our products with informational/tutorial signage and literature, and by backing that up with knowledgeable salespeople.

  • Offer the services of a full time repair department to our client base.

  • Continually modify the product and service offerings to stay on the leading edge of technology within our market.

  • Exploit the many weaknesses of our local and national competitors to differentiate ourselves from them.

1.3 Objectives

  • Gain 25% of the local market share within the first three years.

  • Maintain a minimum gross profit margin of 40%.

  • Create a hands-on, educational approach to musical instrument merchandising.

  • Target the large number of school band instrument customers who currently bypass local music stores for catalog or internet sales, due to poor service, selection and prices.

  • Aggressively target the public school system and local religious organizations.
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