How do overpriced brick and mortar record stores stay in business?

Discussion in 'Marketplace Discussions' started by 12" 45rpm, Mar 27, 2018.

  1. 12" 45rpm

    12" 45rpm Well-Known Member Thread Starter

    Location:
    New York City
    Every town has their token overpriced record store. I usually go once and see dollar bin stuff for $10+. I never go back but somehow the store stays in business. Who buys from these kinds of places and why?
     
  2. Dave

    Dave Esoteric Audio Research Specialist™

    Location:
    Greater Vancouver
    Some are the actual owners of the relestate and a loss is just a supplemental tax write-off.
     
  3. I have noticed that some used music stores almost never reprice anything, leading to dead stock that sits for years and years. If an item hasn't sold in five years at the tagged price, there is a very good chance it's never going to sell for that much.
     
    LordThanos1969 and Galley like this.
  4. curbach

    curbach Some guy on the internet

    Location:
    The ATX
    You ever see Weeds?
     
    cdash99 likes this.
  5. 12" 45rpm

    12" 45rpm Well-Known Member Thread Starter

    Location:
    New York City
    Nope
     
  6. He's implying that the overpriced record store may just be a front for some other illicit business and that selling records doesn't entirely pay the bills.
     
    12" 45rpm likes this.
  7. 12" 45rpm

    12" 45rpm Well-Known Member Thread Starter

    Location:
    New York City
    I've heard this theory with regards to run-down restaurants.. But a loss is still a loss.. So it seems more "urban legend" than true..
     
    Last edited: Mar 29, 2018
  8. I know of a store who is known to be more expensive than most others, yet he's thriving. The reasons are simple. His stock is play-graded and identified as such (with the grade) on each price sticker. The store is super-clean and inventory is categorized to perfection. In addition to his used inventory he carries a significant amount and selection of new releases and audiophile vinyl. He goes to England yearly and always comes back with some real treats. And lastly, he's extremely knowledgeable about all things vinyl, music history and treats every customer with respect and gratitude. Oh, and his wife changes their window display monthly, which always has a theme.
     
  9. Dave S

    Dave S Forum Resident

    That's one thing you could never accused my local record of doing. They have had the same window display for the last decade or more - faded LP covers (I suspect some forum members will be in tears). The LPs sell, perhaps because some of them are cheaper than the overpriced CDs that never, or rarely sell. However, there is a certain element of cluelessness about the CD pricing, with rare OOP CDs being priced more or less the same as common Dollar bin titles.
     
  10. Dave S

    Dave S Forum Resident

    TBH, it's more likely to happen with restaurants because lots of people pay cash. Of course, here in the UK, you are more likely to be offered a cash discount for different reasons.
     
  11. BIGGER Dave

    BIGGER Dave Forum Resident

    My local used record store seems to do things right. Used LP’s are $3 each or four for $10. If something doesn’t sell, it gets moved to the $1 bin. Every once in a while there will be an amazing deal. Last year I scored a NM copy of Led Zeppelin I with A1/A1 matrix for just $20. I nearly passed out!
     
    Dave likes this.
  12. patient_ot

    patient_ot Forum Resident

    Location:
    USA
    Some of those stores have a steady clientèle of hipsters, college students, etc. that keep the store going. I was in a shop like that a few weeks ago on an out of town trip.

    Other shops have cheap rent or the shop owner owns the building. Usually when the shop owner dies, the place goes out of business. Likewise, if a new landlord comes into the picture and jacks up the rent - time to move or shut down.
     
  13. patient_ot

    patient_ot Forum Resident

    Location:
    USA
    Lots of ways to cook the books. In my hometown, wig shops, hair salons, nail salons, laundromats, little diners, derelict buildings, etc. are often used for all kinds of shady things.

    A few years back I had a job where I dealt with small and large independently owned businesses. At one point the owner of a gourmet food product business comes in and wants to know how they can expand and become more profitable. The owner gives me some summarized financial statements and projections they had an accountant prepare. Guess what? Every year that business was either breaking even (barely) or losing money and was projected to lose money every year for the next ten years unless sales went through the roof (unlikely with a niche product like this). I ask the owner where the money comes from to continue to run the business and they won't answer me. After pressing them, they simply say they cannot tell me. Yeah, they could've been draining savings (unlikely due to the age of the owner) or getting money from FFF, but usually people are up front about that kind of stuff in these discussions. Needless to say I didn't spend much time working with that business.

    My point is, you'd be surprised...
     
    PhantomStranger likes this.
  14. ggergm

    ggergm sexagenarian

    Location:
    Minnesota
    While I've known of a record store that was a money laundering operation, or at least that was the general assumption, I think this is an unusual explanation. Instead, I'd want to know what else these high priced record stores sell. If they are selling marijuana paraphernalia or a lot of clothing, that may be where they are making their money, not by selling phonograph records.
     
  15. jimac51

    jimac51 A mythical beast.

    Location:
    Allentown,pa.
    Multiple reasons why they exist,and often a combination of such.
    Rent-overhead. Cheap to run. Yes,these places still exist.
    Store may have a decent online presence and the brick & mortar acts as an "incoming" bunker. Also,place may have a secondary source outside of online-flea markets,swap events-to resell. What happens Mon-Thurs. in a used place has little to do with what happens Fri.-Sun.
    Those in-store high prices may act as an incentive for folks to bring in stuff,thinking their collection of Chicago LPs may actually have value. If you ever witness one of these transactions and the dealer says the magical words:"How much do you want for all this?",and the novice is about to give a quote,that novice has landed in a trap. Dealers that cherry pick only the stuff they want are idiots. Sometimes,that box of Whipped Cream LPs may have yielded a prize or two from a collection.
    Visiting a place one time tells you little about how a place operates. What is priced and what price things sell are two different things. Does this place expect folks to negotiate? If so,better to start high and go low,depending on sizing up customer,quantity involved,paying cash,etc.
    The old saw-10% of the inventory yields 90% of sales has some truth to it. Led Zep & Beatles stuff you may never see can pay a lot of bills.
    The money laundering stories may exist,but the restaurant "cash only" places are much more realistic. To quote The Byrds: Turn,turn,turn.
     
    12" 45rpm likes this.
  16. 12" 45rpm

    12" 45rpm Well-Known Member Thread Starter

    Location:
    New York City
    I am not sure I follow this statement. What is the trap if the novice gives a quote? Won't they usually quote something high?
     
  17. Matt I

    Matt I Forum Resident

    Location:
    Alabama
    As a record store owner in a small time I have to say that there are a lot of weird assumptions, both here and in the small towns themselves. My store does well, but my prices are not too high. I also sell CDs, DVDs, Blu-Rays and video games. The combination works very well.

    Personally, I'd recommend visiting as many record stores as you can and seeing first hand what they have to offer.
     
    Gene Parmesan likes this.
  18. Ron Stone

    Ron Stone Offending Member

    Location:
    Deep Maryland
    Indicating the novice seller doesn't know one or two pieces in the sale pile are actually valuable. A mass quote will generate something like $2.00 per record, even if the clean first pressing of a Zeppelin record is worth more than that alone.
     
  19. jkauff

    jkauff Putin-funded Forum Troll

    Location:
    Doylestown, PA
    Lots of people (well, enough, anyway) want to see the condition of the album or CD, and some shops even let you play before you buy. Handling a physical product is something humans like to do, and they'll pay a bit more for the privilege.

    Back in my collecting days, I had a couple of used CD stores on my weekly visit list because they knew nothing about early pressings, matrix numbers, or target discs. I picked up a lot of great stuff.

    Beware of the stores with savvy owners, though. They put all their best stuff on Discogs or eBay, and then overcharge for everything in the remaining unremarkable inventory. However, if you're selling valuable items you can usually negotiate a fair price if you know what they're listed at on Discogs.
     
  20. jimac51

    jimac51 A mythical beast.

    Location:
    Allentown,pa.
    Rarely. I remember visiting a second hand book/magazine shop as the owner was taking in a huge box of 1960s TV Guides. The guy who brought them in said his Grandmom put them in a box after the week ended. At the time,TV Guide had the biggest circulation of all,but,like a newspaper,was discarded immediately. TV Guide wasn't printed on news stock. It used Rotogravure on the outer papers and the colors were amazing,especially for a 15 cent weekly. I have a few examples of stuff 50+ years old and they hold up quite nicely. The guy skimmed just the top layer-Flintstones,Star Trek,Man From U.N.C.L.E. covers and stories.Those few paid for the box. Profit for the rest.The seller just thought it was kinda stupid that Granny took care of her stuff that didn't mean anything after that issue ended. Joke on him.
    And once that "quote" is out,the buyer can size up the transaction. He saw the poker hand. The buyer knows to go up or down since the seller already gave up an important piece of information.
     

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