opperating expenses

opperating expenses

Postby Scottt » Fri Aug 20, 2010 11:05 pm

Hello everyone,
I know there are a few people out there that breed fishes for profit. How much are your operating expenses? I'm just trying to get a sense of what I should be aiming for (even a % if you don't want to share dollar amounts).

What are the best ways to keep expenses low, and sales high? Where should I cut costs, and where should extra $$ be spent. Do y'all advertise?

Thank you,
Scott T.
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Re: opperating expenses

Postby BaboonScience » Sat Aug 21, 2010 10:32 am

Yes, sometimes I make a profit. Sometimes not. I had sales last month that were good. This month is a down month for many of my customers so three orders so far have been canceled. Lesson, think ahead. Don't rely on this months sales for next months expenses.
From what I see, the only way turn a profit is to go slow. Of the many that I have seen try this, quite a few are out of the game. :( I guess that DavidM leaving the business has me down a bit, so I have been thinking about this.

We live in the country on A-1 Farm land. No water bill, Rain water Collector and deep Well water. Pressure pump does consume some electricity. Down here, summer AC bill is the worst thing. We heat with a wood burner (Parlor Stove) and pump the air around the house with the air handler from the furnace. That keeps the winter heating cost low, as the furnace only works after the stove burns down at night. Ad to that the heat added by the dehumidifier and winter is a good time. Still with all the conservation efforts, I believe the operation costs about $100 - 150/ month in electric for 60 5 - 20 gallon tanks and a 210 gallon tank plus accessories.

Food helps. My labor force is somewhat limited to me so this is difficult to maintain but I keep Algae cultures, Rotifer cultures (2 strains), Artemia hatchout, Artemia Growout and a copepod culture. Together, these are time consuming to maintain. I try to get growout over to pellet as soon as possible. I make my own conditioning diet for the pairs and there have been some good threads here on this topic. If you have a local fish market that can help. I purchase the scraps for a fraction of the cost of cleaned fish and they let me hand pick ten to twenty pounds at a time. The resulting mix costs be less than a dollar a pound and lasts almost half a year. I freeze in ice cube trays and store the cubes in freezer bags, removing and thawing what I need each day. About $50 every six months. Pellet and flake foods for growout, probably an additional $100 per year.

For equipment, I keep an eye on the local reef clubs for the bargains and only purchase what I have the money for. The Greenhouse, for example was $1,000 if I took the entire 40 foot by 60 foot structure down myself. I sold half of it after disassembly for $1000 and stored the rest. Did I say that my back yard looks like an aquarium store junk yard? Probably an additional $50 a month for bulbs, salt, etc. I minimize the water changes and follow the Randy Holmes-Farley (Reef Central) methods for maintaining water quality. Still, some salt replacement is necessary, usually due to things like plugged overflows causing overflow to the floor (human error). In my operation, that can be up to 50 gallons a month. Water is cycled from the recirc system through the algae cultures, through the rotifer cultures and back into the system. A good skimmer and a huge refugium in the greenhouse helps here.

So, although it is extremely variable, I am guessing that I spend on the order of $200 per month just to keep the system going. I don't think that I could get by with less, unless I used solar panels and made my own electricity and the start up cost is prohibitive right now.

These are a few thoughts off the top of my head to keep expenses low.
I do not yet advertise at this time, although it would probably help. I have a small customer list and sell out frequently. This month is a low before the expected fall pick up.
Hope they help.
John
Last edited by BaboonScience on Sat Aug 21, 2010 10:37 am, edited 1 time in total.
Reason: add last paragraph
"The exact contrary of what is generally believed is often the truth" Jean De La Bruyère (1645-1696)
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Re: opperating expenses

Postby Scottt » Sat Aug 21, 2010 11:06 am

Thank you, thank you, thank you! I'm going to reed about the 'Randy Holmes-Farley' method. Right now I use too much salt. I'll try and keep your tips in mind. Thank you!
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Re: opperating expenses

Postby clowncrazy » Mon Aug 23, 2010 10:57 pm

Thanks for asking this, I have been wondering too. Also anyone care to share startup costs/equipment?
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Re: opperating expenses

Postby BaboonScience » Mon Aug 23, 2010 11:20 pm

Startup costs depend on what you wish to do. what you wish to rear.
You have to plan for every aspect to keep the fish happy.
Tell us what you have in mind.

There are, however, two ways to go. All new and yard sale.
Personally, I have 60 tanks from 3 gal to 120 in two recirculating systems. I have not purchase one new. Yard sales, flea markets and the such have been my friend. You can purchase aquarium racks or build them. Same with filtration. If you wish to buy new then you will not have as much for fish, unless your pockets are deep. Mine are not.

If you tell me more, I will give you the two price lists, it will be convincing.
John
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Re: opperating expenses

Postby Clownfish75 » Mon Aug 23, 2010 11:40 pm

How deep are your pockets!!!!

My biggest expense aside from property repayments is electricity, i dont know about USA but prices for electricity are set to rise alot here, and i wouldnt be supprised if the USA did that also.

after that water, i use natural seawater, depending on location.

If i had my time again i would build a setup with a single minded focus on maximum efficiency for heating, cooling, and pumping. all related to elec use.

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Re: opperating expenses

Postby clowncrazy » Tue Aug 24, 2010 10:48 pm

I plan to rear occ. clownfish, get just about everything used, and also have shallow pockets (I think we all pretty much do :wink: ) thanks for the help. I wish I had access to NSW but alas michigan is surronded by freshwater.
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Re: opperating expenses

Postby Scottt » Wed Aug 25, 2010 12:40 am

clowncrazy, are you part of masm?

Used is the best. I'm starting to agree with Christian with electricity. My favorite mentor lived in chicago while breeding marine ornamentals. The electricity is crazy cheep there, something like $0.07 a kilowatt hour. It's 15 cents a kilawatt hour here in upstate NY, including all the taxes and such. What are your power costs?
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Re: opperating expenses

Postby Clownfish75 » Wed Aug 25, 2010 4:20 am

scott my power is very close to the price you pay, so be very mindful of it, you might also get cheap tarrifs for aircons etc.

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Re: opperating expenses

Postby snowmaker » Wed Aug 25, 2010 6:50 am

Came across a post at Boston Reefers that may interest some of you with concerns about electricity usage and going Solar PV.
The topic:
http://www.bostonreefers.org/forums/sho ... ight=solar
The real time monitoring:
http://enlighten.enphaseenergy.com/publ ... s/NhKN5248
The cost:
nice...what did it cost??
Loaded question..

Gross 21434.00
Net with all credits Fed State etc 8852.00
Annual Income from system, Minimum 1200.00 Maximum 2400.00 a year they auction your generated power to Utilities this is for 10 years so 12k to 24k back in our pockets over that time frame.

Electricity produced 4100kwh a year at .18 cents is 738.00 a year.


Fed and State credits make this pretty attractive.
In all things of nature there is something of the marvelous.
--Aristotle
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Re: opperating expenses

Postby clowncrazy » Thu Aug 26, 2010 11:40 pm

To be honest I don't pay electricity (I'm 17 and still living with the parents) so woohoo! I lucked out of the expensive cost. I guess if I started a successful operation I might pay back some of the electric/space costs (for now I'm confined to my room). My other issue is I'm 17 with a low budget (but slowly getting higher) and I've started to pick up things overtime to spread the cost out while I wait for my fish to start laying.
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Re: opperating expenses

Postby BaboonScience » Sun Aug 29, 2010 9:54 am

Electrical costs can be defrayed to some extent by the use of proper equipment and placement of tanks, things like that.
For instance, I would not use a low head pump to fill a head box 15-16 feet up, but I would not use a high pressure pump either. The first because you will simply not get enough circulation for the buck. The second because, even though you get plenty of circulation, many of those pumps are out the roof with current draws like 4 - 10 amps.

Same can be said of lighting, heating, cooling, etc.

Plumb water systems for the most efficient use of the flow that you have.
More ideas from others?
John
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Re: opperating expenses

Postby clowncrazy » Mon Aug 30, 2010 1:00 pm

And Scottt to answer your MASM question, no I am not. I did not know about them until recently and they meet on the opposite side of the state :( . If I'm ever over there during a meeting I will definitely drop by though
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Re: opperating expenses

Postby fishtal » Mon Aug 30, 2010 10:25 pm

The vast majority of my equipment is used as well. Only the pumps and lights were purchased new. I've kept all of my reciepts but I haven't been brave enough to add them all up yet. :P

I'm not sure if I'm making a profit yet but things are getting better now that I'm supplying 6 local stores. I'm having a hard time keeping up with demand. I'm not doing this to make money, I'm doing it because I love doing it and it's the right thing to do. :D

Clowncrazy- Hit me up on the MASM site if you have any questions about meetings and such. While most of our meetings are on the SE side of the state we do try to move them around a bit. Also, I know of several top notch breeders near your area. I can put you in touch with them if you'd like. :)

Happy breeding!
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Save a Fish... Breed Your Own!
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Re: opperating expenses

Postby clowncrazy » Tue Aug 31, 2010 6:21 pm

Fishtal, I would appreciate it greatly if you could put my in contact with a few breeders. I live in Grand Rapids but would be willing to do some travel to see a breeding operation. I know of at least one breeder in the area, but have never talked to him. I will moniter the MASM website and hopefully be able to attend a closer meeting.
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Re: opperating expenses

Postby JustinDiaz » Fri Nov 15, 2013 1:46 am

BaboonScience wrote:Yes, sometimes I make a profit. Sometimes not. I had sales last month that were good. This month is a down month for many of my customers so three orders so far have been canceled. Lesson, think ahead. Don't rely on this months sales for next months expenses.
From what I see, the only way turn a profit is to go slow. Of the many that I have seen try this, quite a few are out of the game. :( I guess that DavidM leaving the business has me down a bit, so I have been thinking about this.

We live in the country on A-1 Farm land. No water bill, Rain water Collector and deep Well water. Pressure pump does consume some electricity. Down here, summer AC bill is the worst thing. We heat with a wood burner (Parlor Stove) and pump the air around the house with the air handler from the furnace. That keeps the winter heating cost low, as the furnace only works after the stove burns down at night. Ad to that the heat added by the dehumidifier and winter is a good time. Still with all the conservation efforts, I believe the operation costs about $100 - 150/ month in electric for 60 5 - 20 gallon tanks and a 210 gallon tank plus accessories.

Food helps. My labor force is somewhat limited to me so this is difficult to maintain but I keep Algae cultures, Rotifer cultures (2 strains), Artemia hatchout, Artemia Growout and a copepod culture. Together, these are time consuming to maintain. I try to get growout over to pellet as soon as possible. I make my own conditioning diet for the pairs and there have been some good threads here on this topic. If you have a local fish market that can help. I purchase the scraps for a fraction of the cost of cleaned fish and they let me hand pick ten to twenty pounds at a time. The resulting mix costs be less than a dollar a pound and lasts almost half a year. I freeze in ice cube trays and store the cubes in freezer bags, removing and thawing what I need each day. About $50 every six months. Pellet and flake foods for growout, probably an additional $100 per year.

For equipment, I keep an eye on the local reef clubs for the bargains and only purchase what I have the money for. The Greenhouse, for example was $1,000 if I took the entire 40 foot by 60 foot structure down myself. I sold half of it after disassembly for $1000 and stored the rest. Did I say that my back yard looks like an aquarium store junk yard? Probably an additional $50 a month for bulbs, salt, etc. I minimize the water changes and follow the Randy Holmes-Farley (Reef Central) methods for maintaining water quality. Still, some salt replacement is necessary, usually due to things like plugged overflows causing overflow to the floor (human error). In my operation, that can be up to 50 gallons a month. Water is cycled from the recirc system through the algae cultures, through the rotifer cultures and back into the system. A good skimmer and a huge refugium in the greenhouse helps here.

So, although it is extremely variable, I am guessing that I spend on the order of $200 per month just to keep the system going. I don't think that I could get by with less, unless I used solar panels and made my own electricity and the start up cost is prohibitive right now.

These are a few thoughts off the top of my head to keep expenses low.
I do not yet advertise at this time, although it would probably help. I have a small customer list and sell out frequently. This month is a low before the expected fall pick up.
Hope they help.
John


Operating expenses have gone up in recent times and profits have come down.. I am trying to leave the business and work on some other stuff.
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