Thursday, May 31, 2007

When I signed my latest lease, I made plans to push sales as hard as I could for 2 years, and then spend 3 years trying to turn a profit. I had a sales figure in mind, which I thought would be a stuggle to reach.

We blew past that figure in the first six months, and then kept going.

At the two year mark, I threw the plans out the window and added two more product lines, which I've been establishing over the last year. We are now a full 25% higher in sales than my original goal, and growing at the 15% a year rate.

So now we've hit the new revised, this is the future, crunch month. July 1 is the actual starting point, but I'm going to use June as a dress rehearsal.

It may be a purely selfish reaction, and possibly short-sighted, but I do believe that the consumer economy in Bend still has at least six months of strong life in it. People just don't seem to be getting the bearish message. Everyone I talk to is either not aware, doesn't believe it will affect them, or doesn't care. (Please don't tear me a new hole for saying this -- I totally believe the housing bubble is bursting and the effects will be dire. I'm talking about the consumers who buy MY product.)

Now I know this housing slowdown is going to hurt, but as long as the consumer is in denial, I'm going to still make sales. I'm pretty sure that even if the local economy tanks, that I will still see some good sales from the tourists over the next six months. It would be the first half of next year that I would feel it.

And what I sell makes a difference. I have a recession resistant product line --that is, historically, my sales have been good in down years, and not so good in boom years. (Indeed, what I'm hearing is that many downtown businesses are slow right now, when we're really doing better than expected.) Except where there was a huge recession in the 1980's, the macro-economy of the overall economy hasn't affected me as much as the micro-economics of the specific product lines.

Even when the micro-economics change, it takes time. When the sport card market started going down, it took a good 5 years before it became common knowledge to the consumer, when comics went down, it took a couple of years, and so on. What really pleases me is that we don't have a single product that I would call 'fad', nor have we for at least 5 years now. I never thought I would say it, but I think my store is better off without the Next Big Thing. (Of course, if one came along, I'd try to tap into it.)

It so happens that the very same preparations I need to make to survive a drastic downturn, are the very same preparations I need to make to turn a strong profit. I prefer the profit, but frankly wouldn't be totally surprised by the former. Disappointed, obviously, but I'm really fatalistic about it.

I'm feeling like I'm in a speeding car which is headed for a cliff, but which has run out of gas. It's a physics equation beyond me whether the car will stop many feet from the edge, roll to a stop inches from the edge, tip over the edge, or go roaring over it.

It's also interesting that some of my competition has fallen by the wayside in the last year or so.

Two years ago, I had four direct competitors to what I sell. I predicted in my business diary that at least half of them would be gone by summer of 07. Three of them are gone.

I'm not cheering their demise, though I'm surprised it is happening at a time when we are doing so well. But I do like confirmation that many of the decisions I've made over the last five years -- painful as they were at the time -- were obviously the correct ones. I like that our sales were increasing over the past couple of years in the very categories that my competitors were carrying. It's the satisfaction of the tortoise crossing the finishing line, if you will.

The second half of the year is always better than the first half for my store, no matter what, so I'm looking forward to it.

Wednesday, May 30, 2007

Finished my orders for July. Once again, Marvel Comics has confounded me.

I'd say, half their line is tied up in one crossover event or another, each title tied into the other. Almost no way to get that right. Either the I order tight, getting just the titles that people are actually signed up; or I order loose, ordering enough to cover everyone who buys a title that is 'related'; or somewhere in-between. There is almost no way to order correctly.

For instance, Marvel has a new series called X-tra Endangered Species, which ties a bunch of the X-Men titles together. Now, I sell roughly 30 copies of X-Men, but only 8 copies of X-Factor, and the story crosses over. If I stick the X-Factor on all the X-Men shelves, the customers has the prerogative of handing it back.

They also have the continuing Initiative series, the followup to Civil War, as well as the huge World War Hulk series. All of these can run out of steam without warning. Any kind of overall economic slowdown in Bend, and my customers can exert their prerogative of not buying.

On the other hand, if I don't order enough, it damages the momentum for the readers and the store, and disappoints the customer.

Because it's summer, and because we've been having good sales, I've taken on most of the risk. I'll know by July and August, when I'm ordering for the slower part of the year, whether that was a good decision.

Marvel has also confounded me with their 'rolling discount' structure. In the old days, the higher orders from the last 3 months would have earned me a percentage point higher discount, but they now average a year, so I won't see the benefits for a year, if then.

Oh, well. I keep telling myself that it is the difficulty of predicting comic sales that makes it possible for us to thrive, and -- so far -- has kept the mass market out.

Tuesday, May 29, 2007

The Hap Taylor article in the Bulletin has made me want, for one last time, to explain how bad things were in Bend back then. (Hap Taylor and Sons went bankrupt in the mid-80s....just like everyone else.)

You know how my parents generation was scarred by the Great Depression, so that no financial decision was made without taking that into account? I've never been able to shake the mid-80s from my consciousness.

It was a time of opportunity, in some ways. I was able to buy the store, because the owner (Mike Richardson, who went on to become owner of Dark Horse Comics and Things From Another World and a bit of tycoon) wanted out, and I'm sure he thought he'd found his 'last fool' in me. I found sports cards to carry me through the 80's. I was doing O.K. when everyone around me was really hurting.

It's really hard to explain the psychology back them. We felt doomed and hopeless, and those businesses who hadn't already left downtown were trying to sell out. The figure that was bandied about was 40% vacancy, but it felt much worse. Think downtown Burns, only worse.

A series of restaurants went into the space the Toomies is now in. Nothing like the haunted look in waiter's eyes, as they stood, tuxedo ed in the window waiting for customers. My neighbor, Jerry from the Sole Shop, and I used to sit out on the sidewalk and play cribbage for hours.

I remember when some young fellow from California named Bauhofer decided to renovate the Old Post Office, most of us thought he was crazy. The rate of change was very slow. I think it was a couple of years later when the guy renovated the O'Kane building, and most of us wrote that off to some crazy Californian who had so much Carpenter's music royalties that he could throw it away.

That's why, when people think that downtown Bend coming back was inevitable, it just means they weren't here. Because it happened one project at a time, and each one was risky, and there were a bunch of missteps and failures along the way.

But the physical reality of downtown Bend, was really only a manifestation of the scary psychology back then. I don't think I was even willing to admit that MAYBE the recession was even over until the 90's. So all that Reagan talk about "Morning in America" was just gibberish.

So yeah, I've seen a boom town become a ghost town, and it's something you never forget.

Monday, May 28, 2007

A three parter today.

There was a fun documentary on the History Channel last night about the Star Trek Paramount Christie's auction.

Amazing how much that show has permeated the culture. My Mom resisted the nerds around her for years. I don't remember her actually sitting with us as Dad and I watched the original Star Trek. But when she went to see the Star Trek movie with the whales she commented:

"I never knew how much I cared about those characters...."

I remember telling her about a movie about a little marooned alien, and how she was going to see it. "I'm not going to see a movie about an alien."

Of course, she went to see E.T., just like everyone else.

She was always a little puzzled about the invasion of the body snatching effect the Lord Of The Rings had on her second son. A perfectly normal kid became obsessed, reading the book so many times he lost count. And then growing up to own a pop-culture store, of all things. She understood a some level, because as a child she had been obsessed with Winnie the Pooh. (Hated the Walt Disney incarnation.) But, she refused to read LOTR's.

I was able to take her to the first LOTR's movie, shortly before she died. Her comment was that she liked Harry Potter better. Sigh. But at least she learned I wasn't the only nut out there.

There is a new documentary on Star Wars on the history channel tonight that looks interesting. I'd like to track down the big book that just came out.

There are some benefits to this job.

On a completely different subject. The article on the building in the Old Mill Quarter that is forcing out most of its tenants. I feel especially bad for Joyce of the Curiosity Shop, because she has already gone through the exact same thing in the old downtown.

I'm also alarmed by that 180 day eviction clause; enough to check our own leases. What good is that? Might as well have a six month lease, on the owners parts, while the tenants are stuck with a full lease?

It does sound like they were getting pretty cheap rent, frankly, in old buildings. What all the boho's and artists need to do is find some downtrodden part of Bend, turn it into the next cool destination for people with original taste, and leave all the yuppie infested places to everyone else. Problem is, I can't think of where that would be.

Finally, just in case there are any downtown owners who read this blog: Over the last two months, my hourly sales average on Sunday's has been 25% better than the rest of the week.

That's right. better.

In fact, on a four hour day, I'm doing 80% as well as a normal 7.5 hour day.

Just so those of you who still close on Sundays know. I worked the store yesterday, and I noticed that almost all the business was walk-about traffic. There was a Sunday edition of the Saturday Market, but my sales have been high for the last two months on Sundays, even when the weather was cooler.

I've said for years that, if you are going to open on Sundays, you need to do it long enough for enough of your regulars to notice. I was slightly sympathetic with those owners who didn't want to do it, because I knew it took time to develop. I don't think that's true anymore. I think we're getting enough business from tourists that we don't need the regulars on Sundays.

I've also thought for years, that we had the potential of doing Sister's type business on Sundays in downtown Bend. Why not? We have a similar mix of stores, a similar appeal to the tourist. In fact, we might be able to generate significant business throughout the year, not just during the summer, unlike Sisters.

I think even without those business owners who don't open on Sundays, we may have reached the combustion point. There are enough old businesses and new businesses downtown, spaced in an attractive enough frequency, to be able to ignore the shuttered stores. Hey, maybe we're getting a bigger percentage of the tourist traffic because those stores aren't open....

What kills me, is that these are the same stores who clamor for 'special events' and 'street closures'. Which I hate, frankly. In fact, I have enough sales history to say that the exact opposite of the recent Sundays sales phenomenon happens. We drop about 25% in sales every time they close the streets. I'm resigned to the 'promotion minded' members of the retail community. (Though the original instigators of almost all these events are out of business, so I guess it didn't do them much good.) But I wish they would restrain themselves to current events. I've always thought closing the streets during the summer, is like closing a restaurant on a Saturday night.

Please don't do me any favors.

I believe, if we didn't hold another special event downtown that we will be PACKED WITH CUSTOMERS THIS SUMMER! Please leave them alone to shop.

But even if I agreed that special events are a good thing, I'm still mystified as to why -- after making so much effort to attract customers downtown -- the same stores CLOSE on days when there are hordes of customers wandering around. Not special event attendees -- who are there for the EVENT and not to shop -- but actual, real live customers. THEN you close?

As I said, I think those of us who open on Sundays are already the winners. And those who close on Sundays are missing out.

Sunday, May 27, 2007

The more I think about the BAT, the more ridiculous it becomes. Leaving out the fuel and maintenance costs, in a TRANSPORTATION industry would be like leaving out food costs in a grocery. I'm sure the trucking and airline industries would love to eliminate those pesky little costs into a footnote. (Never mind those costs.)

I'm also trying to figure out how many real people are using the buses. At a 75,000 population, less than 7% of the Bendites per week have used a bus not counting repeat customers. I'd be willing to bet that almost all the rides are repeat customers., but let's say half. 3.5%.

Interestingly to me, I first started hearing that Bend was the "largest Metro area west of the Missisipi without mass transit" many years ago, when the population of Bend was a fraction of what it is now. Try to imagine a bus system with 20,000 or 50,000 people. (Less than 1% ridership; 2%? 3%?)

I understand there is no political will for free taxi rides for the poor. But it might save us some money. The environment? Tell me that 11 riders an hour in a big bus that meanders around and sits at stops is more environmentally friendly than five cars that go directly to destination.

Finally, when I added 2.50 to the costs per rider, I'm pretty sure this was way too low.

Anyone have any statistics about cost per rider in other towns. Better than 12%? Worse?

Doesn't anyone at city hall crunch numbers? Surely my figures have a hole in them somewhere. Otherwise, we're pissing our tax mony away.
Finally, I can't resist commenting on the Bend Area Transit article in the Bulletin today.

12% of the costs of the BAT are covered by riders.

Not including a couple of little things like fuel or maintenance. (I'm sorry, what else is there? Besides employees?)

Nor, I suspect, does it include things like the original botched investment or the support services provided by city in the normal course of business.

Good God.

Do the math. That means that each of those riders cost 7.50! Not including fuel and maintenance (and investment and service?).

I don't know, let's round it off to 10.00 per rider.

I'll say it again. I'd be willing to submit you could contract it out to a private enterprise for half that much.

5 675 riders per week. Sounds impressive until you break it down. Let's see. 11.25 hours per day. 6.5 days a week. 7 routes.

I work out about 11 riders per bus per hour. So in any 15 minute span, the bus would have, what 2 and a half riders?

Again, I can't help but believe you could probably just hire a few taxi cabs to do the same thing, and put some money in the pocket of some local businessmen.

What a boondoogle!
Best Article Ever.

The chart, in today's Bulletin, listing the phases of an Amenity Migrant town. Having lived through those phases, I can tell you it is bang on. About the only thing I could add would be that Bend had perhaps even more of a "laissez faire, "growth is Good" attitude" than normal because of the horrible recession we went through in the early 80's.

Too bad this study wasn't available 20 years ago.
Nattering nabobs of negativity.

Yep, that's me. A nattering nabob. The funny thing about bubbles is that the positive glow increases to absolutely blinding just before the crash. Nabobs seem more and more irrelevant as the bubble continues to expand. Everyone in the bubble seems to be getting rich, and the guy standing outside the bubble, isn't. Why should they listen to him?

I had a friend tell me, during the height of the Nasdaq boom, that she'd had a friend advise her to buy Cisco Systems early on, and that the stock had gone up 1000's of percent, and that she was -- at least on paper -- pretty wealthy.

I didn't know anything about the Nasdaq, only that it was getting pretty high. But all I needed to hear was the phrase "gone up 1000's %."

"Sell! Now. The minute you get home, call your broker and sell."

She told me all the reasons, all the rationalizations, why she wasn't going to do that.

I repeated. "Sell. Now."

Other than going over and shaking her, I couldn't have been firmer. I don't know if this happened when the Nasdaq was 3500, or 4000, or 4500, or at the height. It DOESN'T matter. She had increased her wealth by a huge amount.

But there's the rub. Anyone who has watched their stock go up that much isn't going to quit.

With housing starts dropping 55% in the first four months of the year, you'd think that would send a shiver of fear throughout Bend, especially in any trade dealing with building. But what I hear, over and over again, is "It won't affect me, because......" And you can fill in the reason.

Over on the BendBubble2 blog, I used the word denial.

People tend to find reasons why it won't happen to them. Houses may go down in the country over all, but not in My town. Houses may go down in my town over all, but not in My part of town. Houses in my part of town may go down over all, but not My house.

I'm doing it, too. Read my message from yesterday. I think I'm right, but there is a little niggling doubt in the back of my mind.

The other thing that happens is that people misread their own motivations. How can that be? Who knows better than oneself what one's own motivations are?

Actually, I think very few people fully understand their own motivations. When sports cards were at their height, I tried to warn people that I thought the values couldn't hold up, that exponential growth meant that in not too many more years, sports cards would be worth more than the gross national product, etc. And just about everyone said, "Doesn't matter. I love sports cards. I'd collect them if they weren't worth a thing."

When sports cards prices collapsed, about 95% of the collectors quit. And unfortunately, most of the 5% who stayed have deluded themselves into believing that they can still make money. When I started in cards, you could barely find them. Here and there in the grocery markets, gathering dust. That was the REAL level of interest by PURE collectors.

Even then, most collectors convinced themselves they quit because, 1.) it got too expensive, and 2.) there were too many brands. But, how does that keep you from collecting one brand? And how does that keep you from collecting cheaper brands?

I won't go through the whole scenario with pogs, beanie babies, comics, magic, non-sports cards, pokemon, etc. -- except to say that at the peak of each of these bubbles, not one customer would admit he or she was in it for any other reason than pure love.

Somehow that pure love disappeared when the bubble popped.

Denial and self-delusion. Of course they find other reasons for why they quit. To admit to being party to the bubble is admit to being greedy or a fool or being a follower. No one wants to admit to that.

I'll admit to it. At least for sports cards and comics. With the other bubbles, I'd learned my lessons.

Yet, I can feel the excitement of seeing my house go up in value. I can feel the temptation to borrow off that value. I can see that my business is benefiting from the boom, but I can also try to delude myself into thinking that it doesn't having anything to do with the boom and a crash won't hurt me.

Having been through enough bubbles, I have built in a safety factor. I know it's going to hurt.

Meanwhile, it still kind of fun to watch.

It's just human nature.

Saturday, May 26, 2007

How I Learned to Stop Worrying....and Love the Bubble.

Not much I can do about it, is there? My fixed expenses are my fixed expenses. I'm halfway through a lease, so I'm still enjoying the rents rates that were in existence a few years ago. Every other fixed expense is as low as I can get them, irreducible, except for the employee. The employee, I've decided, is NOT a discretionary expense. Not if I want to have any days off, any vacations, or any quality of life.

I've arranged for more than half of my discretionary funds to be non-committed. That is, I can spend them or not depending on how things are going. The difference won't be between breaking even or losing money, but between making money and breaking even. I've been planning for this two year stretch for several years.

I also have some countervailing forces at work here. Comics are having a good run, I've lost some competitors, fantasy and SF seem to move ever more steadily toward the center of pop-culture. I've got a full store, with many functional product lines. I'm in a part of downtown that has become much, much busier in the last couple of years, and show every sign of getting even busier.

A busy economy but low comic sales -- or a slow economy and busy comic sales.

A busy economy but slow location -- or a slow economy and a busy location.

A busy economy but slow market share -- or a slow economy and an busy market share.

And so on. Seems as if they cancel each other out.

On the cusp of Bend's housing bubble, say the end of 2003, my store was doing half the business it's now doing. My part of downtown was still the hinterlands. My rent had just gone up. I was working almost every day. My store had maybe a third of the inventory it now has, as well as only 3 or 4 functional product lines. I had high debt, no credit, no assets (sounds scary, but its more or less my reality for the previous 20 years.)

Now, we own a house that has (supposedly) double in value. We have low and manageable debt, and access to all the credit we are ever likely to use. Our stores are both humming along.

Even with the dangers, I'm so much better situated that I'll take it.

So, Yahoo! Ya hoooooooo!

Friday, May 25, 2007

A Bridge Too Far.

Carrying new books and new board games has been a relative success. These two new product lines are almost half a year old now, and the inventory has been filled in to an nice level. (It was never my intent to be a full-line bookstore or a full-line game store.) The easy sales were at the beginning, and sales have slowed, but neither summer or Christmas have been tested yet.

Still, I'm satisfied. It seems as though my daily totals are reached through the combination of 10 product lines easier than they were through 8 product lines.

Earlier this spring, I'd thought to add new movie dvd's and new music cd's. But then decided that I'd wait until summer, and continue to work on the books and games until then.

Well, summer is here, and I'm backing off. Trying to add two new product lines, on top of the existing ten, would make my head explode. I just can't fit it into my brain. I have limited room, time, and money, and if I'm EVER going to turn a profit, I need to quit adding inventory lines at some point. So, I've decided not to do it.

It doesn't help that more than half the 'cult' movies I wanted to carry aren't available through the vendor I have lined up. If I can't get the director's cut of Bladerunner, the original Evil
Dead II, and so on, why bother?

Meanwhile, I'm hopelessly behind on new music. I'd planned to check out College radio lists for groups I should carry, since they usually have the kind of music I like, but it would require more research than I'm willling to invest.

So, back to doing the best job I can on comics, graphic novels, used books, new books, card games, role-playing games, board games, toys, anime and manga, and sports cards. That's quite enough.

Thursday, May 24, 2007

The traditional start to the summer season is coming up this weekend. Now that they keep kids in school past Memorial Day, I think of my store's season as beginning about mid-June.

Wait. Haven't I said that kids and young families are no longer my customers? Yes and no. Local kids and families are a very small percentage. Tourists are a very large percentage. And tourism can't really get going until the families are freed up to travel.

Barnes and Nobles has announced that despite an increase in sales last quarter, they actually lost money through discounts. This is known as giving away the store. The reason I bring it up is that the Harry Potter books is about to be released, at more or less wholesale price, so the next quarter is almost bound to be the same thing. Nevertheless, their stocks went up.

Too bad I'm not a corporation, with my growth rates I'd be a star. We've doubled in sales in the last 3 years. Now if I could just turn a profit.

I'm still not sure if I'm even getting the Harry Potter book. I had to go through the process of swearing that I wouldn't sell early THREE times! Pages of documents. When they called me a fourth time and said I had to do it again, I said, don't bother. The rep mentioned that I "might" get the books anyway, since the system was so screwed up. Either way, I'll get the book within a week of publication anyway.

The fates have handed us a chance to do a bit better in sports cards this year. The Blazers have the first pick!. So I may be selling a lot of basketball cards, which hasn't happened much since the glory days of Drexler and Porter. One of the reasons that sports cards have been hard to sell recently, except for the Blazers, we really don't have a local team.

It's scarily reminiscent of their choice of Sam Bowie over Micheal Jordon, however. Pick a dominant college center with a history of injuries, or a flashy scorer, who was Player of the Year in his freshman year? I'd go with Greg Oden, since good centers are impossible to get. Allen can go out a buy a strong forward, and they already have Roy in place. Finally, a team worth watching -- and worth selling cards of.

Wednesday, May 23, 2007

Back when I used to think I was competing with the big chainstores, before I realized I was a minnow swimming in an ocean of whales and sharks, I used to rail against the big, international corporations. (Well, I still do, but I don't expect anything to change.)

People used to respond with equal fervor, but after awhile I was began to realized that both conservatives and liberals hate big corporations, if not for the same reasons. It's a populous issue. So I'd find myself totally disagreeing with someone about almost every other issue we discussed, and I learned to probe a bit before I got into conversations I regretted.

I'm beginning to realize that Housing Bubble bloggers also cover a wide range of political views. Another populous issue.

What's making me uncomfortable is the bashing of Mexicans, which is sometimes coded as "Californians." To me, blaming Californicators has always been a bit of a joke. It's a state of mind, not a particular location or class of people, I object to. And as a code for "white flight", I'm completely uncomfortable.

My wife's store, the BookMark, is next to a Hispanic market.

They are up and running when we get there in the morning, and still at work when we leave at night. If there is a snowfall, they're out there clearing the snow immediately, sometimes doing our side, as well. They are constantly sweeping and spraying the parking lot. And I feel much better about them being there for the safety of my wife, they are in shouting distance, and as I said, they are always there.

They're great neighbors.

Enough with the bashing.

Tuesday, May 22, 2007

Forgot to mention that I finally saw the Spider-man 3 movie. Liked it quite a bit....

....but it meandered. It meandered in interesting ways, with very competent story telling. But I think in trying to tell three stories equally, it didn't develop a strong core storyline.


It led to some rather abrupt changes in character motivations, even though they laid the groundwork for those changes. For instance, when James Franco comes to Spider-mans aid at the end of the movie, it seemed arbitrary, even though they laid the groundwork for the change through the memory loss/friends again plot. Or at the end when the Sandman suddenly stops fighting, after wrecking half the city, even though they laid the groundwork through the sick daughter/I'm not a bad man device.

I suppose the core story was the Peter Parker/Mary Jane relationship, complicated by Gwen Stacy, and that was very well done. But it was a very quiet core for a very busy movie, that was weakened and compromised by slapstick. (Peter Parker gyrating down the street/ Bruce Campbell's faux French maitre de. ----don't get me wrong, I LOVE Bruce Campbell and would pay for a whole movie with him as that character -- but I thought it weakened the emotional core of the movie to constantly subvert it with humor.)

At the same time, I enjoyed the humor. Like I said, it meandered in interesting ways, but kept taking its focus off the story.

Anyway, it's a far better movie than most, if not quite as good as the second Spider-man movie.

Go see it.

Then read the original comics.....
A review of the Heroes last episode in Salon uses "comic book" storytelling as a pejorative several times, while at the same time the reviewer seems to be enjoying the very thing she's slamming. That is, she enjoys the good parts of the show (not comics) but dislikes the bad parts of the show (comics.) Sometimes, the reviewer will give a back-handed compliment, as if to say the guilty pleasures of a story may be due to comic books, but the real depth comes from somewhere else. Aarrgh.

Absolutely drives me nuts. Just as many of the people who are reading, "THE ROAD", by Cormac McCarthy would never admit that they're reading Science Fiction.

Great stories can be told in ANY format, in ANY genre. So can BAD stories.

I've been talking about how slow business has been, which is a normal part of May. But four times in the last 10 days, a slow day has been turned into a good day by the same customer. Every once in a while, I get a customer who dives head first into the world of comics, like a kid in a candy store, and has the money, apparently, to indulge.

I always try to slow down that person, just a little, despite needing him to change slow days into good days. Because he'll burn himself out. A customer who spends 1000.00 in one month, and then never spends another dime, is not worth as much as a customer who spends 50.00 a week for a year.

I always make certain that I don't recommend anything I don't like, that I try to steer him toward quality as much as possible, and away from any speculation. But if the customers insists on buying 'alternate' covers, despite my warnings, I just try to give him the best deal I can. I asked him yesterday where he was getting his information, and he mentioned the biggest Internet sites for comics, so he's not uninformed.

I hope he'll settle into be a good strong, steady reader of comics from my shop.

But he sure has helped boost sales this month.

Monday, May 21, 2007

An editorial in the Bulletin, yesterday. "Clean up downtown site."

"Teasing out who was right or wrong in the various squabbles requires experts with skills beyond ours." They Bulletin says, and concludes, "It's an eyesore now, and that must change."

Way to take a stand, Bulletin. I'm against litter too!

Actually, I take it out on the Bulletin. But I think they actually do make the case, even if they don't want to point red flags at the conclusions.

".....several years ago, the family..." (the Eriksen's)..."members announced plans to develop first a hotel, and later retail and residential buildings on the side In the process, it got into a tiff with one of the neighbors and has wrangled with city hall over building heights and river setbacks, among other things."

"Meanwhile, however, the family has leveled most of the structures on the land, leaving behind hunks of broken concrete and other rubble, weeds, construction cones and the like. The result is an eyesore."

Gee, I wonder if we can "tease" who's at fault?

I wish the city of Bend luck.

Sunday, May 20, 2007

So there is one of those statistics in the Bulletin that just doesn't compute. Housing starts are down 55% for the first four full months of the year. If you were going to build in the prime building months of spring and early summer, this in when you'd be getting the permits. You'd think there would be some layoffs going on, but not a peep.

So I can make a few guesses. One, most obvious, that there was so much building already in the works that it will take a long time for it to be cleared away. Two, would be that the contractors and sub-contractors had so much on the plate, that even a 55% drop doesn't take up the slack. (Every story of a contractor not showing up or showing up really late is probably a symptom of "over-promising", because the construction folk don't want to be left without work.)

Three, hours are being cut across the board, but again, because there was so much overtime going on, it's still not cutting much into full-time. Fourth, that there might be a fair amount of under the table work that is being cut even as we speak. Fifth, some of the construction folk are moving into commercial building, which doesn't seem to have slowed down at all. Sixth, it's a lagging indicator and there are in fact layoffs happening. (Though I haven't heard of any.)

I have a contractor friend who is starting a new project. (I won't comment on the wisdom of that.) He said that he is actually getting calls from sub-contractors instead of having to chase them down.

People keep talking about a 'needed correction.' Well, to me, a correction is 10%, or maybe 20%, or conceivably 30%.

55% ? For four months? That a hard statistic to get around.

Saturday, May 19, 2007


Went out for my fix this morning. Needed my rush of news along with my caffeine. It wasn't there. My eyelid started twitching.

Called the man, got a busy signal. My caffeine was drained, but I hadn't headlined yet. I started to sweat. Drove to the nearest market. Wasn't there.

Started to shake. I was ready to buy my fix on any old street corner. I didn't care.

Nowhere to be found.

Finally, as my vision was beginning to dim, I bought myself a dose of methadone -- I mean, the Oregonian. The sweats and twitches have subsided.

But I'm still jonesin'

Did ANYONE get their Bulletin this morning?

Friday, May 18, 2007

I have no shame.

I just got in my gummy rubber chicken, lemony and very rubbery. Double Monkey chewing gum, Angry Scotsman chewing gum, Happy Monkey chewing gum, and my favorite -- Nihilist chewing gum ("We Don't Believe In Flavor").

I also got Death Mints, Monkey Mints, and my favorite, Last Supper After Dinner Mints, (with a picture of DaVinci's Last Supper on each one.) As well as the always politically correct candy cigarettes, but hey, they are called Death Row and Machismo.

Pirates stickers, and a restock of the action figures of Shakespeare, Crazy Cat Lady, Vincent Van Gosh, and the Librarian Lady.

I've always said, if I was reduced to my last 1000.00 bucks, I'd just buy oodles of gag gifts and rent a little spot. (Actually porn would work even better.....only, you know, that would be sleazy.)
I'm beginning to realize that we had exceptional business in March and April. Jan. and Feb . were predictably slow, but after a couple of good months, I went into May thinking maybe we were in a new paradigm. Nope. Really, really slow.

Sales aren't actually all that bad, mostly because we've had a few big sales that have pulled the average up. But it feels really slow. Long minutes with nothing happening. It's strange, but it feels almost like rejection, sometimes, when people don't come in the door. That isn't what it is -- I've experienced it enough to know that it isn't personal. Its just the usual Bend seasons.

What brought this to mind was that we got some really late comics yesterday. ALL-STAR BATMAN AND ROBIN, by superstar creators, Frank Miller and Jim Lee. A year late. And ULTIMATES 13, which is the 26th issue in 58 months. A lot of talk in the comics worlds about how this has hurt sales.

It did, but I internalized this damage probably 6 months ago. We lost most of the newbies that had been drawn into the store, already.

But I'm also trying to read the tea leaves as to why it feels there's not as much as energy in the comics world right now, and I came up with this.

The Spider man 3 movie is a flop.

Biggest opening of all time, but I still think its a flop. Because there is no enthusiasm for it. It probably would have been a very cool movie if they'd had nothing but Venom in it for the whole 2 hours....

I compare it to the huge excitement for Star Wars just before the 4th (1st?) movie came out. Anything Star Wars sold, huge, huge anticipation. And then it was as if someone punctured a balloon. The movies went on to make huge amounts of money, but in a strange sense, they were flops. It felt more like a duty to see the movies rather than something crucial and life enhancing.

Or, I could just be looking for reasons because the tourists aren't here.

Thursday, May 17, 2007

I live in Williamson Park, which is near the hospital on the east side. Well-kept homes, on nicely sized lots, with nice landscaping, good privacy. A very nice area.

I had a friend on the west side who was offered an absolute FORTUNE for a house, that in my opinion wasn't any better inherently than the houses in Williamson Park; she could have bought an equal or better sized house, newer, bigger lot, etc. and still have half of the offer left over.

She reacted in horror at the idea of living on the 'east' side.

Yet, I look at all the old, beat up houses in her neighborhood vs. the nicely kept, newer and bigger houses in my neighborhood, and shake my head.

Here's the thing. There is rarely a house for sale in my neighborhood, and when they are for sale, they don't last long. There aren't any for sale at this time, that I'm aware of, except what appears to be the last vacant lot.

In terms of actual living satisfaction in an actual living neighborhood in an actual living house, I think the residents are voting by staying.

On the West Side I see "FOR SALE" signs everywhere.

Somebody explain this to me.
I thought if I posted after midnight that the blog would show up on today.

Meanwhile, I was offline at home all day. Finally called Bend Broadband Tech Support after dinner, and surprisingly, they were there. Told him I'd turned off all the gadgets, and replugged and jiggled everything.

"Have you turned on the modem?"

"Of course I've turned on the modem, do you think I'm an idi.....wait, is that the button on top here?"

Sometimes I wonder if the tech people just have their eyes roll back in their heads as they slide off the chair onto the floor from the sheer stupidity of the people calling them.

Wednesday, May 16, 2007

This is getting interesting to me. Events in the housing market are proceeding almost exactly the way I would've thought they would. The statistics about housing that are coming out in the news seem to me to be pretty clear and unequivocal.

Which is a bit of a surprise.

I was sure the situation would stay muddy and unclear a bit longer. See, whenever a bubble pops in my business, it takes a long time to become clear . Most of the information isn't public; stores don't want people to know that sales have dropped, for fear that it's only them and that the customers will think they're losers; manufacturers don't proclaim that sales have dropped, because they're afraid everyone will stop buying; customers don't want to believe that sales have dropped, because those who are still buying don't want to be the last fool.

So, generally, if the Beanie Baby bubble or the pog bubble or the Pokemon bubble is popping, you have to try to figure it out yourself from insufficient and inaccurate information. It can appear for awhile that other stores are doing better than you. All you can really do is look at your own sales, and gather gossip and anecdotal evidence, and hope you're right. But there is always doubt.

But if you wait until it is clear and obvious, it's too late to do anything.

The housing market is publicly reported, so all the spinmeisters can do is put the statistics into misleading contexts, which can be easily brushed aside. For instance, the data that housing starts went up 2.5% last month is total BS; it went up from a very poor March. In my business, I don't even bother to compare consecutive months because its completely meaningless. Because of seasonal differences, it would be pretty stupid to compare December sales to January sales, for instance. The statistic that counts is the comparison to the same month a year previous, which I believe they said was about a 25% drop. That plus cancelled building starts at the time of year where you'd normally see an increase.

Not starting houses or selling houses in the spring, is like not selling merchandise at Christmas. Tis the Season.

Or Home Depot can rationalize their 25% drop in sales to weather. Which is pretty lame, since weather happens. So you can say its too hot or too cold; too wet or too dry; etc. But since it happens every year, its a really lousy excuse.

And so on. None of the news is good; exploding inventories, lower prices, lower housing starts, rising foreclosures; and so on.

It follows that some people are going to lose their jobs; others are going to cut back on their spending.

So what it really comes to to for me is -- when is it going to affect my sales? When is the full effect going to hit Bend, and even more importantly, when is it going to become common knowledge and wisdom? Will it keep the tourist from coming this summer? Will it keep customers from spending this Christmas?

I'm betting so far that it will take at least until the end of the year before it reaches my neck of the woods. And I have quite a bit of flexibility in my budget so that I can go back to the drawing board sooner, if I need to.

Like I said, I'm pretty amazed that things are proceeding in such an unambiguous and logical manner. And that means Bend is going to be absolutely hammered; maybe even worse the biggest bubble Bear expects.

But it still leaves me with some decisions to make about when to cut back.

It's a matter of timing. Cut my inventory too soon, and I might lose a lot of sales and possibly customers. Cut my buying too late, and all the profits could be eaten up.
Couldn't get online at home, so this will be short.

The Mondays and Tuesdays from the last two weeks (four days) haven't added up to one day's worth of average.

If it wasn't for busier than average Sundays (and a new, heavy customer), our average would've dropped through the floor. It all counts, but still....

Almost intimidating when it gets that slow. After 27 years, lots of regulars, a store full of stuff, a busy downtown, it is still possible to get the occasional 150.00 days.

Tuesday, May 15, 2007

I went and blasted through my budget yesterday.

After 12 weeks of being at or below budget, I spent what was left of last week's, all of this week's, and most of next week's.

The biggest reason was because of American Sports Cards closing.

Even though I doubt I'll get many of his customers.

I've always had somewhat rocky relations with sport collectors; especially once discounting became the norm in that industry. I need to charge at least 40% on any product, and prefer to get 50%. The SRP for most sports cards run between 15 and 25% before the mass market adds their discounts.

So if I'm going to charge more for sports cards, I need to be up on my sports, willing to yak with the guys, and do a bit of trading, buying, or consignment. None of which I have the time and energy for.

If all it took was putting the boxes of cards out, multiplying the COG's by 1.6666 on the calculator, and waiting for customers to buy, I'd be fine. Despite the absolute devastation the sport card industry has suffered, the collectors were so spoiled during the bubble years that they still tend to be a bit demanding and arrogant. So, if they come to me and say, "Treat me really good or I'll go elsewhere..." my response will usually be, "Let's get this over from me at my prices, or go elsewhere...." Kind of a stand off.

I've always wondered when they'll realized that their little hobby has all but self-destructed. At the peak of the bubble years, the sports cards entered the mass market channels to such an extent, that I think its considered standard product. (Most of the mass market stores have middle-men who actually package and sell the product, so there is no risk.)

That, plus the internet, has made card shops unnecessary. Even so, enough guys want to sit around and chat about sports, that there is always some youngish retired guy willing to make beer and cigarette money off his sports card shop, while he lives off his 20 or 30 year pension. What really shows the weakness of cards are that even these guys are quitting. sense in not at least having a wide variety of product for sale. And since summer is on the way, when I at least have a chance of getting fresh customers, I thought it was worth a try.
I had reached a peak of 10k in inventory in sports cards, and that has kind of winnowed down to about 7.5k.

(I have wavered from getting at least one of every basketball and baseball, and two of every football; to one box of every other basketball and baseball, and one box of football; so I'm back to the former option.)

By the time I got all the product from the last 2 weeks that I missed, and upped my orders on the stuff I did order, most of my budget was gone.

Meanwhile, this is the week I order all the seasonal stuff. I ordered a bunch of stand ups (it seems as though every time I stick John Wayne in the window, he sells.) I ordered the funny candy; the Machismo candy cigarettes, the Death mints, etc. The funny action figures, like Albert Einstein and William Shakespeare.

I stocked up on every Calvin and Hobbes, and Zits, and Far Side, and so on collections. Every Asterix. Summer product.

If I cut back a bit over the next 3 weeks, I should have the budget back on track again.

American Sports closing is a special circumstance. Like Gambit Games closing, it behooves me to stock up and try to capture some of that business. There is a certain level of inventory I need to be at to have any credibility.

At least I hope this isn't just a rationalization. The proof will be if I can cut back on the next few weeks budgets and get back on track.

Monday, May 14, 2007

I'm amazed by the amount of passion -- anger, even -- that BendBubble2 can bring to his posts about the Bend economy. I mostly agree with him, but all I can summon is a sigh, a shake of my head in dismay, and a little bit of doubt.

After all, I never, ever expected all the development that has happened in Bend, so far.

But, I still think we're like the guys who saw NASDAQ go from 2000 to 4000, and are screaming warning, while NASDAQ blithely continues to 5000 -- before collapsing in a heap of rubble.

I can't conceive of any scenario where all the Old Mill development will either be built, or if built, will be filled. The destination resort situation makes me roll my eyes. Seriously, there are "FOR SALE" signs everywhere I look on the west side of Bend. That would normally slow down future building, you'd think. So either these guys are stupid or desperate.

The thing about reality is that gravity will take hold. Real economic forces will eventually kick in. I think these guys are really good at spinning it, creating cloud machines, never mind the man behind the curtain. But it will eventually catch up to them.

And the Bulletin continues not to provide much critical insight. Today's editorial seems to be a great example of that.

Bear with me; I'll be searching for the right terminology.

It seems to me that there are two kinds of jobs markets. There is the 'base' market, that creates jobs, and then there are the 'service' markets which service the people who work those jobs. It seems to me that the only real 'base' market that we have that has any real force in Central Oregon is Tourism. Mt. Bachelor creates real jobs. (if incredibly low paying); if a 'transportation' company is created to transport the workers to the mountain, that is a 'service' job, that wouldn't exist if the 'base' job hadn't been created, along with all the financial services that the employee needs, the housing, the utilities, the health care, etc. But without the Mt. Bachelor job in the first place all the services wouldn't be needed.

So the Bulletin makes a big deal out of the increase in employment in ...."transportation, warehousing and utilities sector, with both education and health services and professional and business services not far behind."

Service jobs, every one of them. I still think if the business of Bend is growth, all we are doing is chasing around each other for money. But what generates the original pool of money? I sell comics to the guy who sells shoes who sells to the guy who sells ice cream who sells to the guy who details cars who sells to.......and so on. But someone has to generate the original dollar, don't they? The original money appears to me to be a few small industries, tourist dollars, and the bagfuls of 'stupid' money that people bring to Bend for the lovely lifestyle.

We are depending way too much on the third option; because it counts on Bend being affordable, on the newcomers ability to sell their houses where they came from, and with them continuing to be so enamored of our lifestyle that they'll put blinders on. But most important to me, once the equity infusion has taken place, many of these newcomers are going to need to find real jobs. They'll look around and see only low paying service jobs. That or we are depending on people who are so rich, that they can just continually lose money in Bend, dissipate their fortunes, because, gosh, Bend is just so much better than anywhere else.

Maybe so, but that depends on perception, and if that perception ever changes, we won't get those people either.

BendBubble2 rakes our city fathers over the coals for not creating real, job producing industries. I just don't think we're likely to get those. We are too isolated to make that practical. But we don't need to be insanely boosterish either.

I think the Becky Breezes and the Norma DuBois of the world have an inkling of what's happening and are whistling through the graveyard. They've committed to their insane plans several years ago, and can't back out. What else can they do?

But we don't need to be so gullible.

Sunday, May 13, 2007

The Picture of Dorian Gray has malfunctioned for Phil Spector. Or more to the point, Phil Spector looks exactly like I would've thought The Picture of Dorion Gray would've looked after a lifetime of debauchery.

Speaking of excess, I was out gardening yesterday when it started raining. Came in and flipped on the TV and a documentary of Marlon Brando was on the TCM. Thought it would be an hour or so, but it just went on and on. I think 3 hours. I felt used; in the end, the guy was just a butthead.

Why do these beautiful, vibrant performers who have a look a pure joy in their performances when they start out -- Orson Wells, Elvis Presley, Marlon Brando -- turn into fat slobs? It seems like the bigger the genius, the bigger the slob.

There was a short headline yesterday about the Pygmies having a conference in Africa. It may be condescending of me, but I loved that idea. Having read, THE FOREST PEOPLE, by Turnbull way back in college, it amazes me that the Pygmies would have a conference....

Status Report; as I said earlier, I didn't spend my full reorder budget this week, so that makes 12 weeks of being at or below budget. One more month, and we'll be in the summer season. I count my summer as being mid-June to mid-September. It used to be Memorial Day to Labor Day, but for us it's shifted two weeks later.

I have a feeling it's going to be a huge summer. Unfortunately, these feelings are unreliable.

There is a thing that occurs when I line up all my ducks in a row and I think I'm ready to cash in; something always happens to derail my plans. Please, please, please just let it be routine this year!

Even if it's an average summer, say last years levels, we should do well. We have had a couple of big days lately that I hope are precursors to what will happen; big sales, but not much reordering required. It's a strange phenomenon, but I actually have to reorder more stuff on slow months than I do on busy months, at least proportionally. Because everything in the store is 'new' to a visitor.

Linda and I going on one of my quarterly or bi-yearly shopping trips. I've been keeping a notebook of everything I need, and want to get it all in one fell swoop. I hate shopping. If I had to depend on me as a customer, I'd be in trouble.

Saturday, May 12, 2007

I was out running errands this morning, so drove through Northwest Crossing again. I take back my tree comment, except to affirm that the east side has just as many trees if not more.

I drove through some of the more established areas, and I admit they are much better, though still too many for sale signs and still a little too close together for my personal taste. Linda says that if we were in San Fran, it would look perfectly normal. But that's kind of my point -- we aren't in California.

There actually is a native style, or what I would call a Bend style. Most of Bend wasn't in that style when I was growing up -- ranch houses were being built all over the east side. But you see one on just about every old block. A kind of western lumber style that I wish I could describe. But I wonder how many people in Bend would even recognize it? The burnt red color, and or forest green, or dark blue. Kind of craftsmen without all the gables. Fairly large lots, with lots of trees -- ponderosa if possible. Very restful on the eyes. They sort of blend with the landscape. I wish I could describe it better. The better Gilchrest houses are examples, if anyone knows what I mean.

Anyway, the Faux Craftsman looks like it belong here, but other than a few in the old mill district and along the river, it wasn't the predominate style here when I was growing up.

I had the strangest reaction when I left the N.W. Crossing tour last night and went down to third street. It didn't look as bad -- at least there is a variety of style from different eras.......
My wife wanted to see Northwest Crossing, so we drove out there last evening and looked around. The long and short of it -- she liked it.

I didn't. Something about it just grates on me. I'm admittedly a reverse snob. But that isn't the main reason. In order of importance, to me.

First and most important, the houses are set too close together. They seem out of proportion to the neighborhood. I really, really don't understand why -- if you have the money -- you wouldn't want privacy and space.

Secondly, it has the same relentless style. Yes, many different floor plans and shapes, but the same colors and overall style. Faux Craftsman. Shades of green and brown. It reminds me of the old review of a Katherine Hepburn performance; "She ran the gamut of emotions from A to B." Northwest Crossing runs the gamut of styles from A to B.

Third, the whole neighborhood seems messy and unfinished. "For Sale" signs everywhere, and even the houses that aren't for sale don't look occupied. Lots of empty space with cinder blocks and clumps of exposed wiring. Even more shocking, the lawns are already unkempt! I'm sorry, despite it's advertising campaign, it doesn't look all the walker friendly to me. When we drove back to the east side of town, which is put down by newcomers, I couldn't help notice has many MORE nice big trees there are in the residential areas. Back then, I don't think they just bulldozed everything.

In ten years, the place might actually start to look good, as owners add their touches, as the incomplete lots are filled in, and turnover slows down. But, again if you have the money, why would you want to live in a construction zone for ten years if you have a choice?

Plus, to me there is a real danger that the place won't fill in. That it will freeze in place. And that would make it very unattractive.

It just seems unlikely to me that all these developments are going to pan out. But I must admit I never would have expected the developments that have already been built would ever happen either.

Friday, May 11, 2007

OOPs. This was supposed to be comment in the previous blog. Oh, well. I'll let it stand in all it's defensiveness.....

When I went up the COCC small business division, they made me go through creating a business plan. They told me that one of the best things they do is put people through the process of deciding whether the business plan makes sense, before they put their life savings into it. And that many people, after looking at the nuts and bolts, decide not to go forward.

Part of the point of this blog is to analyze things. Remember, I'm wrong a lot. I'm just trying to cut through the fog of business. I'm also not putting any bad wishes into these blogs. Because I point out that there is a wreck over there, doesn't mean I wanted that wreck to happen.
Got a phone call from Howard at American Sports yesterday, telling me he's closing shop at the end of the month. His landlord has raised the rent too much for him to continue. Still absorbing this news. Feel a strange sense of melancholy over it.

American Sports has been around for 15 years; coming in just as I was trying to extricate myself from being 85% sports cards. I tried very hard to stay on good relations with him, after having a rather disastrous confrontation with the previous sport card dealer. He enjoyed the surge created by the emergence of Shaquille O'Neal, and benefited from my rather rocky relations with the collectors, especially the football collectors. He and I both did Beanie Babies, but Howard ignored pogs and pokemon. I think he's lately been carrying magic cards.

Anyway, it confirms that the sport card drought continues.

It's interesting to me that both a 10 year business (Gambit) and a 15 year business (American Sports), decided to move on at a time when our store has been surging forward. I'd always expected that this would happen when there was an overall economic slowdown. What it really confirms to me is that I was completely correct in diversifying -- despite the way American Sports was able to capture the sports card collectors, and Gambit was able to capture the game players. They basically stole a march on me, and my store became a distant second choice for their customers. I knew it was happening, but wasn't willing to become hostage to any one group of customers.

Bend is hard on specialty stores. We really don't have the population, though we seem to have the 'demand' (that is, why don't you have as much as the store I used to go to in the big city?).
But what really is the killer is that we have a huge amount of mass market retail footage. As much, it seems to me, as metro areas that are twice our size, such as Eugene, Salem and Medford. Without the colleges, without the interstates, without the outlying populations, without the industries.

The difficulty is obscured by the massive numbers of 'recreational' retail. But if you look at the base numbers, it's really pretty dire. No card shops. No game stores. One comic shop. One toy shop. Two record stores. One book store. But dozens of jewelry, dress, home decor stores. Bread and butter businesses are obviously suffering. Fluffy businesses keep opening. Not sure about how that is going to play out.

Really, there is a strange disconnect going on. I look at what the Bulletin says today: "Gas Prices may hit $4"; "Housing inventory piling up. Prices -- relatively flat. Sales -- down. Inventory -- up."; "Retailers post dismal sales. Wal-Mart recorded....the weakest performance since the world's largest retailer began publishing monthly sales in 1980.)

Meanwhile, there is a picture of a young family opening a grocery store in Northwest Crossing. Lets see; limited population, check. High rent, check. No experience, check. Needed to quit high paying job and/or paying for help, check. Opening at a time when sales in the subdivision are dismal, check. Let's do it, honey!

As I said, all this is happening when my wife and my stores are doing rather well. We've always been a contrary business; we seem to do less business when everyone else if surging forward, and more business when everyone else if falling back. I think part of that is the nature of my planning; I'm always diverting profits into newer product lines. Part of that seems to be the nature of comic stores.

Strangely, I haven't really benefited much from Gambit's closing, and I don't expect to benefit much from American Sports closing. I'm not really willing to adopt the business practices of the other stores, and most of their customers have made their feelings known about us by choosing the other store in the first place. What I sort of expect to happen is that anyone who comes to town will at least give us a try; whereas in the past, they would go first to the 'specialty' store and stay there. I have a chance of picking up that business.

Mostly, though it confirms to me what my suspicions have been about the real level of support that these specialty lines have. Its fine during the golden age, tough in the mature phase, but pretty much impossible when it trends back to the base, the irreducible number of true believers. Unfortunately, the true believers are also the most likely to look for cheaper prices online.

I'll do what I did when Gambit closed. Bring in about one third more product. And I'll go ahead with what I'd been wavering on; bringing in movie dvds and music cds, for yet two MORE product lines.

Diversify, diversify, diversify.

Thursday, May 10, 2007

"It has become increasingly more difficult to run a single store like mine," says Allen Drucker, who will close shop after 32 years." Caption on article in the Bulletin about a model train store in CA. going out of business.

Model trains, (and cars and boats, etc.) have been completely wiped out by the Internet. As Mr. Drucker says, ....."there is the looky-loo hobbyist who comes in checks out the latest... but buys almost nothing....then he buys online from some guy working out of a barn..."

Every time I curse the low price point of comics, and how difficult they are to order, I should remember that those two elements may be what keeps me in business. Many customers don't want to be hassled buying 3.00 items online, and it is difficult for any chain or mass market to figure out how to order something that comes in on a monthly basis, but which is constantly changing in story, content, format, creator's, price, etc. etc. It is because there isn't much money in comics that we are protected from a massive entry into the market by the big boys.

The very quirkiness of my store, while it makes it difficult to cash in on mass culture, also makes my store unique and difficult to reproduce.

Meanwhile, a few days ago the Bulletin blurbed that Mountain Supply had to close their Redmond store because they couldn't get qualified employees. Boy, did that sound familiar. My biggest problem when I had multiple stores was finding employees that would stick around long enough to warrant training. I'll never have extra stores again, because of that.

Then there is the jewelry store in Sisters that is closing up, Sharf Gallery. It basically comes down to it not being worth the effort, anymore. What's becoming a fairly constant refrain, is that these small stores are very difficult to sell. Most have to liquidate.

Finally, over at Slate, there is a defense of bubbles. How they leave infrastructure behind for the next wave of businesses. Well, I know that when the Sport Card Bubble burst, my infrastructure shrank from 4 stores to 1, so that's debatable. But what really came to mind was how Downtown Bend just keeps looking better and better despite the constant failures of small business.

Actually, the reason that the stores downtown keep looking better is BECAUSE of the constant failures. The stores are failing upward; a new owner comes along, fixes the place up, the rents rise, and the next owner has to bring even more funds to the enterprise and fixes the place up and rents rise, and then the next owner....

As I've said before, you can't always tell what's going from the outside.

Wednesday, May 9, 2007

This will be a bit nuts and bolts business.

The last two days have been extremely slow, after a very busy weekend. The weather has something to do with it. As I mentioned last week, weather change causes shock to the customers. Last week, the first two days were awful, too, and I was hoping that the weather would stay good. Instead, it got kind of wet, chilly, and windy toward the middle of the week. So I'll express the hope again -- that the weather has turned to nice for a good long stretch.

I also think that we got a wave of regular customers in over the weekend (for Free Comic Book Day) that normally would have trickled in throughout the week. It's something I've noticed about most promotions -- there is almost always a take-back; more on the day of the promotion, less on the days immediately proceeding or following. One of the reasons I'm not a fan of most 'event' driven appeals to the customer.

Anyway, despite the last two days, our average is still pretty good. But just like the two slow days last week pulled down our average for the whole month, so have these two days. So instead of being ahead, we are just slightly behind.

When I did my reorders this week, they only came in at about 600.00 of my 1500.00 weekly budget. I swore that I wouldn't vary this amount of spending; that if I happened to have a slow week, I'd just use the leftover budget to buy the more sporadic material, such as weird candies, stand-ups, and such. But if I wait until next week, I can put it on next month's credit card bill. So I'm just going to keep the 900.00 difference as compensation for the last two rotten days.

I'm nothing if not inconsistent.

I have my wife's store as a contrast. She doesn't have 'big' days because of shipping; the streets outside her store are never closed for 'festivals'' ; she doesn't have big promotion event driven sales. She just has good steady sales on a day to day basis. Much less highs or lows, much more predictable. If she does her job, sales stay pretty steady. I kind of long for that consistency.

Tuesday, May 8, 2007

The SanFran independent bookstores did a study that found that money spent in their stores generated 54 million for the local economy; money spent at the chain bookstores and internet generated 8 million.

Hey, spend more money locally, so I can locally purchased a sprinkler system and lawn!

I found out that putting in a full lawn and sprinkler system could cost as much as 5 thou.
Even if it is half that much, that's too much for me. I'm slowly but surely preparing the back of the house for a lawn. I'm going to try to seed it about June 1, and then nurse it like a baby for the rest of summer. I don't have animals or kids, and its fully fenced, so I have a reasonable shot at doing it right. Buy some sprinklers that mist. Thing is, it will cost me what? less than a hundred for grass seed?

If it doesn't take, no harm done, I'll hire a full crew next summer the rip it up and put in sprinklers and sod.

I've been enjoying Heroes and Lost. Last week's Heroes, where they go into the future, was very much like many modern comics in tone and pace....I liked it. It helps when its an 'out of time' story where anyone can die and anything can happen. Jason, who commented on this blog about rediscovering comics, was mentioning how intimidating the continuity of mainstream comics can be. Which is why Astro City, which is distilled superhero tropes without the continuity, is a great, literary entry for anyone who wants to discover the appeal of comics.

Personally, I read very few comics that require continuity. (Superhero.) Joss Whedon writes a great X-Men comic that stands apart, you can read most mini-series without knowing everything there is to know about a particular universe. And there are plenty of good independent comics that don't require years of knowledge. Vertigo titles are great for getting a quick, fun read.

My newest theory on Lost is that the island is infested with nano bots, who have gained consciousness. They can fix who they want, kill who they want, reanimate corpses, even take on the shapes of things and creatures for awhile. There is a force field surrounding the island which the nano bots have either taken over or are trying to find a way around.

Sorry about the magnum opus yesterday. At least I got it out of my system.

Monday, May 7, 2007

FADS 101

Lessons I have learned from fads, starting with the most important.

1.) Never build infrastructure under a fad. You'll be tempted, at the peak of any fad, to expand or to open more outlets. If you have even a suspicion that it might be a bubble, don't do it.

I structure my fixed expenses in such a way that I can survive on the 'base' level of sales -- that irreducible number that any product sells to your regulars. (Or you go out of business.)

The 'base' number of a fad is ZERO.

2.) Don't try to compete with discounters. You can't win. In a game of 'Name that Tune', there will always be the idiot who thinks he can name that tune with one note or none. If you try to compete with idiots, that makes you an idiot, too. Once a fad reaches a suicidally competitive stage, it's time to move on, cut your loses. Lower your orders and raise your prices -- the exact opposite of everyone else.

3.) Diversify, diversify, diversify. Diversify or die. The specialist will beat you in the short run, but the generalist will last longer. Try not to let any product be more than 50% of your sales. Take the profits from a fad and invest in a new product line, or revamping an old product line.

4.) Don't wait for competition to go out of business. (For a perceived market share.) It'll take much, much longer than you expect. By the time it happens, the benefits will be nil. You'll get, at best, 15% of the competitors business, which by that time is usually pretty bad. Besides, it's a bit vulturish for healthy karma.

5.) Don't wait for the next big thing (NBT). Once you've had a taste of cash infusion from a fad, it's easy to get addicted. But fads are completely unpredictable. They're the sort of thing that no one heard of yesterday, and everyone has to have today, and all will forget about tomorrow. Look to your base.

6.) Try not to order too much in advance, or to pay in advance. It's better to miss sales because you run out of product than to have to accept volumes of product you can't sell. Don't get stuck buying a case, when you only need a couple of boxes.

7.) Order through a middle man to shorten that window, and to control the quantities, and to pay upon arrival. You may get a shorter discount, but the flexibility is worth it. (Remember, you're not competing with discounters.)

8.) Don't try to ride the fad to the top of the curve. Don't get suckered into constantly doubling your bets. Take a bit out on the way up. Get out when you've gotten what you need out of the fad. Don't look back if the fad keeps going. You can always get back in, but you can't always get out.

9.) Turnover isn't important to a specialty store. This is the 'non-fad' product that you need when the fad ends. A specialty store relies on the long tail -- selling that one item to that one customer, instead of oodles and oodles of stuff to a bunch of customers. That means you need a full store. In my experience, everything sells eventually. As long as you paid through cash flow, the turnover rate is less important. (On the other hand, you don't want to get stuck with too much 'fad' product. If you think it's a fad, try not to get more than a few months supply. But everything else, your 'base', keep a full selection.)

10.) Fads always die quicker than you think they will, and will sometimes die for a specialty store before they die in the mass market. Once they are dead, they are dead, dead, least for a retailer. They may come back later, but never at fad levels.

11.) There is a 'golden age' for every fad, when you can do no wrong. All you have to do is put the product out, and it sells. Then there is the 'mature' phase where people get a bit more picky, they start buying elsewhere. Then there is the down phase where everyone complains, no one wants to buy at full price. Try to get out during the 'mature' phase.

12.) Selling fad product is never hard. GETTING ENOUGH OF IT IS HARD. That's the part the customers don't see. The hard part is getting sufficient supply. My advice is never do something you wouldn't ordinarily do in order get product. At the height of every fad, you'll get lots of people shoving and pushing and lying their way to the head of the line. Don't join them. Let it go. This fad too shall pass. Eventually, Supply Always Catches Up to Demand.

Don't get so caught up in the fever that you lose sight of your core values. Hopefully, by being honest and steady you will have a number of reliable suppliers who will see to your needs. If they don't, you'll know to start looking for a new distributor. If the customers can't see that what you are doing is honest and steady, then let them go, too.

13.) See a fad for what it is. If you are selling zero, and suddenly you have lines waiting to buy, sales grow exponentially, then it's a fad. Some fads reach the end of their 'fad' phase and become regular product, (though most self-destruct.) Don't get caught up in the idea that this is a 'new' permanent situation. Rule of thumb, anything that grows faster than 20% steady growth is probably a fad, because there usually is no middle ground. It's either 10 to 20% for base product, or 100% growth or more for fad product. (The exception would be when you are adding a new product line, or expanding an old product line, but it's usually pretty easy to see what increases are due to expansion.)

14.) Try not to mistake a fad's success for your own success. Any moron can do it. You're not a genius.

15.) You don't control the timing. You can have it all figured out, when to get out, how much to extract -- but it won't be up to you. Look for more stuff than you need to show up when you least need it. Factor that in.

16). For god's sake, don't listen to the customers about fads. They never think their love for a fad will end. Remember, you have the experience in fads, they don't. Look at what they DO, not what they SAY. Never listen to what the competitors are doing -- there will be a six month information lag. Usually you'll find that if you are slowing, so were they -- despite what your customers tell you.

17.) You're inside a bubble. You have to use your imagination and logic to try to see outside the bubble. Enthusiasm is no substitute for thinking critically.

18.) Don't try to be first in, and/or last out. You'll constantly have the mirage of the 'next big thing' NBT dangling in front of you. But really, a fad is unmistakeable, and you'll usually be able to get into in time. It's seductive to try to get heavy supply of the initial stock -- if you could guess right, you could make a fortune. But by the time it is clearly a fad, that time has passed.

Every manufacturer will try to convince you that they have the NBT. Sometimes, even if they are right, you are like the guy who tramps a trail through the snow almost to the top of the mountain, where you lie gasping, while everyone else romps up the beaten trail and passes you. Let the other guy do the heavy tromping.

At the end of every fad, there's guys who will pass you, laughing at your conservative habits, but you'll usually get the last laugh as they go flying over the cliff.

19.) Don't get caught up emotionally in the thrill of the fad. Some customers will resent you for treating it like any other product, some competitors will gain business because they are fans, but in the end, you need to take a step back. If not, you'll be angry and disappointed when it all comes to an end. At the peak, competitors may even get nasty. You have to ignore it.

20.) Keep a bit of the fad product around until you see where it ends up. You'll be tempted to dump it when it drops 90%, but you have to remember, even the 10% that's left over is more than you had before the fad started. It's easy to get spoiled by a level of sales.

21.) Whatever you do, don't neglect your core business. The fad customers, in their enthusiasm, will clamor for you attention. There will be days when the fad money will make the base product lines look sickly. But don't ignore Joe over there, who buys 10.00 worth of comics a week; you're going to want him around when the fad ends. Try to add a fad product without subtracting from the regular product.

22.) Watch out for special services that fad customers ask for; such as special nights, or reserved rooms, or tournaments, or whatever. These usually work great during the golden age, not so great during the mature phase, and are absolute disasters during the downturn (require time, space and money, without the customers feeling like they need to buy your product for it.) Don't promise anything you can't live with.

23.) Don't try to be all things to all people. You'll be tempted to carry every size, shape and color, all reference books, all accoutrement's -- after all, the chain store are only carrying the best-sellers. You can distinguish yourself by having everything. It is what everyone will tell you to do. DON'T believe it.

Do the opposite. If a service or product isn't making money, drop it. Carry the best sellers at as close to the mass market price as you can, but don't try to match or beat them. Once the mass market enters your fad, you won't win. No amount of service or selection will win out. No amount of appealing to the customers loyalty will work. Be hard headed about it.

This is counter to everything I've ever read about how to compete with Walmart, etc. By all means carry more than Walmart, but don't try to do everything. By your very nature, a smaller store, you'll be able to provide more knowledge and service. But keep your ordering within bounds.

24). I mentioned this above, but it bears fleshing out. When a fad starts to die, don't be tempted to lower prices to bribe your customer into staying. You'd be better off lowering your orders and raising your prices -- at least you'll make money on the smaller level of sales instead of losing money on higher levels of sales.

25.) Every fad is similar in outline, (more or less), but different in the details. I say more or less, because every fad seems to have at least one quirk different from the last, which can negate all experience. It's easy to get caught up in playing out what you think you should have done with the last fad. Still, experience counts.

26.) It isn't a tragedy if you miss a fad completely. Fads almost always end up with as many negatives as positives, money lost and money gained. They often just cancel each other out, so that all that hard work and risk is for basically nothing. If you enter a fad, and don't do it correctly, it could end up costing you your business. All in all, I've enjoyed my none-fad years more, and profited more, than the heady fad years.

I could go on and on. 27 years of ups and downs. I've no doubt lost 90% of readers by this point anyway.

I've kept a business journal through most of that, so I could probably put 100 entries without duplicating too much. Hell, there's probably a book worth of material, if I fleshed it out with examples. Punch it up into once of those useless business aphorism books.
It's hard to keep up a constant state of alarm over the housing bubble. When I weigh all the news reports, I think its going to get dire --- maybe more than even the doomster's expect. I mean, this could really be devastating.

But...what can I do about it? I think I've designed my business so that I'll be able to respond to a downturn.

Thing is, we're have record sales in the spring. Good, solid, predictable business.

No...this is more a matter that I may be missing an opportunity to make money while I can. All I have to do is stop buying anything but the essentials. I've done it in the past because I had to, and I've done it for years.

But I've had steady growth for 3 years now. I have backup funds, and plenty of credit. The bills are pretty much under control.

So, despite what my mind and experience tell me, I'll let my optimism guide. (Frankly, even if I had never heard of the housing bubble and read nothing else about it, the fact that my house doubled in value in two years would be enough to make me sit up and take notice. NOTHING doubles in that short of a time, especially a high value item, without there being a consequence.)

So I'll just keep monitoring the local economy; and hope that this isn't that point in time that I'll look back on and realized I missed an opportunity.

I have the benefit of experience in a number of fads and in hindsight I can see where I went wrong and where I went right, and try to navigate my business through this situation. But ultimately, my every fad is both the same and different, and I won't really know which is which until it's past.

So, I'm orienting my business toward successful growth, with a eye on possible downturns.

Sunday, May 6, 2007

A rose is a rose is a rose.

What's in a name? My store already had the Pegasus Books name when I bought it, (with the nice advantage of a good logo.) Over the years, I've wished sometimes I could change it to be more descriptive. Then again, I've morphed the store so much and so often, that having a more generalized name has been useful. After 27 years, its a "Brand" name, for what it's worth.

Linda wanted to call her store Sagewind Books, because she's into indian flutes. It's a poetic name, but what does' it mean? We ended up with the BookMark, because it has 'books' in the title, which is no small advantage when it comes to signs and business cards and such. It's a bit more generic than I like, and I think the store has been enough of a success that we could've gone with the Sagewind.

When the Paperback Exchange was still in business, I was mystified as to why they didn't change the name to Book Exchange. They carried hardcover books, but NO ONE KNEW IT! An easy change, that would have helped draw in more customers.

Meanwhile, over on the comic retailer bulletin board, a store has posted pictures. Nice, clean modernistic design, that any customer would feel comfortable in. The kind of non-comic book guy store our industry needs. What does he call it? Spazdog Comics -- which pretty much negates the image thing.

What brought this up, is the Bulletin article about the closing of A&B Meats. Turns out, this store had all kinds of exotic foods, as well as Asian American owners. Maybe its just because I sell anime and manga, but I would definately have played up the Asian Market connection; there is a cachet, especially among younger consumers, and a niche. They could've done everything they were doing, AND perhaps drawn in a whole nother crowd.

Meanwhile, it looks like Free Comic Book Day was a relative success. Did better than an average Saturday, and had more people actually picking them up.

Statis Report. Have now stuck to budget for 11 weeks. STILL no blue sky. The 'slack in the rope' explanation is running thin (costs and material that had been ordered before I instituted the budget.) All I can think is that the little ticky tack reorders and the little expenses (small stationary, snacks, etc.) and my postage estimates are off. I'll stick to this budget through June, but if I don't start getting some savings by then, I'll have to cut my reorder budget.

The reorder budget has worked great -- its been enough to get everything I think the store needs. Maybe that's the problem. Maybe it's just not possible to make gain without pain.

Saturday, May 5, 2007



I'm missing the promotion gene. Went to put out the comics this morning, and unloaded the last two or three years worth, have tons of them that never got took. Just put them all out. Raised my limit from 3 to 8.

Then I realized that I didn't keep any of the posters to put up. Really a half-hearted effort. I don't advertise, I don't have sales, I don't get in the gorilla suit. Just plug away with the best selection and best presentation I can come up with, in the best location, and let the business speak for itself.

I love the idea of FCBD. The companies really produce some great comics just for this event. The comics aren't free to me, but they are relatively inexpensive for a promotion. I'm just not sure it produces any results.

Maybe next year I'll make the grand effort.

Driving home, there's a big orange thing (I only caught the back - - a cat, a bear?) jumping up on down on the sidewalk with a sign and balloons. The new retail center across and west of the Forum.

That's the promotion gene I'm missing

Friday, May 4, 2007

The proof of the old adage; there's no bad publicity as long as they spell your name right. Baltazar gets an A- Review in the Bulletin.

If nothing else, the IRON MAN suit in the movie looks really, really cool.

Free Comic Book Day, tomorrow. Don't know why I don't try to make more of the day. It just doesn't seem to do much for business. I do like using the books to give away to newbies and browsers, but again, not sure it does much good.

Was having a conversation with someone in the know, and he mentioned another downtown shop that was doing very well, but....he complained....doesn't advertise! I laughed and said, "So that's two shops you know downtown who are both doing well and don't advertise....what does that tell you?"

Have to gird my loins for all the people who will be coming in looking for Spider-man "STUFF". Not comics, mind you. They'll just curl up their lip at that suggestion. STUFF. I'm a COMIC SHOP! Over the years I've tried lots of STUFF and it doesn't sell for us. I got a case of the Spider-man toys a month ago and I've sold one.
Guess which one? Three guesses....come on, you can do it. Yep, the Venom toy.
Meanwhile, I've sold my entire LOST toys case, except for 3 Jack toys. Unfortunately, those 3 Jack toys represent my entire profit.

Oh, the store I could have if I could buy all the Yoda, Boba Fett, Venom, and Legolas toys we wanted; instead of Gollum, Jar Jar Binks, and Spider-man battle damaged.

We have a fat cat. You can visit her at the BookMark, if she happens to be taking one of her period breaks to beg for treats. Otherwise, she's curled up in the back room.

Had some guys rush in last night just before closing for a game magazine, excited about the new Magic game release. Obviously, they were set to play the game that night. Found out they were getting their cards from a friend (who I'd done some trading with a couple of days ago against my better judgement) who obviously had bought his cards online and just as obviously was breaking the 'street date.' Sometimes I wonder what purpose we brick and mortor stores serve if the damn wholesalers will sell to just anyone.

Have sold a surprising number of board games. One or two a week, not enough to keep us in business, but they actually sell. Fancy European games like Carcassone, and Settlers of Cataan, and Ticket to Ride. Strictly word of mouth, as far as I can tell.

Not one of my competitors send customers my way; I send customers to all my competitors. Not fair. Won't change that practice, but it's frustrating.

World War Hulk: Hulk was sent to a different planet because Earth's heroes were worried he was out of control. He's weakened, and enslaved and made into a gladiator, but eventually becomes Emperor. Then the shuttle he was sent in explodes, killing his wife and kids. Now Hulk is coming back to earth, with his legions, and he's pissed. HULK SMASH PUNY EARTH!