Skate Shop Business Overview

A skate shop is not only a place where skateboards, accessories, apparel, and gear are sold but is also a hub for the local skateboarding community. These shops tend to focus heavily on building the skateboarding community, and they become a go-to resource for skaters of all ages. Skate shops often sponsor competitions, local skating groups, or individual athletes and may also perform demonstrations.

The key to success in this business lies in building strong customer relationships, providing quality products, and offering expert guidance and service.

• Brick-and-mortar retail: A physical store location offering skateboarding products and gear
• Online store: An e-commerce platform selling skateboarding equipment and accessories
• Hybrid model: A combination of physical store and online sales platform

Related: Checklist to Start a Business

How Do Skate Shops Make Money?

Skate shops make money by catering to the unique needs of the skateboarding community, focusing on specialized products and services. The core of their revenue comes from selling skateboards and related gear, while additional income can come from accessories, apparel, and community-focused offerings.

Here’s a breakdown of how skate shops generate revenue:

• Skateboard sales: Selling complete skateboards and individual components such as decks, trucks, and wheels is the main source of income. This is the foundation of the business, as these items are essential for the sport.
• Accessories and parts: Items like grip tape, bearings, and hardware are regularly purchased by skaters to maintain or customize their boards.
• Apparel and footwear: Many skate shops sell clothing and shoes that are popular within the skateboarding culture. Branded t-shirts, hoodies, and skate-specific shoes are common items that attract both skaters and fans of the lifestyle.
• Lessons and workshops: Offering skateboarding lessons or hosting workshops can bring in additional revenue. These services are particularly popular among beginners and young skaters, who can become long-term customers.
• Repairs and customization services: Skate shops often provide repairs or customization options for boards, such as installing new grip tape or assembling custom boards, creating another revenue stream.
• Events and sponsorships: Hosting or sponsoring local skateboarding competitions and events can help promote the shop while generating income through entry fees, merchandise sales, or partnerships.
• Gift cards: Like other retail stores, skate shops sell gift cards, which provide immediate revenue and encourage customers to return for future purchases.

Industry Statistics

The sport of skateboarding is well-known for its notable style. According to Martlet, while the sport originated as the “sport of outcasts,” today, skate style is nearly everywhere. Skateboarding has come far in its evolution as a sport and a culture. Since the 1990s, skateboarding has become tremendously popular, and it’s now an officially recognized sport, beginning with the 2021 Olympics.

During those 30 years, skateboarding has been normalized as a sport and pastime. The sport has become more accessible, and skate fashion is now normalized as a mainstream fashion. That style comes in phases, with certain trends gaining popularity and then circling back again.

Skate shops belong to the Sporting Goods Stores industry classification NAICS 451110. These retailers focus on providing skateboarding equipment, accessories, and related products to their customers.

Some details about the skate industry include:

Skate Shop Industry Size & Growth: The skateboarding retail industry generated $696.1 million in revenue last year, with a yearly growth rate of 1.5% over the past five years. The market shows signs of continued expansion, with projections indicating sustained growth due to increasing participation in skateboarding as a recreational activity. The inclusion of skateboarding in international sporting events has also contributed to broader consumer interest (IBISWorld).

Number of Skate Shops: There are approximately 2,020 skate shops operating across various locations. The industry remains primarily composed of independent retailers, with no single company holding a dominant market position. This structure allows for local shops to adapt to their community’s needs (IBISWorld).

Skate Shop Profit Margin: Profit margins vary among skate shops based on location, product mix, and operational efficiency, but the average net profit margin is reported to be 6.3%.

Also See: Ideas for Naming a Skate Shop

Costs To Start a Skate Shop

Starting a skate shop could range from $25,000 to $85,000. The lower end assumes a small retail space with basic inventory, while the higher end includes larger inventory and premium store fixtures.

Here are the main costs to consider when starting a skate shop:

Retail Space ($5,000 – $15,000): First and last month’s rent plus security deposit starts your lease. Basic improvements might include display racks, counters, and simple renovations. Many shops find success in smaller spaces around 800-1,200 square feet.

Initial Inventory ($15,000 – $50,000): Stock includes complete skateboards, decks, trucks, wheels, bearings, hardware, shoes, apparel, and accessories. Building relationships with multiple distributors helps maintain diverse product selection. Starting inventory should cover popular brands and various price points.

Store Fixtures ($3,000 – $12,000): Display cases, board racks, shoe walls, clothing racks, and a point-of-sale system create an organized shopping experience. Security systems and cameras protect inventory.

Shop Tools ($2,000 – $8,000): A complete skateboard assembly station, grip tape application tools, and basic maintenance equipment allow for board setup and customer service. Tools for adjusting trucks and mounting hardware help provide full service to customers.

These cost estimates are approximate, and actual expenses will vary based on your business model and scale of operations.

Resources:
Board Retailers Association