Rocket Bomber - retail

I complain a lot about work. A Lot. Retail is a rough job, and we have to smile while doing it — in the face of some some of the worst customer behaviors and unreasonable (nigh impossible) expectations.

Dealing with the public Sucks. You Suck.
—but before you respond in the comments (again) to tell me how awful I am, as a retailer and as a human being (again) y’all need to read the whole article.

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Rethinking the Box is a collection of ruminations on retail: a unique combination of sober (and sobering) business analysis mixed with drunken, inflammatory personal invective.

Previously:
Study your History. Recognise your Motives. Location, Location, Location. Know your Customer Base, and your Staff. Find your Niche. Consider your Product Lines, Stock Your Shelves, Consider alternative display strategies, take a second look at What the Customers Want, and then stare again in dismay at the Profit Margins. Try calculating your upper-limit affordable rent and the revenue from inventory (with a side of coffee) and compare your numbers to average industry per-storefront sales.

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Gods, work sucks.

First, the phone rings off the hook — even on a slow day we’ll get 12 to 15 calls an hour — but around half of these are simple to deal with (Yeah, we’re located just 2 miles south of the mall, and we’ve been here in the same damn spot for 15 effing years already) or obvious (you just listened to a recording where I myself, being the only poor bastard who knows how the ancient PBX board works so I’m the only one who can record the greeting, just told you of both our address and normal store hours — give me a mo, I can even rattle off the script from memory, “We’re open Mondays thru Thurdays 9 AM to 10 PM, Fridays and Saturdays 9 AM to 11 PM, and on Sundays from 9 to 9. If you’d like to speak to a bookseller, please remain on the line.” Do you really need to talk to me in person to verify that yes, we’ll be open until 10pm?) or the people calling actually know the title&author of the book they want. The other half of phone calls? Pure Retail Hell.

We’re not freaking Information; we sell books. But over the past decade I’ve been asked to answer over the phone:

• artist & CD from half a lyric
• plot synopses, major characters, and critical review for a number of titles.
• sales figures for bestsellers, “Sure, it’s number 1. Say, just how many books is that?”
• address and operating hours of my competition, the other bookstore up the street. (not at the end of a conversation, when I couldn’t otherwise help a customer… no. this was the first damn question out of his mouth.)
• availability of a book in one of our branches 5 states and 1000 miles away.
• conversion from Celsius to Fahrenheit
• name and number for a local cake shop for a customer in New Jersey who wanted to send her son a birthday cake.
• “How do I get my book published?”
• related: detailed explanations on how the publishing industry works, how our distribution chain works, why the ‘services’ offered by so-called self-publishing companies aren’t quite the same as actually being published, and why I can’t order your book into the store.
• “I have a book, how do I schedule a book signing?”
• related: if your business model relies on getting an ‘event’ at one local bookstore where you might sell 5 copies of your self-published book — you’re doing it wrong and your model is broken. Sure, you hear about famous authors doing book signings all the time but correllation is not causation and those authors aren’t famous because of the signing — in fact the exact opposite is true: we only bother with the in-store event because the author is famous… or internet ‘famous’, or they were just on TV. [here’s your tip: instead of calling poor, overworked booksellers to get into the bookstore, you need to expend your energy calling producers and scheduling directors trying to get on TV — or take the whole thing onto the internet, post YouTube videos and to your own blog, build up an audience (and a conversation with that audience). But I can’t teach marketing over the telephone. The most I can do is say, “no. sorry”

You might have noticed, with that last pair of questions-and-comments, that there is a wide swath of the general public that has no idea how the book business works but still wants in and their only recourse is to contact the one part of the industry that they know about: the book store.

When they’re lucky, I’m the schlub who picks up the phone at their local, as I actually can explain a bit about how both book publishing and book retail works. [note: I don’t get paid any extra for this.] 99 times out of a 100 though, I’m not sure what kind of response these poor misguided souls get for their heart-felt inquires, as they only want to make a book — but apparently they can’t rub two brain cells together to use Google (and other internet resources) to find this crap out for themselves. (or, you know, come into the store to read the books I have on publishing, maybe even buy a few.) I am of course a bit wary of the actual ‘books’ that may be in the offing (if they have a completed work, and aren’t just looking for what they think is easy money in the book biz) but who knows? There may be a future Pulitzer Prize winner who is just a luddite and doesn’t know any better — but even if one hates and avoids the internet, 30 years ago the model was not, ‘call a book store’ — you sent the manuscript to publishers (or maybe an agent) and you did the leg work and you followed up. These days you’re better off getting an agent first, but I can guarantee top-flight agents are not going to be answering the phone at the bookstore.

To just call your local branch of Big Box Books and all-but-demand publication, fame, and fortune smacks not only of laziness but also of hubris. I’m not Barnum or Svengali or Pearlman or a Faustian devil — the fame-n-fortune contract is outside my purview — I sell books, it’s all I do, and by “sell” I mean ‘take money in exchange for merchandise’, if you need someone to market your books that’s a different skill set and it pays a lot more per hour than my current salary.

Anyway, that’s just the crap I deal with over the telephone.

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Customers in store are just as bad, if not occasionally worse.

They can’t remember a title, or author (or both). Sometimes what they do remember is just wrong. Sometimes all we have to go on is a subject, or a concept, or half a detail (“The author’s first name is Jim, or Jack, or Jan, or Johann — something like that.”) Of course, most shoppers who actually make it into the store have a better idea of what their looking for (since there is a big difference between picking up the phone and driving into town) but there are some who are just there to meet a friend, or who have an hour to kill before an appointment, or the kid needs a book for school and while the fam is in store maybe one of the ‘rents asks about the latest thriller or what was on Oprah or whatever.

When we can succeed at the searches, we feel like Bookstore Gods™ and it almost, almost makes up for the other 95% of stupid questions from the general book-store-going public.

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Here’s the thing:

The phone is ringing off the hook. During the rush, we not only have people walking up to our info desk, we have a line and we’re on the PA paging for backup to the desk, or the registers, or both.

These are great problems to have.

There is no such thing as too much traffic. Sure, if it continues like this day after day for more than a few hours, then we need to hire more staff and that’s also a great problem to have.

The things I complain about at work are the sorts of things other retailers would give their eye teeth for. (Or, they’d punch me in the face hard enough to dislodge dental work and they’d give my eye teeth for a tenth of that business.)

The phone keeps ringing not even because folks happen to have our business card or they’ve read our ads (we barely advertise, amazing for a multi-billion-dollar retail corporation), but because an internet search or the yellow pages or a call to 411 directory assistance gave them our number. When they think bookstore, they are already thinking Big Box Books and there is little we have to do (or can do, really) to either augment or mitigate this never ending stream of phone calls.

[aside: OK, so my store is listed first, so maybe we have to deal with more idiots potential customers than the other branches of Big Box Books in town, but still.]

Opening an independent store means giving this up. It’ll take decades to build up awareness in the community, and even then I’d still be competing against Big Box Books. Believe me, I still want to run my own shop — I’d love to own my own bookstore — but I’m not fooling myself into thinking I can match the sales of the majors, even if I have a larger, better store, because it just doesn’t work that way for a start-up.

If you’ve defined your niche and you can out-do the big boxes in your chosen category, then over time you will find your customers (rather, they’ll find you) and five years down the road you’ll be performing much better. So, what’s your plan to stay open for those 5 years? Or for 3 years? Or even until next year?

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Reputation, name-recognition, and community goodwill are all intangibles that can’t be bought. What can you do?

Be the Best There Is at What You Do.

• Be open, and inviting. This may mean: being open for business earlier and later than the competition, having more comfy chairs or tables (and outlets!), or being just plain prettier than the corporate cookie-cutter retailer out by the mall.
• Hire better staff, and pay them more.
• Sell coffee, and cake. Host book clubs. Sponsor literary events; if you can’t find any to sponsor, heck, invent a few, advertise ‘em, run ‘em out of your storefront. The idea is to pull people into the store.
• Keep the shelves stocked. Nothing sells books like more books. Build taller bookcases, cram bookcases into every available space, stock used books if you have to — just make it look like you have every available book in the universe (or at least, every book in your niche) and believe me, people will talk about it.
• Broadcast. Do whatever you can to get the word out: blogs, social media, print ads, radio ads, stunts, contests; a kick-ass, usable, and useful website; everything and anything you can think of right up to and including a bigger, brighter sign out front.

About the only thing you can’t do is try to compete with the major chains on price. Even Big Box Books is getting undercut by CostCo, Amazon, and Wal-Mart. So sell everything else: the experience, the ambience, the service — if you’re selling coffee and cake, make sure both are better; if you’re open all hours and have comfy chairs, don’t be stingy or grudging or condescending towards the customers who are going to take advantage of that.

[I’ve some work to do myself re: that last point]

I said intangibles can’t be bought; but they’re also not free. This is going to cost you, either in money or in time. If you have decades to scrape by and barely make ends meet until you are in fact a fixture in your community, then fine, you can likely earn your reputation on the cheap — but I don’t have that kind of time (and at least in Atlanta, I can’t buy out another bookstore that has been built up over decades). Invest in the storefront, invest in stock, invest in your staff (keep ‘em happy) and eventually you’ll see the results in your bottom line — just not in the first year.

first and foremost: there is no such thing as a “Coffee Table Book” — sure, I know what you mean and like art (or porn) we all know it when we see it, but I’ll be damned if any publisher cites these as a category or format. It’s a descriptor like Sedan or Compact or ‘family car’ — it can mean a lot of things depending on who is using the term.

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Rethinking the Box is a collection of ruminations on retail: a unique combination of sober (and sobering) business analysis mixed with drunken, inflammatory personal invective.

Previously:
Study your History. Recognise your Motives. Location, Location, Location. Know your Customer Base, and your Staff. Find your Niche. Consider your Product Lines, Stock Your Shelves, take a second look at What the Customers Want, and then stare again in dismay at the Profit Margins. Try calculating your upper-limit affordable rent and the revenue from inventory (with a side of coffee) and compare your numbers to average industry per-storefront sales.

[yes, the intro gets longer with each post; but the one time I omitted the context all hell broke loose.]

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In the last column I outlined a strategy for stocking graphic novels. (an expensive strategy but one that corrects for errors and accomodates certain customer behaviours such that at least one copy of a book is always available *and* where it should be on the shelf, so we can sell it. Buy 3 to sell 1, heh, everything old is new again…)

My “Illustrated Empire” is to be more than just a comic shop, though; in the August inventory post I outlined quite a few categories [Art Surveys and Collections, Art Technique, Architecture, Graphic Design, Fashion, Photo Essay, & ‘Coffee Table’ Travel] that are broadly related to each other in as much as each category is primarily made up of large format, full-colour, expensive hardcover books. These things are heavy, printed on glossy clay paper, tend to run into the hundreds of pages in Quarto or Folio editions, or larger, or odd custom trim sizes, and all in all they’re a pain in the ass.

You’ll need custom shelving for these (or at least, not standard book shelves) as a 4-foot run of art books can weigh 300+ pounds and they tend to overhang standard 6-8” deep shelving by at least a third. For those of you who haven’t moved outside of the graphic-novel corner of your local Big Box Books for more than a cup of coffee, let me put it in perspective: those slipcased, over-sized Absolute Editions DC is so proud of? Imagine 150 linear feet of shelving on a wall 30 ft. long in bookcases 7 ft. high, full of nothing but Absolute DC.

It’s heavy. It’s impressive.

It’s the Architecture section at my branch of Big Box Books — and I know my store is atypical; most stores would be lucky to have one or two bookcases while I have ten, and this is just architecture. I’ve a similar run of Art books, and Interior Design, and smaller runs of things like Photography and Graphic Design.

It’s an odd confluence of being within easy driving distance of both Ga. Tech (with their fine College of Architecture) and the Atlanta campus of SCAD, while also located just down the street from a neighborhood full of Coke-stock-beneficiaries who have little to do but redecorate their mansions once a year.

…between them, and the students, and the homeless, on top of the usual slate of both the casual shopping public and die-hard bookstore junkies, it’s an unusual place to work. —but it might also explain some of my odd perceptions of the business & our customer base [posted previously].

Anyway, when I say you can stock 4,000 large-format, high-price-point “coffee table books” and you can make money doing it, I know whereof I speak.

The books themselves are the draw. Some of you may have been wiping drool off your chins already, after reading my description of a ton and a half of Art books alongside a ton and a half of Architecture titles. The problem, of course, is that casual browsing completely destroys the value of the book [even though the book itself is fine, and intact] and the physical weight of the books themselves will wreak havoc on flimsy dust jackets, or even occasionally the binding.

If it’s an $80 art book, and you have a choice between the fresh-out-of-the-box shrink-wrapped copy, and the one that has been knocking around my store for 2 years, the choice is obvious. The problem I run into, as a retailer, is that often this is the same copy: I have one copy. It’s still shrink-wrapped. Customer A wants it, but wants to look at it first. One time in twenty, they find a bookseller and ask, politely, if it’d be OK to unwrap the one copy in the store because, well, it’s an $80 book, right? Only fair to see what $80 buys. (The other 95% of the time a customer tears into the book anyway, and hides the plastic or cellophane behind other books — which means it’s not an unthinking act, as one went to lengths to hide the evidence)

Customer A unwraps the book, flips through it, decides no, not really, and puts the book back on the shelf.

Customer B, finding said “spoiled” copy, then brings it up to the desk and asks, “Hey, this is your last copy but it’s damaged, no really… can I get a discount?”

Customer A was functioning by their own logic, and Customer B certainly thinks their request is only reasonable, given the condition of the book [as noted above, even though the book itself is fine, and intact, and people attempt to return books for full credit that are in worse shape at least once a day] and this type of exchange is one of the reasons I drink heavily.

Since I don’t want to be an alcoholic [from stress; I’m perfectly fine being an alcoholic who drinks to celebrate the pure joy of being alive] obviously I would need to find a new way to merchandise these books.

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Case 1: Open Shelves.

This is the situation described above. And books sell; it’s not the worse thing in the world. And, while not admitting anything about the performance of my store or revealing proprietary sales data my employer would rather I not post to a blog (sorry, had to say it) if you’ve the right kind of books and the right kind of market, then even with $50+ price points you can manage a turn ratio of 1: one book sold each year per book stocked. At $50 per, that ain’t bad at all.

Open shelving has the benefit of density (three tons of books, noted above) though you’re going to have to take some losses (or the publisher will, if they accept the damaged books back) and you’ll also have to invest quite a bit of payroll into maintenance: These sections are heavily browsed and almost universally, no one puts the book back where they found it. In those rare cases when a customer does reshelve a book it’s always wrong and more often we find a 70lb. stack on a table or bench at least 20 yards away from the section. Now we have to truck 70lb. up to the desk, to figure out where they go, and schlep the same 70lb. back to the section to reshelve them appropriately.

And we do this for each and every ‘coffee table book’ customer. Multiple times. Some customers really suck, you know?

Case 2: Buy 3 to Sell 1

…same logic as my Graphic Novel stocking strategy: one copy is mis-shelved, one’s been opened, but you should still be able to find a sealed copy to sell. You know, until someone unwraps that one too, “Oh, here’s one unwrapped already, but how will I know if the contents inside are the same unless I despoil this copy as well? I mean, that’s only logical.”

Case 3: Curated collections

Instead of stocking everything you can think to order, focus instead on 20, or 50, or 100 really great books. The trick here is picking what your customers will want, so you’ll need an expert on staff (if you’re not an expert yourself) but the main benefit is a much higher turn rate:

You’ve one ‘display’ copy, but 20 or even 50 copies still in the box. Your needy, grasp-y, greasy-fingered customer base can grope and paw the display copy all they want, and if they like it, you hand them the still-pristine copy from the top of the stack. For customers giving books as gifts, this is ideal. Repeat 5 times, and you’ve already done much better than the single copy alone would have done lost in a bookcase with other similar titles.

You don’t even need bookshelves for this — stock ‘em Crate & Barrel style: A fine easel or podium or table-top display, backed by cases of books to be sold.

A curated collection would need to be changed out frequently, so you’ll need to be on good terms with at least one publisher (Taschen and Phaidon spring immediately to mind, though there are others) as you’ll need a willing partner to accept the unsold stacks as returns, and as much advance information as possible to select books that might have sold 20-30 copies to begin with.

Case 4: Behind the Counter

Again, you’ll be looking at just 50-100 titles, but instead of out in the stacks where any hard-up homeless guy can flip through the Photography books because they happen to have nudes in them, you stock your expensive merch behind the registers (or behind some other counter) so they can only be browsed on request. This might save the books from some of the more, intensive, browsers but again limits your available selection from thousands to scant tens — maybe a hundred or so.

And unlike a curated collection, you don’t have duplicates to sell, just one of each.

“Behind the Counter” is the default for most stores, in fact. As a stocking ‘strategy’ it lacks quite a bit of sales potential; this is really more of a just-in-case purchase on the part of the bookstore or comic shop owner. “Oh, I need Absolute Watchmen and Marvel Premiere hardcovers and some Absolute Batman… just in case“

You can write the investment off as ‘decoration’ — yes, these are expensive but some deluxe editions and figures and poly-bagged collectibles and maybe even some DVDs “behind the counter” lend the shop that “Android’s Dungeon” air: we’re serious about this, so serious we stock stuff we know won’t sell. Ever.

OK, let me dial that back a bit: There is nothing wrong with stocking specialty and high-price-point items. It’s commendable. In fact, I plan to do the exact same thing, but in a much higher volume store where, as a percentage of overall sales, not only does it make sense but might even be considered a requirement. (So, in an attempt to forstall comments that I know are coming: yes, your shop does quite well by these, but what of the strip-mall storefront comic shops that are just breaking even on periodical sales: do they need to invest in hardcover Hulk & Batman?)

Case 5: Closed-door Collections

Say you’ve a 20×60 room, bookcases on every wall, a few tables and comfy armchairs set up in the middle. Stack those bookcases with your Art and Artsy titles, and then put a lock on the door. Keys to be held by managers only.

This has the benefits of the Open Shelves model, above, in that you can really pack the books in. 4000 or 5000 different titles, depending on how tall your bookshelves are. You also have a degree of control over access, similar to a behind-the-counter model (though if you let one college student in, there will be 20 there before you can blink). And while this won’t stop the gradual degredation of your stock, by limiting access you might get another year or two out of the books — and even some sales of off-the-shelf, unwrapped copies, as they are still ‘like new’ as opposed to being ragged-looking shadows of their former selves.

And, since customers must ask for access and be granted such by an authority figure (inasmuch as a bookstore manager can invoke that authority) they will be more careful with the books. If a book is just sitting on a shelf that’s one thing; if someone has looked you in the eye and made note of your face before unlocking a door, that’s a completely different interaction.

[long aside:]
Given my past experience, I’m most immediately inspired by the Georgia Tech Architecture Library — it’s a small annex to the main library located in the CoA building, and if you didn’t know it was there, you’d never feel the lack. But for those who know to ask, it’s an invaluable resource, and for those-who-know keeping the library intact and in excellent shape is almost a calling. Books, particularly the over-sized and heavily illustrated volumes, are treated with care. Someone after you will need to look at these same pages, and it is our responsibility to make sure the volume survives for them.

I’d love to capture that same spirit, only, you know, with the add-on that I’d like to sell you that book if you happen to have $100.

Bookstores aren’t libraries. The general public hasn’t caught onto this yet (more the pity for libraries) but eventually the differences will become pronounced enough that the public has to take notice, or they won’t care, or e-books and the related dog-and-pony-circus will make make the point moot, or obscure the issue so that the role of libraries is either forgotten or discounted. And we’ll all be poorer for it.

Don’t mistake me: I’m a bookseller, and more than happy to take your money, and less happy but willing to take on some of the roles of a librarian if it means I can take even more of your money — but I know the function and role of libraries in society, and even if my customers don’t know and feel the loss, I do.

I think we can all see that retailers are not a cultural institution and, at least in Amazon’s case, can actively work against the public interest. (Though who is to say whose interest is served when two major corporations get into a spat over how the dollars are divvied.)

At any rate, I feel the need for an independent, academic repository of books — both informative and entertaining — that has nothing to do with profit motives or sales. We need libraries, or else the soul of our culture is dead.

[and note: Google isn’t going to be that “independent, academic repository” no matter how they try to spin it — but I don’t know what the solution actually is, or is going to be. Just commenting from the sidelines.]
[/long aside]

For my eventual bookstore, I’m leaning more and more toward these closed-door collections, and may have not one but four or five of these reading rooms, differentiated by subject.

Rethinking the Box is a collection of ruminations on retail: a unique combination of sober (and sobering) business analysis mixed with drunken, inflammatory personal invective.

Previously:
Study your History. Recognise your Motives. Location, Location, Location. Know your Customer Base, and your Staff. Find your Niche. Consider your Product Lines, take a second look at What the Customers Want, and then stare again in dismay at the Profit Margins. Try calculating your upper-limit affordable rent and the revenue from inventory (with a side of coffee) and compare your numbers to average industry per-storefront sales.

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And I’m back: for those of us in retail, December starts in late October and doesn’t end on the 26th; it keeps rolling until the last of the holiday clearance is either sold or otherwise disposed of. I’ve been busy.

In the interim, I did find one excellent info-tidbit — National average rents, from Bloomberg

At some point in the near future (February) I’d like to post a rundown of Just The Numbers — anticipated monthly expenses: rent & utilities, payroll, cost of new stock and replenishment of older titles, inventory shrink, and marketing. (…OK, so maybe March. Late March. Maybe May.)

And figuring out anticipated expenses is certainly valid; I’m going to need that number. But even before we open there are other inventory considerations.

Namely, buying inventory.

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Way back in August I detailed quite a few categories and some anticipated stocking strategies — quick summary:

[a blockquote with significant edits, please ref. the original post]

Art Technique:
500 titles at $20 avg per title = $10,000 of stock. sales of 1/2 volume per annum = contribution to sales of $5000.
—
Art Surveys and Collections:
500 titles at $40 per = $20,000 of stock. 1/2 vol per annum = contrib. of $10,000.
I’d be willing to stretch that to 1000 titles, but I’m not sure 1000 suitable titles are out there.
—
Architecture:
500 titles at $40 per, etc. etc. for the same $10,000 in annual sales.
—
Artists:
1000 titles at $40 per, 1/2 vol per annum = $20,000 in annual sales
—
Graphic Design:
250 titles at $30 per, 1/2 vol per annum = $3750 in yearly sales.
—
Travel:
500 titles. $40 per and a turn of .5 nets another $10,000 in sales.
If the business is worth pursuing, I could see devoting double the space — particularly if the turn rate is much closer to (or exceeds) one.
—
Fashion:
Say 250 vols @ $30 per, at 1/2 vol per annum, $3750 in annual sales
—
Photography:
250 volumes, at $40 each, and a turn rate of .5, for a contribution of $5000 to annual sales.
—
Periodicals (non-‘comic’)
From Wired to Shonen Jump, from Otaku USA to Yen+, from Wizard (so long as they still publish) to Playstation the Magazine, there are a number of periodicals that are worth stocking that have nothing to do with DC and Marvel.
I can find room for 100 of these titles in my store, I’m sure. It’d be a magazine rack about 12 feet long, with nine shelves. No matter how many of each title I stock, assuming I could sell just one of each every month, at $4 per these shelves would generate $4800 in sales. Obviously, we’d be looking to sell more than one copy of SJ and ¥+ each month.
—
Periodicals (comics)
I’d be tempted to just match the magazines, but let’s say we double them: 200 titles at $3 at one copy (average, per title stocked) per month = $7200 a year, gross.
That’s as much gray-matter as I feel like spending on the floppies, actually. I’m sure I could find 50 titles a week in Previews; I don’t know that it matters which 50 I’d pick. One presents the comics to the customer base; either customers request something else (which will change the order next month) or they buy what you’ve got. There’s a learning curve out there and I hope I have enough cash reserves (or other sales) that I can afford to teach myself this business.
But as stated, it’s not about chasing or appeasing the Wednesday crowd; there’s the LCS for that, after all. Just a good mix of generally well-known subjects and perenials (Simpsons, Archie, Spider-Man, Batman, + whatever Hollywood is making a movie of) and I know this is the cretin’s path, devoid of any love for the medium and strictly mercenary, asking first ‘what sells’ and screwing the rest.
But in my mind, the love and dedication to the artwork are what the collected trades (and trade paperback originals) are for. I’m not going to save the industry with floppies.
In a bookstore of the size imagined to date: 24 feet of floor space for a couple hundred comics — I’d plan to set aside 10 times that for seating and tables; so I’m sure we can spare a pretty large corner for a comics rack. It may be a loss. But that’s Fine. Newspapers are also a loss-leader; you don’t stop selling newspapers just because you can’t make money on them.
[well… we haven’t stopped selling them yet]
Part of the stocking strategy is the Face you present to the Public, and for a ‘graphic novel bookstore’ some portion of the public will expect the monthlies — they like to see them, even if they’re buying the trades.
For the current math problem, I’ll assume one sale a month on each of 200 comics titles (or 0 sales of everything else but 200 sales of an Obama cover; whichever, whatever) — so, a contribution of $7200 a year from ‘comic books’.
—
Graphic Novels:
And here we go.
This is what I mean by a graphic novel bookstore:
3 copies each of at least 20,000 graphic novels. Are there 20,000 graphic novels? Actually, I hope there are 30k; if not now, than soon. Amazon lists 100,000, but so many of those are false hits and errors it gives me a headache—on a weekly basis—when I look at Amazon and try to compile the aggregate sales rankings.
A lot of these you stock just to have a complete run of a series, or a complete catalogue of a particular publisher. Nothing wrong with that, and the investment is hardly wasted: nothing sells books like more books.
60,000 volumes at a turn rate of .25 at an average price of $10 = $150,000 in annual sales.

Let me cut it off there.

3 copies of every graphic novel. This was my first, gut impulse. I’m going to stand by that, now, even though back in August I almost immediately backtracked following comments by Hibbs and others.

##

Before I get back to 3 Copies of Everything, I want to take some time — and space.

Your average Big Box Bookstore takes up 25,000 square feet and stocks 100,000 to 200,000 titles — individual titles, not just 100 copies each of the 1000 best selling books. Which of course means that for almost all titles stocked, we’ll only have one copy.

A daily frustration of mine (and a frustration of many booksellers) is finding that last copy of something. Sure, we have a sophisticated distribution chain that will deliver a book in scant days. We have fancy computers to track inventory, both coming in the back door and going out via a cash register. We employ several people just to continuously reorganize books — getting titles back to their sections, and back in order (alphabetical or otherwise). All this fails when compared to what just a few determined customers can do in a single afternoon. When I look something up and the computer tells me I actually do have a copy of a book, but only one, it’s almost like not having the book at all. Sure, I go look, while the querent waits on the phone or hovers over my shoulder; I know most customer habits and there are a few tricks (no one bends over to put a book back, they’ll just chunk it on the top—or eye-level—shelf whether it goes there or not) — and I even know a few of the more common mistakes made by my fellow booksellers; my favs this past year were Olive Kitteridge and Edgar Sawtelle (both titles, not authors, but it’s worth looking in both K and S, respectively, in these cases).

Say, four-fifths of the time, by hook or by crook, I find the damn things. But for a not-insignificant number of queries if there is only one copy left,

• it’s on hold for another customer
• someone was looking at it, but just dropped it off in some random section
• It was stolen
• no, really: customers refuse to believe it, “OMG! How could a popular book like that, one that was just publicized on Oprah, have been stolen! It Was Just On Oprah. You obviously aren’t looking hard enough.”
• It’s “in the back”

And let me insert another long aside: Apparently, at least in the perception of some of our customers, “The Back” is a mythical, idyllic land where any book can be had, conjured into existance by the mere mention of an author and the firm belief that the bookstore has Every Book, Ever, but intentionally hides them unless a crafty, intelligent, good-looking customer-in-the-know remembers to ask, “Well, are you sure you don’t have a copy in The Back?”

Our back room is a hell hole of bare concrete floors, bare metal shelving, a mountain of cardboard, 15 year old non-returnable merchandise, last month’s magazines (don’t get any ideas: we return or recycle these on a weekly-almost-daily basis, there are no back issues for sale “in the back”) and a couple of overworked, sarcastic booksellers stuck doing receiving and returns. Your book is not “in the back”. I’ll gladly make an offer to check the back room, as it is a natural part of customer service and about 3% of the time, sure, maybe I’ll find it — but unless it’s a brand new book that just came in this morning, you’re just wasting your time and mine by asking me to go look.

Sometimes a book is just missing. If I’m stocking 200,000 books, even an error rate of one-tenth of one percent is two thousand books I think I have, but don’t. The error may have originated at the warehouse, or in store, or in my computer system. Doesn’t matter where we place the blame; the book isn’t here.

Given human error and the inability of some (customers and employees alike) to put a book back exactly where it belongs, and the computer errors and theft, we’ll be ‘missing’ quite a few books on any given day. Misshelved books can take up to six weeks to relocate and reshelve (we rescan and reorganize the entire store on a six week cycle; some sections we’ll try and hit mid-cycle as well, but that means another smaller, less popular section has to wait even longer) and sometimes a ‘missing’ book is a missing book: we won’t know until our annual inventory.

An error rate of one-tenth of one percent: That’s a one-in-a-thousand error.

Which interactions do customers remember most? The 19 times I find the book with only minimal information? The one time in 20 that I know a book (and it’s location) off the top of my head and don’t even need to touch a keyboard? Or that one in a thousand error in the system that we ‘tease’ a customer with but can’t find?

(any retailer will be able to tell you, actual inventory shrink is a lot more than 0.1%)

At a major chain bookstore, we’re victims of our own success: we’ve supplied so many books in the past, some customers expect us to have everything. Even 200K is just 3% of the (estimated 7 million) books available, or even less if one considers out-of-print titles, audio books, text books, print-on-demand titles, and the 200,000+ titles added to the total every year.

If I had a space the size of the Mall of America, maybe I could stock all books. Maybe. But we still wouldn’t be able to find them all each and every day.

##

I’ll tell you how to fix this problem: Stock 3 of everything. One copy is “missing”. One just sold. And now, even if you just sold a copy of Moomin vol 4 and inexplicably someone else comes in the same afternoon looking for it: You have it. Heck, you might still have two. You don’t have to say no, you capture the immediate sale, you mint a Customer for Life.

This is also how you’ll compete with Big Box Books, down the street, and steal a march on Amazon and other online retailers to boot. If this is your niche, own it. Don’t say, “I can have it here in 3 or 4 days” — only your loyal customers will take you up on that. Stock everything, in multiples, and put the book in the customer’s hand. That’s awfully hard to say no to. “I asked for a book, and here it is!” It’s like magic.

Oh, it’s not a good solution: It’s expensive. About $1.5 Million — 3 copies each of 30,000 books that average $15. (that’s only $1.35M but as long as we’re spending, might as well chip in another $150,000 for slip-cased hardcover special editions)

If you were a major corporation with an ongoing book business and had years of sales data to fall back on, obviously you’d know which titles historically sell better, and you’d have a much better idea on how to set your stock counts: 20 copies of Watchmen, 8 copies each of Naruto volumes, 6 copies each of Bleach, 5 copies each of anything Batman, Death Note, or Fruits Basket… 1s and 2s of everything else

Even as a raw start-up, with no preconceptions and without any data on your local market, over time you’ll figure out what you need to stock. After a few years, you’ll be able to manage you inventory like a pro. But on Day One, Grand Opening? You have no idea what people will ask for.

(Unless you’ve been analyzing online sales for the past 2—and working on 3—years.

##

You sell one copy of a book, that’s a mitzvah. Mazeltov! But if you bought three to begin with you don’t need to do anything yet.

You sell the second copy, and all of a sudden you have a sales trend. Did they sell in the same week? Great, order two more. Did they sell in the same month? Order one as a replacement, to keep your par count at 2.

You sell a third copy, and now we have points to plot on a graph.

At my current bookstore, we place orders daily. [but as a corporate store, most if not all of those are fulfilled internally so we can order single copies as they sell and take advantage of the economies-of-scale inherent in the set up] As an indy, you’ll likely place orders weekly with your major vendors, and a couple of regional distributors. Weekly orders are fine. Just remember to keep a two-week supply of any one book in stock (in case an order gets placed late, or you otherwise miss a week) and you’ll be fine.

And if your backstop is 2 or 3 copies of everything, that likely is your 2 week supply and then some. So you’ll be doing quite well on auto-pilot, and you only order in what sells, what’s new, and what your booksellers want to recommend. Your orders will be a fixed percentage of sales, a manageable ongoing cost of doing business.

[aside: and this is one other difference between selling graphic novels as books as opposed to running a comic shop: your business is the backlist. You don’t have to guess about new mini-series or cross-overs, or plastic ring promotions, you just stock proven titles and likely-looking manga and GN originals. Not an ideal situation, but one with some sales history behind it.]

That initial outlay of $1.5M, though? Gone. Sunk. You’re not getting it back, you can’t really amortize it, it’s going to sit there on shelves (and you’ll need to pay taxes on it) and this is just one more cost of doing business. If you balk at the initial investment, you’ll miss the opportunities it buys you: That one impossible sale, the unmistakable draw of a shop full of graphic novels, your reputation as a Landmark store pulling in shoppers from three states away, a growing legacy as a Expert in the field…

…and your only hope of directly competing with Amazon and Big Box Books. This is the sticker price on an entry to the game.

Yes, it’s a lot of money. (Damn it’s a lot of money) But: This is what I want. So long as I’m writing about hypotheticals anyway, I might as well dream Big. My Graphic Novel Bookstore Pipedream is a beast, the size of half a football field with at least $3 million in inventory and a coffee shop and restaurant besides (I’ll open a pub if I can get a liquor license) — and at that size, a good chunk of my hypothetical bookstore is going to be non-fiction and genre fiction and other add-ons that are only tangentially related to comics. It’s going to be a proud, handsome bookstore.

##

This is also possible on a smaller scale. But you won’t be able to say “yes” to customers nearly so often. You will be just another comic shop, or just another bookstore. There isn’t anything ‘new’ here to recommend it, just business as usual and a couple dozen competitors. But, I wish you luck and I hope my columns have been at least marginally supportive.

I spend a lot more time cruising booksellers’ websites than, um, just about anyone. (it nominally only takes up an hour or so each week — past the time I also spend to shop for stuff for myself — which doesn’t sound like much in and of itself, but because of the odd hobby even after loading up web sites I look at a lot, and I mean a lot of book listings each week.)

So, anyway… ranking at #701 in the graphic novel category at bn.com this past Sunday (…I did mention I look at a lot of these, didn’t I) was this gem:

If it weren’t for some serious miscategorization I’d never have seen it; of course, mis-filings like these are so common I hardly notice, like speed bumps. This one sticks, though:

MP3. Audio. Download.

from a bookseller. for an audio book.

Shit, son, this is news.

Heck, we could have been selling these for 6 months already. I have no way of knowing, and only a coincidence (the Dark Hunger manga bringing unrelated Feehan titles into my graphic novel search results) brought this to my attention. [by “we”, I mean B&N is the large corporation that signs my paychecks, not that I have anything to do with bn.com]

Unlike the nook, or the e-book software for your PC, Mac, Blackberry, and iPhone, no major press releases heralded the entrance into the market of MP3 downloadable books. (something may hit next week, I’m thinking)

The page at bn.com looks a lot like this and it looks like B&N mean business. To be fair, Amazon also has some listings, though they’re, um, different. I’m thinking either Amazon doesn’t quite have their act together yet, or they’re feeling a bit of a burn from publishers over the Kindle’s text-to-speech function.

Downloadable audio books are nothing new; Audible (now a wholly owned subsidiary of Amazon, in fact) has been doing this for years. The major twist is Downloadable MP3s. Legal ones. Audible uses a proprietary format which I’m sure is fine, and all, so long as one remains an Audible customer (and is Amazon’s ownership of Audible also a factor here?) but as has been proven over and over again in the past decade in the world of music by Napster and it’s spiritual descendants, the public prefers open formats and portability (and free, natch, but piracy was another essay) over being tied into a single store and company

Hell, that’s the reason I buy MP3s from Amazon over iTunes — even though iTunes has gotten better, from what I’ve heard, but screw ‘em. DRM sucks, and I don’t want even a hint of it if I can help it.

This is one more front of the e-book wars, and B&N just parked alongside Amazon and fired another salvo.

Edit 7:35pm 2 Jan — Same thing at Borders.com, though there doesn’t seem to be much there yet:

As noted above, Amazon has Audible; even the links on Amazon’s regular site for audio book downloads (when you can find them) kick you out to the audible.com site.

http://www.prnewswire.com/news-releases/borders-partners-with-kobo-to-deliver-ebooks-79339012.html

I don’t have a whole lot of commentary, considering I just read the article myself. But Kobo née Shortcovers claims 2 million titles, supports open standards, is device agnostic, and the crafty Canadians have had 10 months lead time to build up their back-end and launch their e-reader apps for a variety of smartphones (and through the kind offices of Adobe, for a number of other devices) (*cough* including the nook. How’s that taste, B&N?).

The press release says 2nd quarter 2010, though, and for retail (most retailers use a fiscal year that starts in February) that means May at the earliest, and more likely July. So a late start… but maybe six months is enough time for B&N to fix the bugs in the nook, for Sony to sell a few more e-readers, for the media to beat the whole e-book thing into the ground, and for the folks who own a nook, kindle, or sony to start asking the question: where can I get the cheapest book, without DRM?

Still and all: Borders now has a horse in this race.

Came across a new (rather sparse) blog recently, Clay Shirky, though the content provided more than makes up for the lack of bells and glitter:

In much the same vein as my Rethinking the Box series of columns, Clay takes on the topic, “Local Bookstores, Social Hubs, and Mutualization,” and while some of the same concepts come up (bookstore as third place, bookstore as community hub) without my bias as a bookseller the essay goes off into whole new areas, and to a very different conclusion.

Worth a read. (as are the other articles — at least those currently on Clay’s main page — which also touch on issues of publishing and content)

Reuters has a great article up…

wait, strike that.

Reuters has a depressing, gloom-and-doom news article up with some excellent information in it: Actual average rent numbers (Bloomberg.com has a very similar article citing the same source)

National averages (lowest since 2007)

• $19.22 per sq.ft. for strip malls, compared to $19.59 last year
• $39.18 per sq.ft. for the largest regional malls, down from $40.62

Both cite Reis.com — Looks like Reis will sell you a market analysis report for something in the neighborhood of $1000 (they don’t list prices but their home page advertises a ‘sale price’ of $695; even a grand is cheap, though… equal to merely the first month’s rent on a scant 50 sq.ft. of your hypothetical retail space.)

So, one more resource for you folks and some real-world numbers we can plug into past and future calculations.

Rethinking the Box is a collection of ruminations on retail: a unique combination of sober (and sobering) business analysis mixed with drunken, inflammatory personal invective.

Previously:
Study your History. Recognise your Motives. Know your Customer Base, and your Staff. Find your Niche. Consider your Product Lines, take a second look at What the Customers Want, and then stare again in dismay at the Profit Margins. Try calculating the rent and the revenue from inventory (with a side of coffee) and compare your numbers to average industry per-storefront sales.

We’re still in the middle of the current topic: Physical Storefront — Consider your concept, and look at both guiding principles and actual demographics in selecting a neighborhood.

##

Last Time, Torsten commented,

When doing the geographic/demographic research, I would recommend widening your area to at least the Census metropolitan boundaries, and/or fifty miles from your target location. If your store becomes a destination, then people will journey to shop there.

I hope you’ve got more to talk about regarding location… access to mass transit, easy to find, major thoroughfares, foot traffic, BIDs [Business Improvement Districts] and the Chamber of Commerce…

so let’s go back to first principles and try this again.

Before things get too involved and boring, though, there are three simple rules that you can use as a shortcut if you can’t be bothered to do the work and research:

1. Shop where you Shop: look for space to rent in those neighborhoods and retail centers where you yourself already shop and buy.
2. Look at your Neighbors: restaurants, coffee shops, movie theaters, and grocery stores & supermarkets generate a lot more traffic (foot and the more polluting sort) than furniture stores, clothing boutiques, antique dealers, and ‘gift shops’. Don’t go hip, quirky, and fun unless there are other, boring-but-reliable businesses that also recommend a neighborhood. (and don’t pick a spot out in the sticks, no matter how cheap, if they’re aren’t any neighbors.)
3. Don’t Fall in Love — If you’re buying a house, then yes: find the cute little bungalow that plucks at your heart and speaks to your soul. Retail is business, though, so don’t sign a lease for a storefront just because it looks exactly like the bookstore you’ve been dreaming of. White concrete brick walls, flourescent lighting, cheap carpet, and exposed ductwork visible beneath the steel roof aren’t heartwarming and exciting — but the cheap building methods means a cheaper rent and if the store is in the right place, and you have the right concept, customers will flock to gawk at your merchandise. They won’t even notice. This is the lesson you should take away from the success of the Big Box and Warehouse stores: it’s all about the stock. [and there are a few reasonable investments — wood shelving, dropped acoustical-tile ceiling, comfy chairs — that will convert a big box into a bookstore overnight]

With that, you can ignore this rest of this post (and the post before this one, and at least half of the post before that) and whistle as you go on your merry way, secure in the knowledge that you know all you need to know about retail and real estate.

I’m not leading you astray: those 3 rules will serve you well. Most ‘rules of thumb’ work because they draw from and are based on thousands of trial-and-error examples — there is a method to the madness.

##

If you want to actually do the work…

OK. There are at least four different ways to approach real estate development — and while it’s very small scale, you are a real estate developer when you select an address for a restaurant, theater, or retail space.

Think on that a bit. Yes, you’re in it to make money. Yes, you’re only interested in your own storefront. But by opening a business, you are also improving a neighborhood. This is the core of development — well, that and buying low and selling high; but unlike stocks, which require only patience, you can sell at that higher price because you have improved the property in the interim.

4 Approaches to Real Estate Development:

• Demographics: Open where the people are.
• Market Analysis: Open where the other stores aren’t. That is to say, identify a need, see where that need is being filled — and where it isn’t, and situate yourself to take advantage of that lack.
• Breaking New Ground: Open where nothing is. Being first in means higher margins, but also greater risk.
• Urban Renewal: Open where nothing is, but where a vibrant neighborhood once was.

There is a lot of overlap: You don’t buy a rural parcel and look to build a shopping center unless you’ve done research into both the demographics (with projections 5 and 10 years into the future) while also checking the current market to see who else is building, who is already leasing, and what their occupancy rates are. You don’t take a chance on an urban neighborhood on the cusp of rebuilding unless the demographics in adjacent neighborhoods are also improving, or pretty good to begin with, and unless other market players are making the same move.

Dude. This is work. People do this full time, and with tens of millions of dollars at stake. I can’t give you a magic formula that will work, because even the formulas will be different for each zip code.

So much depends on what you want, what you can tolerate, and where you think society is going.

Yeah. Let me cover that third point.

##

Since 1908 our society [American society] has seen an increase in literal mobility for an ever-expanding portion of city dwellers, and the automobile combined with lots of available land, the dream of home ownership, the flight of the middle class away from the city centers (for whatever reason: some sources will cite race, or educational opportunities, or misconceptions about quality of life), and new business models developed to take advantage of the car (drive-ins, drive-thrus, enclosed shopping malls, and strip malls along every major highway) have lead to Sprawl.

In places where there were previously established urban centers combined with geographical constraints (San Francisco, Manhattan) the past century has led to the development of dense, vibrant urban centers; where even former blighted industrial districts get converted to loft apartments, and poor people have to move because they can’t afford the new rents as landlords look to rennovate and re-lease to young urban professionals.

In places where there are no geographic constraints—no ocean, no big rivers, no mountains—you end up with suburbs that have suburbs, one mall after another as you drive out on the interstates, and always always another new development just a tad further out. Atlanta and Houston may be the best (or worst) examples of this development. Los Angeles is the poster child for sprawl, but L.A. has also had a 30 year head start and eventually, hit the San Gabriel and Santa Monica mountains. L.A. is bad, but isn’t quite limitless sprawl.

It’s interesting to note that while New York and San Francisco are seen as cultural centers — and, aside from cost, some of the best places to live on the planet — Atlanta is the butt of jokes

This is obviously a much bigger issue than I can cover in a blog post. I’m going to have to refer you to the literature:

The Death and Life of Great American Cities by Jane Jacobs : Random House Vintage, New York; original copyright 1961, Vintage Books edition 1992, isbn 980679741954. The publisher’s web site and the Amazon listing both have previews.

48 years old and still one of the more insightful books on urban planning. While some of the language is dated (tenements? really?) this is still a primary source and starting point for any discussion of urban planning, renewal, or even the basic question: what is a neighborhood?

Many of the issues and problems outlined in Jacob’s book have yet to be resolved; this is still a current text for urban and real estate development. This was one of the books that was assigned to me in college — despite that I still recommend it to you.

Two more, briefly:

On the one side, Green Metropolis: Why Living Smaller, Living Closer, and Driving Less Are the Keys to Sustainability by David Owen : Penguin Riverhead Books, New York; 1st edition 2009, isbn 9781594488825.

Parts of this book were previously published as articles for The New Yorker. Quite a bit of its content can be divined by reading the subtitle. The main thrust of the book is that Manhattan is one of the Greenest places on the planet to live (with scientific proofs).

And in rebuttal, Sprawl: A Compact History by Robert Bruegmann : U. of Chicago Press, Chicago, copryright 2005, paperback edition 2006, isbn 9780226076911.

Sprawl may be bad, but it has also “provided millions of people with the kinds of mobility, privacy, and choices that were once the prerogotives of the rich and powerful”. Bruegmann also points out that sprawl is not specifically American, or even recent, but rather a function of cities themselves. So long as we organize ourselves in cities, we can’t avoid it.

##

These are long-term issues — generational, even. But unless you plan to just open up long enough for the next comics boom (whenever that comes) and then cash out… wait a second: I can’t let that pass. HA! I mean, honestly? [*chuckle*] Are you looking at the same business I’ve been looking at?

Anyway, unless your horizon is just 5 years out, the Life or Death of your American City is a matter of business, and worth your consideration. This broader debate may seem beside the point, when it comes to retail. If you’re myopically focused on just the numbers — rent, payroll, cost of stock and turnover rates, inventory shrink, and marketing — then you miss the point of having a retail location. You can get the cheapest rent on a warehouse in the middle of nowhere (but within 2 hours drive of a UPS or FedEx shipping hub) and you can run an internet business where your market is, effectively, everyone.

Part of retail is serving a community. Lots of places could use a bookstore. Some neighborhoods could even use a specialty bookstore. At least one city on this godforsaken planet could use my Graphic Novel Superstore, and dammit, I’m going to figure out where that place is and rock its socks off.

Your concept might have to adapt, depending on the community you want to live and work in — wikipedia is no substitute for real research but they have one take on the situation: Your choices are Downtown/Intown, Edge City, Boomburb, Suburb, and Exurb.

I have a feeling if you take Torsten’s suggestion for looking at entire Metro areas, compile the demographic info for every zip code and cross-index that with affordable rents, you’ll find yourself locating in an Edge City/“Boomburg” (a neologism I’ll admit I’d never come across before researching this article) — in Atlanta (where I currently live) that would open up Smyrna/Vinings, Downtown Marietta, Roswell/Alpharetta, Perimeter Center, Decatur, just about anywhere in Gwinnett Co., and even stuff on the south side of town if you’re feeling adventurous.

But intown locations shouldn’t be discarded out of hand, and at least one exercise I’ve done for this series was not to find the cheapest rent, but rather to find the upper limit of what we can afford. A downtown landmark location and “main street” address offer intangibles that can’t be duplicated, and are valuable for marketing your business. Even chains that do just fine with dozens of locations out in the ‘burbs will often spring for — and invest heavily in — an intown, flagship, show-case store.

If you only have one location, why not make it a landmark? (yeah, sure, you can do this anywhere, but downtown caché is only to be found downtown)

So there are choices that have nothing to do with dollars-and-cents but which can colour your business decisions anyway. A downtown location may not be the best option, numbers-wise, but if you commit to your downtown there are ways to find the best downtown location. If you trust your gut and “shop where you shop” (Rule of Thumb #1) you might have a good idea where you want to locate anyway. —this is perfectly valid. In any city there isn’t “one best site” but rather dozens of options with at least three sliding scales, and the point isn’t to make the quote-best-choice-unquote but to make the numbers work and to find something you’re happy with. You don’t have to live and work next to an airport unless you want to, you don’t have to drive 30 miles each way to your new store with the ‘perfect’ rent unless you want to, you don’t have to open up in downtown *or* out in the sticks unless you want to.

Most of us could open an independent bookstore (or even a comic shop) where we live already — even in this economy. There is likely an available location within 10 miles of your current address. The trick is to not just take what’s available but to practice due diligence, run the math, and find the location that works: for your neighborhood, for your concept, and for your budget. The posts before this one are not rules but tools: not a single path but a signpost to point out many possible paths.

##

I’m guessing no one was looking for a philosophical post, or an admonition to find your own route to success: you’d rather have rules and a checklist and the One True Path. So Sorry. But if all you were looking for was a checklist, well, I maybe can do a checklist:

Before you even start shopping for retail space, you’ll need:

• a concept. ‘books’ doesn’t count as a concept; what type of bookstore are you?
• a business plan

• and some idea about how much space you’ll need (and your first estimate is too low, I can already tell you). The actual square footage requirements are foremost, but also consider:
• How much sales floor, to how much stock room space? Do you need a “back room” at all?
• Office space (secured office space: if you’re doing cash business, you’ll need a spot to put a safe, if nothing else)
• Food prep and food storage space requirements
• Seating: for a bookstore, that’s not just the cafe tables but all the comfy, overstuffed chairs and small hidden nooks to curl up in. You might also consider some outdoor seating for your cafe, if you can reconcile the benefits of alfresco noshing with the big gaping opportunity this opens for shoplifting.

Make back-of-the-envelope estimates for all of this, and tack on an extra 10% or so.

Now,

• do you need all your square footage on a single floor, or will some types of multi-story buildings also serve? Or maybe even a couple of adjacent buildings?
• Identify a broad range of what you consider to be affordable rents…
• …with the requisite trade-offs: neighborhood vs. cost, size vs. cost, physical plant vs. cost (that is to say: is the building brand new or falling apart?), terms and duration vs. cost, proffered discounts, nominal ‘market rates’ vs. discounted rents and how, if, when, why, and for how long the latter might revert to the former.

There are more exceptions than rules. Do you accept a 99-year land lease for the nominal rent of £1 per annum with the understanding that no matter how nice a store you build there you own nothing, or do you pay through the nose for 5th Avenue Manhattan rents (or equivalent) secure in the knowledge that while you’re being overcharged now, over the 30 year term your final costs will average well below market rates (when adjusted for inflation), or do you sign a short-term lease because hell, you might not even be in business next year?

This is enough to give me a headache, and I’m not even shopping for my own storefront yet.

Historical arrangements (like land leases, or anything long term) are more of a curiosity these days than anything else: most commercial landlords are offering something in the 2-5 year range, renegotiable at the end of term and while they’ll be happy to cut you a “break” — either a discounted first year or more favorable rates after a proven payment history — they’re still in it for the money, 98% of them have to make a mortgage payment so rents aren’t as negotiable as one might hope, and for the best locations: there is always another guy with a dream who’d love to steal your prime storefront away from you.

Most landlords will negotiate with longstanding tenants rather than terminate the relationship: They like money, and will almost always favor guaranteed money from a proven source — unless you’ve done something to really piss them off — so if you’ve been open in the same location for 5 years, you’re likely golden… unless you want to move.

Which is why you should be doubly, trebly careful about signing that lease to begin with. (And I’d insert an argument for just buying a building but this will be beyond the means of almost everyone, doesn’t make much business sense, and really locks you in to a street address. I’m not saying it’s impossible, but…)

These are all questions of money, though, not so much about real estate: How much space can you afford? If what you can rent doesn’t match up with what you think you need, then you need to rework the business plan, find more money, reconsider your space requirements, or start looking at undeveloped land out past the suburbs.

##

Forget about money for the next half hour — let’s say you’ve won the lottery. Cost is no object; we can set aside the tangles and tangibles of commercial real estate and just consider location. How do you find the ideal storefront? What should you be looking for?

When looking at the map, find your

• Competition: In my case that’s other bookstores, comic shops, game & hobby shops, and even things like computer game stores — whatever your target demographic buys, you’ll want to know where their favorite stores are located.
• That isn’t to say you need to avoid the competition and find a completely empty strip mall 15 miles minimum from your nearest competition: Have you ever noticed that all the hot, trendy bars tend to open up next to each other? Or that for 50% of the shopping malls, there is a Borders a quarter-mile to one side and a Barnes & Noble the same distance on the other? Or: Charing Cross Road in London, Saint-Germain-des-Près in Paris, New York’s ‘Book Row’ (Fourth Ave.), Kurfürstendamm in Berlin, Jinbōchō in Tokyo, İstiklâl Avenue in Instanbul — now, admittedly, some of these are more of historical note than latest-tourist-guide-fodder (The Strand is the last bookstore standing on old Book Row) but it points out that being next door to the competition isn’t always a bad thing.
• Interstate exits: My current place of employ isn’t off of an interstate. This makes giving directions, particularly in Atlanta, a royal pain in the ass. This despite the fact that, dude, we’re on Peachtree. [for non-Atlantans: Peachtree is like Main Street crossed with Main Street squared by Main Street, with a side of Broadway, a gloss of Tolkien’s Great East Road, and a knowing wink to Farmer’s Riverworld: there are many Peachtrees in Atlanta, but only one Peachtree — and why do I have to explain this over the phone at least once a day? If you can’t find us you’re either brand new to town or willfully ignorant] Anyway, if you can say, “Oh Yah we’re just past the Howard Johnson on Exit 52” you’ll save yourself hours of payroll and at least one coronary bypass surgery.
• Universities & Colleges: the closer, the better; whether your business is comics or books in general.
• High Schools: if your business is comics, being close to teens is all for the good. (as noted previously, the US Dept. of Education has you covered on this one)
• Malls. I don’t consider proximity to a shopping mall to be necessary, or desirable, but it’s probably a good idea to know where your local malls are
• Golf Courses. I’ve nothing against golf, other than the fact that I hate playing it. But there is a type of neighborhood, and a type of customer, and a disposable income associated with country clubs, and since they show up as big green blobs on most maps it’s just as well to make note of them, whether you choose to locate near one or avoid them altogether.
  
  

When driving out to see a property, note:

• Directions: could you find it the first time?
• Neighbors: What’s in the same shopping center? What’s across the street, and down the road? Heck, what kind of shop is immediately next door — will they help your business, or turn off your base?
• How far did you drive? How long did it take? Is it because you live no where near the location you want to open up in (…might want to fix that) or just because traffic around here is awful? — Nothing wrong with heavy traffic, actually (there is a potential customer in each and every one of those vehicles) but it will have an imapct on you: can you move, will you move, to be closer to your store?
• Is this an established, built-up part of town, or are there still empty lots (or worse, empty shopping centers) just waiting for the next economic expansion? Depending on the rent offered, this could be good or bad, but is yet another consideration
• Before making that last turn into what-might-be-your-parking lot: keep going. Get lost a little bit, even. What’s just past this location? What’s around the bend? Do you see subdivisions, more strip malls, schools, churches… or farmland? This can take ten minutes, or an hour. Maps and zip codes and census data are fine, but not a subsitute for looking at conditions on the ground.
  
  

Imagine you didn’t have a car. No, really.

• Sidewalks: if there are no sidewalks, there will be no foot-traffic. If there is no landscaping or if the sidewalks are in disrepair… there will likely be no foot traffic. Of course, sidewalks are a rare thing these days, after 80 years of development (in America) centered on cars.
• Bus Stops: A subway/rail station would be even better, but not every city will have heavy rail or massive mass-transit. Bus lines are better than nothing. When someone calls for directions, can you tell them which bus route you’re on?
• Is there anyone who lives within walking distance? Granted, this is such a laughable concern out in the suburbs (*psfsh* everyone has a car, are you kidding?) but when considering intown locations, especially for bookstores and other general retailers, this is pretty damn important. Are there residential neighborhoods nearby, or is it all retail/commercial/industrial for miles around?
• Neighbors, again: people without cars tend to really combine trips. Are your neighbors the sort of weekly-neh-daily must-stop-locations for shoppers, or just the once-a-year-type destinations? You want regular traffic, on the roads or on the sidewalks. (This is Rule of Thumb #2, cited above)
• Even if you’re considering a ‘specialty’ retail district: Who Are Your Neighbors? Music/CD/Vinyl Shops, a Newsstand, Coffee, Restaurants, Video Sales/Rental — heck, where’s the closest library, or college? There are a lot of adjacencies that might make the address more valuable than even the landlord realizes.
  
  

You’re standing in front of your potential store:

• Is it inviting?
• Does it have a presence, from the street?
• If no — can you fix it so that, yes, it has a presence and is inviting?
• OK, so where’s the parking? Do you have your own lot, do you rely on street parking, or is there no parking? (no visible parking is a problem)
• Look to your left, look to your right: One of you will not be here next year. This is a hoary old saw that they fed to the incoming freshman [at Georgia Tech] back in my day. If the café that seems to do booming business now suddenly closes, will you survive the loss? Can you subsist on your own merits — at least as long as it takes for someone else to open a trendy café in the same space?
• Do you have window display space? Granted, this is minor; if the store is good, you can get by with a single 32” door that opens up onto a staircase that leads up to your fantastic 20,000 sq.ft. store (and if this is in fact the case, you could likely make that into a marketing push) but for most [intown] retailers, a little street-side window shopping is a major marketing component. Does this location have a storefront display on the street?
  
  

Step Inside.

• Do you feel it? No, really: Is this your store?

That’s most important, actually. Still:

• Is it big enough? You can always make compromises, but whenever possible get a space you can grow into.
• Do the floorboards creak? (if there are floorboards… concrete slab is more likely.) Does the roof leak? Stains on ceiling tiles are the most obvious sign of leaks, but it is possible the tiles have been replaced (or that there isn’t a acoustic tile dropped ceiling in place to begin with). Consider drainage around the shop and in your parking lot — sure, maybe there is a drought on now but what happens when it rains? You might even go so far as to find a home inspector in the yellow pages and have them come out to take a look.
• Where’s the thermostat? Can you figure it out? (some of these new digital models are tricky…) Past that, what is the age of the HVAC [heating, ventilation, and air-conditioning] system? Who is responsible for repairs, you or the landlord?
• Where are the fire exits?
• What’s the layout? Single, massive big-box style sales floor? Multi-story? Rennovated residential with a maze of rooms and floors? Shotgun-style single use retail spaces that can be combined but only by knocking through walls? I could make just about any space work — and the more idiosyncratic, the better, to a certain extent — but you might have other preconceptions and ideas about retail. Can you fit your concept to this layout?
• Find the middle of the sales space: this might be on the second floor, or just past the main entrance, …or really easy to find in a big box. Close your eyes. [no, really. and taking a big breath and letting it out is optional but recommended] Ask yourself: Where are your specialty departments? The Café, the kids department, foreign language comics, adult comics, new release displays, whatever specific categories you’ve decided on: without opening your eyes, can you picture a home for each in this space? Yes, this is new-age-y crap. Don’t skip this step.

also:

• Are the ceilings tall enough? Bookcases (particularly those installed on a wall) can be 7-8’ tall, and the taller they are the more impressive the store will be to customers.
• Where will you put your restrooms? (If you think you can run a bookstore without a public restroom, all I can say is you are mistaken).
• What will the sales floor look like? Is there a logical flow or will it be a literal maze? There are recommendations for both layouts, acutally, but it depends on what your concept is.

• Is this the first property you’ve looked at? Sure, maybe it is the best, but shop around anyway.
• Don’t fall in love. (Rule of Thumb #3) Sure, it’s perfect. But step back, run the numbers, call in a friend for a second opinion.

##

That’s it. I’m tapped out. If you still have more questions, I’m pretty sure that you need to go back and re-read all three posts, or that you shouldn’t be looking for professional business advice from an admittedly drunken blogger anyway.

Rethinking the Box is a collection of ruminations on retail: a unique combination of sober (and sobering) business analysis mixed with drunken, inflammatory personal invective.

Previously:
Study your History. Recognise your Motives. Know your Customer Base, and your Staff. Find your Niche. Consider your Product Lines, take a second look at What the Customers Want, and then stare again in dismay at the Profit Margins. Try calculating the rent and the revenue from inventory (with a side of coffee) and compare your numbers to average industry per-storefront sales.

##

Last week month I went over some retail theory. Let’s translate that into retail and real estate application & practice.

I could do this for my hometown, obviously, but I’m not quite ready to open up shop yet (a small matter of 2 million dollars… I’m a tad short at the moment) and I’d hate to give away the perfect spot to someone else for their stinkin’ bookstore. So we’ll pick a town at random, do some basic research, narrow in on a neighborhood, and then maybe see if Google Maps has some street level views for us.

Oh, yeah: we’ll be able to do this from the comfort of the internet (I would say from the ‘comfort of home’ but I know some of you are at work, some are at a coffee shop and about 12% of you are clogging up my bookstore because we now offer free wifi) — and did I say random? As long as our target could be anywhere, why not answer the age-old question, “Will It Play in Peoria?“

Peoria (named after the Peoria tribe) is the largest city on the Illinois River and the county seat of Peoria County, Illinois, in the United States. As of the 2000 census, the city was the fifth-largest in Illinois, with a population of 112,936; by 2007 it was the sixth-largest city and had population of 113,546. The Peoria Metropolitan Statistical Area had a population of 372,487 in 2008, making it the third largest metropolitan area in the state after Chicagoland and the Metro-East portion of the St. Louis metropolitan area. (from wikipedia)

So this is our target. Not exactly the back woods, or the far end of nowhere. Peoria is in fact a small city like at least 200 others (it ranks 217th) and it is home to Caterpillar Inc., a Dow component and Fortune 500 company. There is a community college and local private university; Illinois State University is also nearby, just 35 miles away.

Peoria has both a Barnes & Noble and a Borders, and not one but two comic shops. There’s a symphony, an opera, a zoo, interstates, an airport, blah blah blah — you can read wikipedia as easily as I can for the rest of it. It’s a normal, boring small city. —no offense intended, Peoria: you’re a damn sight more interesting than the place I grew up in.

So you could start at the Town Hall, or the Bradley University Campus, or the Madison Theater — or the Illinois River, for that matter — and walk around and get a feel for the neighborhoods and maybe luck across a storefront for rent in a nice looking part of downtown, in a quaint brick building from the 20s or 30s — so cute, and look there are still some shelves and fixtures from the last guy who went out of business here. (note: not the best sign for retail)

Or we can drop some science on it.

##

I was half-joking about the storefront above. I have no idea what downtown Peoria looks like. There may in fact be a thriving shopping district there for all I know.

In fact, I know nothing about the neighborhoods of Peoria and it’s surrounds. That is to say, I know nothing yet.

What’s our criteria for a retail location?
Well, I want to be where the people are, and since I’m opening a bookstore I want to be where smart people are (or at least pretentious people who spend money on books because they want to look smart, those are good too), and I’d like to be where the people with money live. Of course I’m speaking in broad generalities, but this information would be good to have, right?

If you want to know about people, ask the Census Bureau. (This is one of the best uses of taxpayer money ever.) Before we tap the CB, though, let’s start with the map:

Head on over to maps.huge.info/zip.htm, and let’s plug in our target zip code (61605, Downtown Peoria) — if you don’t happen to know the zip code yet, well, just start clicking the map and scan around until you find your target, which is what I did last night. Zoom out a bit and look at the surrounding zip codes — you might want to start writing these down, actually.

Now, point your browser to www.census.gov and look up each zip code. Easy, right?
…OK, so it’s a mess, and you have no idea where to start. That’s fine, because someone at the Census Bureau has written directions on how to find exactly the information we need, by zip code. Gosh, they’re smart. (and I’ve a feeling someone—a lot of someones—have asked exactly this question before.) This will be a lot of clicking and writing and typing — and if you have the time it’d be 2-3 hours worth of work. And worth it, but still a pain in the ass.

If you’re willing to spend a little money, I can make it even easier for you:

Uclue is a research service I’ve used in the past, and have been quite pleased with. The folks they have working there are top notch, professional (but with a sense of humour), and more than willing to tackle tricky (or time consuming) research tasks of all types: From “this is driving me nuts, what’s the name of the song with this lyric” to [*cough*] “Median income and education levels by zip code for Peoria, IL”. Most of the previous questions asked are publicly viewable so you can go take a look for yourself.

Late last night I asked the question and I had an answer before breakfast. Not only that, I asked for (and received) the appropriate census information for all 616xx and 615xx zip codes, and the Uclue researcher even set it up as a spreadsheet for me. Of course I offered a premium (for prompt service) and also tipped well — if you really like the answer they have a mechanism for tips — but I also value Uclue and will often price my questions a bit higher than the information might strictly be worth because the service is excellent.

Maybe I paid too much. If a lot of us ask this type of question I’m sure supply&demand will figure out just what a fair price is — but for less than a c-note I’ve income and education numbers for a place I don’t live in and and have never been to, and in a format which can be quickly and easily sorted. If I actually were looking to open up shop in Peoria, this information would be priceless.

Zip codes are handy because they’re used by a number of independent sources (like the Census Bureau), the post office originally set them up (and continues to maintain them, occasionally adding new ones) so that while not uniform in size or population they fall within manageable ranges for both, and most importantly, every address — and by extension, every real estate listing — has one.

So what’s the best address in Peoria?

The five zips with the most households are

• 61554: 17,770
• 61614: 16,542
• 61604: 14,477
• 61611: 10,354
• 61571: 8,283

The five with the highest median income are 61525, 61535, 61526, 61547 and 61528. These are less than ideal, though, as each of these zip codes has less than 2000 households apiece. (more expensive homes on much larger lots out in the suburbs and exurbs — wait, does Peoria rate ‘exurbs’? — if you were working with a map you’d put gold stars on these: you’d want to be near them, certainly, but perhaps not in them)

Considering both income and population (even doing something as simple as multiplying one against the other) yields this top 5

zip: households/median income

• 61614: 16,542/47,030
• 61554: 17,770/40,220
• 61604: 14,477/35,878
• 61611: 10,354/43,051
• 61615: 8,157/51,548

and considering the number of college graduates (bachelor’s degree or higher)

• 61614: 9,175
• 61615: 4,835
• 61604: 4,315
• 61550: 3,916
• 61554: 3,647

And it looks a lot like we’ve narrowed our search from 55 zips to just 4: 61554, 61604, 61614, and 61615. Going back to our map:

61604 wraps around zip code 61606 (which has Bradley University in it) and lies just to the NW of downtown Peoria. 61614 is immediately north of that, has 4 golf courses in it (as a Peachtree City, GA native son I know exactly what that means) and in the 2000 Census, also included the area now designated zip code 61616.

61615 is just north and west of both and moreover, seems to be defined by I-474: the north half of the bypass runs smack through the middle of the zip code and it includes the I-74/I-474 interchange. (in fact, it looks like the boundary lines for 61615 were drawn after the interstate was built, as it rather suspiciously follows the curve of the bypass loop.)

aside: Both the B&N and the Borders in Peoria have addresses in (wait for it) 61615.

Not that we have to (or should) slavishly follow the major chains, but it’s a nice little confirmation of my data on the part of their respective real estate departments.

…and actually, given that both majors are on the west side of the river (and also sparing a glance at the locations of the local comic shops) I might first recommend something in 61604, closer to downtown and the university, if possible — in part because I actually like downtowns, and I’ve a feeling a small city like Peoria might have some nice, walkable shopping available — particularly near a college campus.

Alternately, an address in East Peoria just off of the interstate (61611 prefered, or 61550 if a bigger location was available at a cheaper rent) would put us closer to both the community college kids and the ISU campus north of Bloomington (just a half hour away down I-74), while still being in ‘Peoria’.

##

We can repeat this exercise for hundreds of other cities and towns. (or you can, and I might be persuaded to if there’s money in it.)

The point I’d like to make is that you don’t have to go in blind: resources are available that will paint a pretty clear picture of where the potential readers are. These numbers will also be awfully nice to have when you walk into the bank, and start asking for money. Market research is a basic necessity for any business, and when you are talking retail, demographics (and real estate) are your market.

If Peoria had an art school — offering a sequential art degree, which would be pure icing if true — we might even consider this city with less than a half-million people in it as a candidate for a Graphic Novel Bookstore. I’m not sure I could make my idea work here, but I could certainly find a home for a strong independent bookstore in Peoria (looks like there are two, in 61616 and 61554).

(and so there might be room for one or two more, in the other two areas I identified: 61604 and 60611. Peoria entrepreneurs, take note!)

If you live in a much larger metropolitan area, you could use these same methods — either on a larger scale, or concentrating on just one county or area (north of I-285 and between I-75 and I-85 in Atlanta, for example) either based on where you currently live or where you see potential for growth. And obviously, there are hundreds of Peorias all across the United States, and similar townships elsewhere (though you’ll have to figure out your own analogues to zip codes and the Census Bureau.)

It’s work. Duh. We’re talking about business here. Even if you are following a dream, don’t forget to ground it in a little business.

Resources:

The U.S. Naviguide Co. set up the Zip Code Map I liberally used above; it’s built on top of Google Maps so the interface should be familiar, and while they have a number of products for sale, the zips map is free to use (but not to copy, which is why there are no screen shots above).

The U.S. Census Bureau rocks. (but then, I’m a numbers geek…) Here’s the link to their detailed instructions on finding census info by zip code

I also made use of the American Booksellers Association store locator, the Comic Shop Locator, B&N and Borders store locators (y’all know those web sites, right?) and the National Center for Education Statistics School Locator — which is handy for finding out how many (and which) colleges, universities, and libraries are in your community.

Uclue did the heavy lifting for me on this one; hell, if you throw enough money at them (with a link to this article, so they know what you’re asking) they’ll likely research the zip codes and identify the best bookstore locations for you. It’ll be expensive, but what’s a few hundreds for convenience?

please note: Uclue provided no money or other compensation for my testimonial. In fact, my queries—as linked above—cost me $80 in this instance. I just like the service.

Coda: The Street Level View from Google Maps for 61606 shows a pretty nice residential neighborhood. It’s not exactly the view of the street I’d be able to open a storefront on, but I wouldn’t mind being just down the road from here. (or living here, for that matter)