Friday, November 30, 2007

To continue: if an industry has any vitality, innovations will come along on a regular, if unpredictable, basis.

Comics have had several cycles, the black and white boom in the mid-80's, the surge in the mid-90's that resulted in companies like Image and Dark Horse, the development of the graphic novel, and the rise of the independent comics.

I worried in the mid-90's that comics would go the route of sports cards, but the industry changed focus, took the moral high ground, emphasized story and art over collectability and rebounded.

There is always a danger of incestuous innovations; changing just enough to attract the same customers over and over again, but not really creating anything new.

I believe the sports card industry has consistently taken the low road, the short term profit. I don't know if they have no brains, or imagination, or ethics, but just about every decision they've made has been wrong.

Comics are always in danger of going that route -- short term boosts by creating huge mega-crossovers, killing off characters, etc. But I'm hoping there are enough true believers, that the culture changed enough, that we can keep going forward.

The game industry has also had a fair number of innovations. There was a long dry spell after RPG's were created, and as the mass market pretty much took over the selling of old standards like Monopoly and Risk.

But, starting about 12 years ago, there has been one innovation after another, (miniature games, ccg's, Euro-boardgames, etc.) which accelerated in the late 90's. But over the last two years or so, it's turned pretty incestuous, and there is a major downturn happening.

Comics are in a state of flux. Will they go big time into the mass market? Will the internet downloading have a major effect? Will the monthly comics continue to be subverted by the collected graphic novels? Will the mass media continue to find fertile ground in comics and will that affect comic sales?

Only thing I know for sure; innovations are ahead, some of which will help, some of which will hurt.
After you've been beat up in business for awhile, you start to see things in cycles. Products don't really cycle as much as the average consumer thinks: sometimes a hot product will get a second wind, which is almost never as strong as the first time, but most of the time the cycle, if there is one, is longer than the life of any one store. Products can mutate, or change, and a sub-element can become hot for awhile, but mostly you get that one chance, and then a second chance, and then its pretty much over. The product fades into the woodwork, there but not really significant.

Industries, on the other hand, have cycles that are relevant to my business. Games, for instance, have had several surges and relapses in the history of my store, and so have comics.

Then there are the internal cycles of a store. Are you expanding? Adding product lines? Consolidating? Cutting back? Trying to grow sales? Or trying to grow profits?

And there are the overall macro economic cycles, which I divide into the local economy and the national economy.

Of one thing you can be absolutely sure. There WILL BE a downcycle in the economy at some point. Whether a recession is on the horizon or not (and I think it is) you can be sure that a recession is coming at some point. You can take that to the bank.

The thing I have learned through hard experience is that it is important to get ahead of the curve. If you only react after it happens, you'll always be behind. You'll cut your bills and expenses too slowly, always a little too late.

On the other hand, you don't want to be a ninny and respond to every little downtick.

I have a rule of thumb for my business; three consecutive months of increase is a go ahead sign, and three consecutive months of downturn are a cutting sign.

I've had my three months of downturn. In fact, I broke my own rule and starting moderating after the second month, because I could see that the internal dynamics of my store were in a downturn: and the two main industries I'm involved in, games and comics, are in a bit of a downturn; and Bend looks to be in a downturn; and the national economy is in danger of a recession. Four down signals, all at once.

In fact, I'm surprised that everyone else isn't seeing the same thing. It doesn't really matter to me. I'm doing what I know is best for my business. I've got all four of my warning signs flashing, so I'll go ahead and moderate now, instead of waiting.

I don't think this is a overreaction. In fact, despite my skepticism about the housing prices around here, I was fairly bullish on business until this spring. I thought it would stay strong through the end of the year.

Instead, I think business will be good enough through the end of the year, but I'm betting on a downcycle after the holidays.

Downcycles aren't really all that bad, if you're prepared. It's like a horrible winter day that gives you an excuse to stay home and sit by the fire. You just kind of hunker down, and watch the wreckage around you, and hope the damage doesn't reach you.
MCGEARY'S LAW: Never play in a game with more than half a dozen names for cheater.

Back in high school, we used to play friendly games of poker. I did pretty well, at first, but then I started consistently losing. We were playing for lunch money, in effect, so no big deal. But I got tired of not eating, so quit playing. Found out later that two of the guys playing were signaling each other.
Both went on to become lawyers, imagine that.

It occurred to me that there was very little I could do to detect cheating. I've not played poker for money since.

I've been amazed that poker took off like it did. Except for a few skilled players, most people will lose their money. People who can probably ill afford it. I have a feeling more than a few marriages will come to an end, mortgages won't get paid, jobs will be lost. But it's a free country.

Most people will lose at poker even if the game is square. But this is a game with immediate and significant rewards -- cash money -- that is extremely easy to rig, that if you get caught probably has very little official consequences (though I suppose, there's the danger of having your teeth knocked out in an alley.) Still, a game that can be easily rigged.

I'm reading DEADMAN'S POKER, a book in the Valentine series by James Swain about an expert at spotting cheats, and it reminds me again to stay away from poker despite it's allure to me. Just for an example, I'm listing some of the glossary in the front of the book.

BLEED: To cheat a game slowly.

CHEATER: One who practices fraud and deception. Also known as an advantage player, grifter, hustler, mechanic, rounder, or scammer.

CLASSMATES: Two people working in collusion in a card game.

COOLER: A prearranged deck that is secretly switched for a deck in play. Also known as iron man.

COOLER MOB: A group of cheaters who switch decks of cards.


FEEL A BREEZE: When you feel something unnatural is going on, but don't know what it is.

GAFF: A cheating device.

GIVING THE OFFICE: Communicating through a secret code.

GRIFT SENSE: The ability to spot a scam or hustle.

HALF SMART: Some who thinks he's smart, but isn't.

HOT SEAT: Where the sucker sits.

MUCK: To switch cards.

And on and on. That's half the alphabet, but you get the idea.

Never play in a game which has more than half a dozen names for cheaters.

Thursday, November 29, 2007

There was a time, and it wasn't all that long ago, when I think I was at least aware of almost every retail business in Bend. Even five years ago, the opening of a store was noticeable, it wasn't that hard to keep track. Hell, ten years ago, it seemed like an event, and 15 or 20 years ago, it was a major event.

Now. Pffffffff. All over the place.

I take home the weekly papers on Wednesday night and just shake my head. It seems like every week, there are a dozen or more new stores advertising, often located on the west side. Why on the west side? Do people really think that is the center of retail? Also way on the east side, even more puzzling. I noticed that Glass Symphony didn't take long to move from N.W. Crossing to a Downtown location. I figure most of the people opening retail on the west side and the east side are newcomers who just haven't quite figured out the traffic flow.

They've all got oh, so tasteful names, clever, artistic logo's and shiny, bright faces in the photo's.

You got to love retail, though. There's Karen Bandy, who's had a shop in downtown Bend for years, advertising a 'new' location, but from what I understand, she's giving up the 'retail' storefront to concentrate on her design business. On the other hand, you have Designer's Jewelry looking as though they are going out of business, but who....evidently isn't. A couple of days ago, I got a cheap looking key in the mail for a promotion that was eerily similar to the one that Saxon's used when they moved.
In other words, I'm guessing an outside promotional outfit is running the sale, but while they never quite use the words "going out of business", you really have to parse the words to realize they aren't. Seems kind of tacky to me. Sorry, Marti, it just does.

But why is it I see older businesses going out, while new businesses pop up all over the place? Are the new generation just better at it? If anything, I suspect the opposite. Nothing trumps experience, in my opinion. And if old timers like Karen Bandy don't see a future in retail in downtown Bend, she knows what she's doing. All the older stores are just further into their business cycle.

The new businesses haven't really confronted the reality of business just yet. They are all still bright eyed and fluffy tailed and enamored by the idea of their little dream business. They have the best attitude, the best inventory, the luxury of no history of mistakes, probably a cash reserve, or at the least a credit reserve, the newest fixtures and that wonderful enthusiasm that will carry them a long ways.

So far, there seems to be more than enough people willing to take the place of fallen soldiers. There's been a line. Lately, there's been an explosion. It's a lagging indicator, I believe. Incubated in the glory days of 2004 - 2006, and only now coming online. It's the froth at the top of the glass, spilling over.

The good thing about this, is that most of these businesses will last a few years, even if they start losing money right off the bat. There are probably plenty of businesses in the works. From a purely mercenary point of view, this is good for my business. Plenty of activity and no boarded up storefronts, and lots of curious shoppers.

But every time I doubt myself, every time I think maybe I'm being too negative, I need only look around and compare my neighbors from 25 years ago, from 20, from 15, from 10 from 5 years ago, and if anything....I'm giving these new businesses the benefit of the doubt.

I feel like an old veteran who has just got a bunch of replacements and I know that they don't have a chance.

I'm conflicted about it.

I hope all these new businesses are great successes. I'm glad they are there.

I just can't figure out how this has happened, or how it's going to turn out well.

Wednesday, November 28, 2007

You know that scene in the old timey movie western where the two gunfighters are walking down the street toward each other, and the bystanders are all standing there slack-jawed, and there's that one guy in the background who is edging for the exits?

That's me.

I swear, I pick up the paper each morning and another commercial development is announced.

In contrast, over the last three months, I have reversed course.

My focus is no longer on higher sales, but making sure all the bills are paid.

I'm ordering what I think the store needs, and not what I simply want.

I've changed the ordering from 60% pre-orders, 40% reorders to 40% pre-orders, 60% reorders.

I've set a strict budget and I'm sticking to it, whereas before I'd break the budget if I thought there was reason enough.

And so on.

Most importantly, it's a change of mind.

So far, any downturn in business has been for internal reasons. I don't really believe that the bubble pop has affected me, just yet. But I'm absolutely convinced, now, that next year will be a different story.

I'm very thankful now that the credit crunch occurred in that month I was waiting for that second lease. That, plus the lousy terms, were enough to make me change my mind. It would've been a disaster to open a second store now. As it is, I probably over-ordered by 6k in preparation, and it's going to take all the fourth quarter to bleed that out of the system.

I'd thought we'd have breathing room through Christmas, and I still do. People always spend money at Christmas, barring a complete disaster. But the drag has started, and I'm starting to feel it. So I'm getting a good head start on clearing the books.

I've never actually done it this way before. I've done all the cost-cutting measures before, many times, but always because I had no choice. I've never gone this way when I was still doing pretty good.

But I also told myself I wouldn't get caught flat-footed again.

And there is no real downside to cutting back. I can always pick up my spending, if sales stay strong. But it's nearly impossible to cut spending once I've committed. There is a minimum 4 month lag in the system.

Sales are actually going to be up this month, on a YtY basis, which is really encouraging. It means my maintenance budget is sufficient to keep sales at a high level.

This is that moment in the business cycle when it doesn't appear than anyone else is concerned, that they are going full speed ahead damn the torpedoes mode.

It takes some real confidence to go the opposite direction.

Tuesday, November 27, 2007

Sometimes I set myself up for such a big entry, I never get to it.

But here goes....

When Bruce came in to show me all the Juniper Ridge papers he'd gotten, he mentioned the 'anti-growth' slate that had once been elected to city council. I immediately thought of the 'men without ties' slate, but didn't remember them as being anti-growth so much as being anti-insider.

I'd forgotten the group that got elected later and fired Larry Patterson, a group who, while never using the actual words 'anti-growth,' seemed to have slow growth policies.

What I actually said to Bruce was, "I think this town has grown so fast, that the locals didn't have enough experience with bigger city politics, and the newcomers didn't have enough experience with Bend, and that was a recipe for disaster."

In fact, if I had to pick a moment when I think our city council went off the rails, it was the firing of Larry Patterson, who was the quintessential insider but also knew what the hell was going on. Seems like a stupid thing to do, if the majority of the city council is new, to fire the guy who knows what the hell is going on.

O.K. A few disclaimers. I only know what I read in the paper. I've lived here my whole life, but I get my info from talking to people or the newspapers. I'm basically not a meeting-goer or a politician. I'm happy alone with my thoughts, or goofin' in my store with regulars. When I read the legal papers on the Bendbubble2 blog, my eyes glaze over. Thank god there are people who are willing to do such things as read the fine print and sit in endless meetings.

But I also know what happens when you expand too fast.

I had four stores at one time. I thought I was successful with one store, so I added another, and then another and then another. But the other 3 stores were missing an essential ingredient to success -- Me. I didn't have the experience, the management style, the policies, the equipment, and the personnel to pull it off. The level of complexity seem to go up exponentially.

I also didn't realize I was riding a bubble, and that four stores weren't possible in Central Oregon over the long run selling what I sell.

When Bend expanded by four times, I think something similar happened. First, the city council misjudged the growth as solid, when a bunch of it was bubble. They lost sight of the bottomline.

But it wasn't just that it got so complex. I think the wrong kind of mentality found it's way onto the council. The 'promotional' minded mentality. I don't have any trouble with that type, as long as there is some bottomline substance underlying the promotions.

But, I'm afraid that sometimes the promotional aspects become more important than the actual reality.

So, when I listen to the city council and city administration talk about their big plans for Third Street, for instance, or Juniper Ridge, I always wonder where they think the money is coming from.

A hardheaded businessman would never have given into an ultimatum from Les Scwab, I don't believe. They wouldn't have closed off all the options for Juniper Ridge by selecting one group of developers. They would have at least done the practical, before leaping toward the improbable.

I repeat, I only know what I observe from the outside. As someone always points out, if you don't go to the meetings, you have no right to complain. But that's what it looks like from the cheap seats.

Monday, November 26, 2007

So national sales were up 8.3% on Black Friday?

I'm sorry. I don't buy it. I don't think they really know, just like they can't really predict how sales will be for the Holidays.

One of my brother in laws said, "I understand that they think sales will increase xxx% this year." And I found myself saying, "Oh, they have no idea. That's a flat out guess."

There is just too much dark matter involved. Way too much margin for error. It's just a marketing tool, a way of reassuring the public that all is right in the world, maybe instill just a twinge of Christmas spending urge.

It could be up, it could be down. I don't believe they really know.

Besides, as I've always said, raw sales don't mean a damn thing. Especially if you're giving the product away. An 8.3% increase in business in my store with an overall store discount of 10% would be a net loss.

Meanwhile, over in Madras, some local stores are trying to fill the niche they perceive has been created by the lack of 'big' boys.

Same sort of thing happened in Bend in the 1980's. We had a 10 years span when no significant national retailer came to Bend, and up popped businesses that tried to fill the void: Big, little businesses, if you will. Or Little/Big businesses.

Then the big boys showed up, and these hybrids were simply crushed. In a sense, they were putting themselves in the path of a locomotive. Safer to be a small and agile specialty business. You want to live in the crevasses, not in the big cave that the big bear wants.

Millions for a transit center? Got to love that federal tax money. Sure, maybe we wouldn't have got the money without a transit district -- but that still doesn't mean it couldn't have been done right in the first place.

Sometimes, the stereotype is pretty much right on. That skateboarders are scofflaws comes as no surprise.

We had a skateboard shop open across the street from us a few years ago. For a couple of weeks, the kids were out in the street, wacking the sidewalks, etc. making a racket. I ignored it -- they were new, and I suspected they would settle down. But my dear, sweet, calm wife got it in her head to talk to the owner of the new store and request that he talk to the skateboarders:

"I've been wanting my own place so I wouldn't have to listen to people like you for so long that I'll be damned if I do as you ask."

Good neighbors. They were gone in less than a year.

But I've learned that every few years some group of kids or parents will start muttering about how there isn't "anything to do" for teenagers. They'll try a teenage club, or a skate park, and almost invariably a bad element takes over.

To complain that there isn't anything to do in Bend, is to reveal that you are a dimwit.

Sunday, November 25, 2007

I was at Linda's store, sorting books, and one thing struck me as truly amazing. It's incredible how some authors just keep on writing, even after they're dead. You got to admit, that takes a lot of deadication.

Robert Ludlum, for instance, is more prolific now that he's dead than he was when he was alive. Just can't let a cash cow die, you know. Got to prop him up and stuff him.

I told Linda this, and she just scoffed, "Oh, is he still dead?"

Any other zombie authors you can think of?
Black Friday was nothing spectacular. Did better than a normal Friday, but not quite the double normal I was looking for (to make up for the closed Thursday.) In the old days, we'd do triple. The foot traffic really got going after noon, but more 'clans' and lookers than buyers. Pat tells me that Saturday had even more lookers, and even less buyers. Ended up with average sales.

I don't do discount sales. I think that either 1.) all the bargains that mass market are offering are bogus, that are planned from the beginning or 2.) a loss leader that does nothing for the bottom line, designed to create foot traffic. Downtown Bend has the foot traffic, these days. We just need to sell them something.

A 2x increase in sales with no discount is equivalent to a 2.5x increase with 10% off, and I doubt a 10% off sale would have much impact. A 20% off sale would mean I have to sell 5x normal to make the same profit, and I doubt the consumer would be excited by even a 20% off sale.

I'll repeat that, a 20% discount would require a increase in sales of 5x normal to make the same profit I made at 2x normal.

Like I said, I suspect that much of the 'blow-out' material in the chain stores is designed from the moment they are created to create an illusion of savings. Let's see; this big screen T.V. makes an acceptable 20% markup at half price, and we can price SRP at 40% markup, so we'll price it at 15% higher than our real target SRP leading up to Black Friday since no one's buying anyway, then we'll lower our price 50% from that price, and end up at our target price.

Call me cynical. Call the public, Pavlovian puppies.

I have found out that my board games, which I have so assiduously accumulated, have already landed in the mass market, Barnes and Noble and such. That didn't take long. I knew it was coming, but this is quicker than I'd thought. Pat says that one customer left a Settlers of Catan on the counter, cause they could get it 'cheaper'.
So much for that product line.

My own observation about the housing bubble is that we are still in the denial stage. I think there might be a few insider real estaters that are fixing to starting to get ready to begin getting irked. We have a long way to go. My brother in law on Thanksgiving thought I was a fool to think prices were going to drop by this time next year. We have a friendly 20.00 bet. But his attitude is what I run into most. The glass is half full, as far as they're concerned, and we are just being ninnies to think otherwise.

Saturday, November 24, 2007

I was reading a review of the new Bob Dylan movie, and it talked about a scene where a "reductive" journalist is trying to tear down Dylan.


Great word. Just the word I was looking for.

I don't think that I'm a Chicken Little, and I don't even think I'm all that negative or cynical. But I do think I have a tendency to be reductive.

The right word is almost the essence of writing, I think.

I tend to reduce things down to the core. And most of the time, I come to the conclusion that it just won't work. The bumble bee can't fly.

Most of the time, life being would it is, I'll be right. But it's the small percent of the time where something unusual happens where life progresses.

When I was writing novels, I didn't know how difficult it was to be published. Or perhaps I knew, but I preferred to ignore it. I sent my first novel off to publishers "over the transom" , as they say, and got acceptances from two publishers. Later I found out that that was almost unheard of, that they get thousands of manuscripts per month, and rarely do any make it out of the mail room. I kept writing, but the more I knew the more discouraged I got. I began to realize how few writers actually make money, and how much of a gamble it was every time; that spending a year or two of my life and sending a manuscript out into the void, wasn't a good gamble, even with an agent and even having been published three times in a row.

I never intended to quit writing, but Pegasus just sort of took over my life.

I had ignored all that when I started, and being published was the transforming incident of my life. It turned everything around. It's how I got involved in Pegasus, and how I met my wife.

Same thing with small business. The statistics are pretty dire for success. But people keep trying. From my perspective, sometimes, it seems as though nobody actually makes money. I know that can't be true, but it seems like it. I suppose one should define success. If a store pays for an owners lifestyle for, say, five years before he moves on to something else, is that a success?

Only the owner (or writer) knows if he had the talent and perseverance to succeed. I could see a store succeed in an overstuffed market, and fail when it has a monopoly.

Of course, it's best to work the odds.

My nephew Sam is like this world famous d-j in his chosen field; drum and bass music. He flies all over the world, sells vinyl off his website. (Lost Souls, is the name of his label.) But he pretty much has to leave Bend to get anywhere.

I told him; two things I didn't realize while I was establishing my business. One, that I had a product mix that was always going to be limited in sales; and two, I have a population base that was always going to be relatively small.

He's doing a type of music that's extremely popular in Eastern Europe, for instance, but for which there is no following in Bend. To be reductive, he either has to accept the ghetto where he is by all accounts very successful, or expand into a type of music that has more followers.

My store seems to be just successful enough in it's specialized field for me to stick with it; hedging my bets, as much as a I can, with other product. It would be a huge leap to become a full bookstore, for instance, and I feel some obligation to my comic customers. I like comics, but they just will never be incredibly lucrative.

Yesterday, I had tons of people in the door, but almost none of them were really into what I was selling. I've succeeded, to some extend, in broadening my appeal in toys, books, and games to get some of their business, but it's always going to be limited by the fact that I make most of my money from regulars buying specialized material.

Anyway, in looking around the business scene in Bend, it's very easy for me to be reductive, to limit the chances of success for everyone else. And, as I said, I'll be right most of the time.

Somewhere out there is the most ridiculous business I can think of -- that will be wildly successful. But it seems to me, that the exception doesn't prove the rule, so I'll continue my reductive ways because it is a crucible that seems to work.

No one should take offense if I doubt that most of these new businesses have much of a chance; statistically, it's true. In a reductive, common sense sort of way, it's true. But you may be the exception.

Friday, November 23, 2007

Went to do some last minute cleaning at the store yesterday, and found the Christmas lights on the canopy vandalized.

Why would someone do such a thing?

Goes along with the year that my Christmas wreath was stolen. Merry Christmas to you, too, whoever was that desperate.

Yesterday wasn't a day for complaints, but this is Black Friday, so all is allowed.

I just don't understand that.

When the people who do that sort of thing lay their heads at night to sleep, do they realize what pathetic toads they are?

I figure they're just angry at the world. Someone probably kicked them out onto the streets on a day they should be spending at home, and they took it out on us.

I couldn't resist the wine at dinner last night, so no yelling or fighting over the merchandise!

Happy shopping! (It's your patriotic duty....)

Thursday, November 22, 2007

Going into my second Christmas season blogging, so I may start repeating myself. I feel the same way every year. The Holidays are different for retailers -- it is very hard to get into the spirit when your livelihood depends on sales.

It's a kind of nervous feeling, because you've pretty much done all the things you can do. Now you just wait to see what happens.

Even ordering doesn't really affect sales, past the first week or two.

Every year, it seems as though the public waits longer. Nowadays, it comes down to the last 10 days or so. Which to me is a big danger. Bad weather, terrorist attack, some major event happens, and Christmas is wiped out.

Every year, in my imagination, I hear the Sheriff of Nottingham exclaim, "THAT'S IT. CANCEL CHRISTMAS!!"

I usually go to the family Thanksgiving Dinner, which is held at my sister's house, bless her, and tell myself not to drink any wine. Every Black Friday, I'm hung over, which is not a good place to be when you're dealing with hordes of people.

Bend has changed, even in the last year. I just shake my head when I look in the papers. I'm astounded by the number of new businesses. A couple of dozen new kids stores, it seems like, a couple dozen more new home decor stores, the ubiquitous clothing stores, the country kit ch that has suddenly popped up. It's just weird, I tell you.

I'm hoping that there are enough visitors in town, that downtown will actually get a turnout this year from people looking for something other than the usual Walmart bargain. Both Tuesday and Wednesday were very busy, which I can't really remember happening before. I hope that bodes well.

Oh, and enjoy your Turkey!

Wednesday, November 21, 2007

The more he doth protest....

Every once in a while I get the look. I call it the fish-eye look. Usually it's a middle aged woman, sometimes a man, people who have apparently become wary in their shopping experience.

I don't get it from comic customers. I don't get it from toy, or book, or game customers.

I only get it from sport card customers. Even then, I don't get it all that much. I used to get it, ten years ago, when the sport card industry was self-destructing. It was that look that really drove me away from cards, even more than that I was losing money.

It's the look I'm sure that used car salesmen get from everyone who walks on their lots. It's the look that says, I don't believe you. Convince me.

And I've learned that the more I try to convince someone, the more they don't believe me.

I literally walk away. I see the fish-eye look, and I say, "Oh." And I walk away. Sometimes they'll come after me. "Don't you want to sell this?" their tone asks. And I'll say, "Hey, if you want it, fine. Otherwise I have to go clean this glass counter top."

I'm sorry that the sports card industry has become the equivalent of being a used car salesman, but it ain't my fault. I pride myself on my integrity. You are making me angry by casting aspersions.

And I've learned through experience that NOTHING I say will really reassure you. I've found that if I give them something, they suddenly trust me more, which is strange. Means they've been manipulated by used car salesman so much that they can't tell the difference any longer.

Had a woman in yesterday who was looking for a 660 card Red Sox set. I said, I didn't know there was such a thing. She looked it up on line and I took one look at the picture and said, "Oh, that's a 2007 Topps set. I have the same thing here, with Yankees on the front instead of the Red Sox. It's just packaging."

She gave me the fish-eye look. I protested. "No, really. I've been doing this a long time...." but I could see she wasn't buying.

Perhaps she'll go off and buy that "Red Sox" set, and find out I'm right.

She's on her own.
Tuesdays have been terribly slow, lately. Just like the old days. Yesterday, however, was kickin'. I think it's because there are Thanksgiving week visitors. Not so much kids; I didn't even realize the kids were out of school until late afternoon. No, it was mostly 20 - 30 year olds who commented on how stocked my store was.

I had a couple of scruffy pairs of guys in early, both of which said, "Great store!" One of them said, "I travel all over, and I can't find this stuff."

I thanked them, but didn't think much of it. Like I said, they were pretty scruffy.

Then they started piling up the toys. Preacher toys, Smallville set, an 85.00 Superman doll.

The other guy piled up about 85.00 worth of indy graphic novels.

"Are you guys in a band?" I ask.

"Yeah, we're playing before Gwar."

Later, they came back with another couple of bandmates and or roadies who spent some more.

Then later, I got this really big guy and a friend, and they started buying. At a guess, I asked, "You guys in GWAR?"

They laughed, "Is it obvious? You've got a great store here, and I'm not just blowin' smoke."

Anyway, between them, they probably spent half the money in my store yesterday.

I should have asked them to mention our store onstage.

Probably wouldn't have done any good.

It's always been sort of an interesting phenomenon to me. For instance, while I can't seem to sell graphics to the younger folk who play video games, I do seem to sell quite a lot to the slightly older guys who actually make the video games. Same thing with Hollywood types. They're tuned into how cool all this stuff is, how imaginative.

I wish I could figure out how to add images to this blog, but some of the other comic oriented blogs remind me every day how astounding the art is in our industry by publishing little snippets. Great stuff.

Instead, I'll get someone in who asks if I have any art? And I just look at him and say, "Yeah, er, look around."

"No," he says. "Real art."

What's that? Exactly? No I don't have any Van Gogh, or Jackson Pollack. "Give me the name of an artist?" I ask. But they can't really describe what they're looking for.

As far as I'm concerned, I have a pretty broad range of art in my store. Do I have whatever the current art scene in New York dictates is art? Maybe. I know I have some pretty cutting edge graphics. You have to understand, that unless you've tuned in lately -- YOU DON'T KNOW WHAT COMIC ART IS!


What is art?

But I'd think anyone who is truly interested in art, would find something to intrigue him in my store, if he has an open mind and eyes to see.

Tuesday, November 20, 2007

I'm working out a reorder schedule for next year. I've never done that before, Budgets, yes, but I usually just ordered what I thought we needed most each week until the budget was spent. But sometimes, that would leave out wholesalers who had product that just missed the cut, again and again.

It has occurred to me, that I have enough of a reorder budget to order from three out of four of the major suppliers I use each week. So if I alternate them, I can order from each wholesaler 3 times a month; and skip the occasional 5th Monday.

If I work out the payment processes of each wholesaler, (two automatically charge my credit card, and two are paid by check), I can work out the most beneficial time to order and pay. Two weeks out of the month, I have way more bills -- the week of my store rent, and the week of my home mortgage. So I need for the product to come in on an even basis, while the payments fall mostly onto the two lighter weeks.

Pretty inside baseball; but that's where my heads been today, trying to figure out which wholesalers to order from each week. I'm going to post a schedule by the phone.

I'm convinced that my store is going to really need to stick to a strict budget next year. Generous, but strict.

On the other hand, I think my wife's store is still in a growth stage. And I really am tired of figuring out the overall economic conditions for all the other stores in town. That is just unknowable.

I just know my bottomline instinct is that it is time to be conservative.

Monday, November 19, 2007


Well, not yet. Going to go see the 3-D version this morning. Will report back.

Sunday, November 18, 2007

The Bend Area Transit is such an easy target, that I've more or less laid off. I'm still surprised that no one was held accountable for the mess, but I also hesitate to have anyone lose their job.


One comment by Transit Manager, Heather Ornelas, is hard to ignore. After making the case the smaller type buses do the job adequately, the Bulletin then says,

"Transit Manager Heather Ornelas asserted the symbolic importance of having larger transit buses on the road to establish the system's presence in the city."


She then subverts her own argument, according to the Bulletin, "But ultimately, having a more reliable system in place may be more important for riders than what the buses look like."

Reliable more important than looks?

You think?

So we spent hundreds of thousands of dollar in tax money, federal and local, for "symbolic importance?"

Later on, she is quoted as saying, arguing in reverse that BAT should retire the 'larger transit buses' that keep breaking down.

"We just can't rely on these buses and when they break down they create a huge operational issue and the problem is very visable (sic)"

Apparently, symbolism works both ways.

But if you want to know what the frikken core problem of the whole fiasco is, it's the concern over 'looks.'

It looks bad that we don't have a transit system, so put one in place by all means. No matter what. No matter that we might save money by waiting. Never mind the due diligence. It's embarrassing that Bend is the biggest city west of the Mississippi without mass transit system (as I heard asserted for years.) We're a big city, by god.

But they've got me thinking. I've decided that it is symbolically important that my store have a solid gold sign. We want downtown to look prosperous, don't we? I think the city ought to be more than willing to grant me the money to have the solid gold sign, because it's important that downtown make a statement.

You guys don't mind, do you? Sure a nice wooden sign says the same thing. Wood just doesn't make the proper symbolic statement, you know?
Wasted a day on the couch, channel-flipping (hey, it was raining!). Between episodes of Mythbusters, I watched an entire episode of a house flipper show. I swear I came across at least four different flipper shows, yesterday, on at least three different channels.

They must have been planned a couple years ago and filmed last year because they in no way reflect current reality. They almost need a disclaimer: "What these damn fools are doing, even if it worked, is probably not going to work today."

Anyway, I'd always assumed that most house flipping was like Bend, or what I thought people did in Bend. Buy a house that was being built or just built or even an old house, sit on it for a year, and then sell it.

The premise of most of these shows is to buy a piece of junk, fix it up (or more to the point, look as though you fixed it up) and sell it.

What was really interesting to me is how they show the process with warts and all. Half the time the flippers lose. Almost always they go way, way over budget.

But these flipper guys really seemed familiar to me.

I've seen them before.

And then I got it.

I'm pretty sure they used to sell baseball cards. They're the guys who popped up everywhere at the peak, elbowed all the legitimate dealers to the side, went all Crazy Eddie and discounted, and hedged, and cut corners and otherwise acted like such soulless, conscienceless, aggressive jerks that they completely ruined the hobby.

Greed. Rampant, sociopathic greed.

I watched a whole show of a complete jerk who spent most of his time whining, yelling, pleading, weaseling, bullying, and generally doing everything he could to get it cheaper. Then walked away with a sly grin. Didn't matter who he insulted, hurt, or walked over.

The part that stunned me, was that he walked away with a 78k profit for two months of shoddy work.

The one consolation I'm left with, is that I doubt he stopped there and is now probably sitting on an even bigger shoddy piece of crap that he can't sell.

I started to watch another flipper show, but the main protagonist was, if anything, even worse. My life would be tarnished by spending another moment watching him.

What I find really sad is, that if there ever is a government program to bail out the subprime buyers, that legitimate buyers like my son in Portland, who bought a house to grow a family, will get shoved to the back of the line by the sociopathic greedmongers, who will walk away with the money with a sly grin.

Meanwhile, a step in the right direction by the Bulletin.

Yes, Martha, there is a housing slowdown.

I've always said, watch what Brooks Resources says: I take Hollern's comments, and add about half again as much negativity to it. I take the next most negative comments, and double them. Ignore all the rest.

Saturday, November 17, 2007

Good God.

Remember, this is a blast from the past.

From The (Bend)Bulletin, Nov. 17, 2007.


(The following editorial appeared June 4, 1948.)


Bend, we think, could well follow the lead of certain eastern cities which, in recent months, have forbidden the sale of no less than 38 of the so-called comic periodicals. This has take place of late in Indianapolis, in Hillsdale, Michigan, and in Detroit. Other cities, even before that time, had been giving the matter attention.

These comics, for the most part, are no funnier than a broken leg. They do have much more appeal, however, for they are gaudily printed in colors and unquestionably compel the attention of children. We have even seen adults reading the things. Sex lure, violence, sudden death, sadism and horror that are out of this world seem to be the basic ingredients of the successful comic. Some of them are harmless or relatively so. Naturally we are not referring to them in this discussion. It is the others we are talking about. We think they are harmful. Read avidly by youngsters in the most impressionable age division they leave their impressions upon the character and mind.

We would suggest that agents and retailers have it in their power to do a real public service by surveying their wares and casting out the objectionable items. The city can achieve the same results through compulsion, but voluntary action, it seems to us, would be preferable. Certainly it would be evidence of constructive citizenship."


Remember, check the date.
Beautiful little bookstore, Between the Covers, at least from the pictures.

Liked the quote from Tina Davis, owner of the Camilli Book Company. "You know, I think it's great. Bend could do a lot worse than have another independent bookstore. We have restaurants open all the time, and nobody says boo. But suddenly, it seems like people get a little wacky when somebody opens a bookstore."

She could, perhaps, be referring in part to my amazement that we've gone from one indy bookstore for the last 7 years, to three in Bend. But she misunderstands me.

I think she's right. I think there should be a bookstore on every corner. Really, that's a world I'd like to live in!

Meanwhile, Keeneye, who has a charming blog about her new pizzeria in Baker City said she's getting a bit of flack from the locals, and wonders if she shouldn't have an anonymous blog instead.

Since I've recently gone through the same kind of self-examination, I'm sympathetic. But her blog is fun and interesting and inoffensive, so I think anyone who has problems with it is someone who has problems, period. I'm way more opinionated, but then I'm in a bigger town.

Still, I know that she's written about run-in's with customers, and I've sort of avoided talking about that because of the reactions.

The customer is always right, and all that. Except when he's wrong. But what do I know? I'm just the guy who's been doing this forever.

But, like I said, the customer is always right.

She'll eventually realize that no matter how perfect her place becomes there will be people who aren't happy. Eventually, you just have to accept it and move on.

I generally don't talk about the worst things that happen. It won't solve anything. I'm amazed sometimes by the way some people act. Small example, because we just got done dealing with it: We had a hose connected to the bookstore all summer, and people would come by and water themselves and their dogs. They would also leave the hose running, leave it in the roadway, and tightened it so much that it took a pipe wrench to take off!

I got the advice one time of looking at them and thinking, "They've got a brain tumor, they can't help it."

I'll give you an example of a complaint about a customer that I wouldn't ordinarily make, because it happens every day and it's part of doing business and why worry about it. A mom and daughter came in, and the daughter 'loved' our store and she wanted to look and examine everything. We have hundreds of dice behind the counter for gaming, and she had Pat take out one dice after another for her to look at. She went over the the anime section and wondered why we didn't have an obscure later copy of a series because it was the "she hadn't downloaded, yet." She had him get up on the ladder and pull down a Japanese toy from the very top section of the wall, and then had him get back up and put it back. And she had a running commentary of what all she wanted and all we didn't have.

I finally got a bit exasperated and said, "What do you want from us? Our store is packed! We'll order it from you."

And I get the deadpan. "I'm just looking." And they start to walk out the door.

And I did what I rarely do and said, "After all that, you aren't buying anything?"

They did a right turn into the other half of my store, and spent another half an hour on their own. Came to the counter with 20.00 worth of stuff.

"Are you happy now, we spent money?"

"Yes," I say. "Thank you."

My wife would say, they had every right to browse, and I would say, yes, within reason but if you make us your monkey, that's just rude.

And retailing wisdom would say, you just take it without complaint. And I would say, yeah, but I got them to spend 20.00 by pointing out their energy expenditure. And the fact they spent the 20.00 means that they knew it.too.

So there you are. A dangerous thing to do. Complain about a customer.

And generally, it makes no sense to complain. People are people.

It's the same kind of everyday aggravation that everyone goes through, and there is little point in talking about.

Even this relatively mild incident makes me nervous to talk about. I remind myself that I get 70 or 80 people a day, and most are perfectly fine. And that in the scheme of things, the kind of situation I just detailed is so unimportant, that there is no point talking about or mentioning it.

But since this blog is a reflection of my day to day work life, I thought just this once I'd talk about it.

Friday, November 16, 2007

If you don't mind, a labored analogy.

Imagine if you will, a successful restaurant, good food with generous portions, decent prices, and cheerful, efficient service. This restaurant has built back it's reputation from the previous owners after many years of downtime.

Imagine your surprise when the next time you go into the restaurant, you realize that they have cut your favorite meal out of the menu, and instead replaced it with 3 varieties of pasta. "What happened to the veal?" you asked.

"No one wanted it. But everyone loves pasta."

O.K. You go along, and sure enough the pasta is pretty good. You don't really notice that the price is a couple dollars higher, and it took a couple minutes longer to get to you. You forgive the snappy waiter.

The next time you go in the restaurant, they have 3 more varieties of pasta, but not the one you enjoyed last time. But you order one anyway, after waiting half an hour for the waiter to show up. The meal shows up, and you realize that it's half the size of the last meal, and doesn't come with any side dishes, and the waiter is a total snot. Plus, it isn't all that good. And when you go to pay, you realize it's way more expensive.


What I'm really talking about here is the comic business. After the horrible 90's, where Marvel seemed to feel they could throw any old crap out there as long as it was Spider-man and had the Marvel imprint, the comic industry righted itself and started producing some great comics. At the end of the latest cycle, they threw out a couple of universe spanning crossovers which were well done and sold extremely well.

And then another, and another. And they came in later, or sometimes, not at all.

Too bad we have to learn the same lessons again and again.

There are still lots of great titles coming out, but they're coming from Dark Horse and Image and other smaller publishers, right now.

Most damaging to the momentum, in my opinion, is the constant late product. Very taxing on the cash flow and on the customer's patience.

I was interested to find out that almost all the established comic shops started seeing a bit of a slowdown on comics at mid-summer, which was exactly when I started to notice it.

It's not too late for them to get it right. And thankfully, the comic business is diversified enough that I don't have to worry as much about whether Marvel and DC get it right. And it's still better than it's ever been.
I was talking to an employee of another bookstore here in Bend, and was commenting on how amazing it was that we had one indy bookstore for 7 years, and suddenly Bend and Redmond have jumped to five indy bookstores.

He said something about how people see a store open, and they jump off the cliff like lemmings....

I had a different take on it. I told him I believed that these stores are incubated at the same time, without knowledge of each other.

So it's just a coincidence?

Not really. Whatever conditions inspired one person to start thinking about opening a store is the same conditions inspiring another. It's an unfortunate and messy consequence of capitalism. No higher authority who says, O.K. we have room for another bookstore, but only one. You there, you open a store.

Sometimes, the very fact that there isn't competition will suddenly invite an overdose of competition.

Very messy.

Creative destruction on a grand scale.

But somehow the economy muddles through, with carcasses littering the roadway. But out of the decay something else arises.

Downtown Bend has gotten so busy, that I don't think even the housing bubble -- which is really going to hit Bend hard -- will slow it down. It is very hard for me to imagine that Downtown Bend can absorb 10 new restaurants without consequence, especially during a slowdown. I'm going to be very curious how this plays out during the months of January through June, especially if Bachelor doesn't get much snow. But I can bet that every new owner is convinced that their restaurant will be the exception.
Interesting times, eh?

Here we bubble bloggers are, merrily raking developers and real estate agents over the coals, back and forth, until they are a crispy shade of....

....and out pops one of our major targets, Becky Breeze, who says, "Hey, what's going on over here. What are you guys saying about me?"

And we're all wracking our brains trying to remember if we said anything disgraceful, and isn't this a good reason to be careful.

And then, a future neighbor of Pegasus, Astacia of Treefort, pops up and says, "Hey, what's going on over here?" and I'm wracking my brains trying to remember if I said anything disgraceful....

You get the gist.

Thing is, because this isn't an anonymous blog, I've tried to be at least respectful of others opinions, and point out, again and again, that these are my opinions and they certainly could be wrong. I love a good debate. Hopefully, I'm not being so harsh I crush their feelings. Hopefully, if I just stay honest, I won't have anything to be sorry about.

Meanwhile, a blogger we know as Bruce (who popped into my store yesterday with the words, "Are you the infamous Duncan," to which I immediately answered, "And getting more infamous all the time....) has apparently managed to get to get his hands on the original agreement between Bend and Les Schwab, and as BEM points out, has scooped the Source, the Bulletin and KTVZ.

I think this internet blogging thing might have a future.

Thursday, November 15, 2007

No great observation here, but I'm noticing way more of the amenity type businesses opening all of a sudden. I mean, we've been talking about them for a couple of years, and they've been opening all along, but suddenly there seems to be a jump in the number, and an inflation of the high concept that is very noticeable. Interesting timing, and I think the result of the surge of newcomers since 2004.

For instance, the number of kid's clothing stores, both new and used, has jumped by 5 or 6 or 8 or something. Seems like every time I open the paper, I see a new one. Number of indy bookstores in Bend and Redmond? Jumped from 1 to 5. And no one just opens a bookstore anymore, or a clothing store. No, there has to be a coffee shop or a deli attached.

Back when I was reading Inc. Magazine and Entreprenuer, I'd notice that stores would become fads. A certain concept or type of store would be trumpeted. And I read these articles and think, that's crazy. A bunch would open, and a few years later some of them would've adapted into something real and rest would be gone.

High concept is all well and good. But we live in a nuts and bolts, bread and butter, meat and potato world. The other stuff is garnishing. You aren't going to make your money on the extra's. Some of it branding, I suppose, a way to make your store stand out. As long as the owner understands that.

For instance, if you are a jewelry store, I'm sure you love to have really interesting, spectacular bling. But I'm betting you still make your money on engagement and wedding rings, etc.

I could be wrong about this. I'm not sure I understand the frizzy businesses that I'm seeing open. I'm very thankful for both the walk-in traffic who is attracted to the high concept stuff I carry, and the regulars who buy my standard stuff week after week. I need both of them. I doubt I could survive without both of them.

But I'm very careful not to limit my selection based on some high concept notion.

I suppose some of these high concept amenity businesses will find out after opening what their bread and butter product will be, if they last long enough, and come down off their clouds. But to depend on the snazzy, look at me, product means they are depending on making their money in the vacation and holiday months even more than usual, and god help them if those tourists stop coming for any reason.

I suppose there is also a possibility that the amenity vagrants will flock downtown and buy a bunch of unnecessary but cute stuff. But mostly, I just seem them spending the same kind of money as everyone else, or just standing there going, "how quaint."

Just once I'd like to see a batch of customers come in and say, "I'm rich and money is no object and I'll take two of that incredibly high price thing over there." (Of course, I understand they aren't going to announce that they're rich, but I don't see behavior that would signal they're rich, either....the I'll take this and this and this....")

Never happens.

But I think in the minds of some of these new amenity businesses, they think it is going to happen everyday.

Good luck with that.

Wednesday, November 14, 2007

Retail has a logic and a momentum of it's own.

I read once that the Japanese were horrified by the failure rate in Silicon Valley. But out of that creative destruction emerged a few cutting edge companies that the Japanese couldn't have incubated themselves. (Though they are pretty good at refining the process.)

I figure sports cards, for instance, became an unprofitable business a good 15 years ago. But there was always some old semi-retired guy willing to try, always some amoral 20-something who tried to become the Crazy Eddie of the internet. And they kept just enough of the card companies around for me to still make a bit of money, and 15 years later cards as a legitimate part of my mix.

To me, the housing bubble was a much more dangerous event. Houses went up in price too high, and too fast. And fundamentally, too many houses were built.

But retail is different. Sure, almost all these new places are going fail. Most of the old places have already failed. But they leave a beautiful corpse. They create excitement and traffic flow and interest. Restaurants, for instance, have always had a horrible failure rate, but that hasn't kept them from popping up on an endless cycle of renewal. Money is churned. Out of the wreckage will emerge a few winners, and a few survivors.

Sure, we could have some boarded up windows downtown, but I doubt it. And if we do, the boarded up buildings will be much nicer!
Yep, I've gone to the dark side.

You ever seen that picture of the little ol' Victorian house surrounded by skyscrapers?

But, really, if these rich folk (or deeply in debt folk) want to fix up the neighborhood, why should I complain? In theory, I miss the old funky downtown, but you know what? I'm doing better with the new downtown, people walk in the door who have money and are willing to spend it.

The old buildings? You know what, most of them were crap. Seriously. Nothing very charming about them. The few that had a little history have already been fixed up, the rest were pieces of junk. Sure I could wish they would vary the styles a bit, but really they aren't that bad. Certainly better than what was there before.

I figure that almost all these construction and storefronts were incubated between 2004 and 2007. You want to buy a house, bang you do it. You want to tear down an old building and put up a new one? You want to open a new business? That's going to take some time.

So, we are in a time-travel zone where the building you see is from 2005. It just happens to be built in 2007 and 2008. But all that money flowing into downtown Bend is nothing but good for me now.

Of course, I may regret it down the road a couple of years. I hope my landlords are living in the same time zone and universe as me, but there are no quarantees. I figure in a couple of years the bloom will be off a bit, and keeping tenants will be a priority. But in the meantime, build, build, build!

Just don't do it on my block.
I don't know what to say about all the new building going on in downtown Bend and Redmond. It's fairly mind-boggling.

I do believe it will soon be very painful to some of these new owners, but an overall benefit to the downtown cores. At worst, they'll leave the 'beautiful corpse' of a storefront for the next guy. They apparently live in a parallel universe where money is no object. Another restaurant that spends 300k on renovations, a two story bookstore with coffee lounge, etc.

To me, it's like taking a Lexus to a Destruction Derby. But, hey, if they want to do it....

I'm calculating that we've got a year or two of new storefronts opening up, and we're all going to look so prosperous and, well, that's half the battle.

Would I do it if I were them? Hell, no. I'd find an existing location, just slightly off the beaten track that is turnkey....maybe. But I don't have to, right now, so I'm just watching all these wonderful new edifices with bemusement.
Let that rosy glow shine on me and my store. If you want to be crazy bastards, why should I stand in your way?

So for all you new businesses: I say go for it! I can pretend I'm one of you guys. You know, the kind of guys who spend the big bucks. I mean, I might be worried about sounding too cynical, but since you guys live in a parallel universe, you can't hear me anyway.

I really think you should do it!

Really! Never mind the naysayers, you have a dream!

Go, for it! Spend that money!

Tuesday, November 13, 2007

Someday we'll look back and know exactly when the Housing Bubble popped.

The steep climb of prices and steep decline will seem to have happened fast, as least compared to all that happened before and all that happened after. Depending on where you start the curve, it will probably unwind at about the same severity as it increased.

But while it's happening, it's a bit like watching a bucket fill with water, one drip at a time. Rather hard to comment about.

Somehow it was easier to talk about the crazy out-of-control building, to speculate about the possible peak, especially when it seemed like most people were in denial, than it is to have a running commentary about the decline. It seems almost cruel, almost too much "I told you so...."

I thought there was a particularly good exchange of comments over on the Bendbubble2 site, that summed up things rather nicely, if I do say so myself. Since I know that some of you feel the comments over there can be too extreme, I thought I'd reproduce them in part here.

To wit:

Bend Economy Man said....

These builders are all just scared to know where the REAL market price is. There's over 2000 houses and almost 1000 empty lots for sale in Bend, and houses are selling at the rate of 100 per month. At David Foster's reported current median of about $350K, there's $750,000,000 worth of houses for sale in Bend right now. At Bend's average household size of 2.42 persons, we'd need about 5,000 new people, like a 7% population increase, to eat up that inventory (and that doesn't even include FSBO and builder-direct-marketed homes).

No sky-is-falling bullshit here -- that just sounds extremely unlikely and anyone not wearing blinders has got to know that $750M and 5K people are not just going to show up in Bend in time to save the day.

So I'll just leave it to those who are browsing this forum to draw their own conclusions on what WILL happen.

Duncan McGeary said....

Not to mention that even if we had 5000 people wanting to move here, they have to be able to sell their houses, and qualify for a loan. Then they have to be stupid enough not to wait for the price to drop.

Meanwhile, houses might start emptying out from hurting builders, sub-contractors and finance people.

And the Dark Matter that IHTBYB talks about. And the houses coming online.

It doesn't take much imagination to see a stock market fall, a terrorist attack, bad weather, any number of things aggravating the problem.

Bend Economy Man said....

Agreed, but I don't even think you need any "what-ifs" on the negative side. The series of miracles that would happen on the positive side pretty much make Bend RE a "Hail Mary Pass" play right now, at best.

Duncan McGeary said...

Too many houses.

All the rest is commentary.

Monday, November 12, 2007

About this 'minimum wage' thing. It's not like I prefer it. It's not like I set out -- all these years later -- to still be making minimum wage.

When I started, I think I just wanted to survive. Not lose the beginning investment, at the very least. My Dad co-signed the original 10k loan, and I was determined that he'd never have to pay a dime. I even kept my landscaping job for almost a year.

Then, I went through my 'young entrepreneur' phase, where I made the mistake of reading INC. Magazine, and believing it a little too much. I opened four stores. I thought I could reproduce the success of the one store, but didn't realize I didn't have the capital, the systems, the tools and, most importantly, the employee's to make it work.

That, plus the sports card collapse, set back any chance of making money for another decade.

Yet I always thought I was just two years away from making real money. It became a bit of a joke between my wife and me. But, like Wiley Coyote buying a new Acme kit, I always thought it would happen. Always two years away from paying off the credit cards, two years away from buying a house, two years away from a vacation, two years away from catching that damn Roadrunner.

I don't know that I ever thought about how long I would be doing this. I just realized one day that THIS was my career; not a stage on the road, but the whole road. And suddenly, surviving for 27 years doing this, especially in a pop-culture store, and most especially in downtown Bend, became something to be proud of. I look around, and I've outlasted everyone else. The adult businesses who looked down on what I was doing, all the suits are gone, and I'm still here, still doing what I like to do.

It's been incredibly interesting to stay in the same place and see the town around me completely transform.

I suppose I still hope that the store has some value, though it's nearly impossible to sell a comic store. But hopefully there is some real equity in the store. I'm finally earning enough money to not have to juggle bills quite so much, and to take time off, though the 'minimum wage' thing hasn't changed all that much.

To be honest, I don't feel like I live on minimum wage. I'm always surprised at the end of the year when I do my taxes that I end up that way.

I'm surprised that we have as middle class a life-style as we do. A couple of small inheritances knocked off the credit card debt, and provided the down payment for a house. Luck that we bought our house before the pricing surge. Determination to pay our bills and keep our credit good and to live frugally in exchange for freedom. I certainly wouldn't trade my job for a higher income, at this point. I like owning my own business.

But I still wouldn't mind changing the title of this blog some day.

Sunday, November 11, 2007

The hidden cost of construction.

Remember the term 'urban renewal?' The idea that government officials could tear down old homes and build shiny new apartment buildings. Which instantly turned into slums? Old neighborhoods torn down to make room for highways and office buildings? Turns out, wasn't so easy to replace neighborhoods with instant recipes.

Several times, lately, there have been ambitious proposals or plans announced by city officials to 'fix' 3rd Street and the 'corridor' into downtown Bend, the corners of Greenwood and Franklin. Because I have one store on the corner of Greenwood and had thought about having a store on the corner of Franklin, I paid attention to these proposals. And what is never mentioned is -- what happens to the people who are already there? Don't they count? After all, they were willing to take a chance, to open a business and try to make it work.

Several times over the last month or so, I've come to work and found the entire east block of Minnesota closed for construction trucks. This morning there was an article in the Bulletin about how the hotel is still a year away from completion. That means the restaurants and stores on the block have full year of construction noise and dust and trucks to look forward to.

That block hasn't stopped to take a breath in years. First the Masterson St. Claire building, then the old Mattress Factory building, then the Firestation, and then the parking garage. And now the hotel. There was a Teddy Bear store there for years, and in talking to the owner, I think she thought -- I thought, too -- that all the construction would end some day and she would benefit from all the new stores around her. But she's gone and the construction is still happening, with at least a year to go. I remember at one point that she had a big dirt pile in front of her store, and it seemed as though it was there for months.

Every time a new store has gone in across the street from us, we have to endure weeks of white panel trucks taking up the parking. A few days ago I had a huge truck, big enough to block the entire store, parked in front. Which means anyone walking across the street or down Bond wouldn't see us. I was there for hours -- and it didn't appear that anyone was using it. Finally, I went out and saw a 'special' parking permit from Diamond Parking on the dash.

Turns out it was a plumber who was working on the 'men's salon' (A MEN'S SALON?! Bend has changed) where Eddie's Canton (then Double Happiness) used to be. There are other empty storefronts across the street, and so I suppose I can look forward to more white panel trucks. Even more concerning to me is the long -term prospect that the owners, who are also the guys who tore down the building next to Deschutes Brewery and who own the St. Claire building might have bigger plans. I'm not sure I want to endure what the people on the east end of Minnesota have been enduring for the last 5 years or so.

The Treefort 'kid's urban store' (KID'S URBAN CLOTHING?! Bend has changed) is just getting worked on (after sitting empty for months). I can't see how they are going to be ready in time for Thanksgiving, and or ready for Christmas, but it appears that instead of doing the work in the relatively slow months of Sept.-Nov., they are going at it during the Holidays. It's like a Bizzaro world of retail where it apparently seems like a good idea to be closed during the Summer and Christmas, but hurry to be open for the desert months of Jan-June.

When is Bend going to settle in to being rather than becoming? I've been lucky so far in that most construction is just off the radar. Not by much, but enough to brunt the effect. But I wonder at what point it will enter my zone -- either my own building or the building across the street. And I need to really include that prospect in my plans.

Can't stop progress? That's great for everyone who comes in after the dust settles. Not so great for us who are choking on the dust fumes. Besides, when does the dust settle? I suppose it's better than having a moribund downtown like so many places. Maybe the trick is to keep trying to dodge the major construction if possible, and endure the major construction on other blocks.

NIMBY, I guess. But I don't underestimate the cost of construction on business sales. Everyone says, yeah, but it will be better when it's done. But as a business, that's like saying that island over there is much nicer; all you have to do is hold your breath for twenty minutes and you'll get there.

Saturday, November 10, 2007

It's been almost a year since I started this blog on a lark. All I wanted to do was post a comment on Blogger, and up popped the option of starting my own blog.

The Best Minimum Wage Job a Middle Aged Guy Ever Had has gone in some unexpected directions. I didn't think I would post so much about the housing bubble, for instance, or about the changes downtown. But then again, I didn't know there would be so many changes downtown, or the credit crunch would hit.

I've posted every day, and -- I probably shouldn't say this -- I haven't found it hard to do. I guess I'm just a natural blabbermouth. For years, I kept a business journal, that was in effect the same as this blog. I did it to save my poor wife from having her ears talked off. I just tranferred that effort to online, without as much cussing and bitching and moaning, believe it or not.

The blog has been both more upbeat and reasonable than I expected, but perceived as more cynical and downbeat than I expected. I am probably more vociferous in private than I am here, because -- online -- I have time to think about what I'm saying. To count to ten.

I know that being outrageous is the surest way of being noticed, but I really don't want to go there. I'd like to believe that just being as thoughtful and informative as I can is enough. The face I'd like to present to the world.

But I really didn't really think anyone would read this thing.

I still haven't looked into how many readers or hits I'm getting. I don't really want to know. The blog has garnered way more attention from the media than I would've ever thought. It has actually maybe even helped my business a bit, though that was never my motivation. The thought that people might actually be reading this has almost made me quit a few times. Or rethink what I'm saying. Or to wonder if maybe I shouldn't do this so offhandedly, but actually take a little time to rewrite and ponder and work at it.

But no, that goes against what's been working. I want to keep it casual.

I've been able, I hope, to keep walking that fine line of being honest and candid and upfront, without giving away too many business secrets. To talk about issues, but from a personal standpoint.

I didn't realize when I started that most 'personal' blogs are anonymous, and most 'business' blogs aren't. I guess TBMWJAMAGEH is a hybrid. Not by design, it just evolved that way.
As usual, I underestimated the cyberworld. There is a whole community who is active that I would've never known about. Turns out blogging is perfect for a person who is both non-filtered but very private.

And finally, I do have one major lament.

I could've written a couple of books by now!
After three lackluster months, sales seem to have recovered a bit this month. It's too early to say that I'll beat last year, but it's looking good now. And, it's always nicer to start strong even if it tails off later , than starting weak, and hoping for an uptick.

Not sure what has changed. Just seems more active, more like it has been over the last couple of years. Maybe people are starting to get over the shock of the credit crisis.

I'm very glad that I diversified so much. Every time I look at the day's readout, I see each category contributing to the bottom line, but none of them really outperforming. Indeed, there seems to be a fundamental weakness in every category, but which is outweighed by the total.

Sports: I was really, really hoping the Blazers would spark sales, with their number one draft pick, but Oden went down and the Blazers went down for the first three games. Meanwhile, come to discover that my former competitor is still selling out of his house to his old regulars.
Sigh. In a nutshell, that's why the sport card hobby will never regain it's footing. It's up to the wholesalers to verify that they are selling to a real business, but I have a funny feeling if they really cracked down they'd lose half their vendors. Especially the guys who throw up an e-bay account and call it a business.

Games also never have gained much since my main competitor left. It turns out that my being the only place in town that carries lots of magic is probably cancelled out by the fact that the players don't have a place to play. D & D is very fickle. Pokemon and Yugi Oh aren't doing all that great.

The one bright spot are board games. This is the one category that I'm actively increasing. I just brought in Cayless and Axis and Allies, along with the new versions of Settlers of Catan. But since they are a subcategory of a subcategory, it really doesn't affect the bottom line much.

Used books and New books are doing O.K., but the limited space is keeping the sales constrained. I have a nice selection of new books, but I'm no longer building that category, so not as much new stuff each week. But my selection of cult and classics sell consistently well.

Comics are really suffering from all the late titles and the endless crossover series. They are chugging along, but the dramatic growth we've seen for the last 5 years is tailing off a bit. I think this is the category that is most likely to be affected by the housing slowdown since so many of my customers work in the trade, and since this is half my business, even a small cutback has an effect.

Graphic novels. There are some major titles coming out. Heroes (the T.V. show graphic novel), Dark Tower, by Stephen King, the Buffy and Serenity titles from Joss Whedon, and the Black Dossier original graphic novel from Alan Moore. This is the first time in memory that I can think of, where I was willing to carry stock of a dozen or more at a time of more than one or two titles. Pretty cool.

Toys. I just keep getting in toys that I like, and they just keep selling in small numbers. Just got in a 'lifesize' R2D2 trashcan. (Well, it's not big enough to imagine a little person inside, but it's big.) Only $175.00. I seem a little too enamored with the designer toys just because I think they are so creative and cool, but most don't sell all that well. I still like them.

Anime is my weakest category, because I think the real fans are just downloading or buying from Best Buy.

So there they are. Each of them feel a little off, but altogether they add up enough to make my nut. Good planning, if I do say so myself.

I'm really pleased that I'm able to keep up the stock on each of them, even increasing slightly with new books and boardgames. I wasn't expecting that. In the past, when I stuck to budget I usually had to cut one item or another that I thought the store needed. Maybe the diversification has finally reached cohesion. I even reordered Skifas and Standups. (Stuck to buying John Wayne, Johnny Depp and Marilyn Monroe, my three best sellers, this time.)

The store feels crowded at times, and yet the results speak for themselves. The more stuff I display, the more chance I have of making a sale. The 'long-tail' theory at practice in a small popculture store. I don't sell a lot of any one thing, I sell a little of a lot.

The only thing I haven't really been able to do, which I'd like to do, is buy off the liquidation lists. I've chosen to keep the stock up to snuff with the blue chip and the evergreen product.

If Christmas is even mediocre, we should be in good shape for next spring. (I'm always really focused on that long slow spell from Jan. 1, to June 15 or so. It's like stretching a rubber band longer and longer....)

If I hadn't spent so much money in preparing for a store I never opened, I'd probably be doing even better. But we should absorb all that material by Christmas.

So there you are, just a little status report.

Friday, November 9, 2007

Got a flyer in the mail that announced a liquidation sale for Designers Jewelry, and said they were closing the store.

Still, it didn't --feel quite right. Something about it. I think there is more to this than meets the eye.

Certainly, Marty has closed a store once before and popped up in another incarnation not much later. And the flyer had that weird Crazy Eddie, everything must go, sort of vibe.

Anybody know anything?
"The very rich are different from you and me," said F. Scott Fitzgerald.

Had a woman in the store who works for Morgan Stanley. They've moved to the fourth floor of the Franklin Crossing building.

She told me she's worked for them since they were Reynolds; then Reynolds, Dean Witter, etc. etc. Been in Bend since 1988, so she's seen many of the changes. That's a long time, I give her that, especially to keep the same job. But:

"You just missed most of the trauma that downtown went through in the '80's," I said. "We were just coming out of the trough around '88. But I will say, almost all of the old guard that were here then are gone."

She told me there was a retail store on the third floor of the Franklin Crossing, I forget what it was. Must get major foot traffic, I said, sort of like opening a business in my back hallway. One thing I was told when I started was never open a retail business that wasn't on the ground floor. There are exceptions but the odds aren't good.

I told her that downtown had lost most of it funk. That to be interesting, it needed a bit of pepper, a bit of ginger, a bit of spice, and some sugar. Instead, it was turning into all sugar.

And, as these things go, I asked her what she thought of the housing market. I asked her if she had ever heard of the housing blogs, and she hadn't. (I've yet to run into a housing person who has.) But when I mentioned that I thought, with so many jobs related to housing, that there was a possibility that the population of Bend could even drop, she shook her head decisively.

"Too many wealthy people are moving to town," she said.

"Yeah, but Bend is too big to fill with only rich people. How many are we getting per month? 10 millionaires, twenty millionaires? It just can't be enough. They might be building their custom homes, but what about the rest?"

She more of less dismissed my argument. "There is some real big money coming to town. I know."

O.K. O.K. I believe her.

One of the problems I think I'm having is that, perhaps, I don't understand the rich. I was raised in an upper middle class doctor's family, so I haven't lived my whole life in the 'minimum wage' class. But I've never understood the ostentatious spending of money. My next door neighbor sells jewelry, and to me, most of it it look like overpriced trinkets (not his stuff specifically, but the whole diamond industry.) I wonder if we're so different from the Indians who sold Manhattan for bangles and trinkets. I don't understand why people need huge houses, bigger and bigger cars, and all the rest.

Added: The more I think about it, the more I enjoy the analogy of Manhattan to downtown Bend. In my building alone, we traded some real goods and services -- engraving, shoe repair -- for trinkets and bangles and bolts of cloth.

So if I don't understand the rich , maybe I don't understand what's happening to Bend.

One real revelation to me was when my house doubled in value. Suddenly, in theory at least, I was worth a 175k more than the day before. I started to understand how it was possible for people who had done even better than that selling their house in California, to open a business that looked crazy to me.

The rich, and the very rich, are a whole nother level above that. They are operating on premises that leave me mystified. The woman from Morgan Stanley said, "The people moving here don't worry about mortgage rates."

So, how can I ever understand their motivations?

I fall back on my assumption that even the rich don't like to lose money. Even the rich get bored with businesses that don't turn a profit. Even the rich won't stick around a town that has lost his mojo.

Thursday, November 8, 2007

"Historically Low 30-Year Fixed Mortgage Rates."

What part of Historically Low didn't they understand?

There is a lot of revisionist history going on. The now accepted wisdom that housing prices started to slump two or three years ago. I swear to God that most mainstream media would barely hint that there was a bubble as of just this last summer.'s as if they always knew.

The other is that house buyers were tricked -- duped I tell you! -- into accepting Adjustable Rate Mortgages.

Linda and I bought our house in early 2004. We'd had all the elements together before that, but we'd just opened the BookMark in Sept. 2003, and I wanted a few months of business under our belt. Finally, around January, I was ready.

One of the reasons I was ready was because the words "historically low" were being bandied about. I was leery of becoming house poor. I was willing to pay a higher percentage of our income on mortgage than was recommended, because I've ALWAYS spent more on housing than was recommended. But I wasn't willing to become a slave to my house.

But when we started looking, I knew that I was going to do it the tried and true method of my parents and their parents before them. Fixed mortgages, for a house I was planning to live in.

I never even considered an ARM.

In fact, I was shocked by a young guy in my store who was going to buy a 'cottage' on Columbia, (800 sq. ft. that cost exactly the same as the 1550 sq. ft. house we bought) who announced he was doing an ARM.

"Are you going to live in the house? Are you planning on staying?"

He said yes, but thought he could get even better rates down the road.

Maybe, maybe not. It a frakken gamble. If you're a flipper, and you buy on an ARM and you think housing prices will rise and you think you can sell the house before the ARM sets in....then maybe.

I'm certain that quite a few people did just that, and came away with a bundle. But it's still a frakken gamble. If you tell me that people win big bucks by betting black on the roulette wheel, that still doesn't mean its a good idea.

My thinking was, that once the rates hit 'Historically Low' that the chances were that they might go down a tiny bit, but were much more likely to go back up. That the tiny bit they might go down would cost more to renegotiate than I'd save. The term isn't Adjustable Down Rate Mortgage, after all, adjustable goes both ways.

As it turned out, we were very lucky. We bought our house on almost the last possible month we could've bought our house. We couldn't buy a house today, even with the same credit history, down payment and income.

One thing I have learned in my business. If you are a newbie, it's best to go by tried and true methods until you figure out all the angles. It's also best to do at least a little research. And to lock into the lowest price and rates possible.

Here's a bit of advice. If you can't afford the terms today, it is simply a gamble to assume you can afford the terms in a couple of years. I find that not only is it usually not easier a few years down the road, but usually -- life being what it is -- it is much harder.

When I started my business, I was immediately offered a 'bubble' lease (interesting term that had slightly different connotations back then) at the Mountain View mall. First year FREE, with increased payments in the second year on. I was just getting settled, feeling overwhelmed, so I declined.

Later, when I did a second store in the MT. View mall, I saw store after store crumble under bubble leases. The mall just wanted to fill up and sell out. Which they did several times before the banks finally put their foot down and said, no more deals. (Which was the beginning of the end.)

Anyway, I'll repeat. If you can't afford the terms now, don't assume you can afford the terms later.

If you can't understand the difference between Historically Low and Adjustable Rates, you shouldn't be driving heavy machinery or procreating, much less buying a house.

Wednesday, November 7, 2007

I told my wife, who's interested in dreams, about an article in the Bulletin on narcolepsy.

"Yeah, I know," she says. "I tried reading it, but I kept falling asleep."

My ongoing solitaire game was wiped out by a power surge yesterday. I'd played 340 games, and I was ahead $2489. Time before that, it was 110 games, behind $1485. Good thing I spend my time so productively.

Meanwhile I've all but stopped drinking beer or wine -- not for all the many and varied reasons that one might think -- but because I grind my teeth. You'd think it would relax me, but instead I apparently really crack down. My teeth are just too brittle to risk anymore. Especially without dental insurance.

Have started rereading the Dark Tower series by Stephen King. I think I'd read about 3 or 4 of them years ago, before I gave up waiting for him to finish. Turns out, it's not much of a chore. It's all still pretty fresh.

Speaking of Dark Tower, the hardcover graphic novel is coming in tomorrow (a day late.) Sold the hell out of the monthlies, which just goes to show how much bigger pop culture and Stephen King are than comics. We're also getting the Heroes (the T.V. show) hardcover graphic novel, which was only available online until now. Also tomorrow, (a day late).

And before Christmas, we're getting Alan Moore's last League of Extraordinary Gentleman graphic novel, Black Dossier. (Alan Moore, genius, of V for Vendetta, LOEG, and From Hell fame, and soon -- as you will all become very aware, even you non comic readers -- the WATCHMEN movie!)

The first Buffy paperback , by Joss Whedon, showed up last week, as well as the hardcover Serenity graphic novel which bridges the Firefly T.V. show with the movie. Everyone is expecting these to be the big items for the holidays.

Apparently, our Euro-style board games will be featured in the article on family games in the next BEND LIVING, and hopefully Pegasus will be mentioned, and possibly this blog. I've been diligently trying to stock up. This will be my first Christmas with boardgames, so I really don't know what to expect. I'm worried about selling out, but as my games rep said, I am a two-day ship. (On the other hand, he didn't mention how often the damn game distributors seem to be 'out of stock.')

Meanwhile, I'm finding that I can stick to budget if I just order the stuff I really need. Which means passing up on all the sales and bargains. I'm not sure how I feel about that. Fine, in the short run, but I've always counted on boosting my profit margin by getting sale items. But it's even more important to have the evergreens. I also need to stock up for the holidays on the quarterly product, the stand-ups, the Stikfas, the funky toys, and Peanuts type cartoon books.

I just know I need to stick to budget if I'm going to clear the decks for next year.

There is such a concentrated dose of bad news in the financials. The sky really does seem to be falling. And yet, there is such a lack of awareness or concern on the part of my customers, that I'm suffering from cognitive dissonance. I'm just laying off commenting on the situation for now, because I want to see how it develops.

Tuesday, November 6, 2007

I've learned, over the last couple years, to take the time to actually point out to customers that I don't get to select which toys I get. I select 'cases' of toys, of which I have no control over the mix. If I had my druthers, I'd order a case of Star Wars toys that was half Boba Fett and half Yoda, for instance. Instead I get 3 generic x-wing pilots, two assorted background aliens, three assorted empire villians, and maybe a Luke or a Hans or two. Very frustrating. Especially when almost every person in the door looking for Star Wars is asking for characters I don't have.

I had always assumed the customer knew this, but have come to realize that they just think I'm a total idiot who would rather stock a generic x-wing fighter pilot than a Boba Fett.

What brings this to mind is how hard it is to stick to budget when you sell in singles, and order in multiples. If you order a box of sports cards, for instance, you might get 36 packs. If you sell 4 per week, it would take 5 weeks to break even. If you eventually sell out, in order to get a single pack of reorder, you have to order 36.

Intuitively, I know it should even out in the end. But it causes short term shortages, usually when things are slowest.

The comics biz is actually one of the few low priced products where you can actually order exactly how many you want. Card games, sports cards, toys all require paying for multiple to just get the first.

It's one of the reasons that I continue to mainstream the store. Being able to buy exactly one copy of a book, or a board game, or a graphic novel keeps the cash flow from busting.

Monday, November 5, 2007

Both Linda and I have trouble with clutter. I tend to exhibit it at my work, while she exhibits it at home.

Her store is clean and spacious and orderly and simplified; mine is packed and narrow and chaotic and complicated.

On the other hand, her home office is overflowing with stacks of books, boxes, and assorted stuff, her desk piled with papers and knickknacks. She always spills over onto the kitchen table, eventually.

Whereas, I periodically clear out my office of as much extra stuff as I can. I try to make is as spare and zen as possible. It's where I go for peace from overstimulation.

We also deal with the clutter differently. I tend to shove things in boxes, and then stack them neatly in the basement or garage. Out of sight out of mind. Even at the store, I tend not to stress about all the stuff in the basement. My attitude is, that's what basements are for.

She tends to try to organize the clutter, try to create systems to deal with it, and to eventually even throw stuff out. I've told her, one of the reasons that the clutter overwhelms her is that she gives stuff "the death penalty" and because of that, she has to be ultra careful not to throw stuff out that she might need later, whereas, I hardly ever throw stuff out, so I'm much more willing to pitch it into a box and forget about it. (I accumulate very few personal things, so this isn't all that big a deal.)

Weirdly enough, I just don't stress about clutter. Life is too short. When it gets to be too much, I just clear it out. I think Linda is trying to get control of life, and organizing is her way of doing it. I figure I'll never gain complete control of my business life, so I might as will go with the flow. Somehow, I always believe the overflow will be taken care of. Everything will sell. All I have to do is wait.

It seems to me that every attempt Linda makes to organize, just adds to the complexity. She has taken to entering all the financial information into her new laptop. "Will that eliminate the original paperwork?" I ask. She say, no, but she wants it organized. I just see that as an extra step. Tossing all my receipts into a box, and then dealing with them the weekend before I see my accountant seems simple to me. She wants to enter all the information into lists and programs and whatnot.

I asked her last night, "If the piles of stuff on your desk and floor are a result of your not having enough time and energy to deal with them as they accumulate, whatever makes you think you can go backward and deal with it later? What about the new stuff coming in? If you take to time to think about each item, to even have a nostalgic reverie about each item, how will you ever catch up?"

She was reading a book about clutter and fung shei, and it said, "Whatever you do, never criticize a clutterer...." or something like that. (When I ask Linda for the book so I could quote the line, she couldn't find it in the piles of books and papers.)

What is the use of all this stuff if you can't access it?

I'm just not as sentimental about the past as she is: of course, she had kids and treasures those memories, she treasures her friends and family. Whereas, I figure what counts is in my mind and heart, and the rest is just stuff. Especially if you've ever had to deal with the estate of parents and realize that almost all of it is tossed eventually. You can't take it with you.

I've gone too far, at times, in my attempt to simplify my office. At one point, I had basically stripped my office of books, and it took a holiday visit to my sister's house, and immersing myself in her den which was lined with books, to realize I needed them.

I would probably furnish the house with very spare, very clean lines furniture, and less of it. She tends to like big stuffed couches and chairs. I've accused her of being very bourgeois, and she accused me of being spartan.

If we could somehow combine our skills: hers at the store, mine at home, we might accomplish something. I volunteered to go into her office and clean it out and she was horrified. I'd have the same reaction if she volunteered to clean out my store.