When you open a hobby game store, you have no idea what kind of store you'll be. If you're starting with a giant Magic collection and you're a Magic maven, sure, Magic will be a big part of your mix. However, you really don't know if you'll be big into board games or miniature games until you figure out the needs of your customer. Your store inventory reflects their needs. Likewise, business models are being shown to shift over time as well, and you need to be just as flexible in this arena as you are with inventory.
In the beginning, there was the Traditional Value Proposition, the pretty good price, with pretty good service, with pretty good selection. Tap 80% of the population and you could safely ignore the other 20%, their poor reviews and all (also known as word of mouth). That has given way to a more Useful Value Proposition, where you find ways to make your retail operation sticky to attract and keep customers, usually through concepts like Third Place Theory. Third Place Theory builds community, and communities are resilient and defy common retail considerations. Finally, you have the future proofing of a Unique Value Proposition, the special sauce in your operation, which might be the building you bought to bend the price curve, community outreach, or supercharged demos that make you the source of demand, rather than attempting to predict supply.
The problem is the Traditional Value Proposition is obsolete, and stores relying on it are closing. The Useful Value Proposition, relying on Third Place Theory, was indeed useful 7-10 years ago, but is now becoming ... wait for it ... traditional. Most game stores are in the useful category, and as useful becomes traditional, their mojo declines and they're at risk. At one point, the early movers of Third Place Theory were unique with their value proposition, so they've slid all the way from Unique to Traditional. Like the shifting whims of customers that determine your inventory mix, your entire retail operation is also built on shifting sands, and you need to be prepared to adapt.
You may think you will run a particular type of store when you begin, but in fact, you absolutely will need to change over time, provided you succeed and you're around long enough. This is not news to more dynamic businesses. Retail didn't change much for a hundred years up until around 1991, when the technology began to intervene. Sears was Amazon for nearly a century, selling everything from wrist watches to houses through catalogs (Sears emerged from the big innovation of that day, catalog sales made viable by the railroad). Sears was so wildly successful they opened brick and mortar stores, much like Amazon is doing today. In 1991 they were the unassailable king of retail. Then the web happened and online shopping provided a Unique alternative.
The key to retail success is coming up with your Unique Value Proposition, but what's even more important is keeping nimble for when your Unique proposition becomes merely Useful, and hopefully before it becomes Traditional. I once ran a profitable BBS system, that relied on technology with multiple phone lines and crazy looking octopus cards. When the web emerged, we invested in new technology to link our BBS to the Internet. Before the loans were paid back, the model shifted again to websites and portals, and we simply couldn't adapt fast enough, while some BBS system could, and became Internet Service Providers. A critical part of having the Unique Value Proposition is being nimble enough to shift your model as you become Useful and then Traditional. When you look at the Traditional Value Proposition losers in retail, the big stores, you'll find the Internet didn't kill them. Almost universally, their lack of dexterity to change did them in. You may be one thing now, but in the future, you'll be another.
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