You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your bait & tackle shop. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a bait & tackle shop?
Bait and tackle shop startup costs are low. Normally, it takes $5,000 to start one. This cost covers the rent, the utilities, and insurance. It will also cover the shop’s basic supplies, like tanks, aerators, refrigeration, gear, tackle, and vending machines. As a bait tackle shop grows, it’ll need more supplies to keep fishers happy.
What are the ongoing expenses for a bait & tackle shop?
A bait and tackle shop needs to source its live bait. Typically, it catches its own. Expenses include gasoline for water trips and bait nets. If you want to source your own bait from another provider, expect to pay about $20 per bucket of shiners, snappers, suckers, or fat heads.
Who is the target market?
The ideal customers are fishermen. Instead of targeting a specific type of client, focus on the area. Establish your bait and tackle shop near a beach, a pier, a lake, or a river. Preferred clients are locals, because they buy bait in bulk. If you have to pay extra money for an extra location, do it. It’s worthwhile to pick a location with return customers.
How does a bait & tackle shop make money?
Many bait and tackle shops make money by selling bait alone. Some bait stands, in fact, only have a single tank with live bait. Others, meanwhile, offer lures, hooks, line, and even spare rod pieces. Depending on the location, a bait and tackle shop will offer different items. Ocean fishing is different than freshwater fishing, and it needs additional gear.
Bait and tackle shops can also sell food and drinks for money. Some shops sell beer and liquor. Other shops may open a café. While rare, some shops are also seafood restaurants. Really, it depends on the shop’s location. Bait can be charged by the bucket, or it can be charged by individual fish, worm, etc. Tackle is sold on a per item basis.
How much can you charge customers?
Charge customers between 25 and 95 cents for live bait, per bait. Fishing lures can be priced between 95 cents and $10. As for tackle, prices range from $15 to $80, depending on what you’re selling. If you’re selling rod necessities, like spinning reels, you can sell products up to $100.
How much profit can a bait & tackle shop make?
A good bait and tackle shop can make about $45,000 per year, if it’s small. Larger franchised bait and tackle shops, meanwhile, can make over $200,000 in profit per year. A lot of a bait and tackle shop’s success depends on its availability—as well as the area’s fishing needs.
How can you make your business more profitable?
Commercial fishing is a big business, but it might not be big in your area. Instead of expanding your floor space off the bat, look for better locations. Host special events like contests, and sponsor charitable community work.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your bait & tackle shop is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
In most states, it is necessary to obtain a bait shop license. Certain state permits and licenses may be needed to operate a bait & tackle business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
It is important to abide by your state’s Department of Natural Resources (DNR) Regulations
Certificate of Occupancy
A bait shop business is generally run out of a shack or storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a bait & tackle business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your bait & tackle business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a bait & tackle shop
Fortunately, bait and tackle shops frequently promote themselves. Reach out to local restaurants, fishing areas, and near-water locations. A lot of fishers rely on big-name brands to get their tackle. That said, they’ll turn to local bait and tackle shops for convenience. Again, a lot of shops thrive from being near the water.
As for marketing, make a Facebook page. Put flyers around local businesses, and reach out to local business owners. A lot of your marketing will be word-of-mouth marketing.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Attract customers by being in an accessible location. Marinas, beaches, and piers will be your best bet. Retain customers by being fully stocked, offering good advice, and being accommodating. A lot of fishers return to the same bait and tackle shops out of habit, so make sure you’re kind to your regulars.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Bait & Tackle Shop In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Bait and tackle shops are perfect for people who love to fish. If you love fishing on the ocean, on lakes or on rivers, consider opening one. They’re also great for friendly sports-lovers. Bait and tackle shops are normally people-oriented. If you like the small shop environment, a bait and tackle shop may be for you.
What happens during a typical day at a bait & tackle shop?
Bait and tackle shop owners have several responsibilities. First, they need to maintain the live bait. To do so, they need to keep the tanks, aerators, and water supplies clean. Bait and tackle shop owners must also keep bait and tackle stocked. They should also make sure other bait is refrigerated. Vending machines need to be restocked, and customers need to be kept happy. A successful bait and tackle shop owner also cleans, works the register, markets, and manages the area.
What are some skills and experiences that will help you build a successful bait & tackle shop?
A successful bait and tackle shop will understand the area. They’ll know which fish can be caught, and they’ll also know how to catch them. More importantly: They’ll know how to use their bait.
A good bait and tackle shop will also offer high-quality lures, bait, and tackle. Fishers lose their tackle and bait a lot, and they’ll pay extra for high-quality products. If your bait and tackle shop is on a pier, near a restaurant, or on the beach, it’ll need to be noninvasive. Serve customers, give information, and let them fish.
What is the growth potential for a bait & tackle shop?
Normally, bait and tackle shops stay local. It’s rare to see a bait and tackle chain, but they do exist. Large bait and tackle shops may expand, stocking hunting, camping, and survival supplies. Stores like Outdoor World, for example, sell many supplies.
For the most part, a bait and tackle shop will serve a very specific area. Fishers search by location, when fishing. For this reason, they’ll buy bait and tackle from whichever shop is closest. There isn’t too much competition with bait and tackle shops, but you should still have a competitive pricing mindset. If your shop is in a popular fishing area, fishers may still turn to other shops if their prices are better.
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One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
What are some insider tips for jump starting a bait & tackle shop?
Invest in an underperforming, unprofitable location. When you’re starting, you’re better off relying on low expenses. Determine your competition, and consider competing with existing shops. It can take a tackle shop some time to get started, but they can become powerful local shops once they’ve gained footing.
How and when to build a team
You can operate a bait and tackle shop alone at first. Soon, however, you should bring on at least two or three employees. These employees will need to help with bait refrigeration, cleaning, processing orders, and stocking the shop. If you plan on franchising, you’ll need to have a team of at least five employees.