Yes, I carried Beanie Babies. Did quite well with them, thank you.
There are a bunch of anniversary (?) articles on BB's right now, and a lot of head shaking. How could we have been so dumb? What made us do that?
Most people get one bubble or fad in their lives -- and it is always pretty devastating. (Especially if your first bubble is housing....) Most people make the same mistakes, and I'm no exception.
But to my mind, you get a guilt free pass on that first bubble or fad. Because there is just no way to understand how they work until you've experienced them. I mean, I'm going to tell you how they work right now, and you won't listen. When that bubble comes along, you'll fall for it.
Basically bubbles require that you go all in, and then collapse before you can get out.
There -- now you know. Not that you'll listen.
My first bubble was sports cards and it was a biggie. Bigger than all the other bubbles I experienced put together. It went on for about 7 years, almost exponential growth and me putting the revenues into bigger and bigger enterprises. At the end I had 4 stores and tens of thousands of dollars in orders out there.
When the bubble started to collapse, not only didn't I see it, I saw it as yet another opportunity to expand my market share.
Big mistake. Not only didn't I get a share of the huge amount of money that went through my stores, I lost a ton of money.
Ironically, it was a series of fads that followed that saved my business.
Almost immediately on the heels of the sports card collapse, comic books took off. I rode this wave too, and it helped me pay off much of the sports card debts. I thought I could "manage" this fad -- but I was wrong. Once again, I was left holding the bag. Fortunately, my suppliers at the time helped me make it through (because they had to -- most of the businesses they serviced either went out of business or were suffering.)
I vowed never to get caught again. (There were other fads along the way -- non-sport cards and magic, for instance, for which I didn't get killed, but didn't really make money either.)
Along comes pogs.
And I managed it perfectly. I pitched a perfect game. I maximized the profits and minimized the risk. It was easier because the supply wasn't limited and I didn't have to gamble. But still...
I walked away from that fad paying maybe half of what I owed on the other fads, as well as adding a product line or two from the store. I was still broke, but closer to viable.
Then along came Beanie Babies. I pitched, if not a perfect game -- I'd say a no-hitter. I minimized the risk by buying what I wanted from a middle man. I could have made more money by going direct, but I would have increased the risk. I took what I could get.
That got me more of the way back, and also added a couple of product lines.
Then came Pokemon, and again I used a middle-man as a cut-off and minimized the risk.
In both Pokemon and Beanie Babies I let go some of the revenue I could have made. I bailed out when I saw them begin to weaken. I was smart.
I paid off most of my debt and restocked my store through this process.
But it was still a gamble. All bubbles are a gamble if you choose to partake. My solution is to partake as much as I can without taking extreme risk even if I don't quite make as much money as I might have.
There hasn't really be a fad since Pokemon, that I've been part of anyway. My business isn't vulnerable to a "fad" element, which is kind of a relief.
But if one came along, I'd try to play it -- get what I can out of it.
And watch the other people go nuts.
47 minutes ago