ursulas_alcove: 19th century engraving of a woman using a drop spindle (Default)
Kind of a bizarre week. We got home safely from the renfaire. The gate count was way down. I am re-evaluating my business. Amazon bought Whole Foods. The weather is more severe these days. We missed a tornado while we were away. Politics and the 24/7 news cycle is trying to scare everyone to death, false reports of Russia starting WWIII. What do all these things have to do with each other?

They are screwing with my business. I am still trying to recover from 2008. Let's start with that. It was the start of the "Great Recession". I had too much inventory and bad sales that year which set me on a bad financial business path. I borrowed money from my business credit card firm because the local bank would not cut me a loan. Then Capital One hiked everyone's interest rate to 18% who had used their "special check". They were sued because of this. We won. I got a check for $5.00. I still have an interest rate of 18%. I have called them many times trying to negotiate this rate down. Nope. This is nail number one and I did it to myself. Never, ever trust a bank. They are not your friend.

Books used to comprise about 60% of my business profit. Now we move onto Amazon. Since everyone started shopping online, the book industry is dead. Yes, books are coming back, however, not soon enough. E-books first. I lost several suppliers. Some just quit and retired. Some were eaten by other businesses who then destroyed the product line. It is very difficult for me to requalify with new suppliers and have minimum orders with three companies when I used to buy from one. A minimum order is usually around $250; however some suppliers require a first time buy of $1000. Yeah, it sucks. And no, many of them only have one title I want to buy. Then we move on to customers who buy books. I can't compete with Amazon's prices. Publishers charge anywhere from 60% to 80% of the cover price to retailers. So my profit on a book is not very high. Thirdly, gas prices went high and shipping costs went up. You get the idea. This really hurt my business too. So that's nail number 2. I zigged when I should have zagged.

Now we get to a couple of factors that have the same impact. Wage gap. With the average person's disposable income shrinking, there is less money available in the marketplace. Then climate change. Storms are becoming more frequent and severe. More likelihood that an event will get rained out or a flash flood will block off the roads to a site. Then there is the 24/7 scare-the-heck out of everyone so they stayed glued to your tv channel people. Results, less cash is spent at a show and attendance is down. It still costs me the same amount of money to get there but I have fewer sales. More shows are becoming marginal. End result is that I travel less because it lowers my costs.

Secondary climate change impact: With hotter summers and milder winters, socks are not selling. Wool is not selling. Hats are debatable. As they are hand made and take a lot of time, I don't know what my maximum sales could have been. I can only physically make 100 per year. So I have no upper end metric to compare to.

So I am going to have to think about this real hard. I don't know if I even have a product people still want. It is very likely that I saturated my market or that my market is too narrow or possibly too broad. I need to reinvent myself. Businesses go through cycles just like everything else. Hopefully I can learn a thing or two yet. I will still be around. My product selection may be reduced for a bit while I figure this one out.

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July 2017

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