Monday, June 30, 2008


Apparently I was wrong about the Bend bypass happening before 1962. In my defense, I was all of 9 years old at the time. It shows how light the traffic was back then that the highway could turn right angles at Wall and Franklin.

New books and card games are nip and tuck near the finish line of the month; with books a nose ahead for second place behind comics. However it turns out, it's an impressive achievement for a new product line. Of course, it's still only 20% of the revenue I'd need to survive as a bookstore; and I have a sneaking suspicion the first 20% is the easiest.

For years now, I've been debating with myself over the cost/benefit ratio for getting a two day ship from the main warehouse. Diamond offers us 'ground shipping' rates for 'air shipping' from their hub in Memphis. The regular Wednesday shipment is shipped to L.A. and then trucked up here.

As often seems to happen in these debates where there seem to be equal merits on both sides, the decision has been made for me.

Last weeks regular shipment, 15 boxes from L.A., cost about 3.5% of COG's, a little above the historical average of 3%. My two boxes out of Memphis cost 20% of Cost of Goods,(!?) well above the historical 8% average. The two boxes cost exactly the same as the 15 boxes. So....can't do that anymore.

It means changing my tactics. I've had the reorder system down to a science. Now I'll have to do a bit more ordering up front, and be a little more aware of what's selling out. It'll be inefficient for awhile until I get it figured out.

Oh, well. Makes the decision easy.

Sunday, June 29, 2008

What's in a name (or slogan).

Quick perusal of the paper this morning. A son and daughter n'law are home, sleeping on our new pull down bed, (which as a bed makes a great couch.) I've blogged everyday, but I think I'm more impressed by people like Chubby Mommy or HackBend who have active family and social lives and still manage to blog regularly.

Anyway, the thing that leaped out at me is the slogan, "Sisters Country."

Hey, right on! They nailed it. I'm usually so skeptical of these kinds of things, but that just sound right.

Reminds me of the first time (out of two total) I went to a Downtowners meeting and they were talking about an advertising campaign "Village by the River."


What's wrong with Downtown? Even 'Old' Downtown? It's what we are. Get down with old downtown, man.

Speaking of names. Got a call from Jerry Opie of the Sole Shop, who is filled with knowledge about the last 40 years of downtown history (I keep telling him to write it down, and he keeps telling me to do it.) He was laughing about the Liberty Theater being sold. Especially the name Liberty Theater, which is an exhumation of a name from way back. We all knew it as the "Fine Arts" Theater. The Fine Arts being XXX.

He also remembered all of the restaurants names that were in Toomies before them: Breads of France, Bentleys, Cyranos, and Piscatore. I used to think that location was doomed before Toomies arrived. Also, just to give you a flavor of what the '80s were like. I remember one of those incarnations they had a white piano in the window, and the waiters were dressed in tuxes or some kind of monkey suit, and I have a vivid image of one of them standing next to the shiny piano, wearing an ill-fitting tux, a white towel draped over his arm, staring out the window with the loneliest, more forlorn look I've ever seen.

All dressed up and nowhere to go.

Saturday, June 28, 2008

New books honeymoon.

I'm in that honeymoon phase with both new books and with board games. Especially new books, which are very close to being my second best selling category. Actually, it's new and used books together, but since I don't even have to pay for the used books makes it my second most 'profitable' category without a doubt.

I haven't separated out the new from the used; I'd love to know, but it would be just too much work at this point. A good argument for a Point of Sale computer.

Anyway, I recognize the Honeymoon Symptoms. I start thinking this is 'easy', that since it's easy, it has great potential. I see the customers as pleasant to deal with, and I see bright vistas spreading before me.


I have felt that way about every one of my fairy princess new product lines. Eventually they turn into pumpkins.

Not that pumpkins are a bad thing.

It's just that they are a regular thing. Every product has it's pluses and minuses, and customers pretty much are people no matter what they're buying, if you know what I mean.

That said....

Man, that was easy. I added new books almost on a whim, and look how they're selling!
The reorganization has worked just the way I hoped it would. People coming in off the street see the books and just assume that I'm a bookstore. I'm quite amazed by how many of them managed to find a book, either new or used.

I'm not under the constant pressure to keep up with the product changes; like with card games or sports cards or comics.

As far as bright vistas: What would happen if I was really paying attention and applying myself? What would happen if I made more room for them?


Despite it being my second best selling category, it still represents less than 15% of sales. Comics and graphic novels are my main thing; and I at least have to consider the possibility that my big drop in comic sales (30%) is because I changed my focus.

I don't think that's what's happening. And if it is happening, I have to consider that it argues even more for diversity. If adding a few bookshelves has hurt my comic sales (who's space and effort and inventory weren't reduced in the slightest) then maybe that just shows how vulnerable comics are to big swings.

Big changes take years. If I wanted to reduce my manga and anime footprint and increase my boardgame and new books footprint, I have to do it in such a way that my manga and anime don't become worthless. Which means finessing the manga and anime, reducing the lesser titles, but keeping the better titles in stock.

I have to make sure I don't lose sight of the importance of comics and graphic novels.

But it's really nice to have options.

Friday, June 27, 2008

Good bad luck, or bad good luck.

If there is such a thing, I've got it. Was picking up my monthly Lipitor at the drugstore, when my engine started squealing. (My car, not my heart...)

Now it's been making kinda screechy sounds for a couple of months now. When I first started hearing it, I checked the oil, and other than it being coal black, it seemed O.K. I went and had all that stuff changed; oil, oil filter, air filter. Probably haven't done it in years.

Thing that always kills me about people who have their cars serviced all the time - I'm driving a 1990 Toyota, and I barely pay attention to it. I'm of the opinion that the less I do to it, the less that can go wrong.

But I know that it can't last forever.

I pull out of the drive-through, and the car dies. I start it up, go about 50 feet and it dies again, screetching the whole time.

That when I look up an notice an alternater/water pump car parts place directly across the road. I nearly coast up to the door.

The guys inside decide the belts are frozen on the power steering and alternator and water pump, and that it probably means either the alternator or the pump are frozen.

Anyway, we cut the belts, I drive out the service center watching my engine temperature gauge.

If this had happened anywhere else, I would've had to called for tow, waiting around with my cat in a hot car, and so on.

Water pump replaced a few hours later. Car no longer making noises. And a four hundred dollar repair bill.

I think that's what would be called good bad luck.

Macho twittering

I caught Pat text messaging the other day while I was talking to him.

"Are you text messaging?"

"Uh, yeah."

"Well quit it."

Today, I was talking to Maston, who is a uber D & D geek, (I don't think he'd mind me saying) when we realize that Pat's in the hallway with his cellphone.

"What's he doing on the phone so much?"

"I don't know, man. I don't even have a cell phone."

"Let us mercilessly rib him when he comes back in."

"Oh, Pat! RU Lovy dovy ur sweetie?" (Obviously, I have no clue about txt. mess.)

Pat looks at me deadpan.

"You twitter," he says.

Uh, uh.

"Yeah, but it's manly twittering. Like "Look at the knockers on that Babe!" or "Damn, my balls itch!"

I won't go into the rest of that conversation...

Event fatigue?

This is a question I've never really considered, except in the narrow confines of downtown Bend. I don't go to many events, (like none), so I can't speak knowledgeably about crowds and turnouts and such.

But....I have a sneaking suspicion.

Look, some of us bloggers talked about a housing bubble a couple of years ago, and I think we were proven right. I've been talking about a Commercial Real Estate bubble for the last year or so, and I'll be proven right or wrong over the next year or so. In both cases, I'm talking more about the number of subdivisions and houses and buildings and stores more than I am about price.

Events? All I know is that the number and variety is astounding for a small town. How can anyone see through the clutter? How can you tell which events are fully thought out and well planned and which are Mickey Rooney 'Let's put on a play!"

The Source, bless them, looks like Willamette Weekly from all the events advertised.
I wonder if there isn't a case of diminishing returns.

But, it's free enterprise, I guess. The hardiest will survive, but in so doing there may be some traditional events that go down the tubes. (Cascade Music Festival.)

Debt is what I look for in businesses when there is downturn. Those that haven't overextended, over borrowed or overreached may survive.

In the event calendar, I guess I'd be looking at which events are subsidized, which events have a founding father who has created the event from sheer willpower, and what happens when he/she moves on (Bend Movie thingy), and so on.

I guess we can't complain. Too much choice?

Still, just as an indicator of the real level of business: I am the only card shop, the only game store, the only comic shop, and the only anime/manga store, and the only pop culture toy store, etc. etc. (Though of course I'm none and all of those things.)

It's a pretty good benchmark for me. If a town like Eugene has 2 comic shops, and 2 Celtic Festivals; and Bend has 1 comic shop and 3 Celtic Festivals (I have no idea how many Celtic Festivals there are; I'm just using it as an example) that can't be a good sign.

Just like my question about retail square footage -- (I presented the challenge that Bend is the most over retailed market in the U.S.A. outside of Vegas and no one has contradicted me yet) -- there is no way for me to know. I just don't have access to the information.

But looks pretty overpacked to me.

Let stores be stores.

This has been a slooooow week. I'm wondering if I misjudged the 'transition' week; that everyone is changing households, firming up plans, getting their kids enrolled in summer programs, or just decompressing, etc. this week instead of last.

Or it could be a hangover from the Bite of Bend event. I've noticed before that there is usually a drop off after one of these events. And if this slowdown is happening in my store, you have to wonder if people who came downtown last weekend to the Bite will be more likely or less likely to visit the actual brick and mortar restaurants over the following week.

Same sort of thing happens when there is a card show or a comic show. Subtract the lack of business immediately before and after such an event, while customers save up and then spend all their cash, and as a store you break even at best.

This is an effect of promotions I believe most businesses underestimate; hell, I don't think they count it at all. But as I mentioned in an earlier post, if you keep having sales they stop having an effect. Promotions should be used sparingly: but people who like promotions have the opposite impulse. More and more and bigger and bigger.

At least one of the reasons that Cascade Music Festival might have had problems is that it went from being one of 4 or 5 major events in Bend per year, to one of dozens. Once upon a time, the Cascade Festival was a very big event in a very small town.

In other words, I think there is a much bigger danger of too many events, than of too little. I have actually seen the results of too little and too lame at the Mountain View Mall, and I'd certainly not want that to happen. But I don't think there is any real danger of the number of events shrinking, and a distinct danger of them crowding out just everyday normal shopping weekends. It's like eating nothing but desserts, without the basic nutritional meals inbetween.

My wife's store has none of these promotional efforts. Her business has grown steadily, almost predictably, for 5 years. Of course, we appreciated the article from the Bulletin, and it seems to have really goosed people to come in, but maybe because it was a special thing, not a four times a year 'festival' or a twice a year 'parade' or twice a year biking event, and many, many others.

Advertisers see no incongruity in having the businesses exist to support the promotions instead of the promotions to exist to support the businesses. What's amazing is how often retailer organizations let themselves fall into that trap.

I think in the end, these events help the events themselves, more than the businesses around them. I don't deny that they are sometimes needed, and that they don't have some beneficial effects. But I don't believe that the benefits to the brick and mortar stores are as strong as some seem to believe. I take my girl to the dance, and she spends the whole evening dancing with the host, and all the way home she talks about how great he is.

Let's be choosy and selective when it comes to street closures, that's all I ask.

Last time this discussion came up, I was informed that there is an official limit to how many times the streets can be closed, but it doesn't hurt to remind the powers that be that there are reasons for that.

What's been most unexpected to me is the significant drop off in comic sales. I'm pretty sure this has less to do with my store or Bend than it does with the regular up and down cycle in the comic biz. But it also means, since I'm very close to last year's totals despite the big drop off in comics, that all my other product lines are making up the difference.

Books are becoming my second best category; which is completely unexpected, frankly. I'd hoped they'd settle in at the 4th or 5th position; it's encouraging enough for me to pursue them further.

I'm well into the black for the month; it's just a matter of how far into the black I get. I was hoping to pay off all current debt; but it looks now like I'll probably only manage to pay off the second credit card, leaving my bank line-of-credit still to be paid. A much smaller amount still owing, but still....

Thursday, June 26, 2008

Cheerful little list.

Interesting trends developing, at least to me. Most of these are totally anecdotal and may or may not reflect reality.

Old line businesses and events going out of businesses, (Book Barn and Cascade Music Festival), while new businesses to town wonder what all the fuss is about. Bend is wonderful!

Lots of petty crime. The Bulletin appears to downplay it, KTVZ through their mugshots seems to emphasize it.

Live music venues sound like a good idea, but apparently are harder than they look. Summit has dropped the nightly acts, and door charges on weekends. This goes way, way back, folks, as far back as I can remember. Live comedy seems even worse.

Lots of motorcycles and bikes on the road. Lots of accidents.

Parking lot emptier at night when I leave, than in the morning when I arrive. How does that portend for 41 restaurants?

All the houses in my neighborhood are still for sale, some for over a year, and all have 'Price Reduced' signs.

Most of the empty spots on Greenwood are still empty, and if they haven't rented by now, you have to wonder about fall and winter.

Credit is not only harder, but harder to deal with. Having to reapply. Having them refuse to do things they've always done in the past. Interesting to me, my business vendors are still treating me the same, if not better.

Traffic seems down to me, empty parking spaces in front of my store even in summer.

The bearish blogs, which had been fairly quiet, gloating in their rightness over the spring, are suddenly screaming danger. (Bill Fleckenstein's Daily Rap today: It's About to Blow!) Almost nothing in the mainstream news; slight downtick in unemployment, downward movement in housing prices, which must be a good thing and so on. But really, none of the urgency.

Commercial Real Estate still mostly ignored. I'm beginning to wonder if we'll have a perfect storm. Housing bust, credit tightening, declining dollar and increasing inflation and deficits, big banks going under, high unemployment, commercial real estate bust, ever increasing gas prices. Seems like a certain negative synergy is developing, right now.

Stock market drops 358 points today, I don't know how much this month.

Public floating through my store still seems generally uninformed and unconcerned.

Can't break thru the shielding.

The brain waves appear to have malfunctioned, working to the opposite effect.

I'm turning them off before they do anymore harm.

You will be assimilated.

I'm going to do 1000.00 business today.


I've decided. It's time for a good day.

I press my elongated fingers to my bulbous forehead. Mind waves are zapping outward, like lightning. All over Bend people are getting a strange, sudden, irresistible urge to.....Buy a Comic!

Strange, I hear them thinking. I haven't bought a comic in years.

But I wouldn't mind getting a book. I know! I think I'll check out Pegasus. I hear he's starting to carry books. Or maybe a nice game I can play with my family. A toy. My kid has been good this week, and he deserves a toy. My husband? He's always loved Conan: I hear Pegasus has a great statue for 350.00. That's not really so much, is it?

Somewhere in Florida, a butterfly has dropped dead to the sidewalk from the force of my mind waves, sending a ripple out, causing rainstorms in the midwest, causing Uncle Louis to sit in his living room and watch a baseball game. He gets an urge to call his nephew in Oregon, reminding him how much they used to love collecting sports cards together.

As I set on my perch behind my console....err, reality bending waves are causing casual shoppers in downtown Bend to suddenly angle toward Pegasus. Let's try this street, let's see what's over there!

See you soon!

Wednesday, June 25, 2008

Ordered twice as much....that's all.....

So I did my first summer reorders yesterday -- and they came in at twice the allocated amount. The good news is that caught me up to everything I was missing in the store. Bad news, I do that again and I can kiss saving money goodbye.

I've given myself a reprieve. The first real week of summer is the best time to fall off the wagon. Again, as long as I don't do it again.

My willpower is weak.

Meanwhile, there is a pretty long comment to my blog entry about restaurants -- the one where I say it was nutty nut nuts; and where I was proud of myself for not bitching about street closures.

These issues deserve discussion, I think.

Tuesday, June 24, 2008


The critics are loving this movie based on a comic. They're saying it's going to have an impact like the Matrix; it's a cutting edge, mind-blowing action flix.

Only problem: I happen to know that it doesn't really resemble the graphic novel, except in its main premise. The comic series was a well-drawn, well-written superhero comic, with a sort of meta subtext about being a fanboy. Well worth reading on it's own.

The movie is an action flix. Not so much superheroes. And nothing of the subtext.

I originally was going to only have a couple these in stock, but since the Rotten Tomatoes critics are 95% approving, I'm ordering a bunch more today.

Last time this happened was Men In Black. The comic was a minor effort, from a small company that was already out of business, black and white, out of print and unavailable, that no one had noticed when it came out.

The movie was huge.

But only because they took the main premise and vastly improved on it. At least the Wanted graphic novels is pretty cool in its own right.

Meanwhile, to continue the more mundane diary aspects of this blog. I got eaten alive a couple of days ago. Woke up yesterday morning with welts all over my body. Dozens of them.

I'd spend most of Sunday gardening. We have a third acre plot, and on the other side of the fence, running along the road to the north of us, is a strip that I figure I'm responsible for. Totally infested with grass and weeds. I managed to do the half by our house, which has a kind of cool rocky outcropping, but the rest that stretched down the street was too overwhelming.

I started doing a few feet, and ended up finishing off the whole thing. Williamson Park is a well-maintained neighborhood. So I finally caught up and don't have to feel guilty anymore.

Anyway, I saw one black ant crawling up my arm, and thought, "oh, oh. Hope I'm not sitting on an anthill." But -- this is weird, whatever was biting me, I didn't feel it.

I don't think it was mosquitoes. Didn't see any, and my wife was with me for an hour, and she's a mosquito magnet. I only have to take my wife with me, and she gets all the attention. Plus, I was wearing a new thick cotton t-shirt, loose, so I don't think they could've got under that.

Anyway, I'm itching like crazy. Good thing it wasn't Linda, because these welts would be bloody craters by now; she simply can't leave them alone.

Man, it's itchy.

I spent money!

I spent money -- on myself. Or more to the point, on our home. Linda can get me to go shopping maybe a couple of times of year. Knowing that, I tend to grab anything in sight that I think I might need.

So for me, this kind of expedition is an adventure, even if it's an everyday thing for everyone else. So pardon me if this is boring to you.

We set out yesterday for: One pair of cheap sandals from Bi-Mart (my Birkies days are over, cause I'm just too hard on shoes); a couple of soak hoses; a couple of cheap sprinklers (I bought a couple of average type sprinklers my first year as a home owner, which broke; I bought a couple of really high-priced sprinklers the next year, which promptly broke; I limped along with my ancient froggy sprinklers from when I was a renter for a couple of more years. Now, like sandals, I'm just going to figure they'll last one or two years, and that's it.) Superglue (because I'm still cheap and would rather fix things); and the biggie, a futon.

We needed pickup and delivery; ended up at McMahans, which Linda and I have used from honeymoon days when we were dirt poor and they were the only people to extend us credit. Their stuff is mostly generic and boring and overstuffed; for instance, needed a new lamp and out of the hundreds they had couldn't find one I liked. But we did find a version of pull down couch that was 500.00; and a cheaper version at 350.00. With the 70.00 shipping and removal charge, this came to 420.00, which we settled on.

Neither version was in stock. (We need it by this weekend, because my son and daughter-in-law are coming to visit.)

Turns out they had a repossessed version of the 500.00 one in the back for 200.00 which we grabbed. Linda was admiring some vases, and I impulsively bought those (her birthday is on the 1st of July); and I came very, very close to buying a big screen T.V.

We came to counter to pay, but they wanted us to start the credit applying process all over again; Linda and I have spent a huge amount of money at McMahans over the years, because it was easy. Now they're making it complicated. I whipped out my paid off credit card and paid. Not pleased. Also very unlikely to buy my big screen T.V. with them, when it comes the time.

We also bought a coffee table and two end tables. I've felt our living room was over-stuffed since the day we moved in. A massive, square lump of a coffee table, an overstuffed couch and loveseat, an over-blocky end table, but no table where I read and eat on the couch, which has bugged me.

What we bought was less massive and more simple in design.

Linda was bemoaning how she wished we could find some solid wood frame couches like the one at the store (which are also less massive and stuffed) and I proposed that we get them reupholstered, and switch out.

By the time we're done, the living room should be a little less stuffed, and little more elegant.

On our way to Bi-Mart, passed Casa Decor, and Linda saw a porch chimney (or whatever it's called) and we snagged one of those. The store was hugely bigger than it looks from the outside. Everything was 1/3rd off. In fact, just about everywhere we went, people were volunteering how 'slow' it was. Had a talk with the salesman at McMahans who had just finished a 'short-sale' on the third house he owned; how everyone including his wife and father tried to talk him out of buying the 3rd house, how his marriage had ended, etc. Wonder how many stories are out there like that.

We also bought 100.00 worth of plants from Bi-Mart. Just started grabbing them. Amazing how few that seemed when we got home.

I don't feel too guilty about spending this money. It's a very, very rare occurance with me. I'm going to wait until probably Christmas, and try to get the best possible deal on a flat screen I can. That would be my first really big indulgent purchase for myself since.....since......I don't know when. Seems like forever. I've been mulling it over for almost two years now.

Even with all that spending, I didn't really spend more than a couple of shipments at the store. This doesn't let me off the hook for my zero balances on the credit cards; just means I'll have to finesse the store even more.

Actually, I think it's about time.

Monday, June 23, 2008

Food food everywhere and not a bite to eat.

41 one restaurants in downtown Bend. Well, that's just nutty nut nuts! Not counting coffee and tea, which would add, what, 5 more? How about sidewalk vendors? Are they counting candy shops? More than 25% of them are for sale? Ouch.

One thing that always makes me wince is when anyone says that they don't need to make money...that isn't believable. Rich people like to lose money even less than poor people (who are used to it, after all.)

Here's the thing. The gap in reality and perception is so large, still, that some of these restaurants will probably actually sell; which will give the landlords no reason to lower lease rates, and will just encourage other restaurants into the pool.

Latest I heard, the high end dress shop in my building might be taken over by another refreshment server.

We had an average weekend, overall at Pegasus. The closing of the streets, and the milling of the crowds, just made it a steeper hill to climb to get there, is all.

But you'll notice I haven't bitched this year. I'm just hoping they haven't scheduled the summer fest and the bike race on the same weekend again.

There is a gallery of mug-shots and KTVZ today.

Another sign that we've over scheduled the damn summer? (When are people supposed to mosey around, and you know, actually shop?) The sheriff can't cover all the events.

Really, it's time to quit packing the weekends.

Relatedly -- when I go to the coast, I want to walk along the beaches and take in the sights. Not normally interested in the touristy things. But they have an exhibit in Newport that combine exotic sea life and beautiful glass sculptures. That sounds awesome.

Sunday, June 22, 2008

Chain store ponzi schemes.

There is a great graph over on the site, Calculated Risk, which shows the massive expansion of Commercial Real Estate in the last five years.

Can you say bubble?

(Even if you don't like this subject, at least read the italized section below and tell me that doesn't blow your mind....)

Essentially, since 1997, the average expenditure on CRE has been 20 billion, (in 1997 dollars, the first year of the graph). Over the last few years that has exploded into 25, 30, 35 billion.

This at the same time that the internet has been making inroads on the brick and mortar stores.

I'm going to make a very bold prediction here. In ten years, stores like Pegasus and the Bookmark will be all the rage, while the chain stores will be shunned.

Huh? That's impossible.

Well, not if you see the chain stores as a giant ponzi scheme.

Let me explain. When I got into sports cards in 1985, my sales exploded. And yet my cash flow was strained to the breaking point. I just couldn't keep up. I finally went to the bank and borrowed money. I did it by opening a second store. I could show the bank that I was making steadily increasing sales, and the overall profit and loss statement looked good -- but what it didn't show was that I was generally broke on a cash flow basis. Summer and Christmas every year would bring me to profitability on my taxes, but I spent most of the year in the hole.

I expanded again a few years later, and then again. Each time, I borrowed money to fuel the expansion, and each time the new store brought in an infusion of cash.

But each time it was a temporary solution to my cash flow problem, because the profit margins were barely enough to keep up. When the sales actually started to drop (my first experience with a bubble) the expansion became a huge negative.

I managed to slowly draw back to one store, which is more profitable than the four stores were.

But it looked good for awhile. The banks weren't asking the right questions. How much was real cash profit, and how much was just expansion of inventory? What was my cash flow like?

They focused on sales, and that's where I directed their focus. I didn't hide anything, I just highlighted the positives, and didn't try to explain away the negatives unless they brought it up.

I believe the chain stores are doing the same thing; but for every Amazon, which actually had a well reasoned plan for expanding sales while not being profitable, there are dozens and dozens of chains that are constantly expanding and borrowing and building and raising money on the stock market -- who ultimately can't survive on a 'real' level of sales; who once the expansion stops for any reason, will fall apart, who have fooled the stock market by ever expanding 'sales', even when those sales are cannibalizing existing stores.

Each expansion I made brought in ever higher sales, but each time with less per capita return.

I think the chain stores are doing the same thing. Building huge, cheap buildings, jumping from 'fad' retail concept to 'fad' retail concept: indoor malls, to factory outlets, to outdoor malls, to big box, etc..., constantly expanding product lines, constantly searching for the cheapest place to manufacture and buy goods. (Imagine China asking Walmart for just a bit more....)

Again, there are solid chain stores, but there is a huge number of very shaky chains as well. The vacancy rate in the malls is continually expanding, and yet more malls are being built.

I have found me a new website: Keypoint Partners retail round-up. It's one long litany of new CRE; empty malls; failing chain-stores; kick rich quick ponzi schemes revealed; management shakeups; new retail concepts (fads!); etc.

The latest wrinkle is that it turns out there are a number of chain stores who have been PAID to anchor malls; who's whole profit structure comes from free rent, and constantly opening stores, and not actual sales.

From Calculated Risk:

The WSJ has an article about fast growing retailer Steve & Barry's facing possible bankruptcy. This story has an interesting twist: Steve & Barry's Faces Cash Crunch

[S]ome of the forces pushing Steve & Barry's growth were not tied to end-consumer demand, but the needs of mall owners in a softening commercial-real-estate market. Much of the company's earnings came in the form of one-time, up-front payments from mall owners. Those payments were designed to lure the retailer to take over vacated sites, say several people familiar with the company.

Without these payments, the stores are barely profitable, if at all ...

Outrageous? Ask yourself how many chain stores have similar models. I doubt Steve & Berry's is the only one. When I was in the Mt. View Mall there was the rumor that Penney's was getting essentially free rent as long as the mall didn't perform well. Don't know if that example was true; but suspect it's indicative of many of the leasing arrangement by the big anchor stores.

Which makes the whole structure suspect. Sure, they can feed off the weakness of CRE for a few years, but if CRE goes down, so do the parasites.

I think when the mass market begins to weaken: looking shabby, raising prices, having less selection and service (first thing they cut is staff) etc. that the specialty stores will look like an oasis. Especially if the consumer wakes up to the fact that the five button shirt at Walmart ("Why does my shirt gap so much?") isn't a real savings over the six button shirt at your local clothing store.

And especially if the consumer has the epiphany that more cheap goods isn't what they really want or need. A few quality goods won't clutter your house, will be higher quality and give more life and pleasure, and at the same time support your local economy.

I have faith that will happen, eventually.

Old fashioned?

Probably best not to quibble too much when the local paper does an article on you. It's a huge favor, as long as they spell your name right.

It was more or less a positive article on Linda and the Bookmark. (How come no cat? They took pictures of the cat!) But as usual, I feel a little ambivalent. The last paragraph is more in the direction I would have liked to have seen the focus:

"This a huge secondhand bookstore and the selection is great...Everything is laid out and organized well."

Instead the focus seemed to be on our card filing system.

Actually, if you think about it, trying to keep our inventory on a computer isn't as smart as it sounds. Imagine, if you will, me sitting at the counter with a computer. You ask if we have a book. I close the site I'm on, bring up my inventory, enter the title, and get an answer.

Let me tell you, I can start walking to the section where the book would be in about the same time, and just flat out look. Probably faster. Also getting them to look at books in the same section.

That's not even counting the time it would take to enter the title and author into the computer in the first place. And, with the millions of books out there, the odds of having a particular book aren't as good as most people think; so there is a good chance we'll be answering in the negative, at which point the person will spin out the door.

Much better to chat them, lead them to the section, let them see all the books of similar theme, and perhaps get them to buy something else. We immerse them in the store, show them our selection and knowledge, make a connection, and show them all the books we DO have instead of the one book we DON'T have.

Anyway, the article does give a sense that both bookstores in Bend are thriving; and that's because, in my opinion, both stores are doing a good job. Clean, well-organized, a common sense pricing structure, good locations, knowledgeable owners, good selection.

We've gotten so many books over the last five years, that it's night and day, and that's not really slowing down. I wish the focus had been that we accept books from every customer instead of the message that we limit that to one box of books per visit. That still a bunch of books, folks.

I like that Linda got across that we don't feel in competition to the chain-stores; but that we have a 'symbiotic' relationship. And the fact that we work with, not against, the other used bookstore.

It took a couple of weeks for this article to show up. I was worried for a time that it might have been spiked because of me. Paranoid. It left the connection between Pegasus and the Bookmark out, which is fine, because it really is Linda's store.

What did you guys think?

Saturday, June 21, 2008

Marvel flood, and some neat news.

Waiting in some trepidation for next week's invoice. Word on the net is that it will be HUGE. Marvel has apparently decided to dump every big selling and/or late title into the same week. 37 titles, vs. DC's 17 titles.

There is some thought that Marvel is doing this on purpose to drown out DC's big Final Crisis series. Everyone seems surprised that Final Crisis is being outsold by Marvel's Secret Invasion (not me, no matter what I do, Marvel way outsells DC here in Bend.)

DC is pretty weak, right now. Most of their new offerings haven't gone anywhere. They destroyed a lot of goodwill be insisting on weekly comics that taxed even the biggest fans need for continuity. And they gave us a bunch of lame spinoffs. So, they're against the ropes. A cutthroat competitor might see an opportunity.

I wouldn't put it past Marvel. They've done it in the past, and there is a school of thought that they managed to drown First Comics and Comico comics back in the 80's and 90's. Back then, a comic retailer didn't dare not order every Marvel title.

Personally, I've gotten over this need. Marvel hit us with so many crappy English reprints and other retreads at the peak of the comic boom, that I'll never go for that again. (Too many may have even contributed to Marvel's bankruptcy.)

Ironically, Marvel overreacted for almost the next decade; not putting out nearly enough titles and not printing enough of them.

But over the last five years, old habits have begun to creep into their policies. Multiple covers, incentive covers, incentive reprints -- though they haven't gone for the gimmick covers, (die-cut, shiny, jewel encrusted, etc.), though that may just be a matter of time. Big events. One-shots. Crossovers ad infinitum.

Unfortunately, comic retailers are probably going to take the biggest hit. Almost all of us have limited terms, in my case 7 days which I can stretch into 14 if I don't do it too often. Even that is better than most stores, which operate on COD.

Getting twice as much material doesn't mean we will sell twice as much. For cash strapped stores, this could be brutal. There was a time when it would've put the hurt on me.

Nowadays, I'm so diversified, even in comics, that it will hurt, but not that much. I worry more about my customers, who are already strapped by gas prices and a shakey job market looking at a big pile of comics and freaking out.

I'll try to reassure them that its an unusual situation, and that they needn't pick it all up on one week.

Meanwhile, watch tomorrow's Bulletin for something kind of neat -- an article starring my sweet wife, our lovely cat (who is not sweet, but a grumblepuss), and 'our' charming store, the BookMark.

Paying the freight.

And oh by the way, not including energy prices in the inflation index is ludicrous not just because of the price of energy itself. My shipping costs have gone up, and that money has to come from somewhere.

It's yet another argument against heavy discounting. You want a retail profit margin whenever possible because of all the things that can go wrong. Damage, theft, unexpected expenses. Once you start discounting, it's almost impossible to raise prices on your regulars.

Bite the bullet, and stick to regular retail, and let those people who aren't willing to pay 'the freight' go.

I'm mostly going to have to take the hit. Most of my product has a SRP included, and/or a traditional price. When the price of the actual product rises, I still get the same per cent of discount. So, rising prices on the product I carry doesn't really hurt, and sometimes can even help.

But I'm beginning to see that static prices on my product do NOT cover unexpected costs in operations.

I've never run into this before. I was a student in the 70's; not a store owner.

Interesting times.

Deja Vu all over again.

I'm getting a real flashback to the '70's over gas prices.

Parked in the downtown garage yesterday (in my 1990 Toyota Corolla I fill once a month) and turned the corner where the motorcycles are parked. Usually, there aren't any, or maybe one, once in a blue moon, there might be two.

There were five or six spanking new, shiny motorcycles and scooters! I'm thinking, these must cost at least 5k and up and that would pay for thousands of gallons of gas. How do you save money buying a new machine?

I think I'm seeing more bicycles than I've seen -- well -- ever.

Also, wondering if people have two cars in the family, a big SUV and/or pickup, and perhaps a smaller car, that they are just choosing to drive the smaller car more often.

So far, at work, one supplier has doubled their freight costs, (no biggie, actually, from one dollar per shipment to two dollars per shipment); another has gone from a flat 3.00 per shipment to 10.00 per. I'm sort of expecting to hear from the other suppliers soon.

I started joking with my comic customers that I was going to add a .5% energy surcharge to every comic.

Friday, June 20, 2008

Speaking of minimum wage.

I don't believe it was preordained that Pegasus would be a Minimum Wage job. Without the dreadful mistakes I've made over the years, it would've turned into a real business long ago.

Some of these mistakes just had to be learned the hard way. It is an extremely lucky or smart guy who can avoid them: especially since the 'common wisdom' and economic culture seems almost designed to lead you astray.

But I got way too enamored of the bubble money. The huge infusion of money that would come along, only to simply disappear overnight. Pogs, Beanie Babies, Pokemon, Sports Cards, Comics.

I got into the habit of waiting for the Next Big Thing.

It's one of the reasons I felt compelled to talk about the housing bubble, because I understood how difficult it is to see and resist the temptation.

If I could give myself advice 24 years ago, it would be; "slow and steady wins the race." Build the business slowly, keep strengthening every year, resist the quick kill, resist over-expanding and over-investing. Live within your means.

Like I said, maybe I just had to go through that fire. I think I know what I'm doing now. I think we were able to apply those hard lessons to Linda's store and have avoided the same mistakes.

But the race isn't over yet...

Pep talk.

There is a certain inertia to ordering. Once I start ordering, it becomes difficult to stop ordering. But the reverse is also true. Once I start not ordering, it can become difficult to start ordering again.

Right now, I'm making lists.

I haven't figured out if list making is a useful venting of steam.... or a time-bomb. I guess, so far as I don't push the 'commit' button.....

In a sense, just scanning the lists has cleared some of the fog of indecision. I can look at the items, decide if they are truly necessary. Or I can sit on the lists, and if nothing happens, I'll know that it was a 'want' and not a 'need.' Keeps me busy and out of trouble (unless I push the 'commit' button....)

I'm trying to break this down into manageable time units. Get through this day. Push off the order one week. Hold off until this bill shows up next month. Concentrate on just this season.

At some point in the past couple of years I became a fully stocked store, without really realizing it. I'd been struggling to get to that level for so many years it was hard to reverse the perception that I needed more material.

Years ago, when I was in credit card debt to my ears and had no backup savings, I had a mantra: If I don't order this item, will anyone notice?

Not a great scheme to increase sales, but it did get me through a tough time.

Maybe now I should be looking at an item and asking myself; would I rather have the cost in cash, or the item itself? Will it sell fast enough to recoup the money before it's due to be paid, or am I willing to carry it as an investment? If it does sell that fast, should I order another copy?

There have been a few unexpected side benefits. When an empty space isn't immediately filled by a reorder, it allows me some flexibility in displaying in-stock items. I've found myself spending more time on back comics over the last two days. Getting them organized and displayed. It's made me realize that I really have been pretty darn efficient in my ordering -- yes, I have unsold material, but not mostly because of ordering mistakes. Too many number 1's, but that's an error in favor of potential; not enough number 2's, which is probably an error in being overly conservative. But, overall, not bad.

All I know is everything I've been doing for the past 24 years hasn't resulted in any real profits beyond The Best Minimum Wage Job A Middle Aged Guy Ever Had. And I getting too old for that shit.

Time to grow up. Become a real businessman. And that requires that I stay disciplined and focused for the next six months.

Which means giving myself a pep talk on an almost daily basis.

Thursday, June 19, 2008

Stand pat?

I realize that talking about budget is probably about as exciting as listening to someone detailing their diet.

But it's the BE ALL and END ALL of my business right now, my total focus. If I succeed, I may finally put my business on a solid footing.

It only took 24 years.

Six months at a time, I can handle. The first half of the year was all about clearing away debt. The second half is all about putting money in savings.

Thursdays, my comic distributor offers 'Liquidation' sales. So this morning was my first test. There was quite a bit of product I would've ordered in the past...but I managed to skip it this time. I just don't need it, the way I used to.

I got two cases of toys yesterday; Incredible Hulk and Indiana Jones, and for the first time I couldn't find wall space. I have an extra bookcase from my reorganizing -- so I'm displaying them there, but that's a short term solution at best. This next week, I'll be getting a wave of Warcraft toys.

I did blow a fuse a couple of weeks ago, and ordered a bunch of DVD's. I was getting requests for non-Japanese animation, and there was a sale, and I just went for it. Which was why I had to extend my non-reordering into this week.

But I just can't fall for that, again. I love having Pinky and the Brain, 3rd season in stock, but do I really need it? I've avoided any DVD's other than anime until now because my margin absolutely sucks -- 10% anyone? But I've learned that I can compete with the big boys as long as I'm selective and patient. I'm not going head to head with them.

I've also noticed that my selection of product is being dictated by my location more than I would've expected. I'm in an relatively expensive location, with lots of foot traffic, but I have limited space. I find myself turning to relatively high priced product that takes up a limited amount of space. I can stack a bunch of DVD's on a shelf that in dollar value probably equals many square feet of toys, for instance.

Every time I wonder why I keep doing sports cards, I remind myself that I can carry a strong and credible inventory in a relatively small footprint in the store.

Makes sense, or course. It's why you see more expensive product in high traffic zones. I just happen to be a humble little comic shop that has had the downtown area mature around me. So I've adapted by bringing in books and movies and other product that will appeal to other people.

I've been reminded over the last few days of a conundrum. I get more customers during the summer and Christmas, but these customers tend to buy what's in stock, and everything in stock is 'new' to them. In other words, even though sales are higher, I actually don't need to order as much.

It's the slow times when I need to reorder, because I can't afford to lose a sale and because the 'regulars' have already seen everything I have in stock and I have to entice them with new material.

So my ordering has tended to be opposite than what the sales would indicate. Heavy ordering during the slow months, not quite so heavy in the busy months.

Well, I managed not to over-order this year during the slow months, because I think my inventory is so full that it's managing to satisfy even the most frequent of buyers.

I was going to significantly up my orders for the summer -- because I could. Now, I'm kind of stepping back and thinking: wait, maybe what's I've got is more than sufficient. Make sure I have my base product in stock, refresh the twice a year stuff (dice, stand-ups, and funky toys) and then stand pat. (I get a constant flow of new material, by the way, so what I'm really talking about is going above and beyond that regular flow.)

I think this whole process has proven to me once and for all that having enough sales and/or customers is not my problem -- over spending is.

Wednesday, June 18, 2008

Into the Current.

This is the week I think of as 'transition week.' Kids are out of school, switching families, going on quick vacations, making plans. Sunday and Monday were very slow. All that will probably change by the weekend. With any luck, we won't be getting anymore extreme weather changes, either.

Anyway, I feel like I've safely delivered Pegasus to the center of the stream. Now all I really have to do is let the current take hold. The next 8 weeks will be busier no matter what. Just go along for the ride.

I managed, somewhat to my surprise, to make just one small reorder this week. It helped that Sunday and Monday and the beginning of Tuesday were so slow. If I get through the first half of Wednesday, without breaking down, then I've fulfilled my business plan for the spring.

I'm narrowing my focus to the next 8 weeks. Take a notebook page, put the total budget for the week on top of the page, and start subtracting as I spend down. When I hit zero, stop. Sounds simple. But I have a tendency to make small little adjustments, and not count them, and I'm not going to let myself do that. I tend to let myself take advantage of opportunities, sudden discounts and such; and I can't do that.

Finding roof tiles in my garden (the ravens are busy) has reminded me that I need to save up for home repairs. There isn't going to be any credit available for that. The HELOC is gone. But the wonderful zero balances on my credit cards will mean any money I make this summer can go into savings.

It's only 8 weeks, I tell myself. I'm going to keep my option of skipping a week somewhere in those 8 weeks, depending. I'll know it when I see it. Anyway, the hard work is done. Now I just have to be careful not the fall back.

Tuesday, June 17, 2008

Lazy Fisherman

To continue my Lazy Fisherman analogy (In case you didn't realize, I'm trying hard to de-motivate myself): I'm already feeling a bit lazy because of summer. It wouldn't be too difficult to just go along with the feeling.

To visitors, just about everything in my store will look new and good.

One more week of taking it easy, then on to a strict budget for 8 weeks, with maybe a skip week somewhere in the middle.

This the battle to fight, right now.

A year ago, the battle was getting in enough boardgames and new books to create credible product lines. When I look at my sales, it's as if I designed them; each category is producing as much or more than I wanted.

Except, oddly, comics. Which I just think is going through one of its ebbs. I never really changed what I was doing with comics -- in fact, because of the discount situation, I've actually increased orders a tad. Unexpectedly, my comic customers seem more impacted by the local economy than my casual and or tourist customers are affected.

Anyway, comic and graphic novel sales are currently running at 40% of my total sales, (down from a 50 - 55% range last year) which I don't believe has happened since the height of baseball cards. Partly, I suppose, because comics are down a bit, but also because I've been successful at adding enough other product to smooth out the flow.

So far this month, we are running even with a very good month last year, which means that all the other product lines have picked up the slack.

So it turns out that not only weren't new books and boardgames too far a reach, but they have finally turned my store into a more stable business.

Monday, June 16, 2008

The Sea of Pick-Me's!

So now I've done four weeks over the last three months of no reorders. (Actually, I've done 6, but I've fallen off the wagon to the equivalent of the other two weeks.)

A couple of more weeks in mid-summer, and I'll be set for fall. A couple more weeks in fall and I'll be set for Christmas, and so on.

I've come up with a little image in my mind that I think is accurate.

I picture 'schools of product' (like schools of fish) in a giant ocean of product, all saying "pick me! me. me. me. me. me. me! ME! me! me! me. me. me.

me me me me! PICK ME! me! Waves of me, rising and falling.

I've been diving into that sea for the last three years, scooping up as many 'me's' as I can afford.

What I need to do now is wait for a product to jump out of that sea of ' pick me.'

"Pick ME!" it says. Maybe even let it jump into my boat.

I need to be a lazy fisherman. For awhile. The sea is bountiful.

Sorry if this is an annoying analogy; but I'm trying to motivate myself to be conservative.

"Shops at the Old Fair District."

What they're calling a new development in Redmond. Too cute. (Of course, the remnant teenage part of my brain immediately translated that into, "Shops at the Old Fart District.")

The Bulletin article today about Redmond, "Retail Growth in Moderation," is as interesting for what it doesn't say, as for what it does say.

But first, I want to admit that I thought the 'Shops in the Old Mill District' in Bend wouldn't work; but maybe I was....wr...wr..wro...wrong, there I said it. The timing was right, and they had the huge boost of a surge from 2004 to 2007 to finish it off. A bit of luck, and a bit of good planning. A great location. They got the "infill" (my new favorite jargon word) they needed. And, silly as I think it is to glamorized Old Mills, the right concept.

I got a comment this morning about why anyone would buy comics, cards, toys, books and games from (I can't find where the comment landed, so this is from memory) "old, tired shop in a side street in a rundown building?"

I made a joke a while back, referring to my store just that way; but I meant it as irony. That may have been the way I once thought of it, but with the landlord rejuvenating the front of the store, the store redesign, a fully stocked store, "infill" all around my shop with fancy stores, and mostly a revitalized downtown, it certainly isn't my perception now. I'd have to say from the comments of customers, that isn't their perception either. And after visiting a bunch of other downtowns, I haven't seen any that look as good as downtown Bend right now, maybe Ashland.

Indeed, I think my little corner is getting more actual foot traffic than just about anywhere in Central Oregon -- maybe only Wall Street gets more traffic. We still have a bunch of "infill" taking place around my store. It's only going to get better. So my location isn't a problem.

As far as the product: sure, if you can find them at the chain stores. My store has become so unique and specialized, at the same time diversified, that I'm not really competing one on one with the chain store anymore. I'm either selling you a comic or toy or book you're unlikely to find anywhere else without it being more trouble than it's worth, or a nifty impulse item to someone walking around.

Anyway, back to the article in the paper. I seem to remember the WalMart assuring us that they wouldn't leave empty shells when they expanded into SuperWalmart, but that's exactly what they did. Which the new owners are having trouble developing. Something to think about here in Bend.

"Most of the national retailers are taking a pause and collecting their thoughts before moving forward...." Words that smaller shops ought to contemplate.

I'm wondering how long a lull there is going to be before "infill" starts up again, and whether it will come in time to help both Bend (places like N.W. Crossing) and Redmond.

I have a vivid memory of development slowing to a dead crawl; not even that, probably backward, for most of the 80's. We've gotten a lot bigger since then, so I don't expect that, except in patches. But it could happen.

Sunday, June 15, 2008

Full of the Blarney.

I've blogged -- at least once -- every day since I started. I know, because I've been keeping track. A few times on trips, I've had to scramble to get it done. But after six months or so, it became a point of pride.

(I brought this up with Jon, of Chuggnut, and he seemed doubtful that I'd blogged everyday. But I have.)

Which shows, I think, that I'm full of the blarney. And that I'm stubborn.

Both characteristics that I exhibit in my business, as well.

I just don't find it hard to come up with something to talk about. I've been thinking like a writer since I wrote my novels back in the late 70's. I see things in storylines and short, punchy observations.

Not real life at all.

But, we infuse narratives into our lives, whether we're aware of them or not. Whether they are 'true' or not. It's how we make sense of things.

I usually have to resist writing down everything that happens to me. Much of it is just too mundane, inane and banal. But even then, I'm trying to make sense of things.

This blog has always been pretty much a business journal and a personal diary. I've been thankful if I've had readers, but I'm never sure if anyone is reading this or not.

Doesn't matter.

I'm full of the blarney.

And I'm stubborn.

"infill hasn't got to it yet..."

So 22 building permits were taken out in Bend in May.


In May.

Say no more.

Meanwhile, over at N.W. Crossing they are having juvenile delinquent problems with their parks.

I'm not surprised.

One of the first blogs I wrote was about my doubt of N.W. Crossing's chances. I felt it was a bridge too far: it was out in the boonies, it was overpriced and crowded, but was unfinished. Vacant lots. Sidewalks leading to nowhere.

In the Bulletin editorial, they cite the isolation: "As a developed park in a relatively undeveloped area..." This would seem to me what happens when you get ahead of yourself. You build everything, retail and leisure, before you have the population. Especially, if a significant number of that populace are flippers, or second home owners. Vacant owners make lousy neighbors.

And the little beauty of a comment above: "...infill hasn't got to it yet." And pray tell, when is that going to happen? Maybe I will say more about the 22 housing permits.

In all of Bend.


In May.

I've always wondered if N.W. Crossing would reach its combustion point in both residents and retail. Especially retail.

In the late 70's building boom in Bend, we built two malls. Never got even close to full occupancy before the 80's recession hit. The malls struggled all through that decade and on into the next. By the time Bend did start taking off, the malls were being bypassed. They were old and tired. Eventually, they were torn down.

But even a year ago, driving through N.W. Crossing was a dispiriting experience. Huge and wide sidewalks, with no one on them. Stores that didn't seem to have any customers other than other store employees.

I expect I'll get the usual fierce N.W. Crossing defenders; but to my eyes, people who bought into N.W.C. were buying into every fad we had to offer. Bend as amenity; mixed used urban planning; and Craftsman style -- oh, did it have Craftsman style.

Trouble with "Mixed" use plans -- and this is a lesson for Juniper Ridge -- is that all elements, residential, leisure, and business, have to be clicking, working in synergy, to work. If one of the element falls down, the other elements are dragged down with them.

Visionary planning is great, if you can pull it off. But, mostly, development is haphazard and messy and unpredictable, because humans are haphazard and messy and unpredictable.

Saturday, June 14, 2008

My Dad and Tiger Woods

Tiger Woods is giving my Dad a thrill in his final years.

My Dad had a stroke a few years back, and has a hard time following T.V. storylines. He reads, and seems to enjoy it, but he's a guy who read more than anyone I've ever known (I read a lot but he read more), so I'm not completely certain he isn't scanning the pages out of habit.

He lives in assisted care, and really seems to prefer his own routine to being taken out and about. He goes the the two Doctor's coffee klatches at Jakes every week; the other thing that is making his life worthwhile.

He's really deaf, and seems not to want to wear his hearing aids.

But he can watch golf.

I don't remember Dad ever playing golf. He used to watch it occasionally, along with every minute of the Olympics, and football, and Wide World of Sports. (I predict when I see him tomorrow, he will mention Jim McKay's passing.) But I don't remember him being a golf fanatic.

Now I think he sticks to the golf channel almost all day.

And he is enamored of Tiger Woods. Geez, after watching the U.S. Open today, I'm enamored of Tiger Woods, too. It's like watching Babe Ruth and Micheal Jordan, seemingly transcendent; skill and luck, as though he bends reality to his liking.

Every time I'm ready to completely give up on sports as a bunch of spoiled brats, who are lionized way too much, there is a sporting event that seems to lift my spirit.

It's pretty cool to watch.

I'm sure my Dad was thrilled.

Now I have to try to figure out how we are going to get him to my house tomorrow for Father's Day, when I know he'll be glued to the T.V. He has his set-up which works for him, and our set-up at home isn't quite to his liking. I'm figuring now, that I'll just have to go over and watch the last hour or so, and then bring him back for the rest of the family.

My Dad will have a full year, what with the China Olympics coming on....

You get what you pay for....

Nothing can get my ire up like sports cards. It's a legitimate question why I still carry them. I must be the stubbornist person in history to keep thinking I can make them work for me.

A letter to the newest CARD TRADE (the trade publication) just yanked my chain.

"I have been collecting baseball cards since 1977. I probably have more than 600,000 cards in my collection, and putting together sets, whether that be the base set, the entire set with short prints or inserts sets, is my main focus. Nothing strikes me more than when I go to a store, either locally or through my travels throughout America, when that dealer does not understand the basic concepts of customer service.

"It is sometimes unbelievable how many times I have stopped by a store and they have nothing for sale or nothing to 'touch.' Almost every store in Sacramento or northern California that has gone out of business in the last five years has been a store of this nature.

"I hear laments all the time from dealers about how expensive it is to crack product, but what dealers fail to understand is that they must have something for all customers, not just a few select big spenders."

I'll stop there. He goes on. Complaining about those lousy card shops. But in my ears, it sounds like he's kicking a dead horse that he just abused and rode into the ground.

And he's wrong, on every count. You are going to have to believe me on this, that my years of experience with card collectors counts for something, otherwise I'm going to seem ....well, a tad intemperate. (Who me?) But I can almost guarantee you this THIS is what he's REALLY saying: When he says he puts together sets, what he's saying is, "I bought all my cards online (or somewhere) in box form at a really cheap price, and I'm only a few cards short of a set. The cards I'm missing are worth maybe .5 a piece, and you've never seen me before, but I want you to spend the rest of your day helping me find them. I will put every card under a microscope to see if they're worthy of my magnificent collection, and even then I'll complain the entire time about having to spend .5 for a common."

The dealers who went out of business? They didn't break boxes, because they can't survive selling singles to people who spent most of their money somewhere else. It is in fact expensive to crack product, if inconvenient to him. Why would they lie? Just to frustrate him? They turn down money because they feel like it?

They were right to concentrate on the big spenders: (box buyers). I do too, because they are the only guys still spending money. I sell full boxes. These other dealers were trying the only thing that still works, but it wasn't enough. I treat sports cards as a sideline, so catering the 'big spenders' still works for me.

I don't crack product. Only one or two major stars will sell, and once in a blue moon a guy from California will come in, sneering at your selection, and want a few singles to complete his set. Catering to the 'big spenders' is the only element of the hobby that is still functional. And who's fault is that?

The "nothing to sale or nothing to 'touch.'?" That would be, "nothing to sale or nothing to touch -- that HE wants.

A guy like this walks into my store, and I won't have what he wants, because what he wants is for me to fill his tires, wash his windshield, check his oil, kiss his ass, and thank him for half a gallon of gas.

If you think I'm exaggerating, the last count I heard was that there were less than 1000 card shops left in America. This was few years ago, so the number is probably much smaller. (There once was probably nearly 20 thousand card shops, and I think the hobby could've supported maybe 3 or 4 thousand if it hadn't descended into a suicidal spiral.) I would be willing to bet, that half of the remaining shops are supported by guys who have put their 20 or 30 years in the military or teaching or fire fighting or something and simply want something to do, and the other half have been living on Magic and Pokemon.

I've gotten into this argument many times over the years: most dealers and collectors and distributors and wholesalers blame the proliferation of brands, the high cost, the internet, and even the behavior of the players.

But I think the hobby was poisoned by a bubble that invited the most morally and ethically challenged group of dealers I've ever seen; and who trained the customers to never pay retail. I still get collectors from 10 years ago who seem to think things haven't changed. I tell them to forget everything they know.

The whole hobby self-destructed. I'd be glad to help this guy if he came into my store on a regular basis, was nice, bought stuff from me and so on. The way it used to be....

Friday, June 13, 2008

Why people spend....

Below is a transcript of an interview with Nouriel Rourbini, (one of the few economists who got the housing bubble right), on Bloomberg T.V.

My response to the interview is: So....other than that, Mrs. Lincoln, how did you like the play?

Here's where you might be thinking I would be agreeing with the old Bear. But, in fact, I think people spend money. They are addicted to spending money. I think they'll keep spending money. They're willing to spend money. They want to spend money. Spending money is what they do!

It's beginning to look like I'll have three months at least even with last year in the first half of the year, and three months waaayyyy under. So which is the true indicator? Complicated by the fact that the last six weeks have been great.

I'm going to guess about 10% lower than last year this July and August. Nationally 10% would be considered a disaster, but in my store it's not a significant figure, as long as I budget correctly. My spending is way down, so my profits are up.


The retail sales figures for May - better than expected - were driven by a temporary factor, the tax rebates, whose influence will fade out by early fall.

Instead, more persistent factors will bear negatively on consumption over the summer and especially the fall: the fall in home prices and the collapse of home equity withdrawal (with their wealth effect on spending); the stressed balance sheets and high debt ratios of the household sector (such debt is up to almost 140% of disposable income); the credit crunch in mortgage markets that is now spreading to unsecured consumer credit (credit cards, student loans, auto loans); the rise in debt servicing ratios (following the reset of mortgage rates, and higher interest rates on mortgages and consumer credit); the sharp rise in gasoline and energy prices that is a serious shock to real incomes; the further erosion of real wages through the rise in the inflation rate; the sharp fall in consumer confidence; the drop in employment (now five months in a row) and thus in income generation; the negative wealth effect of the correction in equity markets and the fall in the net worth of the household sector. All these factors will have – over time – a much more significant negative effect on consumption than the temporary boost given by the tax rebates.

Yeah, summer budget!!

Now that my spring 'budgeting' is nearly over, (one week to go!), I can confirm that, yes, over ordering is my problem. Bills are getting paid, money in the bank, debt reduced.

Not ordering two weeks out of every month has had the unexpected side effect of making it very clear to me what I REALLY miss if I don't order, and what I just sorta kinda miss, and what I don't miss at all.

Sales weren't impacted by this experiment, as far as I can tell. If I were to keep doing it for more than 3 or 4 months, I suspect it would've. But I am so well stocked, that I doubt very many people noticed.

But my cash flow noticed.

Technically, if my Summer sales come in at the usual 20% higher, I should now be able to keep to a budget that is 20% higher than what I've been spending in the spring, and still get the same cash flow benefit.

The problem for me is in the execution. I've always had a difficult time moderating. Easier for me to deny myself 100% for two weeks, than cut all my orders by 50% for 4 weeks. Not sure why, but it's happened so many times I'm not fighting it anymore.

So....I found out what I really shouldn't skip:

1.) Evergreen graphic novels. No excuse to run out of Watchmen, or Preacher, or any other proven sellers. Since I maintain a very wide selection that is just one or two copies deep, it almost requires that I make an order every week.

2.) Magic. The magic players are fairly demanding. They don't know from reorder difficulties, they just know they want what they want when they want it. Some requests I can't fulfill, such as rare singles, or specific theme decks, but running out of decks or packs of any major brand is really not an option. Especially since I'm now the only game store in town -- don't want to inspire anyone to say, "Damn, Pegasus is always out. I can do better than that!"

3.) Sports cards. When I have a couple or three active buyers, they want what's new. I can skip a week or two, here and there, but making them wait longer to itch their need, is dangerous.

Of the three categories above, magic and sports cards take giant chunks out of the budget. Graphic novels can be managed in smaller numbers.

Things that I found two weeks have very little effect.

1.) Board games and RPG's. I tend to order the better sellers in ones or twos, and they usually sell at a pace that can stand skipping a couple of weeks here and there.

2.) Books. I very purposely didn't align myself with the 'best-seller' model of bookstore. So if I sell 2 out of the 5 Vonnegut novels I carry, I probably still have more Vonnegut's than most stores.

3.) Toys. Absolutely can be ordered when convenient. I'm searching out the single toy offers whenever possible. I preorder the McFarlane toys; so that is accounted for already. And I rarely want to do reorders. There is so much stuff that simply freshening up the product on a regular basis keeps the sales up.

Refreshing the product is the key to all the above three categories. I like to reorder proven sellers, but it isn't crucial like graphic novels, magic and cards.

And then there is all the ancillary product:

1.) Standups. I finally ordered the stand-ups, a bunch of Star Wars, new Indiana Jones, and so on.

2.) Gag gifts. I want to order the funky stuff from Accouterments (Albert Einstein toys, Death Mints, candy rubber chickens -- important stuff like that) as summer starts.

3.) Cartoon books. I usually stock up on Asterix and Calvin and Hobbes and Far Side and so on before summer and before Christmas.

4.) Dice. There are really cool looking dice that I can get from a company called Crystal Cast. Fancy gem dice, metal dice, and all that stuff that gets my crow brain to go; "Oh, shiny!!"

And finally, the sale product. This stuff isn't 'necessary' at all. But boy does it help the cash flow when it sells. I have to treat this as a completely separate project, in a way. If I get an item that is one third the price, I can take three times longer to sell it. Plus its a great multiplier of freshness; especially since most of it wasn't ordered by me the first time. To tell the truth, I can't see much difference in sales velocity between middle of the road pre-ordered product and re-ordered sale product.

So, now that I identified what is necessary, and what is just wanted, I can make some better decisions hopefully.

Thursday, June 12, 2008

"Maybe my business plan is too amusing."

I wonder if we aren't going to see a bunch of articles like the one from the Oregonian today (printed below.)

It's meant to solicit sympathy, but reeks of entitlement.

"Is she coming home to tuck in the kids before returning to clean the store? She let go of her cleaning crew.

No, she told him. An employee's coming to help her scrub the floors."

Oh, the horror. The horror!

Admittedly, she calls it a 'cleaning party,' but through obviously clenched teeth. See how plucky I am!

O.K. 20k income after a couple of years for a start-up small business; husband having a second job; bringing kids to work; doing your own cleaning.

I would consider all those things normal, frankly.

What I consider strange is this:

"The shop -- opening at the height of Portland's housing market -- thrived. On Saturdays, the store pulled in about $2,000, helping pay the mortgage on their $550,000 Irvington home."

A 550k home?

"Now the Saturday take is under $1,000, and midweek days are around $300. Last year, the family took home just $20,000. Scott Korn left the store to take a baking job late last year. Seven employees shrank to three."

I think there is a fundamental misunderstanding of what a Mom and Pop business is.
If I'm doing the math right, there might be enough income for a modest living if Mom and Pop ran the store: but not Mom and Pop and three employees, much less seven employees!

Come on, even if they are open half time on Sundays, you're talking 52 hours total. Even with the 2000.00 dollar Saturdays, a couple of on duty people should be enough.

In other words, the store can be run by a couple working most of the week, trading days, and a part-time employee for Sunday and one other day, to give them two days off. (Which, I would consider a huge luxury for a start-up.) If the couple work together on the busy Saturdays, that leaves each spouse with a 28 hours week, so conceivably there is office work and outside work to push those hours up to 40 hours each.

Oh, the Horror!

Linda and I run separate stores, with (usually) one part time employee per store. We do this because our two Mom and Pop's can support one Mom or Pop per store. That's just what we've come to expect.

The business plan is too amusing, but not in the way she meant. She wants to keep her big house and her big success story and her big money, and not have to really work for it, or wait for it.

A lot of stores have opened during the boom that have exactly the same attitudes, and I suspect we're going to see exactly the same response.

Downturn tough for Portland mom-and-pops
Slumping sales are forcing a Northwest 23rd Avenue merchant to close her doors
Thursday, June 12, 2008
The Oregonian Staff

Stacey Korn arrives just before 10 a.m. to unlock her shop on Northwest 23rd Avenue. She hoists orange molded plastic benches from the back and places them outside under the windows. Then she sets up her sidewalk sign:

"Shop 'Hello' -- nifty gifts for the whole family," it says. "Patronizing us is like flirting with a wealthy widow. You can't overdo it."

Korn needs her sense of humor now more than ever. As the economy slumps, sales at her Hello Portland store at 525 N.W. 23rd Ave. are half what they were soon after opening in late 2005. Her family of four went from living almost entirely off the shop's income to barely getting by and deciding to close in September.

"My friends at Irvington School don't know my kids qualify for free or reduced-price lunch," said Korn, 41.

Her boom-to-bust story is about the kind of shop that falters in a downturn. Hello Portland sells lots of stuff people want -- from $45 hip handbags to $25 "I might barf" baby onesies -- but nothing anyone truly needs. More than that, it's a story of a small merchant's struggles, of the people left behind when a local store fails.

"You hear people say, 'I love this. I can't live without this,' " Korn said. "And then they walk out the door."

Korn gets by with her trademark pluck.

She left a dysfunctional family at 16 to attend acting school in New York and then in Los Angeles. She turned to graphic design school and did secretarial work at advertising giant Ogilvy & Mather, learning computer skills thanks to client Microsoft.

She found a creative niche designing saucy greeting cards for Paper Moon. "Desperate Career Girl," said one. "Sexual harassment: She could dish it out, but could she take it?"

Her big break came when Reuters, the media and financial company, contracted with her in 2002 at $250 an hour to design Web sites. She was still nursing her second child, so her husband took a hotel room next door and paged Korn when Piper was hungry, handing the infant to Korn at a lower-floor restroom in Reuters' Manhattan building. Her bosses never knew she had a baby.

After two years, Korn opened the Hello store on Martha's Vineyard. Richard Singer, the primary developer and landlord on Northwest 23rd, lured Korn and her shop to Portland in 2005, beating out Bridgeport Village.

The shop -- opening at the height of Portland's housing market -- thrived. On Saturdays, the store pulled in about $2,000, helping pay the mortgage on their $550,000 Irvington home. Now the Saturday take is under $1,000, and midweek days are around $300. Last year, the family took home just $20,000. Scott Korn left the store to take a baking job late last year. Seven employees shrank to three.

Korn thinks concerns about finding parking around 23rd are worsening the impact of the downturn. And many of those who do come in just play -- picking up Japanese vinyl toys despite signs saying not to.

"It's like amusement," Korn said with a sigh. "So maybe it's my fault. Maybe my business plan is too amusing."

Extra effort

Sometimes she's direct. When a customer asked if she could buy the shop's melamine plates on the Internet, Korn told her, "Yeah, you could. But I'm here selling these so that I can feed my kids."

Reinforcing that connection is crucial for mom-and-pop businesses, especially now.

"Everyone is just kind of holding their breath to see what's going to happen," said Robyn Shanti, coordinator of the Sustainable Business Network, whose membership includes 360 locally owned Portland businesses. "People also realize if they don't patronize those businesses, they're not going to be around. And if they're not around, we'll lose the whole quality of life in our neighborhoods."

Korn is doing what she can. She tries making customers comfortable, fading out alternative rock music and fading in her "Old people just walked in" mix of Billie Holiday and Glenn Miller when seniors step in.

She puts a sale table outside on warm days. She uses cash to buy merchandise, avoiding additional debt. She rarely gives out even basic handle bags -- "Can you put this in the bag you have?" she asks -- saving 35 cents a pop. And she's gotten her kids involved, saving on child care.

On a sunny spring weekend, Piper, 6, and a friend sat outside selling $1 buttons they made, quickly pulling in $58.

Looking for work

Sometimes stress gets the better of Korn. A week ago, she parked her car just over the line into the valet zone for the restaurant next door. The restaurant had it towed. The cost: $210. "What am I going to sell on Craigslist to pay that ticket?" she said, sobbing. (She sold her car-top storage container.)

Kind comments help. Leslie Hildula comes for offbeat party favors and invitations. "It has this kind of inner-child enthusiasm for life," Hildula said of the shop.

But as the Korn family prepares to take on a foster child in need of emergency placement, Korn must be pragmatic. She hopes to find a stable job in graphic design or another creative field.

On Tuesday, Scott Korn arrived at the shop at 5 p.m. to pick up the children.

"Bye, cutie," he said to his wife as he headed out, Piper and Skyler, 10, ahead of him.

"Bye, sweetie," she said.

Then he remembered to ask: Is she coming home to tuck in the kids before returning to clean the store? She let go of her cleaning crew.

No, she told him. An employee's coming to help her scrub the floors.

"It'll be a party," Korn said.

Erin Hoover Barnett: 503-294-5011;

Wednesday, June 11, 2008

They got the memo

The proliferation of (Insert Name: Real Estate Blog)s is a little suspicious. As if it is a concerted effort by the real estaters to counter the negative bubble blogs.

But they are so bland and inane, you have to wonder how effective they are. Sort of like form protest letters.

Nothing works better then thinking and writing those words for yourself, instead of parroting talking points.

Good luck with that.

Mr. Nice Guy?

You all know my love of the mugshots. There's a really good one today, a tough looking fella in a ski's the new manager of Mt. Bachelor.


Tuesday, June 10, 2008

The Magic Formula

The magic formula.

Of course, there is no magic formula for small business, and if there was, it would completely change six months later. That doesn't keep me from trying.

Since the day I bought Pegasus Books, in April, 1984, comic books have been my mainstay. My identity. But comic books have always only brought about 65% of the revenues needed for viability, and probably 55% of the revenues needed for true profitability.

This has never really changed, through all the vicissitudes of the market, the rise and fall of other product lines, or the rise and fall of comics themselves. As Bend grows, the comic market shrinks; or the comic market grows, but the cost of doing business goes up, and so on.

The other statistic that has never really changed is that, as a specialty store, I need about a 40% gross profit margin to stay in business.

I'll combine these two statistics, later.

Realizing very early that comics weren't going to pay me a living wage, I cast about for some other product lines. My first attempt was games, but I just didn't have the monies to get in enough inventory fast enough, and the arrive of the store Book and Game in the Mt. View Mall blew me out of the water. New and used books also failed to fill the gap. New book distribution was in the dark ages -- I'd see books at Waldenbooks that I wouldn't get for another month, if then.

Finally, I lucked upon sports cards. Good luck...and as it turned out, really bad luck. Card fueled my growth, but I also put every dime I had back into more cards, and eventually I got left holding a burst balloon in my hands.

Early on, though, I heard the idea of three legged stool; it's more stable than a one legged stool, or a two legged stool, or even a four legged stool. This made so much sense to me, that it became my magic formula. But I could never find that third leg of the stool after comics and sports cards, and after sports cards self-destructed, I had a hard time finding even a second leg.

At some point I gave up on the analogy. I decided that the best model would be to have comics be 50% of my business, and the other 50% would be everything else.

I brought in anime and manga, and toys, and roleplaying games, and card games, and used books, and so on. Each brought us a little closer, squeezed me for room, made inventory the most important facet of my business. But not quite there.

Finally, I realize that turnover rate really didn't matter to me. As long as I was paying for the product within my cash flow, it didn't hurt me. I started doing a 'long-tail' business before I ever heard the term.

I also became more sophisticated about COG's; Cost of Goods.

Notice, if you will, that some product has a Suggested Retail Price, and other product does not. Almost without fail, the product that doesn't include a SRP on the packaging has very low margins. Product that does list the price, such as comics, books, graphic novels and games usually have adequate profit margins (i.e. 40% or so.)

The reason that most toys, cards and anime doesn't have SRP on the packaging is that the manufacturer knows the margins suck and is allowing the retailer to chose the price.

Interestingly, the same product tends to be suicidally competitive. So the pressure is on to lower the price on product that you already have lousy margins.

I discovered that if I set my price as close to my own profitability as possible, and stuck to that price, that most of this product was profitable. That is, I might not sell huge amounts, but what I did sell was profitable.

So, realizing that I could carry low margin material, and realizing that I could carry slow moving product, and still make them profitable, freed me to try many different product lines.

Over the past couple of years, I added new games, board games, and new books. My current sales are roughly; 30% comics, 20% graphic novels (50%); and 5% RPG's and Boardgames, 15% CCG's and miniatures (20%); and 10% books (probably more since many of these get lumped into graphic novels); 10% toys and anime; and 10% sports cards.

The magic formula, for now, that seems to be working.

Monday, June 9, 2008

Nobody Likes Conquistadors!

Conquistadors make good bad guys. I was watching C-Span the other day, a book reading about early settlement in North America. The guy said that in the Dominican Republic, people are claiming Indian names even though the natives were nearly wiped out. In Mexico, they also tend not to much like the Conquistadors.

So, the armor and aspect of the bad guys in Narnia was perfect. Better than the Middle-Eastern appearance in the books.

Do they write children's books with quite so much warfare these days? I guess the last Harry Potter had a big battle at the end.

I'd forgotten Reepicheep and his tail-pride.

As usual, Peter Dinkledge is the best actor in any movie he appears.

Damn *#^$&^^* Budget!

Going into my third month of budgeting. Two weeks reordering, two weeks off. I could definitely see the results, in cash flow especially. Plus higher payments on my credit cards. By the end of June, I should be debt free. It feels very virtuous.

Which is why I feel a little let down. Spent the whole weekend doing nothing. After a week where my spending was out of control. Gained a bunch of weight on my trip. Spent two hours watching a Frontline I'd already seen; rolling my eyes at the Bush escapades. Cringing at pictures of American soldiers being blown up and assassinated on street corners. All in all, pretty stupid way to spend my time. Oh, and reading Blood Meridian by Cormac McCarthy, which is a cheerful little romp through the American West. (Bloodiest book ever.)

I've read two books by Cormac McCarthy, The Road -- about the end of the world. I mean, really, the END of the WORLD. And Blood Meridian. I've seen two movies, All the Pretty Horses and No Country for Old Men. I think I get it. No one is safe from random violence, the good guys don't always win, there is no rhyme or reason to fate, existential despair. Arghhh.

I admire the books, but I'm not sure I enjoyed them.

But underlying it all, is the realization that I went off budget big time last week. Almost out of control. I think I can recover from it, but I'm disappointed. I'll be holding my breath -- I can't tell you the number of times I've had a good sales streak, went and spent the money to keep it going, and then had sales fall off the table.

I had gotten a couple of thousand ahead, pure bonus, and had contemplated not doing the two weeks off this month, figuring that business would stay good, especially if I was supplying the store. And would it have hurt me to pocket the bonus? It was a bonus!!!!! Damn.

But now, I'm going to be forced to follow the original plan. A strict two weeks of no spending. Hopefully, I cam get back to where I started the month.

Linda and I are going to go see Narnia. Maybe that will cheer me up.

Sunday, June 8, 2008

More CRE musings.

An article in Newsweek, had the following paragraph.

"...banks that recklessly financed the housing boom—and then traded mortgage debt even more recklessly—are still cleaning up the mess. But it turns out (surprise!) the same sort of clouded judgment led banks to excesses in commercial lending..."

I keep going back to the local CRE (Commercial Real Estate) market because no one else seems to talk about it. As I've said, I often see hundreds of comments on housing on financial blogs, but only a dozen or so about commercial. Which makes sense, I guess, since so many more people are immediately affected by the housing market.

But everyone in Bend will be affected by a commercial bust, too. Maybe not in a direct way, but the CRE climate in Bend will affect everyone's finances in one way or another.

What's sort of frustrating to me is that I can't find any available statistics. My web-fu can't even wrangle up an article I remember reading years ago to the effect that Bend is the second most over-retailed town in America behind Las Vegas. (Seems to me, the article was in the WSJ or the NYT's; so possibly it's proprietary info?) Retail square footage is what I want to know. It's probably out there-- but, it's not my job, you know? I'm just curious.

Besides, even if it turned out the stats said we were average or something, I'd still be convinced we've overdone it -- because of factors like demographics, isolation, types of business. Really a couple of big box stores or two either way could completely obscure any number of small businesses.

In the end I have to fall back on experience and instinct.

A little history. (If you've heard it before, move along....I'm doing this from memory, so the details may be slightly off.)

Two malls, Mountain View Mall and the Bend River Mall, were built in the late 1970's and the early 1980's. At the time, the only real business districts Bend had were downtown and the 3rd St. strip, which probably extended about half a far as currently.

Small pockets on Division, Franklin, Greenwood, Newport, and Galveston; very small pockets.

The malls enticed many of the better stores from Downtown Bend, including J.C. Penny.

The Reagan recession walloped Bend pretty hard, and downtown Bend dropped to something like 40% vacancy rate, which is brutal; worse than it sounds, because the aura of emptiness is overwhelming.

Still, a few hardy souls moved into downtown, like weeds on the sides of blasted St. Helens. Bend was static for most of the 1980's; it was a big deal if anyone attempted a renovation, much less a new building.

The big box stores started arriving with Fred Meyer, in 1990; Shopko in 1992; and just about every year hereafter. Strangely, downtown Bend was less impacted by the big box stores (Wal-Mart, etc) than most downtowns, because it had already begun to claw it's way back from emptying out into the malls.

What's ironic to me, is neither mall really ever became robust; the Mt.View mall swung some deals and appeared to be hopping for a few short years, but there were always dead zones.

I had a store in the Mt. View Mall for much of the 90's, before seeing the handwriting on the wall in 1997 and selling the store.

So what happens? They tear down both malls, which were rundown, and start over with even BIGGER footprints. Meanwhile, 3rd St. keeps stretching out, North and South, Highway 20 becomes a legitimate shopping zone, Factory Outlet Malls, Walmarts and Targets and Barnes and Nobles and just about every big box you can think of, including some still to come, like Kohl's. Northwest Crossing tries to bring in Retail, the huge Old Mill, and Century Drive and on and on.

And I still remember how much a struggle it was to make a living in Bend through most of the 80's and into the 90's. Yes, I understand we have 4 times the population, but my visualization of the retail space built is much, much bigger than that. (Visualizing being unreliable, I know, but it's all I got.)

I think we've gone way over the top. The big boxes are here to stay; we hit 'metro' status, and a red pin showed up on every planning chart.

Meanwhile, the humble businesses of the first half of my career, have been replaced by very fancy, high end businesses. (Every time one of these 'high' concept stores came into Bend in the 1980's and early 90's, it seems to me they were slapped down.)

I used to look down on Wall Street from the entryway of Pegasus, and be half envious about the traffic I saw down there, and half relieved I didn't have to deal with it. Now, I'm getting the same kind of traffic -- and there is no denying it helps my business.

I think Downtown will be the last to feel it. (The big national chains may feel it, but we'll never know.) I suspect that outlying areas, such as N.W. Crossing and much of the new development along Century Drive and Newport and Highway 20 and anywhere else that isn't a 'natural' retail zone will feel it first.

Because, I suspect that many of these new stores and malls were built with CRE monies -- which is the link I was missing. I've always thought we were over-retailed, but now I suspect we're over-leveraged as well.