Margins are very low, and sales occupy a tremendous amount of time. Musicians want to talk about tone for hours and then ask you to price match at the end after you've given exhausting amounts of advice. So you have to guard your time while still being a guru, or you'll never earn a fair wage. Lessons are a must for a small shop. You need steady revenue to get you past tough weeks. Be very skeptical of everything the sales reps tell you, and do not accept things like "minimum order" limits or mandatory stocking of certain items at face value. Usually that can be tweaked. Most sales reps will hurt you and your business if it means getting a bigger piece of your purchasing pie.
The industry is crammed with failed musicians, too. And they don't always make the best businessmen. Guys who would never get past the mail room in most corporations get to be "Vice President" of something or other in the music business.
If you can find other ways to produce revenue that's great too. For example, have practice space for rent to bands. Then when they are practicing and break a string, or decide a phaser would go well in the song they're writing, they'll come right over and buy, and be less interested in whether you're $3 higher than Guitar Center. If you know how to record, you could even offer demo sessions. Good digital gear is so cheap now that you could set it up reasonably, and make a good buck, even if no one's buying wahs or amps that week
Like bamm said service work is a great road to success, but you have to be good at it or else it backfires.
