Saturday, January 31, 2009

Trapped by theory.


Before you read anything else from me, go to my wife's poetry blog, SAGEWIND VOICES, and read the "Sportscard Dealer's Ode...." Just because it's so cute, and to explain my fear of sports card trading....

******END OF NOTICE*****

Back to regularly scheduled blathering....


Over the years, I've made many a business decision based strictly on a theory. Either because of something I read or something I heard.. Sometimes, the theory was based on (what seemed to me) common sense or every day observation.

And then, for some reason, I would try the opposite. Maybe I was forced to, because it came down to -----try something else or quit. Or I accidentally tried something that worked, saw the light, and followed it up.

I find out I was wrong all along, sometimes wrong for years.

I call this being "trapped by a theory."


The theory that captured me the most and the longest was -- a Mom and Pop can't compete head to head with the mass market.

It made sense at the time.

I had good reasons to believe this:

1.) My own experience with sports cards, where I had my head handed to me.

2.) Just about every article I ever read.

3.) Just plain old common sense.


But like any theory, the devil was in the details. I was right about not competing with the mass market on prices. Especially is the product is a common commodity. Commodities are something that is the pretty much the same for everyone. Sports cards turned out to be a commodity; a box of 2008 Topps Baseball is a box of 2008 Topps Baseball.

There may be differences in packaging, but if you have to explain the differences, it doesn't matter.

If it's a commodity, and everyone has it, then price becomes the only thing that matters.


If the product doesn't have a Suggested Retail Price (SRP) then it will have such a low profit margin that the chainstore pretty much can sell it for very close to what you're buying it for.


I didn't realize until I started carrying books that items which have a Cover Price are different. Products such as games and books. Especially if the mark-up is in the 40% range.

Even if the chainstore has discounts, it usually isn't a killer discount. Either that or the customer seems willing to overlook that I'm selling it for retail because it's marked right on the cover.

And because I have it in stock. Never underestimate the impact of having the item you want in your hot little hands. Sure it's cheaper on Amazon. But it's there, in your hot little hands.

Books are a very big world, and it actually does matter what I chose to carry, and how I chose to display it. The customer holds a book they remember fondly, or have always been looking for, or have heard about....and they often buy it.


Like any theory, I should have tested this. Easier said than done. It's a pretty pricey proposition to attempt a new product line, but if you try just a small amount you can never be sure that you've done enough to affect the outcome.

Sometimes you have to go with the theory.


There are always exceptions to every theory, and there are probably ways to make anything work if the details are changed.

Friday, January 30, 2009

It's the psychology, stupid.

To follow up on the previous post, I'm starting to look at the psychology of the consumer again.

While I wouldn't put in the dire terms that Buster put in the comments, there is a fine line between having a wounded consumer and a mortally wounded consumer. To my mind, it's better to be informed and skeptical, but not panicked.

Last night, I began wondering about all those people who have secure jobs, or relatively secure jobs. This is probably the majority, even the vast majority of consumers.

But they've cut back, nevertheless. It's a natural response. But most of them are still coming in and getting their favorite comics, or buying a book, or pulling the trigger for a toy that wows them.

What would be very dangerous is if they didn't just cut back, but stopped spending altogether.

I think that's what all the stimulus package talk is all about. Maybe Buster is right, and little of it will reach Bend in truth. But as long as the 'impression' is out there that SOMETHING is being done, I believe that the consumer will continue to be careful, but not stop altogether.

Obama is a plus, because he holds out the potential for improvement. The stimulus package is a plus, because it looks as though something is being done. The bail-out -- god help me -- is a plus, at least psychologically -- because it keeps the Big Bank Fails headlines out of the paper.

On street level, I saw the immediate impact of Bears, Sterns going down. Then the even bigger impact of Lehman brothers, and Bernie Madoff was the nail. I suppose, Murphy being a tricky bastard, that I should expect at least one more real eye-opener, and hope the psychology doesn't turn permanently bearish.

The underlying conditions are stark, but I can deal with them as long as there isn't another total shift in psychology.

Homes are up, homes are down, homes are everywhere to be found.

I know the news outlets report the news for each day, but I do wish they could put some of this news into perspective.

Last week, it was announced that home sales had gone up.

This week, it was announced the "new" home sales had gone down.

But there was little effort to tie the two events together, or to explain them.

And they did that little thing that has driven me crazy for the last two years of blogging. They told us new home sales were down 14.4%.

But that refers to the previous month. If you compare new home sales for the same month the previous year -- a much more accurate gauge of health -- new home sales were down a whopping 44.9%!

Scratch under the surface, and you realize that home sales went up mostly because of foreclosures and short sales.

Meanwhile, there is almost no point in building new houses as long as the bottom has fallen out, and as long as there is so much inventory on the market.

To my reckoning, the more important statistic for Bend is the "new" home sales figure. Because this is where the bulk of the jobs have been. Just this morning, I read the article on the stay at home Mom's -- and sure enough, the husbands all worked in the building trade and talked of the stress of finding enough work.

Combine that with the 9 building permits issued in December, and the average of 25 building permits over the last year, and that's where Bend is really going to suffer.

Just over the horizon, I believe, is the Commercial Real Estate bubble here in Bend. Banks like Banks of the Cascades, which are already falling through the floor, are really going to be hammered when that starts to take effect.

I don't even want to think about the credit card debt that is out there.

But Bendites still seem a little oblivious to the possible ramifications. I think most of them think it's all be over soon, and we'll be back to where we were.

I suppose, as a business owner, I ought to encourage them in those beliefs.

Thursday, January 29, 2009

What the hell do I know?

I should refrain from commenting on restaurants.

Different rules. Different dynamics.

Yes, they're retail. But with a whole 'nother set of overhead requirements, and vastly more labor oriented. Just buying fresh food would be a completely different experience.


It's my blog.

So I was quoted in the Bulletin a couple of Sundays ago that I wasn't really worried about downtown Bend. That someone would come along and fill the Volo space, and the Deep, and even the Merenda -- though in that last, I thought maybe only the bottom floor.

One thing about Bend's continually failing upward; it leaves beautiful corpses.

These are attractive spaces, after all. A lot of money was spent on these locations, and that cost isn't passed along to the new tenant, except in rent, and with the economy the way it is, the rent can't go much higher.

Hermit crabs could come along and grab these beautiful shells.

And finally, foot traffic is really important. And where else in Bend, except maybe the Old Mill, will you find significant foot traffic?

Still, privately, I had my doubts about the Merenda space. It still seems awfully big.

In my mind, I was imagining a meeting in the Portland offices of McCormick and Schmicks and these words being spoken: "Let's go to downtown Bend -- where restaurants are dying like flies, replace a well-regarded name, pay just as much rent, and wait for the economy to turn around!"

It didn't seem likely to me. a retailer, I realize that you have to grab that prime location when you can. Linda and I jumped all over that corner building on 3rd and Greenwood where we now have the Bookmark. I'd driven my it a hundred times and commented to Linda, "Too bad we couldn't have THAT space..." So, we didn't hesitate.

It's all a matter of timing.

For one thing, from the interview in the paper (and from what I've heard on the grapevine) the landlord wasn't being terribly flexible on the rent rate.

It seemed even more unlikely that a local group would come along and be able to swing a deal. And what they could do better than the previous tenant; except, as I said, save on the 'opportunity costs.'

Apparently, that's what happened.

I'm going to take a wait and see attitude, though. I'll totally believe it when it happens. I suspect there are a few more preliminary rounds to play. bodes well for downtown, that we'll get through this next two or three years without becoming a ghost town.

Wednesday, January 28, 2009

Guns, Jewels and Tools.

"Guns, Jewels and Tools!" Sign at local hock shop.

Kind of describes Bend, right now, eh?

Cheap Entertainment at home?

Played Settlers of Catan last night for the first time with friends Char and Aaron. Once you play a game, it's actually pretty easy to learn. And lots of fun.

I mentioned that I'd had more requests for SofC after Christmas than before, and Aaron said, "I think with the economy the way it is, you'll see more of that."

An easy, fun, but challenging game that you can play with two or more people and you can play over and over again?

Yeah, that might fit the bill.

Next visit: Ticket to Ride.

(By the way, speaking of Aaron, I'd like to repeat my recommendation for him if you need help with your computers. He's a real wiz, and I think he's very reasonably priced. E-Mail Address:

Depression Nostalgia?

The point I'm trying to make is, I've had a bit of weird nostalgia for the '80's. Not that I'd like them back, but they do take on the cast of an simpler time. I seemed to have time back then to actually read comics, to actually play games.

I've driven home a few times lately, and the traffic was so light that it reminded me of the old days.

I feel myself being strangely relaxed.

I'm relaxed partly because I have a cash reserve in the bank, pretty much for the first time. I've known a 'cash reserve' would be handy since -- oh, I don't know -- about a year into owning a business.

It just shows how hard business was that I spent the next 20 years trying to accomplish this simple goal. But I always needed to keep the store moving forward, and sometimes I needed just to keep it from slipping back. I always made the choice to spend the money.

But not now. This time I'm hanging on to it, because this feeling that I'm covered in the short term is priceless.

Settling In.

Meanwhile, I seemed to have found my groove here at the store. I was kind of worried after a couple of weeks. I was plenty tired, had a few customer incidents, and just seemed to have a hard time of it.

Then, this last week, I remembered a few tricks, a few techniques, and a different attitude, and it's become much easier.

Hoping I can keep that going.

Remarkably unremarkable.

Was reading the Bulletin blog fodder this morning, and it occurred to me that what someday will be remembered as tough times, and what was once predicted would be tough times, has become...simply the reality.

Quiet acknowledgment on the part of the city that it might not be possible to both maintain the Bend Area Transit and the general police and fire services.

No flashy expensive searches for new city manager or new police chief, (hey, we're a big time city and we need big time outsiders!) simply endorsement of the competent people in place.

Realization by the Forest Service that land in Sisters isn't in demand anymore.

The big positive story in the Bulletin, Deschutes Brewery's expansion plans, is really talking about 'planning' and at least a couple of years out.

The article RECOVERY ISN'T LIKELY IN 2009, is the most remarkable in it's mundane approach. Ho, hum. We knew it all along. No big deal.

" real signs of a local economic recovery until 2011." (Remarkable how the headline can use the 'negative' of unlikely recovery in 2009 but the very first paragraph pushes that timeline out two more years...)

Later in the article, this comment. "Rather, Watkins sees a "long, slow crawl out" after 2011."

Terrific. So we are, what? looking at 2012, 2013?

Also buried in the article is this; "....the unemployment projection -- 15% in Central Oregon by the fourth quarter of 2010, was disturbing...."
(Personally, I think that 15% figure will be hit this year....)

Finally, I always love the quotes from Mike Hollern, CEO of Brooks Resources.

"Hopefully, all this government intervention works great, and hopefully we have really smart people making those decisions." (words highlighted by me, but I imagine Hollern muttering them under his breath.)

So the bottom line assessment, in a secondary article in the business section is:

15% unemployment.

No recovery until 2011, that will grind into 2012 or longer.


Tuesday, January 27, 2009

The Rise and Fall of Books.

I have a theory about the rise and fall of books. Like many good theories, it depends on the idea of a 'golden age,' which may have never existed.

My understanding of book publishing was that the 'return privileges' were instituted during the Great Depression as a way for publishers to support bookstores. The ability of your local bookstore to order books and return unsold copies stayed in place and worked pretty well for the next 40 years.


But there was a big loophole in this policy that no one really exploited until around 1971 when Leonard Riggio bought Barnes and Nobles. He realized that if he built really big stores and filled them with lots and lots of books, that he could stomp the neighborhood bookstore into the ground.

Why not? He could always return unsold books.

At first, this worked. The mega-bookstores did very well. More were built. More books were ordered, and then huge racks of returnable magazines.


But in the backroom of every Barnes and Noble and Borders there is a guy whose job it is to rip off the covers of unsold books and magazines and return them for credit.

I'm sure the publishers thought it was all worth it. Instead of having to process small 10-book orders from 10,000 independent bookstores, they could sell an equal number of books to 2 book chains.

The more books B & N sold, the better their terms became. The longer they had to pay, the more they could return. They started to dictate to the publisher what kind of books they wanted; best-sellers became the benchmark, and mid-list books were dropped.


My theory is that after awhile, the real growth of publishing and sales came from opening newer and bigger stores. It would be very interesting to see the sales graph of stores that were built in the mid-80's, for instance. At what point did the temptation to over-order become the predominant technique?

Discounting a book 50% is a no brainer if you are going to get 50% in credit for a return. So discounting become endemic.

But what is the real level of readership? How many books are really selling? How many books are selling per square foot, and when does cannibalization begin? It becomes a 'Peter Principle' for books -- you keep ordering and ordering until they stop selling, and the publishers will be swamped with the leftovers.

Magazines especially have been hammered by this process. They base their advertising costs on how many magazines are distributed, with 'estimates' of readership instead of sales.

Not surprisingly, many people began to just sit in B % N and drink coffee and read magazines and never buy them. Again, the magazines went along because more and more stores were opening and they could pretend that they had ever widening readership, nevermind the sell-through.


But eventually, when you have built a chain store in every single metro area, you have to build a second in the same market.

I think B & N picked up market share throughout the 70's, 80's and 90's, but what happens when you've pretty much stomped every single independent you can and there are no more to destroy? Or when the survivors have figured out ways to take some of that business back?

There are only 3000 or so indy bookstores, down from 8500 from less than a decade ago. These are probably the irreducible minimum, and B & N is going to have a hard time prying market share of out of them.


I think, eventually, the publishers will close the loophole of returnability; or make the conditions such that it can't be abused. The magazine distributors have had enough; they are demanding a payment for every magazine handled. Some publishers are creating non-returnable imprints.

But the biggest problem for B & N is that, like every Ponzi scheme, it will become top heavy and topple. Older stores will start to show their age.

Customers will start to wander back to places where the owner can talk books with you.

Those customers looking for price and selection will turn to Amazon.

Barnes and Nobles and Borders will topple like the dinosaurs they are.

Buy a book, dammit!

The publishing industry has been crumbling, lately.

Mad Magazine's editor put it best after announcing that Mad is going quarterly, and canceling it's spin-off mags.

“The feedback we’ve gotten from readers is that only every third issue of Mad is funny. So we decided to just publish those.”


The Village Voice just announced that they were dropping all their editorial cartoons in their weekly newspaper chain (LA Weekly, etc. etc.) This has been going on in newspapers all over the country.


Sometimes it isn't just the cartoonist that disappears, but the entire newspaper. Christian Science Monitor is now online, the Seattle paper is looking for a buyer.


In my own little world, the monthly trade publication for cards, Card Trade, has followed it's comic cousin, Comics Retailer, onto the internet, where I probably will never read it. Diamond, who has a near monopoly on comics distribution, has raised the limits for independent comics, and has dropped several of their in-house publications as well.


There have been layoffs everywhere. Diamond and DC are the most noticeable. There was a prominent article in the USA Today about how comic sales are up. I didn't comment, because it contradicted everything I was seeing and hearing. And Diamond, who is THE DISTRIBUTOR had a 4% drop last year.


Meanwhile, if I might steal from the Comic's Reporter's site, there's this:

"Call me gullible or impressionable, but I'm actually feeling kind of hopeful this week." -- Sara Nelson, Editor-In-Chief, Publishers Weekly, posted this morning.

"Sara Nelson, the editor in chief of Publishers Weekly, the main trade magazine to the book industry, has been laid off in a restructuring by the publication's parent company, Reed Business Information." -- NYT Arts Beat, posted noonish.

Sara Nelson was a big supporter of comics, and one of three news sites on comics I visit everyday, The Beat, is sponsored by P.W.


DC comics has released long-term industry veteran Bob Schreck. Started with Dark Horse, helped co-found Portland's Oni Press, editor for Frank Miller.


Two of the biggest magazine distributors (representing 50% of the market share), are insisting on a small payment for every magazine distributed. (7 cents per.) Magazines are howling. (Apparently represents millions of dollars.....)


Sales in books were down significantly last year, and especially last quarter. (Pay attention not to the entire year, folks, but that last brutal quarter of the year.)
Article from Galleycat below:

"Last week, the U.S. Census Bureau issued its retail figures for November 2008, including a 13 percent decline in bookstore sales compared to the year before. Now the Association of American Publishers has released its numbers for the month, reporting a 14.4 percent decline—and, when all the revenue for the first eleven months of the year is tallied, it's down 4.4 percent from the year before.

Nearly every category experienced severe declines; children's and YA hardcovers were one of the few categories to improve, showing a 14.3 percent from November 2007, but the year-to-date sales are still down 20.6 percent. Oh, and e-book business more than doubled for the month, and is up nearly 64 percent for the year—but you could take e-book sales for all of 2008, quintuple them, and you still wouldn't have as much money as publishers report in sales for even a lousy month like November."

I have a hard time reading these numbers. Down 4.4% or down 20.6?

Either way, they are down significantly.


I have a theory (as usual) about this, which I'll talk about either later today or tomorrow.

Monday, January 26, 2009

Where's the Momentous?

I don't know about you guys, but I got used to momentous things happening all the time. Living in the Bush years was a Chinese curse -- interesting things happening all the time. War and rumors of war.

Two objects flying through the air. In a sense, the Bush presidency started with two planes flying into two towers. It ended with two shoes being flung at the President's head. From the powerfully affecting to the ridiculous.

You could turn on the T.V. and get a vicarious roller coaster ride by watching the Dow Jones, or see a huge, big name company self-immolating.

Or turn on the Oberdolferman, and listen to him rant about something outrageous that McCain did, or turn on Faux News and hear Sarah Palin say something incredibly stupid.

It was like living through the Sixties again, or something. You just think it's normal at the time, and then when things settle down again you realize you've just ridden out a storm.

I think the Israelies pulling out of Gaza just before Omama's swearing in was a symbol of all the crap that went on.

Or....we can hope.

We can hope Obama is an Eisenhower, not a Kennedy. Calm and steady and undramatic. A get things done, kind of guy. That the public will be consensus not contentious. That we'll all learn to live within our means again.

Or....most probably not.

Most probably it will indeed be a Chinese Curse century. That we're just seeing a lull before the storm.

Sunday, January 25, 2009

Out of step.

Every Wednesday, as I walk to my car on the way home, I pick up some of the Free publications out of the vending machines.


First, I read The Source, and it's sort of familiar, even though I'm not into much of what they advertise about (music, food, theater). But as an old hippie, I'm not uncomfortable by what it represents.

Their political slant isn't too far from mine, and I often find their articles interesting, and their cultural stance of...let's get some culture here in Bend without losing what makes us Bend and let's be open to new cultural O.K. with me. I like reading HBM, especially now that I've met him several times.


But then..... I pick up some of the Cascade Business News publications..

I don't want to be mean or judgmental here. I have no right to be. They seem to be perfectly nice people.

I just don't understand them. I don't understand what they're saying, what they're showing me, what they represent.

They are just plain -- I'd be tempted to say weird -- but I'll say different. No, better -- Foreign.
Like a foreign culture, right here in my hometown of Bend, Oregon.

So the shiny pictures of oh, so carefully coiffed people; or tastefully bohemian, or...this one always throws me even though I'm a native Bendite and bucked hay, and hunted and fished, and went on trail rides....the 'Western' look.


I mean, they seem to be all about -- Look at Me!

Please, please look at me. Even better, I'll get to look at ME!

So we get a puffed up ad, followed by a puffed up blurb, followed by a puffed up picture followed by a puffed up --- should I call them 'news?'

And many of these businesses I've never heard of. Selling goods and services that seem -- odd. Buildings -- really, really big buildings which all seem to be tall and vaguely craftsman and interchangeable and forgettable. I think the word "Congratulations!" is the most common word on every page.

Does this really work, even as advertising? Does anyone but me actually read these 'articles'?

Or do you buy an ad, get an article, clip it out and add it to your resume, and send it to Grandma and Grandpa, look! I made it! Here's proof!


I'm tempted to think it's valuable evidence of the Bend Bubble Boom, and how we lost our way from a sleepy little hunting and fishing and outdoorsy town -- to what?

A Circus Wilderness?

A Desert Art Illusion?

A Cultural City-lite?

A Gastronomical Waystation?


And yet, and yet....

These guys profiled on these pages have way more money than me, obviously. They could buy and sell me many times over, without blinking.

What the hell do I know? I write a blog, that would seem pretty much a "Look at Me".

I know, in the end, I'm the weird one here. I'm pretty much a homebody. I enjoy simple things. I know that my store is 'foreign' to many people, Science Fiction and Fantasy and comics...

These people at their wine tastings, and art shows, and theater events are engaged and enjoying themselves.


So despite what I said above, I suspect they are more in the mainstream, even with their insistent cheeriness, their never-say-die attitudes, their "I'm conquering the world!" self-promotion, than I am. I would definitively feel like a fish out of water in their milieu; whereas, I bet they'd adapt pretty quickly to mine.

So more power to them.

I enjoy visiting their country once in awhile,

Like picking up a National Geographic when I was a kid.

Saturday, January 24, 2009

Obama watch.

Anyone else notice how many stories there have been about photographers 'discovering' Obama early on and following him throughout the campaign? 'Theodore H. White's', everyone of them.

Obama must have been a genius at making each of these gaggle think they were special and unique.

Meanwhile, my niece Mattie has been working at restaurant in Obama's Chicago neighborhood, The Medici, and has met him. (Wow, you shook hands with him?) She said, when he first came in, he was alone or with one or two other people. Then, after he became better known, he'd have a security guy sitting in a table over, and then...the whole enchilada.

She says he's a nice guy. Michelle Obama would come in with the two girls, and Mattie said there was no doubt about who was in charge. The two girls would sit up and take notice when Michelle gave them a 'look.'

Reassuring, in a way, that I didn't have to hear an 'arrogance' story, even before he was famous, and that he treats workers with respect.

Poor guy is caught in the spotlight. He'll never eat a quiet meal in a restaurant again. It would be my worst nightmare.

Except for being King. The heck with being a Mayor, I would love to be King, making Kingly decisions.

Just as long as I didn't, you know, have to deal with people.

Virus Free at Last

I've been struggling with my store computer for weeks.

Which is really unfair, since I haven't once visited a porn site.

I'd come to the store and try to get online, and freeze up, or get waylaid, or .... hell, I don't know what all was happening. It usually would allow me on just long enough to check my usual haunts, but several times I couldn't answer customer questions that I should have been able to access.

One of the great things about a Mom and Pop store is that customers are always willing to help. I've had knowledgeable friends work on it for hours, but the viruses were just too deep. I thought I'd have to have the whole thing scrubbed, or at even replaced with a laptop.

My friend Aaron Leis, who Linda and I have known since he was in high school and we had our Sister's store, came to my rescue.

He brought his own laptop and ran the programs and waved his magic wand, and poof, my computer is a dragon again.

I swore I'd never commercialize this space, but for Aaron, I will. He's incredibly good at it, and he is one of the nicest people I've ever met to boot.

E-Mail Address:

Meanwhile, neighbor John (Pave) thought it humorous that on the T.V. story on parking downtown that the person holding the camera also worked for Diamond Parking.

Not exactly sure what it signifies -- small world, or conflict of interest?

So now that I've totally 'sold out'; it's back to the bubble.

Apparently, the city will be raising fees to cover the revenue shortfall -- yours and my fees, anyway. Just go ahead and do it, don't drag it out, water and sewage and transportation utility fees. I'll just close my eyes and hold my nose.

Don't bother with putting a gas tax on the ballot. There is no way in hell that would pass.

And that money we spent on lemon buses and fired Juniper promoters, sure would come in handy about now, eh?

Friday, January 23, 2009

Potholes and you.

One of the first posts I made two full years ago was saying that unless the city of Bend stopped throwing money at Juniper Ridge and the Bend Transit, that it wouldn't have enough money to repair the pot holes.

Paul-doh over at BB2 has been predicting bankruptcy.

Bruce has been nagging them about Juniper Ridge for quite a while.

Which is why it is maddening to read this comment in the Bulletin article, today, "There's not much left to cut..."

"Andrews said the city started dipping into its reserve funds, which are used to provide a cushion for emergency situations, years before the economy took a major downturn. as a result, she said, many departments don't have much wiggle room left."

Methinks they don't understand the words "reserve" and "emergency."

I predict that the city council will let Bend go bankrupt before they raise fees. Indeed, I predict they'll delay or lower fees.

I predict they'll keep pushing Juniper Ridge.

I predict they'll keep the Bend buses rolling.

I predict I'll have to replace my shock absorbers, and get another lock on my door.

But, hey!

Who could have predicted it? (Except me and paul-doh and buster and bruce and tim and quimby and bem and marge and lava bear and just about every other bubble blogger out there.)

The "Selling" of the Recession.

Bear with me, as I pursue this line of thought. I haven't heard anyone else talk about it, so it's a bit more work to reason it all out.


It seems to me that the news coverage and corporate spin on the recession has been going through a subtle transformation.

At first, there was mostly denial from the major retailers. It was a short term problem, but they were taking care of it.

Then it was an acknowledged serious problem, but they were in better shape than the other guys.

Now -- it's almost as though they've realized that there is no way around this recession, and are looking for ways spin it as an advantage, as something they can exploit.


This Associated Press story (bottom) has been making the rounds, including the Bulletin a couple days ago. I ignored it the first few times, but it seems to be resonating with people, so I'm going to comment on it.

I think it's a lazy and superficial analysis.

While it is no doubt true that retailers are tightening their inventories, I doubt most of the slack was because they could "afford to be sloppy." I suspect that much of this material sold, at least quickly and often enough to warrant ordering it. That which didn't sell, they usually wangled discounts out of the manufacturers.

If you order five and sell four, it makes you no more sloppy than if you order four and sell three. I suspect it's all just for show.


But they get to fire people!

They get to cut unwanted lines of product!

They get to cut services!

It's not their fault, it's that nasty dirty recession!!


I mentioned before all this change in tone that I thought the customers would be surprised by what was going to happen. The media was making it sound as though the customers had the retailers over the barrel -- and they did, in the short run.

But once all those SALES, SALES, SALES!!! were through the pipeline, I was convinced that the customers would find less selection, less service, and eventually less price moderation.

The Big Boys get 'leaner' by piling even more work on the remaining workers. (And I thought it was difficult to get clerks to help me before!)

The 'spin' in this article is so furious, it makes me dizzy.

Less product = "less cluttered."

Lower price = "affordable luxury."


But even more maddening is that the article continually contradicts itself, because it is taking the retailer's words at face value. So it constantly talks about "weaning the customer from discounts" and in the very next breath, talking about enticing the customers with discounts!

" years past they would buy one color and three different styles, he said, now they're buying three colors in one style."

I'm sorry, what in the hell does that even mean?

I suspect it means the retailer want to buy one brand in three colors because IT'S CHEAPER for them to carry, not because the customer is demanding it.

I know reporters aren't trained economists, but they should be able to think.


The funniest part, was the creation of a Recession brand of clothing.

Yeah, right...

It's almost as though the Recession is turning into a new marketing opportunity, like "Fat Free" or "Carbohydrate Free" or "Green" or "New and Improved."

Buyer beware.

Like I said, this article got wide distribution.


Sales, keeping inventories down as consumers stay reluctant to spend.

For years, retailers could afford to be sloppy about running their businesses because customers kept buying. No more. Stung by the worry that shoppers — who cut spending by the most dramatic amount in at least 39 years this holiday season — may not start spending again for a long time, stores are making drastic changes. They are cutting out marginal suppliers, hiring outside experts to keep inventory lean, holding special events for those who are still buying and making extraordinary efforts to gauge customer satisfaction.

The new discipline will be mostly good news for shoppers, who will find stores less cluttered and see an array of products at lower prices, from ordinary groceries to jeans from brands they could once only aspire to.

Of course, the downside is that consumers who want something out of the ordinary — an olive green prom dress, for example — may have to look harder. Stores are rooting out offbeat, unpopular colors and styles, which will mean fewer choices.

Sales clerks are also checking back with customers to see if they're satisfied with their purchases.

"We are in a sea change," said Millard "Mickey" Drexler, J.Crew's chairman and chief executive and former CEO and visionary of Gap Inc.

Pricing goods within reach of strapped consumers is also a big focus, given the way nervous consumers have stopped shopping. Same-store sales, or sales at stores opened at least a year, fell 2.3 percent in November and December together, according to the International Council of Shopping Centers. And the worsening sales slump in January has many worried about the industry's prospects over the next few months.

J.Crew is working with its factories to adjust its prices on certain key items like ballet flats, which now start at $98 rather than $118. It's also stocking fewer of its high-priced items like $1,300 leather trench coats. It's cutting inventory and slashing expenses.

Status denim brand Rock & Republic will ship a new Recession Collection this spring that runs about half the usual $200 price tag for its jeans.

Even supermarket chain SuperValu Inc. has promised lower everyday prices on groceries and more promotions.

Chief executives from Crate & Barrel to J.C. Penney acknowledged during the National Retail Federation meeting this month that they're navigating new territory, predicting that the fundamental shift by consumers to spend less and save more will linger.

The biggest unknown is when or if shoppers will ever resume spending the way they did when the housing market was booming, credit was easy and jobs were more plentiful.

"Customers wanted and wanted and wanted some more and we sold and sold and sold some more," said Burton M. Tansky, president and CEO of The Neiman Marcus Group. Now, "frugality is more important."

This sudden hibernation of customers is leading even the luxury retailer to try new strategies. Neiman Marcus is eliminating some vendors and focusing on serving its best customers. It's trying to retrain its shoppers to buy regular-price merchandise by throwing more smaller private events for 20 to 30 customers.

Weaning customers off discounts is a big challenge for the industry, as people have gotten used to them — particularly on luxury brands that hadn't been discounted before sales all but dried up.

For the last two years, many of the best-run nation's stores like J.C. Penney Co. had been reducing inventories in response to the consumer spending slowdown. But no one anticipated the severe retrenchment that hit in September as the financial meltdown ravaged shoppers' retirement accounts, reduced credit availability and resulted in massive layoffs across industries.

As shoppers simply stopped buying, stores were forced to discount as much as 75 percent off in some cases even before the official start of the holidays — resulting in the weakest season since at least 1969, when the ICSC index began.

Some companies like KB Toys Inc. couldn't make it through the Christmas season, and many more are expected to file for bankruptcy in the coming months. Circuit City Stores Inc., which filed for Chapter 11 bankruptcy protection in November, said Friday it will go out of business — closing its 567 U.S. stores, after not being able to work out a sale.

With no sign of the economy improving soon, and no pressure on people to buy now that the holidays are over, merchants are preparing for times to get worse. Those who have survived face battered fourth-quarter profits and are slashing expenses and hoarding cash. Apparel merchants are cutting inventory by 20 percent to 30 percent for the summer and fall seasons from already reduced levels a year ago, according to Kathryn Deane, president and CEO of Tobe Report, a fashion consultancy.

But it's just not about slashing how much merchandise they carry. Companies like Polo Ralph Lauren Corp. are turning to outside specialists in areas like sourcing and currency hedging to reduce the impact of volatile foreign exchange rates. They're working with suppliers to reduce the time it takes to produce an item. And they're trying to understand the new mindset of shoppers, scrutinizing the products they offer to see whether the prices and quality meet the new standards from consumers who are questioning the real value of things.

Apparel suppliers say they have noticed the difference in recent weeks as the buyers for big chains visit their showrooms to order for fall. They want eye-catching pieces that have longevity — and nothing too radical.

"They're not buying disposable clothing," said Allen Schwartz, owner of fashion company A.B.S. by Allen Schwartz. He noted that store buyers are taking styles with staying power like daytime dresses. But while in years past they would buy one color and three different styles, he said, now they're buying three colors in one style.

Fashion company Nicole Miller is now shipping 80 new styles per month instead of 120. Bud Konheim, president of the business, said even buyers from upscale stores are questioning the prices of its top designers, which top at about $1,600. He said he's doing more clothing business in the $200 to $300 range instead of the $700 to $800 range.

Such scrutiny from buyers is forcing Nicole Miller to do its own editing, cutting out styles or colors. For prom gowns, Konheim said the company used to do oddball colors like olive green — but not anymore.

Michael Ball, founder and creative director of Rock & Republic, said he immediately lowered the prices of the company's most expensive jeans in September before they hit the floors when the economy imploded. The premium line, which had been priced from $180 to $320, now peaks at $280.

"The days of the $300 jeans are gone," Ball said. While other high-priced denim brands have been heavily discounted in recent months, he said he was able to avoid such heavy price cuts because of limited distribution that kept demand high. Still, given the new climate, Ball cut the number of styles and decided to offer a less expensive, cleaner look that features two styles for men and two styles for women. The line is priced from $128 to $132.

The Recession line, to be offered at Bloomingdale's, Neiman Marcus, Nordstrom and Saks Fifth Avenue, will be sold alongside the premium denim collection.

But Ball plans to end the Recession Collection when the economy recovers. For now, he believes he's doing his part to keep the economy rolling and help shoppers "open their pocketbooks."

Thursday, January 22, 2009

Inexorable -- verb or adverb? know what I mean. It all seems to be coming down on people's heads much faster than I expected. Every January I expect a bit of a fallout, and usually not much happens.

Not this year.

What I have to wonder is -- did they not see this coming? I've been preparing for this for so long, that it seemed overdue, almost. A 'correction', if you will. Talking to the other comic shop guy, I said, "Didn't you see this coming?" and he laughed, and said, "I've been expecting this since 2000."

I've talked to more than one tourist who blithely planned to buy a house, I've talked to more than one customer who has already bought a house.

The Merenda story was interesting: the landlord certainly doesn't sound inclined to lower the rent, doe's he? But, perhaps without the 'loan' money, the two story restaurant is manageable? Like I said, hermit crabs finding a beautiful shell. I do, however, doubt that the local workers are going to manage to swing a deal.

Maybe I'm being inconsistent, but the idea of a 'out of town' owner doesn't bother me much. Even the idea of a 'chain' store isn't that disturbing.

Meanwhile, it seems like one corporate office after another is laying off employees. Suspiciously, the 10% figure is often quoted. I've told the story before of waiting up late to watch Jack Welch, the 'most admired CEO in America', on Charlie Rose and then wanting to reach into the screen and strangle him. What a ruthless piece of #$%@!$. (His post General Electric career has pretty much confirmed what a sleazebag douche he is...)

His concept was to fire 10% of the employees on a regular basis -- but I think most corporations have a bit more hesitancy than that -- unless they've got a good excuse, like now.

Maybe I can't talk, since I let go of my employee.

I've made an updated list of "Old and New Downtown"

If I'm going to name a 'new' store, I've decided it's more accurate to name the store they replaced, unless it happened more than a year or so ago. Thus...the Book Barn was replaced by Dudleys. Who was in the Goldsmith and Powell's space?

Since, say, the beginning of Fall, 2008.


Outdoor Store
Luxe Home Interiors
Powell's Candy
Dudley's Used Books and Coffee
Subway Sandwiches
Bend Burger Company
Showcase Hats
Pita Pit
Happy Nails


Stewart Weinmann (leather)
Kebanu Gallery
Pella Doors and Windows
King of Sole
Olive company
Pink Frog
Little Italy
Pomegranite (downtown branch)
Pronghorn Real Estate office.
Blue Teal
Speedshop Deli
Finder's Keepers(?)
Paper Place
Bluefish Bistro
Painted Pony

Help me out here. Any others?

Wednesday, January 21, 2009

Has Obama fixed things yet?

The business climate seems pretty inexorable right now.

I noticed another 'For Lease' sign in a window on the way to the parking garage last night; the store next to it had a 50% off everything sign, which is never good.

My list of stores leaving downtown Bend has hit about 16, stores opening about 6. The Bulletin pegged the vacancy rate downtown at only 5%, which seems low unless we started with an even lower rate.

Got a call from the only other comic dealer I talk to on a regular basis; he has a similar situation and longevity. He was feeling kind of down about things -- the downturn caught him more unprepared, I think. We seem to leapfrog each other a lot. I'll have a few good years and then retreat; then he'll have a few good years and then retreat.

He's more dependent on games than I am, and I think games are having a hard time of it.

I'm actually looking forward to the Magic store opening downtown, because I'm hoping he can get some activity going.

The comics press has been in denial about comics mostly; being mostly comic people, they are defensive about it. But I think comics are down, despite what the statistics they feed the media say. The statistics reflect sales to retailers, not customers, and I'm guessing the retailers had a less than stellar last quarter.

Diamond distributer, a de facto monopoly, has raised the limits on independents, which is causing a lot of concern since smaller publishers already are struggling.

It just makes me want to push into books even more and even faster.

Modern technology and modern media make everything uncertain right now. The Bulletin had two articles today; how not to spend money, and how to trade books online for free.

But none of the product I sell, or indeed, none of the product I could sell, is immune from change.

So I have to look to my own business model, and try to maneuver my way through the mess.

As I was telling Tim, yesterday, about how a used bookstore is dependent on what books people bring in, so too will such "Free" arrangements. So too with things like Kindle.

My store, being in a foot traffic heavy, tourist heavy area, needs to be designed to pick up the impulse reader. Just present them with so many good books, that they can't resist. (Because in the back of their minds, many people will know it ain't that easy, and they just won't want to wait.)

But no matter what kind of store I try to design, the point will be to try to find ways to endure in the face of constant change.

Tuesday, January 20, 2009

Going whole bookhog.

Once again, I find myself going in the opposite direction as everyone else. I can't tell you the number of times this has happened. I'm gearing up, just as everyone else is gearing down; or I'm gearing down, just as everyone is gearing up.

I'm not totally sure why myself. Perhaps it's arrogance and hubris. "Pride goeth before the fall."

But what better time to proclaim yourself as healthy and raring to go? Let others cut back on their offering, I will actually increase mine.

I just ordered near 6000.00 worth of novels, in retail.

I'll try to explain why.

1.) My budget can handle it.

I've ordered everything in all the other categories of the store, and feel well stocked. I saved books for last. When I added all my finances up, I had a surprising surplus; if I continue thru the rest of the month at even 10% less than I've done up to this point, I'll be able to pay for 2/3rds of these books.

2.) I'm feeling more secure about my lease.

And my longterm occupancy in this space. My landlord (I refer to the property manager here, really, not the owner) was actually complimentary about my business; saying she thought my business would prosper in the coming times more than most.

Yeah, yeah, I know...buttering me up so I won't object to my rent, but I could also see she meant it.

3.) Sales haven't been as bad as I expected.

After the drop in fall of 2007, we had another big drop in the fall of 2008, but it seemed to stabilize at that rate and didn't fall any further. Sales have stayed consistent enough for me to make predictions. I'm at the higher of my three scenario's; which were admittedly very, very conservative.

4.) I've lowered my overhead so much...

I actually have more money to spend on product. I am debt free. I still have my reserve funds. I was so concerned going into Christmas, that I really cut back leaving me with more wiggle room to maneuver than I expected.

5.) Books are doing well.

They are currently my second best category, not bad for an inventory I've done very little to replenish over the last three months. My wife's store is doing so well. I just want some of that book goodness.

6.) I'm interested and engaged, and that's really important.

I've always been a huge reader, and for some reason titles and authors really stick in my head, which is a handy talent for a bookdealer.

I attribute success to motivation as much as anything. If I turn my focus to something, it tends to do well, at least while my focus is there -- and I'll be sure to stay on this until those books are paid off.

7.) The last year or so has almost been a trial run to being a bookstore.

I learned that best-sellers and newer books don't actually do all that well for me. I've learned that liquidated books, no matter how cheap or how well known I thought the authors or titles were, don't. I learned that mass market paperbacks don't sell as well as trade paperbacks, and neither do hardcovers.

I experimented with non-fiction; I tried carrying popular fiction.

What I have found works best for my store are classics, cult books, the 'hip' authors, and my own favorite books.

A stop gap measure, at first.

At first I carried new books because I got tired of people asking for TO KILL A MOCKINGBIRD, for instance, and never having it in the used section. Finally, I got the bright idea of carrying it new, and low and behold, people bought it.

It was easy to come up with the first 50 books; and then another 50 books; and then another. This last order was exactly 400 books -- all the books on my 'want' list; the books and authors I've either sold already, sometimes more than once, or books and authors I have a pretty good feeling I will sell.

You sell what sells.

Because, when you get right down to it, my job is to sell things. This isn't always easy. I mean, I often don't know in toys, games, cards, and comics what will sell and what won't. I identify best-sellers whenever possible, and keep them in stock and call them 'evergreens'. But mostly, I've already done that, pursued that course in graphic novels and board games which are the only real 'evergreen' categories I have, toys and cards card games being much more time sensitive.

I get the advantage of constantly new stuff in comics and cards and games, already. Books give me a more stable platform under that activity.

Classics are never dated.

With books, I'm still finding new old books that will sell. There really isn't too much guesswork in thinking that Hemingway, Faulkner, Fitzgerald, and Steinbeck will sell. These books and many more have already stood the test of time. There isn't actually much guesswork in thinking that GONE WITH THE WIND, or SHOGUN, or THE LITTLE PRINCE will sell.

Just keep following the veins of gold.

This order kept expanding because I was following a -- to me -- logical strategy of adding similar books to those that sell. For instance, if I find that 2 out of 3 Shel Silverstein books keep selling, then order a 4th.

I maybe got a little carried away. I've been carrying about 15 Philip K. Dick books, for instance, and I had sold half of them, and I decided to carry them all. Turns out, that was 40 books. But even that is a statement. A stack of 40 cult books is a form of advertising; it says, wow, this store is different.

Carry only the best.

Similarly, when it came to carrying S.F. for instance, I made a stab at carrying the cutting edge authors, such as China Mieville and Neal Asher. But, I also made a point of carrying lots of Asimov, Clarke and Heinlein.

In mysteries, I made a point of carrying all the Raymond Chandlers and Dasheill Hammetts.

Limited space.

I have enough space to carry a very good selection of fiction novels. But I do have to be selective. What I discovered was, since a mass paperback books of DUNE costs 7.99 and a trade paperback copy sells for 15.00, and they take about the same amount of space, that if I carry the bigger book a customer will still tend to buy it.

Because it's a good and or classic book.

Class sells.

Similarly, I've found that if you have a choice, pick the classiest version of that book. I can buy a nice generic copy of DRACULA, for instance, a solid color cover with only the title and author. Or I can buy a nice 'prestige' publisher version of the same book, sometimes for twice as much.

I'm not sure people are aware that they are buying the Simon and Shuster, the Random House, or the Penguin versions, but they gravitate toward them.

Hardcovers are sometimes the answer for the same reason. An ANNOTATED ALICE IN WONDERLAND, seems to be preferred over a cheap paperback version. When I looked to carry Walt Whitman's LEAVES OF GRASS, I settled on a 22.00 Random House hardcover rather than one of the myriad of cheap versions.

Because, if you are a customer buying a classic or cult book, you won't mind -- you may actually prefer -- to buy the nicer version.

I am pretty confident in all 400 books I just ordered. At a guess, I'm betting there are another 1000 or 2000 books that would fit my criteria.

And I have yet to look at a single best-seller list.

Monday, January 19, 2009

This and that.

I realize that everyone else has noticed, too. But it's kind of appropriate that M.L. King day falls the day before Obama's inauguration. I still worry that people expect too much, too fast. I've learned enough about economics in the last couple years to know that he won't impact on the recession until at least late in the year, if that.

Good luck to him and to us all.


I've gained about 20 pounds, and no one notices. No one. Or as my friend Cameron put it more succinctly: "No one cares, Duncan."


So far, the worst part of working everyday is not fitting in the time for a movie. I managed to read some comics last night, though.


Bend Bubble2 has become unreadable. Someone (not me) has been posting entire acts of Shakespearean plays, which is an appropriate comment on what's happening over there. I just can't wade through all the dreck anymore.


Started renegotiating my lease. Sounds promising. So far.

I really want the lease as soon as possible so I can do economic planning, and they aren't in any hurry. But they seemed amenable to continued storage in the basement, which was a big concern. I tried to make the case for lower rent, she made the case for equal or higher rent.

But it looks right now like that a manageable lease will probably happen. So I'm feeling relieved.

Sure enough, the landlord threw my comments in the Bulletin about a 'thriving downtown' in my face, but she did it with a smile.


My wife is still amazed by how much fun she has with her blog. She's a natural; I think she and I have just written so much over the years that a blog isn't much of a stretch to write on a regular basis.

Sunday, January 18, 2009

"All that is speculation...."

In the Bulletin business section front-page article, MOVING IN, MOVING OUT" is the comment by Roger Lee, executive director of Economic Development for Central Oregon, "which promotes business growth for the region."

"I don't see us getting in a situation where we're losing residents. All that is speculation, but there is nothing to back it up in the numbers. If all the jobs evaporated, that would be a game-changer, but net out-migration in 2009 is very dubious."

I think the way this works is: if it's positive, it's a 'prediction.' If it's negative, it's 'speculation.'

First of all, no one is saying "all the jobs" are going to evaporate, just some. Secondly, the claim that we won't lose residents is equally 'speculative.' And third, a guy's who's job is described as "...promotes business growth for the region..." is not exactly an objective party.

But I'll agree that looking out moving van activity is akin to reading tea leaves, or the entrails of an unfinished condo.

So lets look at a few facts.


There were 7 building permits issued in Bend in December.



The previous low I remember is 14.

Seven is more like incidental leftovers than any sign of future building activity. I think I must have 7 customers per hour that work in the construction trade -- they can't ALL be working on those 7 projects, can they?


"Deschutes County's construction labor force is 12 percent of its total work force, compared with about half that amount for the rest of the state."

Personally, I think that percent is low, but I'll take it at face value. Twice the number of builders, and no building....


Bend had a near 10% unemployment rate. If that was the national number, there would be much mashing and grinding of teeth and howls of doom.


That was then, this is now. If you looked at Pegasus Book's sales numbers in the first half of 2008, they would look a tad better than what I expect in 2009.


But no worries. Bend had "engineering, health care or renewable energy fields" jobs.

So...if you have an engineering degree, you're just fine.

Just rewrite that resume to include a doctorate or nursing degree, or a engineering degree. Better yet, proclaim yourself a renewable energy expert: I think just about ANYONE can do THAT.

But it seems to me that we've seen some high profile companies in these fields actually laying people off -- St. Charles being the most prominent of all. I've also heard from customers of engineering jobs about to go south in the near future. And I'm beginning to wonder if GREEN is just the next scam, even bubble, if you will.

The extent of this slowdown will be that even if we technically get immigration, it won't be all that noticeable.

I think we'll notice the slowing of growth more. If people do move here without a job in place, I think we'll see them leaving just as fast.

And it's very possible, we'll not grow at all.

Saturday, January 17, 2009

A Cheerful little show called Battlestar Galactica

Watched a cheery little show last night, nothing much, a silly science fiction show.

Of Shakespearian proportions; with the Admiral as King Lear, his son Apollo as Hamlet, the President as Lady Macbeth.

Copious amounts of alcoholic rages and stupor.

Of hugging and tears -- and that's just the men.

Steely eyes and clenched jaws -- and that's just the women.

Ex-spouses get offed on a regular basis.

I may not understand all the 13 Tribes mumbo jumbo, but I love the histrionics.

Stay tuned next week, when the actor who formerly played Apollo becomes King Richard the Third or something.



You're a Cylon, I'm a Cylon, we're All Cylons! Hate your neighbor as yourself......

Friday, January 16, 2009

Pegasus Tagline.

I noticed in today's Bulletin article on Taglines, that the Bend bookstore, Between the Covers (I always want to say, Under the Covers, for some reason) has a nice little tag.

"Book lovers never go to bed alone."

Nice. Sly and cozy, just like the name of their store.

So I thought Pegasus Books should have a tagline.

For instance,

"Pegasus Books -- Buy a Damn Book."

Says what I want, but there is something inelegant about it.

How about,

Pegasus Books -- Buy a book, you illiterate wretch."

Better. Still says what I want, but there is still something...oh, I don't know...blunt? about it.

"Pegasus Books -- Show some parenting, and buy your kid a book."

Or how about:

"Pegasus Books -- Comics -- Smarter than you are."


I think I'm not quite getting this marketing thing.

Anybody have any suggestions?


"Pegasus Books -- older than our customers." Tim

Pegasus Books -- Where imagination takes flight. Olde Dame

Pegasus Books -- Fascinating reading is just around the Bend. Olde Dame

Pegasus Books -- Where books wing their way into your heart. Olde Dame

Pegasus Books -- Just Who the Hell is Oprah? Dunc

Pegasus Books -- What do you mean you want change? Dunc

Pegasus Books - Buy this book or we'll kill this puppy. Bruce.

Pegasus Books -- Make a deal, or we'll club a seal! PopGoesBend.

Why I missed the Obama comic.

I was going to let this just pass, water under the bridge and all.

But another retailer, Brian Hibbs (Comix Experience) did an autopsy on the whole mess that I thought about doing, but then shrugged.

I've borrowed heavily from his column, Tilting At Windmills, so I hope he doesn't mind.

Let us back up a little tiny bit though, and read the original solicitation for ASM #583. It looks like this:

Written by MARK WAID
After the revelations of “Mind on Fire”, love is in the air for more than one member of the cast and Pete finally gets some time out with the ladies. (and who better to bring it to you than two men who both had dates as recently as 1987!) Amidst the romance though, forces are gathering that will spell trouble for Peter in the months to come.

32 PGS./Rated A …$2.99

This is the information that retailers had when they were trying to determine their orders, accept preorders and so on. Not a thing about Obama in there.

As I’m sure most of you are aware, we have a system called “Final Order Cutoff” (FOC) for Marvel and DC comics. What this means is that our orders are able to be freely adjusted upwards or downwards before the FOC date – typically three weeks before a book ships.

The holiday season interfered with the normal FOC schedule, however – because of Christmas and New Year’s, the FOC for ASM #583 (which shipped 1/14) was the week of 12/18. We also had to FOC all of the books shipping 1/7 as well as 1/21 – three different weeks worth of FOC.

The “Marvel Mailer” with the FOC information for ASM #583 then suddenly said this:

*AMAZING SPIDER-MAN #583 OBAMA VARIANT (OCT088192, $3.99, FOC – 12/18) AMAZING SPIDER-MAN #583 (NOV082358, $3.99, FOC - 12/18) will have a previously unannounced variant by Phil Jimenez featuring Spider-Man and the next President of the United States – Barack Obama. You can order the AMAZING SPIDER-MAN #583 OBAMA VARIANT without restriction if your orders of AMAZING SPIDER-MAN #583 regular cover by FOC are higher than your orders for AMAZING SPIDER-MAN #575 by FOC. AMAZING SPIDER-MAN #583 will also feature a 5 page back-up story of Spider-Man meeting Barack Obama.

This was not the first-placed change/incentive/difference, it was the third of twelve different product changes listed for that week. Marvel typically inundates us with last-minute product changes.

The recent trend on variant covers has been a declining one – there are so many of them offered each month that they’ve ceased to be special. Further, the overall sales trend on “Amazing Spider-Man” has been a downwards one – at Comix Experience we’ve been losing roughly 10% a month in sales since “New Ways to Die” ended. So, really, the idea of exceeding our orders from eight issues back, in order to be able to order any of the Obama cover, wasn’t something that really registered to me as a viable possibility.

Of course, this didn’t account for the impact of the Slow News Day, and the media interest in the title. Ah well.

Some (many?) stores missed the notification of the Obama cover in the first place – it was the week before Christmas after all.

Some (many?) stores missed the incentive by a single copy, unfortunately reading “exceed” as “match-to,” and so aren’t receiving a single copy of the Obama cover.

Note that in that latter case, the orders were cancelled out beneath the impacted retailers with zero notice of any kind – it wasn’t until they received their invoices this week that they saw they weren’t getting them, and, of course, it was far too late to do anything about it at that point. That’s pretty bogus behavior on behalf of Marvel and Diamond, however unintentional.

I may be a Pollyanna, but I really believe that had the book had its contents and cover properly solicited in the first place, without the ridiculous hoops that retailers were asked to jump through, supply within the market could be three-to-five times what it was. This still (probably) wouldn’t have been nearly enough copies to meet Slow News Day demand, but it would have gone a long way towards letting the Direct Market put its best foot forward to the hordes of civilians arriving in a frenzy that I haven’t seen since the “Death of Superman.”

I should add that in my own case, I consider most of Marvel's mailers to be nothing more than Spam. And I tend not to use the FOC except in extreme cases, because I've found that I tend to get it right with my first orders more than my second. Ordering on the fly every week usually gets me to overorder, instead of underorder.


So there is the LONG answer as to why I missed the Obama comic, and I'm just going to sigh and send people to the blog for explanation.

Thursday, January 15, 2009

Join or die!

Todays Bulletin, Business page.


"Downtown Bend businesses that are not members of the Downtown Bend Business Association could see a spike in their Economic Improvement District fees this spring, while those that are members would see their fees drop under a new plan proposed at a regular monthly meeting Wednesday."

WAIT! They can do that? They can charge non members -- non voting members -- more money for not being part of their club?

Lots of us moved Downtown instead of the mall to avoid interference by the Mall Rules.

What next? Are they going to dictate our hours? Tell us what kind of Christmas decorations to put up?

"If supported by at least two-thirds of downtown property owners and passed by the Bend City Council in March, the new three-year EID levy would require all downtown businesses to pay for membership in the association, said Chuck Arnold, executive director."

I'm stunned they even have the power to do this. I didn't ask anything of them. Indeed, I've often wished they just stop doing anything at all. I think the days we need a quasi-governmental organization Downtown to promote things are over. I'd just as soon skip the street closures and the rest.

"EID fees pay for all those things that a visitor to downtown Bend might take for granted, including flower baskets, holiday lights and snow removal. Events organized by the association, such as Art Hop, Oktoberfest and sidewalk sales, also would be in jeopardy if the extension of the EID is not passed."

Oh, my God! We might lose the flower baskets? That changes everything.

Sidewalk sale? All you do is have a Sidewalk Sale! Don't need a tax for that!

Look, I'll decorate the tree in front of my place. I promise. A few bucks and few hours a year, I can do that. I don't need Big Brother to do it. Snow removal? I'm also paying my landlord through triple net for that service, but you know what?

I'VE BEEN REMOVING THE SNOW! Either they are showing up way past the point of usefulness, or they aren't showing up at all. Either way, no big loss. In fact, it's a perfect example of why I wish they would butt out. If I clear the sidewalk, the sun almost inevitably creates bare sidewalks. If they throw that damn chemical on the snow, whatever the evil poisonous concoction it is, the snow turns into glop and sticks around forever, coming into my store and creating little grey sculptures on my carpet. CHEMICAL!

Not my choice, apparently.

Art Hop? If the businesses who benefit from this -- and any business that closes before 6:00 doesn't -- then let THEM support it.

As I've said, I'd just as soon NEVER close the streets. But now I also will have to Pay for the privilege of losing money on those days.

If there isn't enough volunteer interest to keep the Tree Lighting, and the Christmas Parade, and the Fourth of July Parade going, then they are done.

I doubt very much that is what would happen, though. I think there is enough civic pride to keep the tradition events going just fine.

But forcing us to be part of an organization that we chose not to be part of, seems an odd move.

"....would be in jeopardy if the extension of the EID is not passed, Arnold said. So would the executive director's salary."

I like Chuck Arnold, I think he's done a good job, but this appears to me to be a money grab, to keep his own job alive. Sorry. That's what it looks like. It's a really bad time to be adding to my rent, by the way.

Looks to me as though they've lined up 60% of the downtown owners as members, and they have a pro real estate city council and they can ram this down the non-members throats. (With the nice little incentive that their own fees will go down as a reward.) Gee, I wonder how that will go.

They've tried things like this before. The infamous "BLUE STRIPE" that was going to run from fountain below Hospital Hill and running down to the river that would've require the sidewalks be pulled up. Or the idea of putting camera's on every street corner and hiring a private police force. These were bad ideas at the time, and even worse ideas in hindsight.

"Downtown Bend Business Association members, comprise about 60% of the estimated 200 downtown businesses, pay the association dues that benefit the entire downtown..."

Benefit the entire downtown? Says who? Says the 60%? What about the 40% who chose not to be members? We don't think so, obviously.

I'd love to add up the years of the non-members vs the members and see who has more seniority. Just the two businesses quoted in opposition in the paper, plus me, represent businesses with over 80 years experience in total.

But hey, what do we know?

I went to a meeting once, where they wanted to change the organizational slogan to "The Village by the River." It was an asinine slogan. I couldn't believe it, but there they were all nodding their heads.

Even further back, they wanted to turn Downtown in into a paved mall: Which would have been the death of downtown. And what I remember was, it was the outsiders, the oldtimers, the old reprobates who raised a clamor and got that voted down.

If I choose not to be part of their group think, I think that should be my right.

The original EID was not only a good idea, but it was necessary. Downtown was in sad shape. But it was about infrastructure -- things like sidewalks, streetlamps, trees, and important things.

It was NOT about flower baskets.

I think the EID has outlived it usefulness and is turning into a self-protecting organization.

It appears that Compass Commercial, who are my property managers, are solidly behind this. I suspect that I AM ALREADY PAYING MY LANDLORD THROUGH INCREASED AAA for their membership in the EID; so what it looks like to me, is that I'll be paying TWICE.

I will also say, all other things being equal, I think making non-voting, voluntarily non-members with HIGHER fees and current members with LOWER fees is outrageous adn the Achilles Heel of the whole proposal. I don't see how anyone could think that was fair.

Wednesday, January 14, 2009

Oh, the irony.

A friend of mine Downtown has begun negotiations with his landlord.

He started to tell the landlord that sales were down, that they needed rent to come down....

"I thought you would say that," the landlord answered. "So I cut out this article from last Sunday's Bulletin. There's another store owner Downtown that says everything is just fine. His name is.....Duncan McGeary."

"What?!" That's impossible!" my friend exclaimed. "I know Duncan! That's not the kind of thing he would say. Let me see that!"

Reads article. "This doesn't sound like Duncan...."

Then -- (I think) -- he explained that Duncan is a well known crank and pay no attention to what he says.....

At least, that's what I would've done.

Since I will soon be renegotiating my own lease, I'd like to repudiate everything that Dumbshit...wasshisname, Dudley? Duncan? said in that article! I ...I mean that Dork....was mistaken! Bend is DOOOMED! Game over! Does the name Custer mean anything to you? We need lower rent, like half as much, maybe less. In fact, we ought to get a couple of free months!!!


It never pays to be positive.....

Anyway, I do think the next six months are going to be very tough, on into the later half of this year, and probably most of 2010 as well.

Really......a rent moderation wouldn't be out of line. Not a bit.

What I was trying to say was, that though the spaces Downtown were probably rentable, it doesn't mean whoever rents them will prosper at the higher rates.

From what I've heard, there have been at least six different people looking at the Merenda space already, including a national chain (which I'd never heard of.) Another local restaurant has apparently been looking at the Volo.

And why not?

The money has already been spent fixing those places up. I've always maintained that businesses Downtown leave beautiful corpses. That we fail upward.

Another way to put it, these are some beautiful shells for some enterprising hermit crabs to move into. If all they have to do is pay rent, hey, it may be a real opportunity.

Here's hoping, though, that the Downtown landlords will see the benefit of longterm, stable businesses who have proven that they can pay the rent, even if means a little less in the short run. That we try to keep a few older business around for seasoning.

It shouldn't be all high end, for instance, but obviously that means that rents can't be astronomical. If the space is somewhat more humble, so be it. I'll be sorry to see that Bond market go out, for instance, because that's just the everyday kind of business we could use a little more of.

So, when you read last week's article, just remember that there is more to the story.

Laying out the odds.

What I'd really like to do is an honest assessment of what I think is going to happen to my business, and to Downtown Bend, without either the hyperbole or the wishful thinking.

Best is to put 'odds' on each likely occurrence, overall.

Scenario One.

A quick, deep recession, which we've already suffered most of, and comics do very well with the Watchmen movie coming and new books sell well, and games doing well with the addition of another game store in town. Sales actually start to go up from the bottom before summer, and start approaching last years levels by end of summer.

Unlikely, but you never know. 10% odds.

Scenario Two.

Things bump along pretty much as they have been, with slowly declining sales, ending up about 40% from the peak average to the low average. Occasional empty storefronts, which are rented fairly quickly. Enough businesses to keep Bend -- relatively -- vibrant. Enough business to keep the store well stocked. But challenging through the end of the year and well into the next. Leaves us vulnerable to sudden shocks.

Mostly likely, I'd say 70% odds.

Scenario Three.

Things really crash, dropping 50% or even 60%. Storefronts empty and aren't refilled. People leave town. I start playing cribbage on the sidewalk with my neighbors, waiting for customers. Ironically, after the worst has hit, probably no more vulnerable than the above scenario, because concessions would be forthcoming, one would think. And I would just cut to the bone.

Hopefully, unlikely. I'd give it 20% odds.


Anyway, despite the last three really slow days, I went ahead and started on my February reorders.

I'll be getting pretty much a complete restock of the evergreen graphic novels.

I reordered most of the solid selling board games and card games.

Next week, I'll be ordering books and cards.

Then, it should be pretty much maintenance levels after that.

The amount I spent was about half of what I sold at Christmas -- that is, half of what I sold at Christmas were evergreen products, and half were one-ups, which don't need to be replaced.

I'd have to say there was just enough business the first two weeks of this months, just barely enough to restock the store completely. Maintenance levels should be easier from here on out. At the same time, they will have to be maintained with REAL sales, and not prospective sales.

Otherwise I'll just wait until the Summer boost. My three best months are in the second half of the year, July, August and December, proceeded by my fourth best month, June. So -- this period of January thru May is always a tough time for Bend retail, and this year it probably will be just tougher.

Trick is to get through it without going backward, without resorting to debt, without having my store empty of product.

I think I can pull that off.

Tuesday, January 13, 2009

A little, of a lot.

I told this story to my wife, and we just started laughing.

When the guy said, "I'm going to shove these cards up your ass," I answered, "I was thinking of doing that myself."

Everyone in the store sort of hesitated. This really puzzled look came over the guys face, and I thought of trying to explain myself...

And then, the argument went on.

Capped by the customer's remark, "Well, that went well, considering..."

About 15 years ago, the card customers became so difficult to deal with, I stopped trading for singles. A couple years later, I stopped buying. Now....I'm going to stop selling the singles.

The comment I had back then was, "When a 'service' becomes a problem, it's no longer a service."

I haven't made money off singles for years. They are strictly an add on bonus service.

No more.

And yes, it is a way to avoid burn out. If I carried one product and devoted 100% of my attention to that product, I would be equal or in advance of any possible customer.

But by having 8 product lines, and devoting say, 20% to each product line, I'm still working 160% as hard, but probably don't know as much as the more hardcore customers in any single product line.

Most customers accept that. A few seem insulted that I'm making my living doing something they know so much more about.

But this broad, diverse product offering, but with a light touch on each product, is the method I've found to survive in Bend. Like a "General Pop-culture Store" I need to carry a little of a lot.

If Bend was bigger, or demographically different, I might be able to focus on one or two product lines. But it more than a little revealing that there aren't any full card, comic, game or pop culture toy stores in town. But one store who does all four.

Make it too difficult, and I'll stop.

Got to work yesterday, and it felt different. Just really slow.

I wonder if the next two days will be more indicative of the month than the first 10 days or so....

I waited most of the day for customers, got a guy who comes in from Eugene periodically, and because he was an out of towner in the know kind of guy, I kind of dumped on him. (I mean, I complained about how hard it was to sell comics....)

After he left, I was surprised by the bad taste that left in my mouth. Wow. I didn't know I was that down on the business.

Then, I got a father and son in the door. He reeked of alcohol and was a big, loud pain in the ass. Expounding about the 'right' way to collect cards, (the son was actually pretty right on his observations, the father completely wrong.)

I finally stepped in and explained that I don't "really do" singles anymore, that all the cards in the boxes and albums were a flat .50, that I don't have any inside knowledge on trends.

And hour in, the father is still asking if I have "Joe Namath Rookies" in any of the boxes, and how the Beverly Hills Card shop he goes to is so much better, and on and on.

It was the on and on thing that finally got to me. The son had pulled about 100 cards out of my alphabetical albums before I thought to ask if they were going to buy them.

They both froze. I went over, quietly closed the albums, and said patiently, "Why don't you pick a few cards out of this stack you want, before we go any further...."

Anyway, a family came in an started shopping for books, but every time I tried to say anything, this guy kept loudly interrupting.

Finally, (after about and hour and a half of this of trying to reason with a brick wall), I said, "Come on guys, you need to finish this up. I've got work to do. Buy something."

He said something rude, and I said, "O.K. then, I'm going to ask you to leave."

He got all blustery, and told me he was going to shove the cards up my ass and it was too bad I wasn't doing well and was burned out, but I didn't have to be such an asshole.

Just leave, I said tiredly.

He got in my face ready to fight, but I didn't feel fear or anger, just tired and he saw it in my eyes.

I said, "You might want to think about not drinking during the daytime."

He said a few more rude things.

Finally he left.

The father of the family in the store, who had been watching all this in stunned silence turned to me and said, "Well, that went well, considering."

This is the second incident with sports card collectors, concerning singles. I think I'm ready to remove them completely. Pat was always on me to remove the Magic singles, as well. They both seem to attract the wrong kind of business.

If I'm going to run the store by myself, I need to simplify. The 'burn out' accusation isn't far off, at least where it concerns cards. Simply selling packs and boxes ought to remove some of the tension between 'collectors' and me and will reinforce -- confirm and nail down -- that I don't buy, trade or SELL singles.

Monday, January 12, 2009


I hadn't appreciated the fact until today. Because I've made no reorders over the last month, I've also been relieved of making any decisions.

Now the store is back in play, and decisions need to be made.

Projections have to be arrived at, and allocations of resources.

Do I hold back cash, or reinvest in product? Do I shore up best-sellers at full price, or continue to buy merely good product at discounted prices? Is it better to spend most of the money up front, and get the full month's benefit in sales, or hold back and give myself breathing room?

As usual, I'm splitting the difference. Basically, half the money I'm saving by working the store myself is going into savings, and half into product. Holding back half of the projected surplus, and only spending half of the money I am going to spend in the first two weeks.

Holding back cash would seem like an obvious answer, but any real downturn can wipe out cash pretty fast, whereas a solidly performing store with good inventory could stave off a downturn longer.

Simple, but complicated.

I've been reading a Pulitzer Prize winning history book, An Army of Dawn, (The war in North Africa, 1942-1943), by Rick Atkinson.

It's a bit of cliche to compare business to war, but the parallels are unavoidable. Commanders were constantly being cautious when they should be bold, bold when they should be cautious. Misreading signals. Not firming up their supply lines. They based their decisions on inadequate information.

But the biggest lesson is that war is chaos, and no one really knows what's going on.

There is an Admiral Hewitt early in the book, who harbors the notion of "velvet" which is that little bit of wiggle room that every plan ought to have. I'd never heard it before.

From now on, it'll be part of my business vocabulary.

I've struggled for years to turn the store around from ordering stuff and paying for it with sales, to having cash to buy stuff, and then selling it. To do that while not hurting the momentum of the store has been a long process.

I don't want to give up that Velvet, when I need it the most.

Sunday, January 11, 2009



Because I can't stand to have my little gems of wisdom (or as I tell Bilbo about plastering his words all over the place, 'turds of wisdom') and because I know that not everyone here goes to BB2, I'm repeating a series of comments I made over there about the creation of Bubbles:


It started with Bilbo saying that I had said that one couldn't stop a bubble from happening. (Earlier, he had accused me of not reading Popular Delusions and the Madness of Crowds.) Because it involves good old anonymouse Bilbo, the language isn't for the faint-hearted.


Of Course, you COULD stop a bubble. It's just that no one ever does. Too many people making money.

What I said is, you can't START a bubble. (Shit, Buster, they're trying ALL THE TIME! Every new business, every new product, thinks they are going to take over the world.)

What it comes down to, people think they can CONTROL a bubble, manipulate a bubble. The other guy will always be the last fool, not you.

And bubbles ALWAYS end badly, lower than where they started, with everyone at death's door.

Only a lucky few will escape before it all collapses, and a few others will get out intact.

And yes, I've equated fads with bubbles, that's my premise, if you don't buy it, I understand.

I've read POPULAR DELUSIONS. A more boring and dry book would be hard to find....


You and I are never going to agree on this, Bilbo. We have different world views. You see Evil Genius, and I see Chaos.

Ordinarily I'm a great believer in cause and effect, but when it comes to bubbles, I'm an agnostic.

I think they're a mystery.

I could be wrong about this, but even if it's true that bubble are created, who decides what becomes big and what doesn't?

So it becomes a moot point.

I'll give you this much. It is possible to recognize a bubble early, to promote it, to be part of the TIPPING POINT, and making it really happen.

The biggest benefiters to the bubbles, are people who were accidentally (on purpose? Luck goes to the prepared?) positioned.

In Bend, you have the Hollerns, the Coats, the Wards, the Miller, sitting on what had been, up until 15 years ago, fairly worthless property.

The other people who can profit are the few survivors of the last bubble who have no consciouses and are willing to screw people in the new bubble.

And you have a few survivors like me who are just trying to survive with their businesses and integrity intact.

But as Tim said, we'll be buried under fetid corpses....

To Which, Bilbo answered:

"Bullshit dunc, you haven't read the book, and if you did you skimmed, you were bored, ... you don't like reality.

Your a sci-fi guy, you like fake worlds truth bores the fuck out of you."


I just told you, Bilbo, I did read the book.

Must be nice to ignore everyone else's reality.

I gagged my way through it.

The only interesting parts were the South Sea bubble, and the Tulip Madness.

It was like reading The Gangs of New York. You force your way through because there are some fascinating elements.

But you wish a modern writer would update the info in a more entertaining fashion.


Jeebus dunc, just let go, I could start a fucking bubble anytime I wish.


Ummmm, go right ahead?

Spend a fortune of time and money trying to create a bubble.

If you succeed, you will be hailed a genius. If you fail, we'll never hear from you.

Like I said, it begs the point -- why do some things take off and not others? It can't be just brains, and money.

It's something more mysterious.

In your view, I'd have to say that the housing bubble inflaters were awfully nice to wait for the Nasdaq bubble inflaters to burst first.

One bubble at a time? Benefiting only one element?

Accident explains it more, fertile ground, maybe, but the EXPLOSION (not just 'hot' product, that can be created by advertising, but BUBBLE magnitude is way, way bigger.

Unaccountably hugely delusional.

If ten thousands monkeys set out to create a bubble, and one succeeds, is he lucky or a evil genius?

You could write a book about how this one evil genius monkey figured it all out, and find all the reasons in hindsight.

I guarantee you there are ten million monkeys out there right now, trying to create wildly successful, delusionally profitable trends or product.

General Mills right now is expending millions on product development and advertising, trying to create the hottest cereal ever.

Ford is trying to convince you their next model is the new Mustang.

And so on.

It's the "Sam Walton" is a genius school of thought.

If you start with 1000 stores 50 years ago, one will end up being the biggest. Then we can all go back and see why, and give it all kinds of importance.

But to me, it's like asking why Saturday is the busiest day of the week in retail. Oh, because people are off work, or whatever.

But what if the busiest day was Tuesday, then we'd find all the reasons.

And alternative explanation is:


It's simple statistics.

So, yeah, Walton did some things right, but if it hadn't been him, it WOULD'VE been someone else. And we'd be calling them, CHEAP SHIT FROM CHINA, either way.

And Target would be trying to position themselves as the classier Walmart, but it would still be, "WE ARE COOLER THAN WALMART, BUT WE HAVE CHEAP SHIT FROM CHINA, TO