The Average Income for Car Stereo Shops in 2015

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JC Audio

The average car audio retailer will post sales of about $550,000 this year, marking significant growth over last year, according to businessWORX, based on results from 71 of their customers.

For these stores, total invoices for the day averaged over $2,500, this year. Total customers sold over the lifetime of the store averaged over 7,000.

These car audio shops saw strong gains in many aspects of their business in 2015, based on data through November, with some projections for December.

Average revenue was up from about $400,000 last year, marking a 37 percent increase. And the average tickets for the day rose 35 percent from $1,873 per retailer last year.

As a group, the retailers showed extremely high customer satisfaction.  A businessWORX customer satisfaction score based on the Net Promoter Score (your score when customers are asked if they would recommend your shop to a friend) was well over 9 on a scale of 1 to 10, with 10 being the best score. The Net Promoter Score is considered a leading indicator of a business’s future growth.

Ben Vollmer of businessWORX said, “Specialist retailers take care of their customers. There are hack shops out there and hack mechanics, but the shops investing in their business do very well with customers.”

New customers represent about 20 percent of specialists’ client base on average. Vollmer warns that new customers are expensive. “If you spend $1,000 a month on a Yellow Page ad for new customers, you’re probably better off figuring out how to re-engage your existing customers.” This would be achieved through methods like email blasts. The average number of email addresses in the businessWORX stores’ customer base was 1,567.68 in 2015, up from 677.69 in 2014.

A great goal for any retailer next year is to encourage past customers to make one additional purchase in the coming year. The average number of invoices per customer per year for specialists is about 2. Moving that up to 3 would produce a significant boost in revenue, Vollmer said.

Photo: JC Audio

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14 Comments

  1. Thank you for the article. In this day and age we will take all we can get as far as information goes and to simply criticize it for not being enough I feel is the wrong approach. If there are improvements to be made a recommendation I’m sure will be appreciated by all parties involved. Keep up the good work.

  2. This article is nothing but an advertisement for businessWORX, which is Avidworx that specializes in driving customers to a retail car audio shop via cloud based software protocols. So, what your saying in your article Amy is : If you happen to be a paying client to businessWORX they could say of our 71 clients they have seen x% increase in revenue using our in-house home grown metrics. Even the article was very vague about what segments of the business they were referring to or how they arrived at stated averages. I’m sorry but that certainly doesn’t sound like anything close to what an “average” shop that is an independent, non subscriber to businessWORX services.
    CLICK BAIT PURE AND SIMPLE. I suppose content advertising is the new thing but come on be real.

    1. I would like to note that while my headline may have been misleading, CEoutlook featured the information from businessWORX because it was instructive, rare and therefore valuable information about a class of car stereo retailers. I was in no way, shape or form compensated for the story. I believe the error in judgement in the story was the headline, and for that, I apologize.

    2. Mark –
      I do think that as time progresses we will see and find some segmentation of Mobile Electronics retailers. The questions I have is how and what is the best way? Do you segment by years in business? Number of technicians? By annual revenue? By the size of their market? I personally haven’t figured out the best approach, but in looking at the revenue, you see basically four layers of the market based upon revenue.

      The averages above where from the POS or Accounting system the retailers used. So that average was created by taking the retailers that have been using the same POS/Accounting system for the minimum of 24 months. So it wasn’t a number that was pulled from thin air.

      Could the results be different for other retailers? Absolutely! Are businessWORX subscribers generally more focused on growing their business? I would say yes. But there are other groups of retailers growing their business. Are other retailers content to be lifestyle retailers? Yes. And would I guess their growth follows the averages? My guess would be their growth would be from 0-10%.

      Hope the information above helped shed some light on to the process and numbers.

      Ben

    1. Wayne –
      I wish I had a solid answer there. 🙂 I REALLY do. Not all Point of Sale / Accounting systems give access to Line Items on customer receipts via their API. And then combine that with every retailer using a separate numbering / lettering system for their internal inventory and answering that question is one I REALLY want to answer, but it will take a little more time. 🙂

      Ben

  3. The #’s offer some interesting insight, the bigger questions I think we should be asking are:

    1. How do we get more independent dealers involved in reporting their #’s so we can get a larger sample size, and once we get enough be able to look at our industry from what seems to be 2 growing camps: the specialist retailer, and the specialist integrator/fabricator.

    2. Many people in business (and benchmarks from some in our industry) say that businesses become profitable (to the business, not just paying an owners wage) at 1-1.2 Million a year. What can we do to create programs and blueprints for dealers to grow from whatever point they are at to that point and beyond. So we have a strong stable dealer base that can invest in training, store upgrades, marketing, new technologies etc.

  4. Thanks Amy for the incredible insight into the specialty car audio business… our industry would be lost without you…

    1. Gary –
      There is actually a retailer I work with VERY closely that based upon his demographics the Yellow Pages are an awesome investment for him. But for others, I wouldn’t recommend it. 🙂

      Ben

    1. As part of this study group, I gotta say that after using their products, my stores have grown 30% this year alone.

      These guys are extremely helpful in allowing car stereo owners like myself turn a profit.

    1. Dan –
      I would love a much larger sample size. 🙂 This sample of 71 is ones that met some criteria around YoY use of a POS/Accounting, etc. And compared to NPD, it is a MUCH larger sample of Specialty Retailers as opposed to big box retailers. I’d love to track this with 800-1000 retailers and see what the results look like. And then by segment then in an intelligent way would be nice as well. 🙂

      Ben

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