Anyone own their own business? I want to...

jeddy lee

OK, I would like to someday own my own business. The best business opportunity that I see right now is where I'm currently living: Juneau Alaska. There is no classic brick & mortar comic/hobby shops. There is 1 hobby shop in a crappy location run by a very unfriendly man who stocks only things that he approves of, is open very strange hours (closes at 6) does not maintain a website and seems to have no connection with the pulse of the community.

Now I worked at a very successful comic/hobby shop for a few years, as well as their distributor for the cards/games, which is a connection that I could still utilize to get conveiniently cheap product to sell. I also got a pretty even head for what could serve the population well, and a target market of people between 8 years old (and their parents) to adults 40+.

I also have the labor available currently between my wife, myself, the population and my friends.

Also the city could use it, it's a population of 30,000, higher than average education rate, low crime rate, does not have access to these items through conveinient means, and is a large college town (young adults = real target market).

Now comes the help (other than general suggestions) what all is involved in starting a business? I would be maintaining my full time job working for the state during the day, the business (I plan) would be open 12-8.

-What kind of research should I do?
-What are the terms/conditions like for business loans?
-What is the usual amount of time for a smaller retail store to start showing a profit (if handled well)?
-What do I need to know about hiring employees?

Retox

I would definitely look into shipping rates early on. Juneau, while being a reasonably sized town, is pretty dang inaccessible, and the high shipping costs might mean the margins would be too small to sustain a stand alone comic/hobby business. Of course I have no idea if that's the case, but that's the first thing I would look at.

EggyToast

If there is a strong demand, it could work. In Baltimore, a city of 700000 people, there's, I think, 3 comic shops?

For research, you need to research:

Lease terms for a commercial space
Business taxes in Juneau
Revenue models for the comic/hobby business (how much you can expect to sell and earn)
Actual cost of goods from the distributor (they aren't likely to get you a deal if you're a business, but you never know)
Utility estimates for the leased space
Signage
Point-of-sale stuff (POS machine, credit card contract, etc.)
Employee wage and estimated # of hours needed to maintain the business during all open hours

Work out a basic pro forma statement and see if you can figure out all of your potential sources of revenue, your potential costs, and then see if you can dig into them. OK, you know it costs $1000 to buy 500 miniatures that you then sell for $5 each. Assume you sell 450, 10 are stolen, 40 are put on clearance when the next year's models come out. At what rate do you expect to sell them, etc.? These aren't questions you need to answer me; they're questions you need to work out based on your best estimates.

Feel free to do some research into the sketchy dude's shop, to see what his prices are.

A bank is going to want to see essentially everything that would go on a pro forma financial statement, so not only would you be doing homework to see if it's feasible, but you'd be getting the basic information that the bank would need. They'd be able to fill you in on other details if you go to them earnestly; they're typically willing to help people out, as making loans is how they make money.

psycojester

I'd start out by trying to assess the size of your target market. You've mentioned it's a college town, thats a good start. If there's a public message board for the college either Physical or Net based, i'd suggest posting some kind of survey or flier, something that will give you a rough estimate of how many of the students are interested in what you're planning to sell and what volume of stock you can reasonably expect to shift.

Once you've got a rough idea of the level of interest in the community and how much you can reasonable expect to sell you can start doing some calculations about how much your overheads are going to be.

Also if you do end up going through with this, i'd advise advertising heavily upfront, nothing stupid and expensive like radio or tv slots, but get some fliers made stick them up around the college and other places that you think your target demographics are going to congregate, make sure that they're aware where your shop is and what you sell a while before you open your doors. My local area isn't too different from the situation you've described and over the last few months i've had the unhappy experience of watching an independent comic shop wither and die because they totally sucked balls at advertising and nobody had a goddamn clue that they were there or what they were selling. (Also the fact that they treated the shop like their lounge room didn't help, but considering you're planning on competing with weird guy i doubt you need advice on that point)

Monolithic_Dome

So, if I was a college-aged kid living in Juneau, why the hell would I get up off my ass, put on pants, and waste gas and time to go down to your little comic shop instead of just buying my comics online and get them shipped to my apartment while I sit on my lazy, smelly, butt?

You don't have to answer that question here and now, but you better have an answer for it before you open your doors.

psycojester

Because you're a social awkard nerd who wants a comfortable environment in which to interact with people who share your hobbies and interests.

jeddy lee

Well, I think the draw to being a comic/hobby shop is that you get to meet other people with similar interests, and if you encourage tournament/league play for things like magic, warhammer, pokemon, yugioh, and vs, you can get people to want to meet up. Thats one of the big things missing from this environment, a central public meetup spot, which if they are doing booster drafts and what not makes them buy product and also keep them in the store to buy soda/candy.

The survey idea is great, and I think I will go with that. I'm thinking about doing about 6 months or so of research here before I make a decision on this kind of thing.

As far as advertisement, Juneau is really into community involvement, so between sponsoring people in marathons, posting on message boards, distributing flyers near schools (elementry through college) and word of mouth, I think it would catch on like wildfire.

I'll also look into shipping costs, and try to form that pro forma statement.

Thanks for all the advice guys, I'm not trying to half ass this because I'm a nerdy guy who wants to read comic books all day, I want to run a successful business initially on the side, and if possible, eventually make it my carreer.

psycojester

Oh one other good promotional idea (not sure how well they followed through on it) the failed comic book store in my area had was reaching out to the local primary schools and talk to them about donating comics to their early reader program if they've got one, ask to have a sticker with the shops logo and address somewhere on each issue you donate. Create your own market from the ground up.

jeddy lee

psycojester wrote: »

Oh one other good promotional idea (not sure how well they followed through on it) the failed comic book store in my area had was reaching out to the local primary schools and talk to them about donating comics to their early reader program if they've got one, ask to have a sticker with the shops logo and address somewhere on each issue you donate. Create your own market from the ground up.

That is a fantastic and partially insideous idea.

rockmonkey

Realize upfront that you'll have a large investment in inventory so that money will always be tied up, presumably inventory that includes a good amount of regular backstock issues, of which you either won't ever sell and when you do sell them it won't be for a profit. Your backstock will always grow over time so that's more and more tied up investment. It takes a LOT to get your shipments right and project demand for certain titles and specific issues. Ordering correctly will be difficult for awhile/always.

To support what others have said, make sure your area can support your store. with a population of 375,000 we have TWO comic/tabletop gaming shops (and at least one strictly hobby/table top gaming shop, obviously this doesnt factor in RC hobby shops but that's irrelevent).

A good buddy of mine owns one of those comic shops and he has told me he doesn't make money off of backstock, they're just there to at least gain something back from his cost. A lot of things make their way to his dollar boxes when they're worthless/ he has too many leftover issues.

Hosting events obviously helps. Said friend often shows more interest than he actually has in certain games like Clix because it gets more people in there buying the packs and wanting to chat about it with him, he's really good at making you feel comfortable yet somehow avoids having the unsavory sort lurking about running off parents/kids with their smell and creepiness. He's found a good balance.

MetroidZoid

If it helps any: In our small town of similar size (though this is Southern Oregon, much more accessible than Alaska), we've had two main game shops do considerably well in the past say 15 years: One rode the Pokemon train to glory, and when that started to fizzle out, the business was sold, and the previous owner left with a profit. The guy who tried to pick up the sticks with no major schtick floundered a few months before giving up shop. That was obviously a few years back.

Now there's another game store that's popped up about a year ago, and there main push was miniature games. They try to sell as many different games as they can, have tables made up for gameplay, sell products for customization along with 'hosting' local miniature gamers' collections (which makes for nice looking and also full display cases). On the flip side they also host various card-game tournaments (and sell the cards too), and have a few computers and Xbox360's with various online games to play by the hour (Rock Band and Guitar Hero, too). And they keep hours that make it easy for the local high school and college kids to use their shop (usually lunchtime-ish to 10ish, later on weekends). Also they have kind of a 'geek' gift section, eg. Cthulu-plushes, odd board games, etc. But they do a good job of making the store not look like there's too much going on at once. Also, they treated everyone with respect, they didn't act like this guy

So far they're still doing good, even without a major fad to run on.

Good luck!

jeddy lee

Thats a good idea with the rock band and stuff. Do they charge for use on that? Or count on that being an attraction just to get people into the door?

psycojester

I think thats rule number one of running a successful comic book shop/nerd emporium, don't turn into comic book store guy, EVERYBODY hates that guy.

With stuff like rockband most stores would let you buy time using the games consoles, but thats mostly so you don't get cheap-skates moving in and camping on them.

jeddy lee

I hate that guy. That is my largest complaint with small music/video game/card game/comic/book shops is more often than not, they open the business or apply for jobs there because they want to show the world how much more they know. That is the opposite of what I want to do.

TK-42-1

i was going to suggest not only having a hobby shop, but maybe integrating a small net cafe or something in with it. you can have your local nerds come in to buy shit and form a little community playing mmos or something together

Nibble

At my university, the local gaming, anime and comic book shops reached out to the clubs. The gaming club had a large portion of its library supplied by one store at a reduced cost in return for some word of mouth advertisement, and always invited them to hold their major events at the store. Any member of the anime club who presented his membership card could get 5% off DVD rentals at the anime store, although the club exec always failed to mention this fact to the membership, so I don't know how well it worked out for the store.

Orogogus

I remember there was a thread about starting up a comic book store a year or more ago, and someone was extremely emphatic that to survive, girlie magazines and snacks would be absolutely necessary. Something like that, anyway. I thought that was kind of interesting.

psycojester

i was going to suggest not only having a hobby shop, but maybe integrating a small net cafe or something in with it. you can have your local nerds come in to buy shit and form a little community playing mmos or something together

Personally i really wouldn't advise this one, mmo's are a great way of alienating people and filling your shop with the sweaty creepy types who want to treat your shop like its their lounge room.

jeddy lee

The problem with that is it ups the start up costs to be able to purchase the computers and the games for that. It's do able, but that's a lot on top of the initial setup, and also limited space initially. I can easily see expanding into that if possible, but I don't want to dilute the idea too much.

My idea in my head currently is have a shop with one side being the prime retail area with the counter, with the (easily shopliftable) card products in display cases, on top of and behind the counter. Then, having coolers, for drinks and a candy counter would be ideal somewhere on that side too. Then a shelf with say 6-10 back issue long box's for comics, then rotating rack or wall shelving for the new issue comics. Other harder to steal stuff would be on the opposite wall of the comics such as toys, board games, and other items.

Then the rest of the shop is tables for gameplay, opening packs and whatnot.

So if we were looking at say a 20' x 50 ' retail area (one up for rent right now) it would be something like:

That didn't work too well... I'll draw something later.

---

| Counter Space |
| c |
| o |
| t a b l e m|
| i |
| t t t c |
| a a a s |
| b b b |
| l l l __|
| e e e Entrance

---

Either that or to cut down more on theft, switch the counter space and the comic space, but the most important part is to have it as an open, welcoming environment that encourages participation while also being able to be run by 1 person at a time.

Darkewolfe

I don't think Juneau will be able to support you and Collector's Hideaway at the same time. Best case scenario is that you offer a better service, and you both end up going out of business. It's just such a limited community. Tack on to that the fact that game stores are never-ending labors of love that operate on the slimmest margin any business has ever tried to survive on, and I just don't see why you'd want to do it.

If you did, the most important thing you could possibly do would be to always engage the customer and be a salesman, not just a buddy. You don't need to be pushy, but you need to be demoing new products and always encouraging everyone to try and buy things. Being the local club house is death. You sell a product.

edit: Also, you will be paying a premium for all your product. Freight costs being flown in have gone up with the change in administration. You're going to be on an even tighter margin, and as some have said you'll be competing with people's urges to just get things delivered to themselves instead of having to come into your shop.

psycojester

Hmmm, yes, kill the other guy and burn down his store.

supabeast

Putting a comic/hobby/magazine shop near the docks would be a great way to sell stuff to tourists who found out the hard way just how fucking awful the days at sea on Alaskan cruises are.

TK-42-1

supabeast wrote: »

Putting a comic/hobby/magazine shop near the docks would be a great way to sell stuff to tourists who found out the hard way just how fucking awful the days at sea on Alaskan cruises are.

depends on what cruiseline youre on. im going on the regent seven seas mariner at the end of july

Improvolone

Since you mentioned you'd be selling snacks, consider that coffee can have an amazing mark up.
I'm not saying go full espresso bar of course, but coffee.
COFFEE AND TEA. If the market likes it.

CelestialBadger

Check out this epic RPGnet column series about setting up a game store. It seems to be just what you are looking for.

http://www.rpg.net/columns/list-column.phtml?colname=businessofgamingretail

Jasconius

As a comic/hobby shop.. knowing what I do from just visiting a few, I'd give the following advice.

1) Try to not hire anyone at first. You'll be paying a slacker kid minimum wage to play runescape on your cash register and ring up a magic card every couple of hours.

2) You need to establish reliable recursive income to pay your rent. Host DnD games, and if you can't DM yourself, find someone who can, for free, in exchange for the free games. Charge the players at the door to cover profit, food, and drinks.

3) Look for low rent places. I cannot imagine the margins are fantastic on this kind of business, and the biggest impact on your business from that fact is the quality of space you can host your business in.

EggyToast

You do not need food licenses to sell packaged foods, such as snacks or sodas. You do need a food license and the inspections that go along with them if you sell prepared foods like coffee, sandwiches, etc.

YodaTuna

The number one thing I can't believe no one has said yet. There is almost no way you will be able to keep your current job if you really want this store to succeed. Owning a business a 2x full time job. If you can't give the store everything you've got, you're going to fail. Full Stop.

Second, make sure your business plan allows for at least two years of not making a profit. I've seen many stores open and then close 3-6 months later before anyone even knew they existed

Thirdly, I'm going to go against the idea of a "net cafe" Costs too much money and will make you almost none. A guy I know worked at a hobby shop with a net cafe and no one ever used it. People who are interested in the things a net cafe has to offer already own a sweet rig and a broadband connection.

Darkewolfe

The one guy I know who ran a game store that didn't go out of business works essentially every single hour the store is open. He sometimes takes Sunday afternoons off. He pays one part time guy minimum wage, and that guy is the most trustworthy human being ever. He also sometimes gets his wife to run the store (with no pay). It's a huge part of how he makes his margin, he keeps his overhead to the tiniest amount possible.

FyreWulff

1) Don't rent a gigantic building at first. It's okay to start small and expand if it takes off.

2) Be friendly and open to kids coming in. Most parents think this: if my kids aren't allowed there, I don't want to shop there. It's surprising how many businesses start up, do well for a while, then start being anti-kids and then they die a year later.

3) In relation to 2, don't plaster the front windows over with posters and crap. Let people be able to see into the store.

4) With loans.. shop around with banks. Have your business plan ready to go, be ready to answer ANY questions they might have. Talk with multiple banks. Read the fine print. When you narrow it down, read the contract over at least 3 times, have someone else read it 3 times. If you have the money, have a lawyer look over it and explain it to you. Don't just take the first 'good' offer.

5) You mentioned hours. I would look around where you are going to put your store and see the hours the businesses have around it. If everyone in the area closes at 9, you should close at 9. If everyone opens at 11am, open at 10 or 11am (of course, you should probably have your actual 'work day' start 1 to 2 hours before actual open)

6) Hiring.. just go with your gut. At minimum, I would pay for a background check (make sure you have the correct papers for them to sign a release saying you can do so). Remember that you don't have to give them a full week. Look into your local labor laws for the minimum hours you can hire somebody for. For instance, you may just want to hire at first for the busy days and not pay somebody to stand around the other days of the week.

Darkewolfe

On the note of being kid-friendly. One of the stores I saw start up and crash soon after allowed older guys to loiter and smoke in front of the store, cuss like mad, etc. Little kids buying pokemon cards (or whatever kids buy these days) can be a major source of income, even if they aren't the part of the job you like. Make the environment kid friendly. You want parents to feel comfortable dropping little Jimmy off for the pokemon tournament, because afterward he's going to want 30 booster packs.

clsCorwin

Avoid that dank dungeon feel. If you've got lots of windows, keeps them free of clutter and let that sun in.

When I was younger and still bought comics, the shop I went to was run by a guy named Ray. He pretty much manned the store all the time, except briefly he'd have a part timer in there.

2 things that struck me that he did very well to keep business: I'd come in every week, get my comics, char about books etc, and he gave me a discount. Something pretty meager, but it meant something. Not only did it further solidify a customer to his shop, it encourages word of mouth praise that shops like this need.

Secondly, he have an entire wall full of used books. He'd buy them from you too. He gave me Nine Princes in Amber, saying I'd like it, to quickly have me come back and promptly buy the other 9 books in the series from him.

Wezoin

Another thing to keep in mind is insurance costs. Not sure if they're mandatory or whatnot over there, but I know my store dishes out quite a bit in them, and also that according to our insurance agreement, in order to keep the price slightly lower, we have to have 2 staff members in the store at all times while it is open.

If you ended up in a situation like this, you would need 2 staff members to work the main shift, and then (not sure if there are mandatory breaks over there like there are here) someone to cover lunches. This ups the cost alot, because it means you cant just pay minimum wage x number of hours the store is open, and would cut significantly into your profit.

jeddy lee

Is the benefit to having a 2nd employee + the savings on the insurance worth the cost of the additional employee?

I hear tell that if I could do it myself, or myself + my wife I would be much better off in the begining, but that's what I hear.

Wezoin

jack eddy wrote: »

Is the benefit to having a 2nd employee + the savings on the insurance worth the cost of the additional employee?

I hear tell that if I could do it myself, or myself + my wife I would be much better off in the begining, but that's what I hear.

Not if you're just starting out. The only reason it works for us is there are times when we actually need two employees working the store because we do get quite busy occasionally. Honestly, if you're planning on doing any hiring at all to begin with my plan would be minimum wage, and tell them depending on how the store performs you might be able to increase it. Although, I wouldn't recommend hiring anyone at all until you know how the store is going to run, and how much profit to expect.

EDIT: That said, fiscally it makes sense that if you make more than you're paying the staff in your store you should hire someone to work it while you're at work (or if your wife can work it that works too.)

AresProphet

psycojester wrote: »

Hmmm, yes, kill the other guy and burn down his store.

Clearly this is a joke but you need to have this mindset in a metaphorical sense.

There's one other shop in town. Every customer he gets is one less customer for you. If he closes up shop (because of legitimate competition, not because of arson) the better for you.

Visit his shop often. Note what he does well, and do it. Note what he doesn't do well, and improve it. If you're ten times better at giving customer service and keeping customers happy, be it the regs or walk-ins, they'll come back to you and only you.

Running him into the ground, when it's a low-margin niche business like comic/games retail, is your best possible option. If you can't stomach the idea of befriending someone just so you can learn how they earn a living and then turn around and stab them in the back so they aren't earning it anymore, you might want to reconsider. If he's a savvy business owner he'll do his level best to keep you from ever making a red cent once your doors open through all legal means possible.

Times are tough right now, and you're going to have to ponder the full meaning of the word competition if you want to open a small business. The demand for comics and games in your town isn't going to suddenly double overnight when your shop opens. Accept this, and do your best to get as much of that demand for yourself as you can.

firewaterword

YodaTuna wrote: »

Second, make sure your business plan allows for at least two years of not making a profit.

Came in here to say this. Considering the economic climate, it could very well be more than two years. Don't let that stop you, but be very aware of it.