Too far?

This new organization of books has given me a chance to integrate graphics and books even more than before.  Now, I wonder if I've gone too far.

Two comments:  One by a guy who said, "I know your secret plan -- you are turning into a bookstore."

Second comment:  "I've walked by here for years and didn't know you had comics."

Now, I'd known that I had fewer and fewer indications of comics in the windows, but I always figured the comic people would know.  I always figured that walkersby would just keep walking if they saw comics.  I was trying to have my cake and eat it too.

Unfortunately, apparently people have a hard time with the yellow pages, or don't think to google comics.

I've always had a certain flow from Calvin and Hobbes, to Edward Gorey, to Persepolis, to Watchman.  I'd sneak the occasion graphic novel into the novels and so on.

So now I'm really trying to integrate it all, more by subject than by form.

And I think I'm too far ahead of the curve.  Maybe years ahead of the curve.

I can get away with it because of the tourist traffic.  But I probably need to stop about where I'm at.

Maybe even put some comics in the window.

Visions of Sugar Plums, Dancin'

Painful as they are, market corrections do at least expose idiotic thinking.

I've been trying to wrap my brain around this paragraph in the Bulletin's front page article today:

"Pepsi first started looking at Juniper Ridge land about two years ago but was told it's warehouse didn't fit the city's vision...."

Huh, what?

I thought this was supposed to be an industrial park?

No?

Nothing so mundane. Juniper Ridge was supposed to be a "university-centered research and development park..."

"....Juniper ridge will grow in the coming decades to hold a university, research and development park, neighborhood shopping areas and thousands of homes."

So we've fallen back to earth and will accept Pepsi as a tenant.

I think this would be the equivalent of my saying to a good customer:

"I'm sorry. You only buy Superman and Batman. I'm looking for customers who have higher tastes -- who will buy expensive graphic novels and independent art comics. You don't fit my vision of Pegasus."

But what puzzles me was that the 'vision' was of a huge complex, surely with more than enough land to accommodate any legitimate business. Which just shows how pie in the sky the whole project started to become.

Even the argument that it wasn't creating 'new' jobs seems rather ludicrous. What part of the word "Expanding" doesn't the city understand?

I'm afraid, the city of Bend has managed to go from pick and choosing, to beggars can't be choosers rather quickly.

I would basically table the Juniper Ridge Vision -- hell, banish the word 'vision' altogether. Call it an industrial park. Look for tenants. When you've accomplished that, then go back into the drawer, pull out the 'vision' thing and look again.

Because until then, we risk missing the boat completely.

I leave you with this comment to mull over, by Andy Moore, President of Bend Pepsi:

"It should be somewhat a wake-up call to the Bend business community that there are local businesses that need real estate to accommodate expansion opportunities.

"That's not a healthy long-term situation for the economic climate, and hopefully there's a sense of urgency within the city and within the community to ge that resolved."

Weather argument.

Having a bit of a weather argument over on Bendbubble2, which I'll reproduce below. I'd love to know what others think.

A statistic might tell us if it was a 'cloudy' day; but it might not tell us it was a slightly 'darker' day; or that the clouds hung around for 4.5 hours, instead of 3.6 hours. In other words, a lot of this probably comes down to perception.

Anon: said,

Duncan's blog: "This cold and wet for Central Oregon really is unusual."

No, it isn't. This spring has been a little colder and wetter than usual, but cold and wet springs are the norm here. We often see more sunshine in February than in May. I've been here more than 20 years and know what I'm talking about.

But cheer up -- we should start getting some decent weather by early July.

To which I answered:

No, I disagree. I've lived here for 55 years, and I don't remember a year when we had only one week of real sunshine through May. This is unusual.

Maybe I'm using a rough 'gardener's' measure. But I've always had several weeks worth of gardening under my belt by now, maybe a month and a half worth since February. (Yes, it seems like there was often a warm February period to start clearing refuse.) Then usually a spring week or two in March, a week or two in April, and much of May.

I don't think there's been more than about 10 days I've been able to garden without the temperature being under 50 and or wet.

I don't think stats will prove much one way or the other. There is the de facto time spent in the garden.

That's my measure.

My Mom, Libby McGeary, used to own Mint Hill Gardens in the west hills. I worked for her every spring for years.

Her selling period was nearly over by this time -- maybe one more month.

This weather wouldn't have stopped her. But it might have stopped her customers.

Meanwhile, I've only had to water a couple of times, and have yet to mow my lawn. That ain't normal, not for me.

Anyone else want to chime in? Perceptions can be tricky. But...the steady frequency of the clouds, and the moisture, and the lower temperatures....maybe that isn't reflected in the statistics, either.

Sorry about playing the oldtimers card. But I'm curious if this is just my perception.

You know who would know? Nurseries and landscapers; but I doubt any of them would be willing to say.

Soggy mess.

My Bulletin came as a big soggy mess this morning, and I forgot to snag a Source on my way home. I'm bereft of blogger fodder. This cold and wet for Central Oregon really is unusual. To add to the never rains but it pours; I'm almost feeling sorry for real estate agents trying to sell houses in the peak selling season this year.

I fertilized my lawn a couple of weeks ago, and it's about 8 inches high now. My lawn is infested with daisies, which apparently 'weed and feed' doesn't kill. I probably just ought to start all over. Repair bills are starting to pile up. We need a backyard lawn, a new front yard lawn, a new sprinkler system, a new roof, and a new lower bathroom. The joys of home ownership.

Comics are coming in on Thursday this week, because of the Memorial Day Monday.

Because of the cost of shipping, I only order the life-sized standups a couple, three times a year. But I always make the offer to people who ask for a particular figure I don't have; "If you buy it now, I'll make my order this week." Hardly anyone ever takes me up on it. Standups are like the ultimate impulse item. Anyway, a big Indiana Jones fan finally paid me yesterday, so I'm ordering a batch of stand-ups for summer. I'm almost completely out of the Star Wars characters. I probably overstocked on Pirate Johnny Depp and Dress floating Marilyn Monroe and Middle-aged John Wayne figures last time. I'm torn between a wider variety of one each like I've mostly done over the years -- and then more reorders -- or ordering larger quantities of characters most in demand.

As Summer approaches, and as May was such a good month, it's become almost impossible to stick to the old budget. The new summer budget may have to start a couple weeks early. Or.....I can just try, try, try to switch my brain off until June 16th. Just sent a huge check off to my credit card -- another check that big and I'm debt free for summer. I've got to try to knuckle down. But, for example, that stand-up order is over and above. I can try to take it out of the summer budget, but by then the pressures for something else will have developed. It's just a constant struggle to hold back.

Rick, who is really into the statues -- he repaints them and re-envisions them -- looked at my Venom life sized bust and said, "That would look really cool with a blood red tongue (it's sort of pinkish) and some dripping. But.....I'm too busy." Bastard.

Left out.

Extremely interesting article in the Bulletin about Memorial Day business.

First off, when I saw the pictures of the crowds at the Schwab, they looked -- sparse.

Secondly, a 70 to 90% occupancy level at hostelry's during a vacation weekend is not what I would call "solid." (I always assume the lower of the quoted ranges.) I remember when Bend's motels were full on normal everyday winter weekends, much less the kick off to summer.

Third, Jeff didn't really talk about retail much in the article. He actually came in and talked to me, but he seemed a bit rushed. I knew I wasn't giving him a good quote; my message was mixed. I'm down 15% in sales, but way up in profits. I'm down from a very peak year when I was adding new product lines. I'm down as much from comics being in a lull as anything else. I was busy on Saturday, slow on Monday. That sort of thing.

I've mentioned before that I thought it interesting that the Pine Tavern -- as much of an institution as this town has -- was willing to be forthright with their numbers. Even more surprising, was the Merenda saying that business fell off late last year, and has seen a 23% drop since January. And also the Summit Saloon, which didn't give numbers but did give the same impression.

But, my goodness, I can count at least 5 new restaurants in downtown so far this year, and they aren't small restaurants, either.

Seems like a clear case of over-fishing.

I'm actually beginning to feel a bit more secure. January was horrible, but it was backed up by a good February, March was horrible but stacked up against a peak month last year, and April was mediocre. But then again, May has been really good, so overall I'm feeling confident about summer.

It's made me examine what's happening, and like I said, I came away with the analysis that I was trying to compare to a peak year, where I had added two full product lines, which would be like a restaurant adding a dinner meal after only serving breakfasts and lunches; the following year, comparing a 3 meal day to another 3 meal day is going to be harder to beat.

Most encouraging, is I'm on the cusp of being able to fully stock the store for summer again without breaking my budget, and that almost has to result in more sales.

Hope for the best, and expect the worse.

Me too stores?

Memorial Day weekend. Very good Saturday, average Sunday, very poor Monday. Still, I didn't get the sense we had as many tourists in town. Paul-doh asked how we were doing, and I mentioned my bang-on Saturday, to which he said:

"Yeah. I've come to expect Dunc's stores performance to be poorly correlated with downtown retail in general.

He's sort of a quasi-monopoly. Not a Me Too store, like 90% of downtown. You got plenty of places to buy shoes, for example. Pegasus probably'll be OK come hell or high water...."

Yessiree. We are the cockaroach of downtown businesses.

No, I know what he means.

But it reminds me of a time I was bemoaning how few of some graphic novel I was selling in comparison to Rory Root's Comic Relief, and telling him he was lucky to have such a prosperous and populated area. In his very gentle way, Rory said, "Well, it wasn't an accident I located here."

(This is a small memorial to Rory Root, who was one of the nicest guys I've ever met online and who died last week.)

Anyway, I've made a conscious effort to attract regular local business as well as tourist business. I've made an effort to pursue product that the mass market ignores, and which other small businesses haven't been able to make work.

I think it's interesting that almost all my competitors from even 2 years ago are gone; Gambit Games, American Sports, Anime Mountain, Fun n Games, even the Book Barn. How is it that so many of these niche businesses are having trouble surviving -- and yet we see a multitude of small businesses opening in downtown Bend. I think the fact that full time game, toy, sports card, anime and bookstores (along with Boomtown) haven't found Bend to be lucrative enough to keep going is more an indicator of real business conditions than another clothing store opening. Another jewelry store. Another restaurant.

While I don't know if I'd call them "me too" businesses, they are pretty generalized and hard to get a handle on.

Dark Tower

I've been bogged down in the last Dark Tower book for over a month. It's not that it was bad, it's just that it was looooooonnnnnng. There are seven books in the series, which I re-read them from the beginning to get up to speed. Each of the books is roughly twice the size of the proceeding book, and the whole series is roughly one million pages. Maybe two million. I think.

At the end of the last book, Stephen King talks about how it isn't the ending that matters, but the journey. But, you know, I wanted a vacation, not the death march of Bataan.

I mean, King is always readable to me. I pretty much enjoyed the whole series. But....why did it have to be so damn long?

The metafiction aspect bothered me a little --each time King entered the story, it pulled me out of the fictional dream. But it was O.K.

I was warned that the last book sucked. I found it to be pretty good -- the ending seemed just right on to me, actually, though I can see how it may dismay people who have slogged through 1000000000000000000000000000 pages.

I read lots of mysteries -- out of sequence, I don't care. Just as long as each book is a self-contained story. I decided a few years back that I would keep to fantasy or science fiction trilogies, at worse, and wait until the author is finished. Then got suckered in by George R.R. Martins "Songs of Fire and Ice" series, which has gone four books. We waited five years for the fourth book, and another two or three for the fifth book. The Dance With Dragons is coming out on Sept. 30, 2008. Finally. At least it's on the schedule. (Best fantasy series since Lord of the Rings, in my opinion.)

Still, it's enough to send me back to reading mysteries again.

Lookey here! We have industrial space! Afterall.

In a small way, I feel I have a parallel situation to a new resident looking to buy a home. That is, I need to renew my lease over the next year or so. If I believe that commercial real estate is going to weaken, it would be in my best interests to wait to negotiate.

On the other hand, I really dislike the uncertainty of it, and would like to get it out of the way.

In my case, I don't believe rates are likely to go down -- but they may just stabilize at current levels.

I'm torn between trying to do it now, or waiting -- just like a home buyer.

So I'm interested when the Bulletin publishes a piece about weakness in the commercial market. TOO MANY COMMERCIAL BUILDINGS, FEW TENANTS.
They are mostly talking about industrial and office space, and mention that retail space has barely budged. Which is a little hard to fathom when I see so many spots for rent on Greenwood. But I won't argue it.

The industrial and office space numbers are kind of interesting. It wasn't so long ago that there was concern and worry that Bend didn't have enough of this kind of space. Just like the concern over lack of land for housing, I thought it was a bogus issue. I felt that market forces would take care of the problem.

And so it has. No real short term need for land for houses, is there? And a 14.2 vacancy rate would indicate that the market has corrected itself.

Not long ago, there was much bemoaning that Redmond had it over us Bendites; well, they sure do. That 21.6 vacancy rate sure shows us!

Meanwhile, over at Bendbubble2, Paul-doh is back to accustomed zest in deflating the bubble.

Orders weekend.

Doing my monthly orders this weekend, so that --plus it being cold and wet -- just lets me off the hook for gardening work. These orders are for July, so I'm over the hump as far as seasonality is concerned. While Sept., Oct. and Nov. are always pretty slow months, July, August and December are my three busiest months. It's that long stretch from January through most of June that is hard to get through without ordering too much.

I have one more two week non-ordering period before I get back onto a regular weekly schedule. So far, I've fallen off the wagon twice. Once, for ordering a couple of statues that I'm pretty sure I'll never sell. (One of them is a life-sized bust of Venom with a huge red tongue hanging out; so far every ten year old boy (and ten year old boys at heart) has exclaimed "Cool!" If only it didn't cost 375.00.) And the second time I lapsed, it was for an order of Magic the week after the new release. I probably didn't need to -- but I didn't want to run out.

I'm waiting to see what the 'unintended consequences' --both good and ill -- will be from the changeover downtown. Many of the regulars don't even notice, which only goes to show they aren't using that side of the store, which I knew. I got my first negative comment, a regular who thought it made the store smaller, but most have thought it made the store more roomy. I know what he means, though, because the bookcases are more of a solid wall down the middle than I expected, even if the aisles on both sides are wider than before.

It feels a little strange to me -- not quite lived in, if you know what I mean.

I will be open for the Memorial Day weekend, usual hours. I could speculate that maybe more shoppers will visit downtown because the woods are wet -- but, you just never ever know.

Penus drawing.

So Pat and I are talking about the penus drawing in Superbad. I tell him I used to know someone in school who did that, and that I thought it was a syndrome.

"I know. I'll google it."

"No! Don't!"

Too late.

Among the penus enlargement ads, I notice an entry about a guy who -- you guessed it -- draws with his penus.

"Does he use a paint brush?"

"Hmmmmm.......I don't know....I'm not going there...."

Volatility?

Volatility.

I had some very high peaks in sales in comics last spring -- Civil War was probably 3 times better a seller than Secret Invasion; Dark Tower Pt. 1, probably sold twice as well as Dark Tower Pt. 2, and so on. So I really didn't expect to be able to match those sales.

Nevertheless, in two months of this year so far, I did match last years sales, which means that some of my other product sold better.

But there are three frankly horrible months interspersed.

So my question for all you stock market types -- what does such volatility signify in other markets?

My own take is -- whenever I've seen a spike in sales, within a year I'd be averaging that spike. I suspect the same is true on the downside.

***********************************************************************

Article on KTVZ.com of Bend being the 'new' Boulder, with this comment:

"Isn't that awesome?" Alana Audette, executive director of the Central Oregon Visitors Association, said in reaction to the article. She echoed one theme: "A predominance of new business startups here is largely from people who came here on vacation" and liked what they saw.

Oh, my God.

I've told this story before, but it bears repeating. A few years ago, a lady opened a Mystery bookstore in the Brooks Alley, facing Mirror Pond Parking lot. I won't call it Brooks 'Street' because there is no vehicle access.

Anyway, it was a very nice store, especially for us mystery readers. She really knew her stuff.

But I thought it doubtful that she could cut the customers down to such a small portion; and I especially doubted her location.

Finally, I asked her why she had opened on that spot.

"When I used to visit, this alley was absolutely packed. I'd come for the Market."

In other words, she had come on probably the only days in the entire year when Brook's Alley was super busy, and thought that was normal.


Unlike the COVA director above, I don't think luring tourists into opening businesses in Bend is "awesome." I think it's a recipe for disaster.

1.) They most likely visited on Peak days and hours.

2.) They most likely moved from a bigger town for the small town feel.

3.) They haven't lived in Bend long enough to really get a handle on it.

There seems to me to be only three ways to understand local business conditions: either you do a heck of a lot of accurate research. Or you live here for awhile. Or you have extensive experience in the field you choose, and can make educated guesses.

The most important thing a business needs to do to survive is to calibrate as closely as possible what the most likely sales levels are going to be, and to carry the proper amount of inventory to get there and to have overhead low enough to be covered by that level of sales.

How the hell do you know that? Especially if you are from out of town? Especially if the business is a dream business and you've never done it before?

Lets say you open a restaurant that does an average of 50 tables worth of business a night after 3 years. If you opened with 75 tables for peak hours, and you can still survive with 25 tables business, than you guessed accurately. But if you opened with 100 tables, you overreached.

And every business has the same strictures.

The problem with doing demographic research for Bend, it that it will probably mislead you. Bend really is different -- most people have been here for five minutes, for instance, which completely changes the whole marketing dynamic. If, as is likely, you come from a more populated area and you've seen what you perceive as successful businesses and that Bend is lacking such a business -- your conclusion might be that Bend needs such a business. When your conclusion might ought to be -- that Bend doesn't have such a business for good reasons. That if you actually knew any better, you'd know that several such businesses have already come and gone. And so on....

I've seen many businesses open that had great presentation, great inventory, great service-- and still failed, because there just weren't enough customers.

Bend's population is rather dramatically higher during the peak season, when most business opening tourists are visiting. But that's like visiting a restaurant on a Saturday Holiday night and expecting that to be average. They need to come back in February and November. Take a clicker and stand on the street corner and count how many people walk by, something like that.

So by all means, open a business in Bend. But live here for a year or two or three, first.

Staying focused on the negative.

I know, I know. That sounds strange. For readers of this blog, it may not seem like a problem for me.

But you'd be wrong. I've never been under-confident or timid in my business. I've never lacked for ideas or energy. No, I tend to get brainstorms and pursue them. I tend to believe that can think or willpower myself out of any disaster.

So I'm trying to hold back and say to myself, "Why go there at all?" It's as if I'm in the batters box and I see a flaw in the pitcher's motion, and I say to myself, "I've got a good chance of knocking the ball out of the ballpark!" But the game situation calls for a bunt to advance the runners.....

I'm not above looking around myself and seeing negatives in the local economy and still thinking, "Yeah, but I can do better than that." Then arrogantly ignoring my own advice and pursuing some plan or another that will cost every available resource. And the most likely result? Higher sales and an improved store -- and a zero bank balance.

So I look at the way my brother in law Ernie loses his job at the age of 60, and tell myself -- hold your horses. The future is now. You need to prepare.

I suppose I just believed that things got more predictable and secure as one got older. Instead, I'm seeing the opposite. Friends and family move on, or run into difficulties. The market gets tighter and tighter and it seems like you've got to work harder just to stay in the same place.

I had a guy in his mid to late thirties come in and say, "I used to come in here when I was a little kid and buy baseball cards!" His mother was with him, and started asking my how I had planned this little venture, and I found myself blurting, "I never thought it would be a freaking career!"

Which they thought was pretty humorous.

I still feel like the outsider, the underdog; and yet, here I am -- an 'institution' in this town (or maybe just in my own mind), nearly the last man standing downtown. And it still seems like a day to day proposition to me.

So I'm trying to be 'adult' about this, and take a step back, and try to wrangle some money out of the store.

Temptation is everywhere. More new books, more games, more cards, possibly Warhammer and so on and so on.

So, staying focused on the negative keeps me in check.

If you take out all the extraneous information, it seems pretty clear to me that Bend is dramatically overbuilt; that way too many of my customers were making their living from that growth; and that tourism is at least iffy with gas prices.

Stay focused on that, bucko.

But I'm having a really good month in sales. I had a really good month in sales in February. If I take the huge drop in January out of the equation, I'm really not doing so bad.

But that isn't the point. The point isn't the local economy, or the sales level, or anything like that. The point is to make this store profitable in a cash sense. It is a relatively short period of time I'm trying to do this -- I hope to be able to look back on this time and say, "There is where you finally got ahead."

Part of it is, taking the credit cards down to zero just isn't all that satisfying. (Linda is amazed by this, but I just don't get a frisson out of it.) Not going into debt in the spring is not exactly the same thing as actually making money. (Though, by the end of summer, it will mean more savings.) It's such a slow process, with such little emotional payoff -- that I can only do it by staying focused on the negative.

So much more fun to buy a bunch of 'good' product, and see it sell, and watch the happy customers and humming business.

So, every bit of bad news is savored. I add it to my little motivational talks to myself every morning. "See! Look at That! Be careful, don't be a bozo!"

I only have one more month of this, and then I had planned to loosen the purse strings for summer, as long as I stuck strictly to a budget (which Paul-doh immediately doubted I could do). But the latest news has got me thinking again, and I've decided to raise my spending by 50%, instead of doubling it like I planned.

And just keep reminding myself to be careful.

Step Two complete.

The basic framework is in place. I'm stocking the shelves a bit willy-nilly at first, and I'll refine the display space over the next weeks and months.

It's never as dramatic as I hope, and it never clears quite enough space, but it's a definite improvement. Necessity really is the mother of invention. There is a temptation to want a bigger space, as if that is the answer to all the problems, but I'm convinced I'm better off staying the same place for year after year, decade after decade. Literally.

I'm always amazed by how one can achieve subtraction by addition. I lost almost no display space, and gained a bunch, but it looks as though I have more empty space. Several people asked me if I had brought in more cards -- because they are now in one place instead of spread throughout the store.

As I said, the rest of the changes will be by osmosis, by feel, by mulling it over and sleeping on it. I have some space I can use to display books, and I have to decide how I want to go about it. I simply don't have enough space to do a complete bookstore; maybe enough to warrant regular visits by locals, but really it is more designed to catch the visitors. So it's going to more along the lines of what I was already doing, with better displays.

Scapegoats?

First I should probably tell you my -- as of last month, former -- brother in law is Ernie Pool.
I've always used him as an example of someone who could start working in a lowly position at a young age and work his way up that ladder. Until he gets around 60 years old, that is, and possibly eligible for benefits and other such inconveniences.

That may be a cheap shot, because I should make it clear that Ernie never talked about business to me -- he was a loyal trooper. So everything I say is pretty much conjecture. This is going to affect my sister at an already difficult time for her, and Ernie is good guy.

Still -- this is the sort of thing you can almost guess was going to happen when Mt. Bachelor goes from a locally owned operation to a national corporation. I always say, when the Corp. says that the only changes will be positive, hold onto your wallets.

So....at a guess, the people at the mountain were given less money to work with, higher ticket prices and shorter seasons, a stretched work force, and aging equipment without adequate replacements.

And at a time when almost all the other ski resorts in Oregon numbers are up, Mt. Bachelor is down.

What to do?

Fire top management. (Local management, that is, I'm sure the corporate heads are safely attached...)

Something tells me that not much will change next year. Probably a stronger public relations effort -- never mind that broken chair lift, look how we painted it a new color!

Like I said, I have no inside knowledge. But I think we just saw a great example of scapegoating.

Cha,.cha....cha...Changes......

I feel as though every muscle in my body did 50 sit-ups yesterday. My lower back, has stiffened to the consistency of particle board. I went back to work last night and finished off the last 5 bookcases in preparation for todays switch. Good thing, too, because I was there till midnight again.

I didn't realize what a huge favor my wife had been doing me by making the other 8 shelves. The first one took me an hour, and was a botched job. The second one took me half an hour, but also wasn't pretty. It ended up taking me an average of 45 minutes per case. That, plus the eight trips transporting completed cases and boxes, which was about half an hour each, means I spent about 14 hours just wrestling with bookcases.

I'm hoping that the changeover will go smoothly. I decided that rather than try to move one massive bookcase I'm replacing, I would just take a hammer to it. Take it apart. It's 30 years old, and I doubt it will hold up under another move anyway.

By tomorrow, the basic outline will be complete. That actual stocking is almost as important to the actual look, and that is a more day to day process. So, by around this time next month, the store should look the way I want it to.

I'm also hoping everything fits. I've measured and tried to visualize, but sometimes the actual results just look so wrong, that I have to change it. There's even a possibility of 2 more bookcases, but that's being optimistic on the high side, and usually I have to actually do less than I planned, not more.

The whole point is the streamline the look and flow of the store, and I don't want to wreck that by trying too hard to fit more cases in.

I know I'll be glad when I'm finished. I just don't have the zest for changes that I used to have. But I think if you see a way to dramatically improve your stores look with minimal cost and you don't do it, it may be time to quit. I'm not there yet.

Step One complete

Had five good people show up to help, and Patrick. It wasn't as difficult to move stuff as I thought it would be -- but maybe that was because I had enough help this time. So, that part went relatively smoothly.

Then, as promised, kicked my helpers out. Was there until midnight putting it all back together again. It's still in an uproar, and I'm going to have to leave it that way for another day, and finish it off Tuesday night. As usual, things didn't quite fit, and as usual I had to move a few more fixtures around that I originally envisioned. Changed my mind a couple of times. Just tried to get enough done to leave the store functional for Monday.

I'm not going to get the five shelves around the pillar I hoped, only four -- it blocked off the cash register counter a little too much. Also, it's looking like the way things configured, I'll be adding 3 shelves to the Used Book section, which wasn't my original intent. But, now that it's there in front of me, I can see how that might be even better.

I had a can of flat white acrylic paint and thought I'd give the sport card rack I brought up from downstairs a quick coat. But, it was as if the paint was invisible. It hardly covered anything. Mystified, I gave it a quick coat, came back later and gave it a second coat, but it still didn't want to cover much. A final third and as thick as I could make it coat made it presentable. Next time I go with enamel paint and be done with it!

In the midst of chaos, it always looks worse. I'm always horrified by the dust and dirt and grime in all the nooks and crannies that were invisible before. Always aware that the fixtures are a bit beat up. When all the merchandise is back in place, and artfully displayed, it covers a multitude of sins.

There is always that moment of doubt. But I can still visualize how it will eventually look, and I think it will be a vast improvement. I gain display space, while actually making it look less crowded. Always amazed by how -- if you mull it over long enough, it's possible to have subtraction by addition. Consolidation often not only conserves space, but actually makes the product more impressive by all being in the same place.

It'll take another month or so of moving merchandise around and experimenting before I find best use. The point is to create more capacity, and then figure out how it all fits later. One thing that has made it easier but also more stressful in the past is that I was buying new material to fill in the new spaces. This time, the point is the display the stuff I have a bit better. Less urgency to finish, in some ways. But....well, I'm on my way. The hard part is done.

The most dramatic visual change is yet to come. But, by Wednesday morning, I should have something approximating my vision.

Bubble news, redux.

Timothy mentions that there is 'no one to argue against.'

That's never stopped me yet. But I also don't think that's quite true. There is the general unawareness, there is the real estate community, and not least, there is the Bulletin.

Today's Oregonian has an eye-opening article on a local builder that everyone should read. I suspect that this is just the tip of the iceberg. A short excerpt:

"Bend developer's problems leave losses, questions in wake

Desert Sun Development is beset by liens, unpaid creditors, big employee losses and a federal inquiry

Sunday, May 18, 2008

JEFF MANNING

The Oregonian Staff

BEND -- As central Oregon's long real estate gold rush gives way to a grim new era of falling prices and foreclosures, few companies have crashed to earth harder than Bend-based Desert Sun Development.

The upstart operation, led by its intense 29-year-old founder, Tyler Fitzsimons, is under siege from lenders, suppliers and contractors who say they've been stiffed for millions of dollars.

But Desert Sun's problems go well beyond clamoring creditors, The Oregonian found in its examination of the company. It offered a homeownership program to more than 30 people, mostly employees, that has left many participants deeply in debt for houses that aren't complete or even started."

Meanwhile, the Bulletin does one of it's summations. What's terribly interesting to me is the way the quotes from the U of O economist Timothy Duy are framed in this article.

And a completely different tone in the way Tim Duy is quoted in a blog, Economist's View. Sample from the blog:

"The local story is that the Bend area will always attract a steady stream of wealthy California retirees with plenty of wealth. If this were true, I cannot understand why so many of these recent migrants are desperate to leave. Consider the 55 price changes on just one day, Friday May 16.

"While there is truth to the underlying story that Bend is attractive to retirees, and is a very pleasant place to live, work, and play, that story clearly does not justify median home prices at six times median incomes. Bubble, plain and simple, and now there is a rush for the exit.

"What strikes me most in these charts is the massive misallocation of capital during the last six years. The housing stock in Bend was twisted in a direction that is fundamentally misaligned with the community income profile. True, this happened in many places – I would argue that home prices in Eugene are also misaligned, although to a lesser degree. But the magnitude of the misalignment in Bend is quite remarkable, and in my mind represents a complete failure of social policy. This is especially the case when policy has turned homeownership into a moral imperative, creating a culture that equates renting with failure and granite countertops with success."

The Bulletin, on the other hand, has him saying this:

"But some aspects of Central Oregon's economy -- including its aircraft, technology and medical sectors -- are progressing well and could potentially supplant real estate as the region's economic drivers, Duy said."

Love the word: "Potentially." Potentially, all my lesser selling product well sell better in the future and supplant comics....

But it actually might happen in my store, because I've been very, very diligent at plowing profits back into development of slower product.

Whereas, I think in Bend, we just doubled down on growth and real estate.

Anyway, what's really noticeable about Duy's comments is that the actual quotes are almost all negative, even if the way they are framed aren't:

"I get this feeling that we've reverted back to 1997 or 1998."

"Once they pop, bubbles tend not to be reignited. People have to come to grips with this."

And so on. Most of the positive slants are paraphrased, which makes me a bit suspicious.

Meanwhile, much of the article is taken up in quotes from Real Estate Agents. After Duy says that he wouldn't be surprised to see prices drop to 200,000 medians in the next year, he is immediately contradicted by Sandy Garner, of Garner Group Realtors:

"I don't see it going there. That's what it feels like for me working with buyers and sellers. I think it could go down to 250,000, but it's become much more stable."

Gee, by all means, let's go with a real estate agent's 'feelings.'

Tell you what. Don't even read the article. Look at the graphs.

People need to look at those graphs with their own two eyes and their own one brain and figure out that 1997 levels of business for Bend ain't going to be pretty.

(POSTSCRIPT: Jesse over at My Back Pages thought Duy was quoted in a 'good and balanced' way. But I still think his comments were slyly slanted by the Bulletin, so that they looked candid. Could be, though, the Bulletin is edging toward a bit more realism.)

Bubble news, old news?

I'm utterly astounded that bilbo and paul-doh are acting as though the housing bubble thing is old news. Personally, I don't think we've even hit the brunt of the first gale force winds. We've had a bit of high winds and rain, and we 're all thinking, "Is that it? That wasn't so bad."

In my opinion, the real storm hasn't even arrived yet.

There is the 'eye of the storm' analogy that is being used for places like Florida and California, and I think that's probably accurate.....for them. But we haven't really had the front of the storm pass through, in my opinion.

And I think Bend has a second storm brewing, just as big if not bigger. Commercial development went just as out of control in Bend as the housing, and it's going to take at least a year longer to develop.

This isn't time to slack off. There are a whole lot of people in Bend who are aware in a general sense that not all is well, but I find that in specifics, most haven't even thought about it yet.

That the victims of this storm are nice people -- I've always thought that there were a lot of people who were led astray in this mess. I tend to believe that perfectly nice people made some bad decisions.

So...much as I didn't want to warp this blog into a 'housing bubble blog', either someone new needs to take on the job, or Paul-doh and Bilbo need to fight the burnout and get re-energized.

The 'Local' card.

I've been watching with interest the startup of Paizano's Pizza in Baker City.

Kina recently posted the following under an entry called Full Disclosure, so I think it's O.K. to reproduce:

"It wasn’t cheap to open this place. We’re paying out the nose to make it work. But we believe in it. We believe in our product, we believe that this town can support it, wants it, and will continue to make it work. We obviously can’t do it alone. We aren’t the richies from Bend. We work incredibly hard and we are true to everything we do or say."

She's being just a bit circumspect about what's going on, but I can guess.

When we first opened our (3rd) store in Redmond, we felt very welcomed by the community. Redmond was less than half the size it is now, and still a very small town. But we were told that the town needed a store like us, and we were rewarded with pretty good business for a year or two.

And then, one day, business fell off the table. My manager finally informed me that a store two doors down from us was carrying sports cards. I had talked to one of the owners of that store quite often, not realizing I was being pumped for information. It even turned out they were sending their kid down every day to check our prices, and then systematically pricing slightly lower. (Which is known as 'cut-throat.')

Thing is, they proclaimed themselves as 'true' Redmondites; that we were rich carpetbaggers from Bend who were strictly in it for the money. That we charged too much. These people had kids in the local school system, and belonged to a rather large church that turned out to be a significant number of collectors and so forth.

I have to tell you, the Redmond store was always fringe -- it didn't take much to get us to leave.

I remember the HUGE feeling of relief when we closed.

Six months later, our competitor was also gone.

Small towns are funny creatures. They will welcome the 'new kid' in town; they will welcome any business that is different and creative; but there is a negative side to small towns. They tend to be very suspicious of outsiders, very clannish. The smaller the town, the more they are that way.

So much so, I swore I'd never open in another small town. The margin for error is just too small. Of course, Redmond is twice that size now, and by definition most of the residents aren't 'local' in the traditional sense.

I'm not all that sorry that Bend has gotten big enough that no one group of customers, no one clan can put me out of business if they don't like the way I do things, no one rumor campaign or bad mouthing campaign can drive away every customer. There is room for diversity in Bend.

The irony, of course, is that I'm not adverse to playing the 'local' card myself.

All the time.

But hopefully, I'm not using it as a bludgeon on other newer businesses.

Every time I talk about being a "native Bendite" I'm playing that card. Every time I talk about being in business for 28 years, in downtown Bend, I'm playing that card.

And of course, complaining about 'gentrification' is in a sense playing the 'local' card -- with the imputation that the 'newcomers' are forcing out the locals. Every time I talk about people having lived here "five minutes" I'm implying I'm an old timer. But, hopefully, I'm open to new experiences. I shake my head sometimes at what I see, but I'm bemused by much of it as well.

As I've said, it's not like I was ever part of some 'in' crowd.

Still, I think in every case it's a very small minority of people who try to hurt you using these techniques; and the best advice I can give is to pretty much ignore it, to take the high road. You can't put much more of stake in a community than moving there and opening a business.

Eventually, you become the 'local.'

Step One

When I first designed the new store layout a month or two ago, I had planned on getting bookcases from Office Max that were 25" wide. But they discontinued carrying them, apparently. We were able to order a bunch of 28" wide cases from Staples, which have been stacked at the back of the Bookmark, my wife's store, which she has slowly been building.

I looked back over the plans, and realized that I could do about 3/4th of the changes I wanted if I could spring 4 of the smaller bookcases from Linda. (Actually, I need 6 but no matter how I measure, I can't find two more cases to steal.)

So last night, after closing, Linda volunteered to build the shelves if I did all the book moving and sorting. Even though I had measured the space several times, Linda pointed out the wall thermostat, which threw a monkey wrench into my plans.

O.K. Time to remeasure. But Linda doesn't have a tape measure.

Before we even start, I feel stymied.

So I have a bit of a fit, stomping around the store swearing up a storm. Finally, I throw myself on the couch, cross my arms, and say, "I don't even want to do this."

Linda just looks at me mildly, and says, "I be in the back the store making bookshelves...."

After stewing for a few minutes, I get up and sheepishly ask for a foot long ruler, which I use to mechanically measure. I figure out a solution, and we're on our way.

Four hours later, we've extricated the four shelves and replaced them, in the process moving around four other shelves and putting the books back.

When it comes to reorganizations, ignorance is bliss. I used to start these little projects with nothing more than enthusiasm and a notion, and find myself with a huge, stressful mess, which would eventually sort out and be an improvement. But each time, my enthusiasm was a little less, my planning a little better.

I used to have the urge for major changes every 6 months or so; nowadays, I can usually hold off for a year or so. But I know going in that it will be a hassle and stressful.

I wish I could just wave a magic wand.

I feel that periodic changes are absolutely necessary to rejuvenate a store. One of the things I noticed most about failing stores is how few changes they make in response to changing circumstances. It's like they are stuck; frozen in the headlights of change.

I'm sympathetic, but I know you can never get too comfortable. I think, in fact, you should question everything you do on a regular basis.

Linda is much less predisposed to making changes, but her business is a more stable one than mine. In fact, she has found a business where steadiness and predictability is an asset.

You don't want to make too many changes too fast -- moving, for instance. But a sort of slowly, constantly morphing attitude is not only best, but suits my own inclination. Especially changes that don't require my being dependent on anyone else.

I just wish it would come together a bit more smoothly.

The Store Makeover.

I've decided that -- instead of a dramatic Sunday night make-over, I'm going to spend a couple of weeks worth of evenings doing 90% of the changeover to the store myself. I do this for the sake of everyone's sanity. I'm worse than the stereotyped housewife moving the furniture around over and over again.

Half the time, I don't know how it's going to look until I do it -- and then I completely change my mind.

I also spend a whole lot of time sitting on the floor and leaning against the wall mulling what I want to do, trying to visualize.

And finally, I know that when I move stuff around, I can put it back together again myself. Like a game of concentration, I'll remember where I put most of the material, saving me much effort and worry about where everything was (mis)placed.

I figure by the end of the month, I'll have consolidated all my trading cards in one section without losing any real display space. I'll have about 2.5 times more bookshelf space devoted to 'new' books. I'll have the tops of all those bookcases to display about twice as much boardgames. I'll have two shelves against the wall to display all the 'designer' toys in one consolidated space. And the store should look slightly less cluttered and crowded.

The magic of ergonomics.

I'll fill in the new books and boardgame sections by the end of summer, in the meantime taking the opportunity to display way more of the games and books I already have face out. (I'll be interested to see if that helps sell them.)

But I will need help moving a couple of the biggest fixtures at about 4:00 this Sunday afternoon. Jason? Adam? Can you give me a call, RSVP? I'm not doing the pizza thing, Jason, because we're probably talking half an hour of moving, and I want to spend as much of the rest of the evening as possible moving stuff around by myself.

In fact, I'm going to be downright rude about kicking you out when I've used you up. O.K.? with that?

So, a couple a strong fellows on this Sunday, May 18th, at 4:00 p.m.

See you there.

Recreational sales?

Trying to glean something from the tourism stats in the Bulletin today. Not sure there is much there to learn. I suppose I'm just a little surprised by eating/drinking being 2.5 times as much as retail. But not really, when I think about prices. Who goes on vacation specifically to shop, anyway?

But, if they do take time out to shop, seems to me they'll try Downtown or the Old Mill first, and they'll try funky 'pop-culture' shops. At least, I hope so.

Maybe the biggest eye-opener is how much is spent on "recreation." Higher than retail sales. I'm not exactly sure what this entails...renting boats and bikes; guided tours; campground fees?

Over the years, the browsing element of my business has gotten bigger and bigger. Used to be, I'd get destination 'comic' customers. Now, they seem to just stumble across me. I think it's because most comic customers I know are already overwhelmed by selection and aren't looking for more.

On the other hand, I have so much interesting and cool stuff that my success rate with browsers is hugely higher.


Like I said, not a lot there that says anything. I'm optimistic that we'll not see a huge drop off in tourism. I think the drop in sales has come from locals more than from tourists, so far. Hard to say. Stats like this just don't reveal much.

Recession proof?

It appears to me that you are likely to get reasonably accurate economic news from two sources: solid businesses that have nothing to fear from the truth, and teetering businesses that have nothing to lose.

From the later source, we recently have the news of the Book Barn closing it's brick and mortar location.

From the first group, you had....well, me? And in the article below, the Pine Tavern.

"At the Pine Tavern Restaurant in Bend, year-over-year sales have plunged by double-digit percentages in each of the past four months....

"It's serious," said Susan Eshleman, manager at the Pine Tavern tourist landmark, where she has worked for more than 20 years. "I don't recall a consecutive two-month period where we didn't experience growth....

"In Bend, the Pine Tavern may offer less-expensive entrees: a 6-ounce top sirloin, for example, or a 10-ounce New York steak, down from 14 ounces. The restaurant probably will boost its staff to 90 this summer, instead of the usual 100.

Pine Tavern hasn't laid anyone off, Eshleman said. "But people are not getting quite as many hours," she said, "as they have in the past."

It's nice to get confirmation from another credible source. I can't say I've had 20 years of increasing business -- the fads precluded that. But I was on an eight year streak.

Seems silly to me to deny a recession has hit. "Official" numbers, notwithstanding.


A few days ago, I was surprised to see that we sold 120 houses in April, down from 154. Only a 20% drop.

Turns out those stats were inaccurate. The Dana Bratton Appraisal Group (what happened, Dana?) released their figures: 91 homes sold, or a 41% drop from last year. That's more in line with what I expected.

But you have some guy on the Bend Economy Board making a big deal out of two houses selling in Northwest Crossing. I too have anecdotal evidence of houses selling; two friends who sold their houses rather quickly. But a couple of swallows doesn't a spring make.

What I've noticed is a distinct lack of credit card offers in the mail. It's gone from two or three a day, to none. Anyone else noticing this?

There was a huge concern not too long ago about failing banks, which could still happen. But since they've pretty much removed themselves from the field of lending, does it really matter? They aren't serving a purpose in the expansion of business, but only in covering their own asses. They are de facto defunct.


Meanwhile, Randy Sebastian "secured financing" for his defaulted subdivision. Well, without seeing the actual terms of the deal, I'm assuming his nuts just got placed in a vice and clamped pretty tight.


The unemployment rate in Deschutes County has reached 7.9%. You can gauge the quality of those not working by the fact that the Inn of the Seventh Mt. feels the need to import 10 workers from Jamaica. There a picture of day laborers in the Bulletin today (is that a beer the guy is swigging?) ; and the comment that one of the job placement branches revenues were down 80%.

80%?!

Not to worry: Deschutes County has a new "income source." Knot's Landfill. We can become the garbage capital of Oregon! Methane is a valuable resource -- we could hook up some cows and double our output!

Jobs in Oregon's Tourist Industry Take a Hit.

Hires last month were half of what was expected.

Tuesday, May 13, 2009: Richard Read; The Oregonian Staff.

Middle of Nowhere nomore.

This may be ancient history to some of you, but I remember a time when candidates for Governor of Oregon (Goldschmidt) didn't want to debate in Bend because it was the "middle of nowhere."

Back when Bend was smaller than Redmond is now.

So it's pretty amazing to see Barack Obama coming to town, and to have 2 visits from Bill Clinton. Why is it flattering to hear them talk about "Bend?"

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I'd love to be able to get on my old-timer soapbox and tell you that this kind of weather is normal for Bend. But, frankly, I don't ever remember it being this cool this often this late.

Extreme weather? Tornadoes, hurricanes, and cool cloudy spring days in Central Oregon?

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Where have 6 million T.V. viewers gone? Maybe if they didn't shift the schedules willy nilly, offer us a bunch of nihilistic and narcissistic reality performers, and cancel just about every decent drama, they might be still around. If it wasn't for CSI Las Vegas, and Sarah Conners Chronicles, and House and Battlestar Galactica. Oh, and Lost and Heroes. Half of those shows seem to missing in action at any one time. But it's pretty slim pickins....

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Linda and I drove to Redmond to see the new bypass. We lead exciting lives. Stopped in at the Shelf Life bookstore; Linda loves it's feel and selection. Then dropped off at the Paulina Springs bookstore -- and spent at least a couple of minutes waiting for traffic to ease enough for us to even get out of our car. The bypass has to be an improvement for that.

Do all independent bookstores cater to women, nowadays? Seems like most of them have a feminine slant. Lots of Good Sense books, but not so many S.F. and hard core mysteries.

I'm still trying to figure out what I'm going to do in response to the Book Barn closing. I suppose it will depend on how much room I manage to open up with my new bookshelves.

If I decide to significantly increase my new book selection, I'm aware that I face an uphill battle getting any of the downtowners to notice. I'll be selling to casual browsers, and visitors ... but that's where downtown Bend is at, nowadays, so that might actually work. Maybe in a few more years, some of the locals will become aware, too.

Thing is, I can't over promise, either. A couple of shelves of each category; with a heavy emphasis on fiction. But I can attempt to make the selection I have choice; quirky and unusual and idiosyncratic. Let Costgo sell the latest Oprah hardcover. It will be fun, and a challenge, and I think I can do it within normal cash-flow, if I take my time.

Comic capsule reviews.

I read the first 10 Jonah Hexes. Liked them, interesting how he looks like Clint Eastwood with a big mangled face. I like how they are individual stories.

Man With No Name comic doesn't look much like Clint, on the other hand.

All-Star Superman. The story about Pa Kent's dying was very touching. Best drawn and written comic, certainly superhero, comic out there. Also nice individual, or at most, two part storylines. I like the longer stories, but there is something refreshing in getting an entire story in one.

The Boys was sick and twisted. If people only knew. Best they don't.

Read some first issues, since that might actually do me some good.

Rasl by Jeff Smith, (of Bone fame) is about a dimensional thief. Promising. Still early.

Kick Ass; scrawny nerd puts on a rubber suit and gets the crap knocked out of him. Also interesting. Still early.

Punisher: great story, great writing. As good as any thriller out there.

Star Wars Legacy: First 20 issues. It's great to be in the Star Wars universe.....but.....something bothers me.

How come the Jedi are ambushed and destroyed......again! For being Jedi, they sure are stupid.

Why is another Skywalker tempted by the Dark Side? With father issues.....?

Why does the frakken Republic constantly fall apart? With a corrupt leader that anyone with half a brain could see was corrupt?

Basically, in a weird way, it cheapens the original story. I can't tell if they just keep going to the same well because they feel they need to, or because Lucas O.K.'s it, or because they really lack imagination.

It's fun. But.....why the same damn elements over and over again?

Real Estate brokers...blah, blah...

Real estate brokers: "Blah, blah, blah, blah, blah.....blah.

First Quarter house sales, 2008: 728
First Quarter house sales, 2006: 2178

Real estate brokers: "Blah, blah, blah, blah, blah.....blah." I see their lips moving.

First Quarter house sales, 2008: 728
Number of Brokers: 1892.

Real estate brokers: "Blah, blah, blah, blah, blah........bleeep!"

Cash flow.....?

I'm going to tackle a subject that for me has been the most difficult thing to learn in business -- cash flow management. I'm not even sure that I'm using the definition properly: call this a working man's definition.

For me, cash flow is having the money in the bank as the bills come due.

Easy, right? If you make, say, 15 thousand in revenues, and you have 15 thousand in costs, you've broken even.

But what happens if 2/3rds the revenue comes in the second half of the month; and 2/3rds of the bills come due in the first half of of the month? Then compound that with product that arrives on a quarterly basis -- like the newest release of Magic, or comes in seasonal waves, like for summer or Christmas, and arrives in the off season? So that the largest quantities show up at a time when the least sales are happening?

All for material you're ordering in advance. All for material you are more or less guessing at the quantity and speed which it will sell.

So, for example, let's say you get the newest wave of Magic at the first of May. You have to order in bulk to save on shipping and get the highest discount, plus my wholesaler gives me other incentives to order more. I order what I know I can safely sell in a couple of months. So, let's say I have 1500.00 worth of Magic arrive. Even at a best case scenario, I'm likely to sell only 150.00 a day; so it will take me 10 days to gain back the gross amount. But remember I have to pay overhead and bills in that same 10 days, so only 60% of that is COG's; it really takes me more like 17 days to pay. Add in the complication that by the time you get down to the last boxes, you have to reorder.

A further complication; you have four different types of Magic arrive. One sells out right away, the other sells a bit better than the other two, and you have to reorder those 2 items before you've even gain back the initial costs.

Compound that with every product in the store.

What happens if, say, a couple of skyscrapers and 2000 Americans are destroyed by terrorists? What happens if a madman invades Kuwait (or Iraq)? What happens if, the week before Christmas, 2 feet of snow drops and and paralyzes traffic?

About the only sure answer you can have to cash flow problems is to have an entire month's revenue in savings -- and even then, you have to manage the flow of bills.

For a business that is teetering, or trying to pull itself up by it's bootstraps, having an entire months savings in the accounts can seem like a pipe dream. That money isn't working for anything, so if you see an opportunity and you spend it, it's gone.

Any and all growth has to come out of cash flow as well, unless you borrow the money.

Then there is the problem of too much growth. A problem you think all businesses should have, right?

But imagine this; you buy 2000.00 worth of sports cards and sell them out in a couple of weeks. You take the entire 2000.00 and buy more product, and you sell them out in 2 more weeks, and so on. Let's say, you have exponential growth (doubling sales) every year for five years.

You must be doing pretty good.

Actually, even if your Cost of Goods is 50% (and it's more likely, your COG's will be 55 or 60%) you've spent every dime you made on product. And probably more. Anything less than 50% margins and you've probably borrowed money just to keep up.

And then....a customer walks in the door one day and tells you he bought a box of cards at Costgo for 10.00 that you have just purchased from your wholesaler at 11.50. Your sales drop in half overnight. You have six months worth of product ordered and or paid for.

You go into debt, or you go out of business.

I've gotten pretty good at timing my bills -- that is, scheduling them for times when I know the cash will be there. Sometimes it means putting off an order for a week. Sometimes it means ordering less, and getting less of a discount and or paying more postage.

Cash flow requires constant vigilance. Constant monitoring of how fast and how much of every item you have in the store is selling.

It took me 20 years, but I finally have enough in the accounts to pay for checks as they come due. But that money won't be there for very long if I mismanage the cash flow.

Comic bingeing

My sole 'job' today is to read comics.

I'm going to throw open the new French doors off of my office onto the new back porch; two of the improvements we made with our Heloc to our 'devalued' house. Screw it. They're nice living additions.

One aspect of comics I've never quite gotten used to is the periodical nature. So I tend to accumulate them and then read them all in one big binge.

I'm in the mood for some western, Jonah Hex, some S.F. Star Wars Legacy, and some degenerate superheroes, The Boys, to start with.

Too Doomy and Gloomy?

Too Negative?

This blog is useless -- at least to me -- if I can't call it the way I see it.

I keep falling back on my knowledge of bubbles.

1.) Bubbles don't reinflate. Sometimes there is a dead cat bounce, but you have to recognize it for what it is.

2.) What's left after every bubble is the core reason the product exists, without the speculation and the hype. The more valuable the core reason, the more people keep buying. With pogs, Beanie Babies and Pokemon, the core interest turned out to be minimal. With sports cards, it turned out to be much, much smaller. With comics and magic, there turned out to be enough readers and players to keep my store alive.

3.) You can't believe what people say. Either the promoters or the believers.

4.) Once the fall starts, other than the dead cat bounce, there is a long and inexorable decline (sometimes a short and brutal decline).

What do we have left in Bend? We have a desirable place to live. We don't have much industry. We have too many houses, and way too much retail. There is a tourism and retirement industry. So there is a core interest that will keep the town alive. But strip away the excess and the speculation, and we have a pretty big fall still to absorb.

I think we are in a long and inexorable decline, like a python tightening. The frog is the hot water. I was waiting to see how this would play out, and I'm getting the sense that it will be slow, so slow that there will be plenty of plausible deniability. There will be plenty of twists and turns, and it will never be obvious.

That's why it important to pay attention to previous patterns of booms and busts, and not get caught up in the day to day details. This is going to play out over a 3 to 5 year span, long after most people quit paying attention. Like a long march, some people will drop out, some will join, and to the casual observer the line of marchers doesn't change, but to the actual participants, it's a trudge.

Those that are paying attention, who have patience and forbearance, and most of all, keep their focus, will survive. Eventually, they will even thrive.

Reversion to mean.

No, I'm not talking about me reverting to being mean. I'm talking about the economy of Bend.

About 6 years ago, Linda and I finally finished off paying our credit cards. I was finally released from the crushing debt, which had left very little money to buy inventory. I was finally able to begin to build the store back up.

I had a sales figure in mind, a daily average, that I thought might be possible, might be impossible, but which -- if I could just manage to get there -- I thought would take care of the store's needs (keep it well stocked and nourished) and also provide a living wage.

We blew past that figure about 2 years ago, and kept climbing.

But you know what? I never really trusted that increase. I never really believed it.

The original figure seemed about right.

And guess where we're at? Granted, this is the slowest time of year, but I also expect that sales are going to continue to struggle for another year or two, and I wouldn't be at all surprised if our average ends up being what our slowest month is now.

And that would be just fine. Because the store was designed for that sales figure. Costs are a bit higher, of course, but it turns out that I've learned enough over the last five years to increase productivity enough to pretty much neutralize that increase.

I'm not trying to be Goldilocks here, just saying that I had what I considered a 'realistic' number in mind -- and it doesn't surprise me that when things start reverting, that is the number we are ending up with.

I'm afraid I think that most of the growth this town experienced over the last 3 or 4 years was an illusion. I don't think there is enough business for even half the restaurants we currently have, much less the new ones that are coming.

But it really doesn't matter what I think about restaurants and jewelry stores and clothing stores and art galleries. I can't relate. I don't understand their appeal. I'm not qualified to speak, when I rarely buy anything or eat out. There is a psychology out there I freely admit I don't understand, represented by what I see advertised in the Source, for instance.

But I do have a pretty good sense of what's likely to happen in MY store, and I'm comfortable with that. I think it's going to get slowly tougher for at least a couple years for most businesses, but that is also a chance to gain market share, to make a statement, to be steady, and reliable and interesting when others are faltering.

I'm afraid I don't believe there is much substance behind the curtain. That the curtain was hiding the truth; that it was fluff and hype. Maybe -- if I had a sense that all these newcomers were really committed to Bend, I might believe that the substance would fill in. But I get the opposite sense -- that people are here almost as a lark, as an amenity, as a dream. Not a cold, hard reality. I'm not offended by this, really I'm not. This is the way of the world.

But my own experience has been that when the jobs dry up, so do the people. If the housing bubble has popped, and and think it has; and if it has a ways to go down; and it think it does; then we are left with two possibilities for people living here.

First, that they are retired and or well off. Or secondly, that there is more viable industry here than I think. But, what I think is that way too many jobs are connected to the housing industry in this town, either directly or indirectly.

And that the money flowing through this town was coming from the growth -- the building, and the hyping. And when that dries up, we are back to our basic industries -- tourism and retirement, which are more or less minimum wage paying jobs.

But again, I didn't get a lot of the 'rich' money, anyway. Most of my customers are working stiffs.

This is all just a gut feeling, but I've learned to trust those feelings. RDC and Bendbb would require more evidence to come to such conclusions, and I respect that. I could be wrong, because it really is only a feeling. On the other hand, I've always firmly believed we were in a bubble, and in my observation, bubbles don't just pop and you shrug it off. The consequences are more dire than most people think. We'll survive and muddle through -- those of us who survive and muddle through....

But I also think I can kind of sidestep a bunch of the problems I foresee for many businesses, because I've been planning for it. In some ways, I felt more threatened by the boom -- the ever rising rents, the constant threat of a competitor with 'more money than sense,' the possibility that the building I'm in could be sold and torn down or renovated; or almost as bad, the building across the street (that not only looked possible, for awhile, but probable.) Things falling back to old habits and patterns is somewhat reassuring.

I know that there will be some challenging times coming up; I've learned to my chagrin that downturns hurt everyone, even those who think they're prepared. No business is completely safe from every contingency.

I don't expect very many people to agree with my assessment. I'm not expecting a quick disaster -- just a slow grinding down, a slow reassessment and dawning realization that the boom times aren't coming back quickly, and that Bend isn't the goldmine newcomers thought it was.

I think we'll have a cooling off period, maybe even a population loss. (It's anecdotal, but there seem to be a heck of a lot of people leaving, for one reason or another.) I think that it will turn out that many of the 'rich' are up to their ears in debt. People will just have to settle down and get used to it. Some of the businesses will have enough reserves to weather this downturn, some won't. Some will have enough willpower to survive, some won't. Some will be just a little smarter, and will work a little harder, some won't.

All this will take at least another year or two before it becomes common knowledge. If nothing else, there are still a whole bunch of businesses that haven't even opened yet. For many others, who have opened in the last year or two, this is only the sniffles stage. It will be hardly noticeable to most people. Ironically, it's the people who have already been through the mill a couple of times who are giving up. Because they know what's coming.

Most people will just go merrily on their way.

But that's O.K. It just gives me more time to prepare.

Shifting the dollars.

Oh, Bulletin. Is there no end to your quirky little ways?

Front page of the business section, reports that car dealership sales have "shifted." From trucks and SUV's to smaller cars.

That's like saying that my sales have "shifted" from graphic novels to comics. From boxes of sports cards to packs. From statues to toys. Fine. But if you read the article, it's clear that their overall sales are -- dare I say it? -- down, down, down.

There is a reason the car market has pushed the big trucks and SUV's all these years -- because they make a whole lot more money from them.

From now on, though, I'm not going to say my sales are down, only that they've shifted. I'm not gaining weight anymore, I'm redistributing the pounds. I'm not getting older, I'm processing. I'm not spending money, I'm just moving it to another place.

**********************************************************************

Sounds like they came to their senses about the parking lots, and are going after the actual offenders, not the general public.

Must be an election year.

I do have a suggestion, one that I've made to anyone who would listen: give the employees their own lot at minimal fees -- no more than 25.00 a month, and 10.00 or 15.00 would be better -- but make it the second to the top floor of the parking garage. Even better, FREE parking just a block or so off city center.

45.00 a month is a lot for a half-time, minimum wage earner -- close to 10% of their take-home pay. We need to figure out a way to make it easy. Otherwise, they'll just keep playing parking tag. Even if that is foolish, and costs them way more money in the end.

*************************************************************************

Diamond; three legged critter.

The is another shoe to drop in the discount levels; I know, that's the third shoe, but Diamond Dist. is a very strange creature.

Now that DC and Marvel have set their discount levels, it's probably time for Diamond to firm up it's discounts levels, as well.

I have a suggestion: count all product.

Our monthly catalog from them comes in at roughly 600 pages and roughly 5500 items. The first 200 pages or so are the big four comic publishers: Marvel, DC, Dark Horse, and Image, who nationally account for about 80% of all comic sales. The next 200 pages are all the other comic publishers.

Followed by separate sections.

Magazines
Books
International Books
Trading Cards
Apparel
Toys, Statues, Models
Designer Toys
Import Toys
Prints and Posters
Novelties
Games
DVD's.

Everything a pop culture store could want.

It's very handy, all in one. Because Diamond is more or less just a distributor, they give us access to a huge amount of material that otherwise would be out of reach, either because of discount levels, minimum orders, or just the sheer work it would take to set up an account with each manufacturer.

The downside is, that I need to order months in advance, and if I miss something, there is not much likelihood that Diamond will have it it stock. I have to grab it as it goes by, so to speak. Only I'm guessing how much I'll need in the future.

I could easily supply my store strictly through Diamond; at about the same discounts as I get otherwise. But something has always made me keep other distributors active. Something inside me rebels at putting all my eggs in one basket.

But Diamond has also made it easy for me to use other distributors. The discount structure is set up so that the 'exclusive' publishers, (most of the comics) which I have to order through Diamond because of their monopoly, usually gets me to a discount level that doesn't budge much with the addition of other product.

The biggest hurdle is that they have a large amount of 'net' product; that is, product without a SRP and without a discount. Almost all the trading cards and DVD's; much of the games and toys; don't have discounts, giving me absolutely no incentive to order through Diamond. Nothing I order that is net counts toward my discount.

I prefer to order more on a 'just in time' basis from other manufacturers for most of that product.

And because the comics have always ensconced me at a certain mid range discount level, I really don't have much incentive to order books from them, either.

So I order all my trading cards, almost all my games, most of my books, from elsewhere.

I do order all my toys from Diamond, because Toy Manufacturers are impossible to deal with; they have huge minimums and lousy discounts.

All this is leading to a suggestion I've made once on Comic Industry Board, where I'm given to understand Diamond lurks.

Make the games and toys and DVD's and trading cards count toward a higher discount, and you might get more of my business.

I don't know if other stores, especially stores that are focused on mostly comics, would much like this idea.

So my second suggestion is to have an opt in, opt out type discount. That is, you can opt in to have the back of the book product count toward your discount, or stick strictly to the front of the catalog.

I'm kind of torn by this suggestion. As I said, I like ordering on a 'just in time' basis, and many of my other distributors have more or less free shipping.

But I wouldn't mind having the option.

The budgeting entry has started a whole string of thoughts.

For instance, one of my pet projects is (are?) art books. I have hundreds of art books, probably close to 1000's. They were lovingly assembled over the years, because I usually only have a short time to get them before they go out of print.

This goes back to the days of my Tolkien Hildibrant calendars (as atrocious as I now think them) and the Frazetta Conan covers.

I started with strictly fantasy and science fiction art. Then weird pop, such as Basil Wolverton and Big Daddy JRoth. Then I added pinups, then Art Nouveau and Art Deco, then Howard Pyle and N.C. Wyeth and Maxfield Parrish and their illustrator brethren, to pre-Raphelite and 19th century art, to impressionism, post-impressionism.

Pulp artists like James Bama and Robert McGinnis and Jack Vettriano.

Anything that has the slightest 'fantasy' flavor -- which turns out to be anything.

Tell me Van Gogh and Cezanne don't fit the bill; or Edward Hopper or Alex Gross. Artists like Gustave Dore and Diego Rivera and Escher and Dali definitely fit the criteria.

My perimeters has broadened to the point where, well, just about any art book is fair game.

Makes sense. My Mom was an art major, and our house was full of art books. I used to spend hours browsing, looking at the art books. Dad had the big history books with illustrations, and as I said, the classic illustrators like Wyeth. I plastered the walls of my bachelor pads with cheap art prints.

When I was young man, I visited a friend in N.Y. who took me to Moma and Met. He had to explain Art Deco to me, and other art movements, and I was sort of embarrassed. I came back and spent a summer reading art history volumes, watching the Shock of the New on PBS.

I found that there was little art I didn't like. I love modern art. And I love classic art.

I'd like to pretend that I immediately recognized the value of comic art. But it took time to realize that I dismissed most comics not because I was sophisticated. But because I was ignorant and biased. I simply didn't know enough to judge.

Eventually, I came to recognize that there was a level of quality that would astound most people, and then it took me even longer to recognize it in the older comic art. I came to see even simple line drawings like Peanuts, and Calvin and Hobbes, and Bone has having a world of expression and artistry.

So when I bought my own store, I was a real sucker for art books. It wasn't a problem at first. There was very little offered to me from the distributors.

Then I found Bud Plant, and that was my downfall. I only had a year or two to order from him before he became a online only, retail only presence. But I was completely taken in by his esthetics's. I'd love to have a brick and mortar version of the Bud Plant catalog. But of course, even Bud Plant doesn't have a B & M version, probably for good reasons.

I believe a store in Portland, for instance, could have a heavy presence of art books and do well. But I'm probably wasting my money in Bend. Maybe in Portland. But it would be cool.

I've done it so slowly, it hasn't really hurt.

But here's where it gets slightly ludicrous. I have 95% of those art books (which aren't cheap, by the way) spine out! How ridiculous is that? Hiding my light under a bushel, for sure.

So, when I triple my bookshelves later this month, I'm going to resist the impulse to immediately fill them with new books, but try a little harder the display the wonderful books I already have.

Damn budgeting.

There is no doubt that this budgeting process has been good for my business.

I can see it in all kinds of ways. My cash flow has easily covered the bills in a timely manner, and the savings has never been threatened. I've paid off one card in full, and I have been making substantial payments on the other. I'm not carrying any balances with my suppliers. And I'm doing at a time of year that is usually my toughest.

So why does it feel so unsatisfying?

First of all, I've never really done it like this before. Or, rather, I've never done this when I didn't absolutely have to, when my back was totally to the wall. I've cut back many times before to raise capital to pay overdue debt or taxes. But that was different somehow. For one thing, I was terrified, and motivated, and adrenalinized.

This time? It's for my own good. Yep, like caster oil. Like going on the wagon. Like dieting. Like exercising. Like taking vitamins, or shaving, or taking out the trash. Like doing the dishes, and pulling weeds. It's a damn chore.

The changes are incremental, and below the surface. Look, say I owe 10k on my credit cards. If I pay off an extra 500.00 a month, I'm making progress, but it may take twenty months. At the end of the day, though, all I feel it is costing me is 500.00.

Here, I'm paying an extra 3 to 4k per month. It still takes me 3 or 4 months, but in the end, in a sense, all I'm saving is that 500.00 payment.

I know, I know. That isn't what is really happening, but that's what it feels like.

I also feel like I'm in sort of in a holding pattern.

I've obviously become a risk junkie; just as bad as climbing mountains, or rolling the dice in Vegas. I just love that feeling.

If I went out right now and bought a 1000.00 worth of stuff, I'd be excited for a week, trying to stock it, display it, show it off, checking it out and exploring it, and -- oh, yeah-- trying to get the money back.

Not spending a 1000.00 bucks? Yawn.

Catching up on bills? Yawn.

In a sense, the money I'm not spending right now isn't the 'keeping the store well stocked' money -- I'm keeping that going. I'm keeping the new material, the best sellers, the basics. Nothing has changed.

No, the money I'm not spending right now is the' play' money, the 'have fun and try something new' money, the 'let's experiment and see if it works' money. It's why I read the trade publications, and peruse the web, and keep my ear to the ground. It's the stuff that intrigues me and interests me. I've already read the Watchmen; so obviously I'll keep that in stock. The store continues to do well because there are still plenty of folk who haven't read the classics yet. But what about material I don't even know about yet?

I'd also like to find the occasional 'Fun Home' which totally surprised me with how good it was; the occasional DMZ or Criminal, that I didn't expect to like so much.

Or the weird looking toy that I know will excite comment, but probably take a long time to sell.

Of course, you probably are saying, I should let go of the 'play' money. Entire books are written on the subject of selling established, proven sellers.

But the exploring, the playing with inventory, is what makes this job worth doing. The trying new things is what keeps me interested. The turning people on to something they've never seen.

What I'm trying to tell myself is that I've been playing in heavy traffic, so to speak. I need to build a fence before I start playing again.

I don't want to overstate my case. Of course, I'm getting new material in every week. Because of the nature of a pop culture store, 'new' is the default position. What separates my store from others is that I've made more of an effort to keep the 'mid-list' quality product, and the outside the normal material.

For example, when I was a kid, my parents subscribed to the New Yorker. I'd read the cartoons every issue. They also had Saturday Evening Post cartoon collections and such. I remember becoming aware that my favorite cartoonist was a guy named Gahan Wilson. Over time, I became aware of other names, such as Charles Addams and Edward Gorey, and Jules Feiffer and Shel Silverstein, and eventually cartoonists who's art I recognize, but not the name, such as Ronald Searle's. One of my projects has been to assembled as many of these cartoonists as possible.

There are modern practitioners of this level, who do 'comics': Troy Nixon, Renee French, Rick Geary, James Kochalka to name a very few.

It's a "I like it so I hope others will like it" effort. Not at all necessary, but fun and completely unique to my store. I'll be going back to it as soon as I've created a firewall. As soon as I'm out of the heavy traffic.

Back to the budget.

At least half to two/thirds the money I save in the budget is going toward debt, and pulling in the slack in my cash flow. I'm addressing a problem I wasn't really feeling. Cash, if there is any, will come at the end, so I don't get to chortle over the money, money, money.

In theory, I'll be able to use the money I normally make at Summer and Christmas as actual, honest to goodness cash profits, instead of just paying the debt I incurred over the previous months.

Almost every year, I would go deeper and deeper in debt to keep the store up, almost accelerating toward the end (the more you owe, the more tempted you are to buy your way out of it.) That may sound crazy, but it has almost always worked. At least, I'm usually caught up at the end of summer and Christmas. But....with little left over for the next off season.

I'm bound and determined to turn that around. It's a great time to do it. There's a slowdown, which creates less outward pressure. My sales are high enough to keep a steady flow of material coming in, even now, at the proper discounts. The store is full. I have almost no competition. I know how to do it. So far, I've been doing it without much real effect on sales.

If not now, when?

I could've done this last year, or even the year before. But business just kept increasing, and I went with the flow. (Despite my deep suspicion of the boom.) What has been the final motivator is the fact that I will need to renegotiate my lease in the not too distance future. I have a few good seasons to prepare. I really can't delay much longer. The idea of a recession is just a further motivator.

I know at the end, I'll be very happy I did it. But right now it's just feels kind of like trudging.

Iron Man musings.

Robert Downing has the bad boy charm, and the soulful eyes to make the character interesting. I'd watch Jeff Bridges read the phone book. There is a robot academy award for best supporting robot. And Gweneth Paltrow is visually ravishing.

They keep saying Iron Man is a secondary character, but I've always thought the secondary characters are more interesting in some ways. I get way more comments on my Green Lantern t-shirt than I do from Batman or Superman, for instance.

And the movie had lots of Mech, which makes it very modern, somehow. But they kept enough of the old clunky armor to give it some steam-punk.

I'm not trying to be a movie reviewer, here, but I think this movie has hit the national zeitgeist somehow. Don't we wish we had a guy who could fly into a village, kill the bad guys without touching the civilians? This isn't just adolescent power fantasy, but power fantasy for all of us. What would we do if we were super rich and super smart? We'd play for awhile, and then we'd get serious.

Ah, well.

Downtown turnover.

“It’s been dead down here,” she said. “It’s like the ’80s.” Linda Torres, owner of the soon to be gone Book Barn.

"Interesting piece. In raw numbers though, it looks like more are leaving than arriving.

(SAYS: I Hate Too Burst Your Bubble.)

And some of the additions see, well...

A hat store?

Nothing but clothing retailers & restaurants.

I've seen what are the beginnings of that Blue Moon Marketplace, and that could be interesting. But the location?

Far & Away the most interesting quote is the highlighted one by Torres.

How bad is it Dunc? I thought I heard you rolling your estimates down over the course of this year.

Anyway, a decent piece on what looks to be a pretty heavy net outflow from the downtown core, with a partial replacement by some total noobs."


Duncan's Answer:

If you don't mind, a 'yes, but we're different answer.'

On a scale of 1 to 10 for walk-by traffic, Pegasus has spent most of it's existence at a 2 or less.
For the last three or four years, that shot up to a 7 or 8.

Meanwhile, the Book Bark probably has been in the 7 or 8 range for many, many years.

Now? We may have dropped to a 5 or 6 in foot traffic, and so has the Book Barn, probably. So while I'm still doing way more foot traffic than I was accustomed, Linda (Torres, by the way, not my wife-- already had someone make that mistake) has probably seen an overall drop.

We also have maintained the 70 or 80% destination by regulars status, whereas most downtown stores are probably the reverse of that.

You can sort of feel it, as I've said before, just by the number of parking spots outside that are open. I can sort of feel it when I walk to the parking garage and see the restaurants don't seem very busy. And there are still stores that I walk by every day that never seem to have customers.

Pegasus has gotten a bit lucky. Pop culture has surged to the fore -- the Iron Man movie being an example. I'm optimistic. We had a HUGE turnout for FCBD.

But yeah, our sales are down from a year ago, and I had been guessing that other downtown stores were feeling it. As bad as the 80's? Oh, that was -- shoot a cannon down the middle of the sidewalk and not hit anyone -- bad. If it ever gets that bad, most of these noobs won't last a month.

I have to say, I think the number of new restaurants and new clothing stores is simply nuts.

New stores don't mean much, except the the downtown is a desirable location. It doesn't mean everyone is thriving. Just that there is another noob for everyone that leaves. I don't expect this to change for awhile, yet. So far, I haven't seen any boutique location stay vacant very long on Minnesota or Wall.

The Life of a Small Business.

When someone comes in and tells me that a new business is doing great, I usually refrain from answering.

Could be, could be. More likely, not so much.

Anyone with an ounce of effort can look successful in the first two to three years. Obviously, based on results, most people aren't. If their overhead is just the lightest bit too much, their margins just the slightest bit too little, their sales just the slightest bit too low, then they could be bleeding internally and not really know it.

I've always said that most people can do two out of the following three things; overhead, old product, and new product. Few people can do all three things consistently month after month, year after year.

Some of the words I'm going to use to describe phases in business may sound pretty negative. But remember there are all kinds of positives going on at the same time. You are your own boss, you're (hopefully) having fun and being challenged. The following are the downward pressures on a business. So try to keep both concepts in mind at the same time, O.K?

(Notice also, that I'm talking about motivation more than money, because it is at least as important, maybe more so. Strong motivation has more of a chance to overcome lack of money than money has to overcome lack of motivation, in my opinion.)

Disillusionment: So....any one can appear to be successful for 2 or 3 years. But there may be creeping dry rot underneath that takes time to become apparent. About 3 years in, there isn't quite as much money at the end of the month, you've spent your beginning funds and maybe even resorted to extra credit, the product and fixtures are getting run down and stale, the overhead is taking a bit longer to pay and getting more expensive, unexpected expenses come along on a regular basis, and you can't quite afford enough of the new product to satisfy demand.

This is the first crunch moment. Most people start making wrong choices and bad decisions around here. They might raise their overhead, thinking the infrastructure is at fault. More advertising, for instance.

Or they might lower their margins, thinking that if they are cheaper, people will buy more.

If you make the wrong decisions, you're toast around the year Five. Anyone with an option, like a better job, will opt out around here.

Burnout: But let's say you make the right decisions. You lower overhead, you promote your store through guerrilla marketing, you keep your margins strong, you adjust your inventory so it sells better.

At around year Seven, you reach the next crunch point. Because all those things you did to survive probably added mightily to your workload. You are on the verge of Burnout.

So, if you haven't bailed out in the 3rd year, the 5th year, and you make it through the 7th year, you are an 'established' business. Ironically, this is the stage that the public things most well-appointed businesses are already at, but very few are.

Boredom: At around the 10th year you face the next hurdle, boredom.

You've finally got around to treating your business as a business, instead of a hobby. You begin to realize that this isn't some after-college lark, but a friggen career! And once you've gone to your donut shop every day for 10 years, you can barely stand the sight of donuts.

Here you either suck it up and treat it as work, or you do what I do and start experimenting or playing with your business -- which puts you back onto the battlefield.

Now you are a battle-scarred veteran. Most successful businesses reach this point somewhere around 10 years, I've heard. You can actually afford to take time off, you may be savvy enough to be able to expand and so on. I've always heard that Sam Walton was well into middle age before he figured it all out. And, from my observation, very few people get to this stage -- businesses do more than owners, as they are passed off on the next entrepreneur, but very few get here.

In my own business, it took more like 20 years to reach this point, because I kept getting knocked back down to the bottom of the hill. Beware the bubble. Beware the premature expansions!

The final phase? The dangers haven't gone away, of course. You're just much more aware of them

If you make it to 20 years, you can even become the 'old codger' like me, dispensing advice that no one listens to.