Wednesday, January 2, 2008

I love doing the end of the year analysis of my business. Seeing what sold and what didn't sell. Trying to figure out why things sold or why they didn't sell. I've never understood other business owners who don't do this. How did you do compared to last year? I ask. And they don't know, and don't seem to care.

I can probably tell the percent increases or decreases in every category over the last five years. I can probably tell you if we went up or down each year from the beginning.

To me, it's almost the essence of small business. Making plans, trying to decided which products to support or increase, which to let slide, which to drop, which to add. To me, it's the whole ballgame. It's where I can prove myself right or wrong, and separate myself from the other business owners. I really trust my conclusions, and I find that I'm often ahead of the other guys in making necessary decisions. I think it is where you prove whether or not you really think for yourself, or just follow the lemmmings off the cliff.

We've had increases in sales overall in each of the last five years. We are currently about double in sales than 2002. 2002 was a real low ebb, matched by 1997. But we finally paid off our debt in early 2003, and the Sword of Damocles was no longer hanging over my head. I could start to take a few risks, a few chances, spend a bit of money.

Which proves, I suppose, that you can't run a successful business without risk, and you can't make money without spending it.

The earlier low ebb, at the end of 1997, we'd just suffered 3 straight years of decline as sports cards, comics, magic and other bubble's had all burst, and all the stores I'd opened in the bubble were closed and all the debt on the credit cards came down on our heads like a ton of bricks.

I found out later that Congress had changed the rules for credit cards in 1997, more or less removing the limits to the % level and when or if they could be raised. Suddenly, bills that we had been paying since the sport card collapse in 1992, became too much.

Anyway, Pokemon and beanie babies came along around then, and we went to Consumer Credit Counseling, and just hung on. By 2002, all those bubbles had also burst, and sales were declining but we were all but finished paying off the credit cards.

I'm proud of the way we paid off our credit: it was an amount that would've probably sent most people into bankruptcy. But at the end, amazingly, our credit was still decent enough to get a regular 30 year mortgage.

I started my project of diversifying. There hasn't been a bubble in my business since the peak of Pokemon in 2000, so the sales I have today are more solid than ever before. I never would've expected 7 years without a bubble, since we had more or less about 9 bubbles in the first 18 years; sometimes overlapping.

But the foundation is more solid without a 'hot' product, and the risk of it disappearing overnight isn't there.

Our overall increase in sales this year was 7.5%, not quite the double digit increase I've become used to. Our sales actually dropped 2.% in the second half of the year, which isn't what I wanted, but I can sort of see the reasons.


What I'm going to do, is each of the next 8 days, I'm going to sum up the results from each of the 8 cash register keys, starting tomorrow.

1 comment:

Mrs Sally Heatherton Esq said...

Below is the "Inn of Seventh Mountain" new owners board report. Duncan, please note, most interesting is Councilman Friedmans use of 'armed guards'. They look quite similar to the guards seen at Tetherow some weeks ago.

Message from the New Chairman of the AUO
January 2nd, 2008

I am writing on behalf of the new board to give you all an inside view of the events of the past two weeks leading up to the special meeting to remove six members of the old AUO board and replace them with a new slate of candidates introduced to you in previous posts. It has indeed been an emotional rollercoaster for the group of us most intimately involved.
At first, the task of tracking down all of the owners in a short period of time with the sketchy information finally provided to us by Bill Friedman’s office seemed overwhelming. We all received a rapid education in using the internet to find people. The encouraging and gratifying part of the job was that the assessment notices had grabbed owners’ attention and our position was an easy sell. We began to feel guardedly optimistic.
Then we learned several days before Christmas that the Papes had directed Patti McMean to make offers on a number of larger condos in an attempt to increase their ownership percentage. Pessimism reigned. As we learned that they had been successful in purchasing 4 or 5 units we redoubled our efforts to find the remaining “lost owners.”
We made contact with our final lost owner on the afternoon of the 26th and she immediately faxed in her proxy. Only two of the non-board, non-selling owners refused to support us. At 5pm on the 26th Lisa Kirbs and Peter Smith delivered proxies representing 50.813% of the common ownership to Bill Friedman. We needed 50% to remove the board. Our attorneys sent a strongly worded letter to Friedman saying that we would expect him to maintain the same level of confidentiality with the Papes as he has with our side and not leak the results. We were instructed by our attorneys not to discuss our knowledge of our prospective victory, as we wanted to keep this information from the Papes.
Nonetheless, on the day following Friedman’s receipt of our proxies, the Papes instructed Patty McMean to seek to purchase more condos in a last ditch, seemingly desperate, attempt to reverse the results. Some committed owners resisted these efforts but we learned that the Papes had closed several more deals. Our attorneys assured us that the only way to rescind and/or reverse a proxy vote after the 12/26th deadline was to personally show up at the meeting. Consequently we were on pins and needles at the meeting as many owners, including partial owners, stood in line to check in with Bill Friedman. It turned out that most of these owners were in line only to ascertain that their votes had been received and counted. In fact, to our knowledge, not one owner whose proxy we held actually attended the meeting and revoked their proxy, so we know that we did win the vote
I requested that as a board member I be allowed to observe the tabulation of the vote by Bill Friedman. My request was denied. As expected Jordan Pape stood up at the end of the special meeting and announced that we had not achieved a 50% majority and adjourned the meeting. At this point our attorney stood up and reported that we had in fact won the vote. I then announced that there would be an emergency meeting of the new board.
We did meet before a group of approximately 100 enthusiastic owners and had a successful first new board, or “unINNspired board”, as it was dubbed by one of our owners, meeting. Notable actions included rescinding the assessment, terminating Bill Friedman and Tamara MacLeod, the AUO attorney, and establishing a construction committee to oversee the necessary improvements to our buildings. Complete minutes of the board meeting will be posted on our website.
It is of interest that not only have our AUO funds been supporting an attorney, Tamara MacLeod, who has done everything in her power to obstruct the will of the majority of owners, but also the old board and Bill Friedman saw fit to hire an armed security guard to stand in the back of the room at the past two special meetings. The new board did not find it necessary to retain the security guard’s services for our board meeting. As I am unaware of any threats of physical violence from even our most irate of owners, I can only conclude that the armed guard’s presence was for the purpose of intimidation. The new board does not consider AUO expenditures of this sort either prudent or reasonable.
Thanks to all of you whose efforts and support made this outcome possible. Your new board promises to act in a completely transparent manner and work on behalf of all of our best interests. Any of you not presently included on my concerned owners email list who want to receive the most up to date reports on our progress, send me a email and include your phone numbers if you so choose. Best wishes for an exciting new year.

W. A. Peter Bours, New AUO Board Chairman
wabours@gmail.com
503-357-9684