0 Comments | Add
Rate & Share:
The Entrepreneurial Spirit
By Oliver Chin
Reprinted with permission by the author
October 8, 2001
The Entrepreneurial Spirit
Propelled by the cataclysmic events of September 11th, the US economy continues to plumb new depths. While financial fallout continues to spread from Wall Street to travel and tourism around the globe, uncertainty is the prevailing mood. As we've now entered a real "Worlds at War", domestic consumer confidence has fallen dramatically. A depressed stock market combined with geopolitical and military conflict has driven a downward spiral of belt-tightening.
Considering the manifold consequences as the ripple affects the entertainment industry. First, content gets second-guessed. Movies and television shows were either edited or shelved indefinitely in the wake of heightened sensitivity to scenes of terrorism, explosions and the World Trade Center (such as shown in the trailer promoting the upcoming Spiderman movie). Second, the coattails of "wanna-be" blockbusters get shortened. As box-office spending shrinks across media, marketing and promotional budgets get downsized to ensure project profitability. Third, future production gets adjusted. Dependent on serving the red meat of sex and violence (guns, bombs, and murder), the US entertainment industry suddenly wonders if the public wants to change its consumption habits.
These and other uneasy feelings compound the existing trials facing a small and consolidating comics industry. The cliché of finding the best opportunities during the worst financial times provides little comfort. Already challenged by declining production, distribution, and sales per title, the industry has little choice but to function smarter...together. In this period of reassessment, both retailers and publishers need to accomplish two goals simultaneously: to retrench and to outreach.
Rolling up the sleeves
Facing these weather conditions, some intrepid souls do plow ahead into the fog of doubt. In this spirit, I offer a case study. Recently I interviewed Lawrence Hong from Comic and Card Outpost, located in the outer Sunset district of San Francisco (1349 Taraval Street San Francisco, CA 94116, 415-753-8515). A comics industry veteran for over a decade and store owner for 6 years, Lawrence keeps a busy schedule. As a single proprietor without any employees, he opens Comic and Card Outpost every day (Monday through Saturday 11:30 am - 7:00 pm, Sunday noon to 5:00 pm). This compact store has less than 1,000 square feet, but is situated nearby a main thoroughfare (19th avenue which runs north through Golden Gate Park and the Golden Gate Bridge), a public library, and a municipal trolley line.
In these troubled times, Lawrence decided to give his store a facelift. Though it could be construed as a vote of confidence in the industry, at another level, it was simply a business necessity. For him, renovation was crucial to please his current clientele. Lawrence explained that his main reason was that "I was running out of space and wanted to maximize my space better." Since he doesn't operate a web site to generate additional income and there was no possibility of expanding his store (it is one of many tenants on the ground floor of a multi-story building), reallocating existing space more efficiently was the only viable option available.
Therefore, Lawrence geared up for his biggest renovation project yet. "The new comics are probably the best selling products but I wanted to make more room for everything I sell and better display them," he reflected.
Assessing the change
Starting during Labor Day weekend, Comic and Card Outpost was closed for "three full days and the project took about 3 weeks to complete," recounted Lawrence. As a gesture of goodwill to his regular customers and subscribers, on the night before the hiatus, he held an evening sale to clear out as much product as possible. Operating an additional shift to midnight, Lawrence gave generous discounts from 10% to 50% across all his merchandise.
Next was the hard work. Declining to cite the actual construction costs, he admits that he "spent a lot more than I thought I would but most of the cost came from racks, carpet, and raw material." He painted the ceiling blue to match the new carpet. But since the store itself wasn't level, he had to redo his initial wood paneling of the walls to fix their alignment. From a financial perspective, not adhering to a firm budget, he'll have to eyeball when and where his breakeven point is.
But Lawrence does know he achieved his priority of adding more rack space for new monthly comic book releases, as well as more SKUs for t-shirts, toys and trade paperbacks. The store's focal point continues to be comics (6 rows of plastic shelving), followed by merchandise, action figures, and back issues. By compressing all his displays more economically, Lawrence figures he was able to squeeze out 10% more display space in total.
On the subject of suppliers, Lawrence encourages them to spur retail sales by providing sufficient inventory and marketing support, "My favorite publisher is DC Comics because they always seem to have most of their titles available for reorder and they seem to send more promotional posters and miscellaneous items for projects that they seem to have faith in." But mindful of the controversial new guard at Marvel, Lawrence states that they "seem to be getting there act together since Joe Quesada became their editor in chief because we have been getting more promotional items from them." These two largest publishers provide his best-selling products, led by the New X-men and "not far behind such as Daredevil Yellow, JSA, JLA, Green Arrow, Uncanny X-men, Wolverine Origins, and Amazing Spiderman."
So in this environment of uncertainty, Lawrence has taken a positive step forward to stabilize the foundation of his business. For him, one thing is certain. Customers have appreciated the improvements and benefit from seeing "product better displayed." Give him your encouragement at email@example.com and visit his establishment the next time you're in the Bay Area.