Thursday, July 16, 2009

Pick on someone your own size.

One of the reasons I started writing this blog about Pegasus Books, is that several years ago, I got caught up about reading the rise and fall of a new comic store called Riot Comics.

I knew from the first entries that the guy was going about it all wrong, but I was fascinated by his bullheadedness. It was a disaster waiting to happen. Generally, it's not all that difficult to get a strong sense of whether a store is going to make it or not make it.

Talking about it on a blog just makes it all that much clearer. (There's a lesson there, I suppose....)

He was very disdainful of all the other comic shops, which is common enough among fans. But of course, these shops have been existing in the real retail world and it seems foolish to dismiss everything they are doing.

The guy had a vision, to be sure, and he was entertaining and candid in his lead up to the store. He designed a very nice looking store.

And then fizzled.

Because he went about it all wrong.

In fact, the most fascinating aspect of all was watching him change his mind about each of the things he had made fun of about other stores. He brought in back issues. He had to buy some more functional fixtures. He found that having an "anime" club didn't do a thing for his anime sales. And so on.

He forgot he was a store, and not a 'model.' He forgot he needed lots of inventory. He narrowed his focus to such an extent there was simply no way he was going to make money.

He come into retail as a purist with a vision, and left disillusioned that people liked the look of his store, but didn't buy anything.

He seemed to spend most of his time designing business cards, and logo's, and signs, and t-shirts. Describing the colorful Ikea furniture, and showing off the 'art' on his walls.

But nuts and bolts, you need inventory and lots of it. Design doesn't pay the rent.

Anyway, I've found two new blogs about start-ups, and they seem equally misguided and bullheaded.

One is called Rocketbomber. He's gained some notoriety for writing about his book customers in a mocking way. But he's entertaining to read. He certainly has put a lot of thought into his store.

But his 'vision' is fundamentally flawed. The 'vision' of a Graphic Novel store. No comics, no back issues, no toys, no cards, no books even, except as they tangentially relate to graphic novels.

The question is -- why would you cut off all possible revenue streams but one?

I started with comics -- and it wasn't enough.

I added sports cards -- and it wasn't enough.

I added games -- and it wasn't enough.

I added card games -- and it wasn't enough.

I added toys -- and it wasn't enough.

I added graphic novels -- and it wasn't enough.

I added used books -- and it wasn't enough.

I added anime and manga -- and it wasn't enough.

I added new books -- and.......well, I can't add anymore. I've at my wit's end in space, time, energy and money.

In the midst of all this trying, I also handled Beanie Babies, and Pogs, and gave up any idea of being a 'purist.'

Pogs are about as widgety as it gets -- if I'm willing to sell Pogs, I'm willing to sell anything.

The other start-up is Greenlight Bookstore in Brooklyn, N.Y. They got the go ahead on June 1 or so. A couple of days ago, they had a party in their still untouched store-space, for their friends and neighbors. Had a great time sipping wine and tasting cheese.

The architect's drawings were on the wall.

WTF?

An architect? You hired an architect? It's an empty space! Slap a coat of paint, scrounge up some bookshelves, but some damn books and get rolling?

You sign a lease on June first and you're still staring off into space six weeks later?

No, they've 'designed' some bookshelves. Custom made bookshelves.....

Hey, if I'm an investor, I'd be looking to get my money out of this disaster. They are going to sink a ton of money into this store, and it will be a marvel to behold, and it will even generate a lot of sales at first.

But they will spend most of their career trying to dig themselves out of debt. And if they are as pie in the sky about their day to day operations as they are in their planning stage -- their career won't be long.

But they'll leave a beautiful corpse.

7 comments:

Broofa said...

Hey Dunc, gotta teach you how to add links to your posts. :-) It'd be nice to be able to just click a rocketbomber link instead of having to google for it and wonder if I found the _right_ rocketbomber (???) site.

Regarding the Brooklyn store, I'd agree with you that they're off to a rocky start... except that they are selling to a market of 8-9M New Yorkers, not 100K Central Oregonians. And that's a game changer.

It's the ol' numbers game again. 1/10th of 1% here gives you an upper limit of 100 customers, which ain't enough to build a business on. But in Brooklyn, that's 8,000 customers.

You also have to take into account the increased cost of business there. Rent is likely 3-4x what you're paying. They may not have the option of taking a "stuff it to the gills with inventory" approach. They need a gimmick or an angle that will set them apart from their competitors, and that attracts a customer base willing to pay a premium for whatever image and specialty merchandise they're selling.

Big cities polarize businesses, pushing them to one end or the other of the cheap-mass-market .vs. pricey-high-end spectrum.

As you astutely point out, the high-end, image-based approach the Brooklyn store is taking simply won't work in our neck of the woods. But does that guarantee failure in their choosen market? Similarly, would your approach fair any better in NYC, or would you fail for lack of distinction among the 100's of specialty book, game, and card stores there?

Duncan McGeary said...

rocketbomber is right.

I think spending too much money on extraneous stuff and limiting your revenue streams would be a problem no matter where you are.

I suppose it's a matter of how much weight you give it.

Jeff said...

On their blog the proprietors of the Brooklyn store say they have "an award-winning business plan".

They should definitely advertise this -- Why shop in an ordinary bookstore when you can shop in one with an award-winning business plan?

Maybe they're MBA students and got an "A" in Entrepreneurship 101.

RDC said...

Duncan,

Given enough time and enough floor space so you can continue to bring in more and more product lines. Then when you cover all of the lines that you think that there is a market in you can start fine tuning your stocking and buying patterns to maximize profit by improving inventory turns. Do it will enough and you become Walmart or Target.

blackdog said...

"But his 'vision' is fundamentally flawed. The 'vision' of a Graphic Novel store. No comics, no back issues, no toys, no cards, no books even, except as they tangentially relate to graphic novels."

I agree with what Broofa said: A store catering to a very specialized niche can work if it's in a very big market. A store selling (for example) only left-handed guitars might do well in NYC or LA. In Bend ... nope.

Duncan McGeary said...

Well, there's specialized and there's the Scotch Tape store in the Saturday Night Live Sketch.

"It's really slow. I don't understand it...."

They don't have to go as pop cultural general store as me, but having a couple or even three viable product lines isn't going to stray too far from your vision and seems much more prudent.

Duncan McGeary said...

I didn't mean rocketbomber is right, I meant your link is correct.