So why are so many specialty stores suddenly opening in Bend?
Why is it, for instance, that it seems as though a dozen children's clothing stores, new and used, have all of a sudden opened?
I think I may know one of the answers.
I'm going to throw out some figures that are absolute guesses, that are meant to be representational, and to illustrate my points.
Let say that 5000 people have moved to Bend in the last couple of years. Let's say that 5% of them open retail stores. 250 people look around and based on their own interests and knowledge, they are going to look for likely stores to open.
Perhaps some of them are interested in games? Or pop-culture toys and statues? Or sports cards? Or anime and manga? Newcomers are going to look around and see no one doing it.
Will they wonder why? Or will they simply assume that the stores that vacated these specialty niches didn't do it right. Will they come to Pegasus and think, he's got it covered? Or will they think, nah, he's treating them as a sideline and I can do better.
One of the surprising things to me, over the years, is how many times people have opened stores in competition to me, without even knowing I existed. American Sports and Anime Mt. never really looked at my store, and I think Brad moved his gaming store downtown a few blocks from me without even considering the impact.
Because, as specialty stores, they will believe they are doing it right. And at first they will be rewarded by the fans. A specialty store will almost always do better than a general store in the short run.
But they are putting all their eggs in one basket. Because every specialty has it's ups and downs.
I think I've done it right. I think after 27 years and watching dozens of competitors come and go, making the same mistakes, that my configuration has proven to be more durable.
For instance, let's take each competitor and my guess as to how much more material they were selling than me at their peak, and at the end.
Gambit Games -- Probably 10 times, at the end probably 5 times.
American Sports -- Probably 5 times, at the end, probably 3 times.
Anime Mt. -- Probably 3 times, at the end, 1.5 times.
Fun and Games -- Probably 5 times, at the end, probably 1.5 times.
Add them up, and I'm halfway to a viable store. Add in comics and books and I'm a viable store.
So what happens? Someone moves to town who loves games, looks around and doesn't see a game store, and decides to fill the niche.
Zero is a more dangerous number for competition than 1 or 2. Zero invites new competition, any of them who could be 'Crazy Eddies' and or people with more money than sense.
So two years ago, a dozen people -- who love kids -- looked around and thought, the kid's clothing stores in town aren't carrying the brands I want, so I'll do it. At the same time, without knowing about each other.
I've had quite a few clothing store wannabe's come in the store, and when I point out that there are dozens of such stores downtown, they always say the same thing: "They don't have the brands I would carry."
Well, that seems to be slicing the salami a little thin, so thin there aren't enough nutrients to keep them alive.
Over the last three years as housing prices exploded, and downtown filled up, and more and more people looked around for a business to open, there was the incubation period for what's currently happening. I'd bet almost all these folk came from somewhere there were multiple examples of the stores they want to open, and instead of questioning why Bend didn't have such store, they are going to show us how to do it.
Some will be right. Some will make mid-course corrections. But a lot of them will have opened 'specialty' stores that are a little too special for the population and demographics.
Bend is different. 25% retiree? (Notorious for not spending money.) Tourist employees? (Mostly minimum wage) We are an Hour Glass economy, rich at the top, pretty thin in the middle, thick at the bottom.
If I had to put it in a nutshell, it would be this: Almost everyone overestimates the population and prosperity of Bend. Almost everyone misinterprets the demographics. Almost everyone overestimate the demand.
As a whole. I mean all of Bend, not just the rich enclaves, because I'm still convinced that to succeed in Bend, most businesses need to appeal to as wide demographic as possible, long timers, newcomers, red necks, rich folk; and even then, they need tourists to really do well.
Over the last three years the top of the hour glass has kept many specialty stores that wouldn't have succeeded in the past, in business. It seems pretty clear to me that there almost has to be a domino effect to the housing slowdown. Every store is going to see a bit of a decline.
Just as umpteen new stores are opening.
2 days ago