Owner of Subterranean Books Details the Store's Uphill Battle to Stay Open
Kelly von Plonski, owner of Subterranean Books has posted a letter on the store's website addressing its bleak financial situation.
Is Subterranean Really in Danger?
So, yes we are struggling.
2010 was a very difficult year, a shell game of sorts in order to get bills paid. And there just was not enough money to pay everything. This is not sustainable.
Sales were up in December and I thought maybe the tide had turned. But then January arrived and we were down 25%. If our sales for this January through June do not at least equal 2010’s January through June we will close. If we don’t reach at least that level of income there is simply not enough money coming in to keep our doors open.
The three major expenses in a book store are rent, payroll and inventory. We aren’t bloated in the staffing department so there’s nothing there we can cut. Our inventory is not top-loaded, meaning we don’t buy stacks of thirty to make pretty pyramids. Instead we buy just in time, gauging how many we’ll sell in a week and re-ordering for the new shipment to arrive just before the last copy sells. That leaves rent. We asked for a rent reduction but were turned down. This doesn’t make our landlord a bad person. I’m sure she has a dollar number that she needs to hit every month to keep her bills paid, and decreasing our rent would cut away from that.
The problem is that the sales we generate in our current location are not commensurate with the rent we’re paying. So our options are to either generate more sales or move to a location with cheaper rent. Moving is an intriguing and exciting option, but we don’t have the many thousands of dollars that a proper build-out would require. If there are any interested investors out there we would love to hear from you.
Which leads us back to generating more sales, and our survey. The survey was our first step in trying to figure out what we’re doing well and what needs improvement. The first step in trying to earn back sales from folks who might have left. There are lessons and ideas that we will be carefully considering and thank you to everyone who responded. It is a tremendous help.
My major concern is that it won’t be enough. What might have been enough in sales when we opened 10 years ago is not necessarily enough now. (Our rent goes up every year and so is considerably higher than when we started.) Have we reached the threshold of what a bookstore in University City can support? I just don’t know.
---Kelly
Maggie Stanley Majors
5:27 pm on Sunday, February 27, 2011
Let me echo Glo Nickerson's challenge on Subterranean's facebook page. She writes:
"Will each resident of U. City able to read, join me in buyng at least one book during the month of MARCH. We can no longer sit back and do nothing when a business is struggling. This community is and has forever sought after the business owners in U. City for IN-Kind donations. Now this is our opportunity to give back."
My husband and I have already transferred a number of our amazon purchases to Subterranean - both in store and online at http://store.subbooks.com/. We encourage you to do the same.
Contd. in next post...
Maggie Stanley Majors
5:32 pm on Sunday, February 27, 2011
Furthermore, I encourage Subterranean to consider bringing back used book sales big time. The U-City Public Library receives many donations of excellent condition used books every month (the library may kill me for suggestion this, but I think they would still get plenty of donations). And I'm not talking about stuff no one wants or everyone already has, I'm talking about good, sometimes hard-to-find stock. I venture to think at least some of the book donators might love a local place to buy, sell and trade books. Not to mention the many college student and faculty populations close by.
To become a really viable used book seller might indeed involve a different location with more space for stock to sit around until the right buyer comes along. I think the prospect of moving could be an exciting one for Subterranean. BUT ONLY IF THEY STAY IN U-CITY. Having our own independent local bookshop is part of the fiber of this community. I can think of a number of possible locations with potential.
Finally, could the Loop association find grant funds to subsidize rents for struggling local businesses? It seems like opening up the playing field to chains (Verizon, Noodles & Company, etc.) may be driving rent prices up. That’s unfortunate.
PS. This article is part of my first ever tweet at http://twitter.com/weeklyucitizen! Very soon I will be launching a new U-City-themed blog: local news commentary, local business reviews and more at http://www.u-citizen.org/.
Myra Lopez
5:57 pm on Sunday, February 27, 2011
Thanks for your suggestions Maggie. I don't know if my one book purchase I plan on making this month will help, but it can't hurt. Kelly is asking the community for help. If the bookstore does go under it's not like residents can say, we didn't have any idea.
3rd Ward Rogue
8:03 pm on Sunday, February 27, 2011
The U City sales and property tax rates are too high.
The property owner or the city can supply you with the property value, mortgage rate, insuance rate and property tax rate. These may give you an idea if you are paying a fair price, if not you may use this as a bargaining point. Plus the actual value of property has gone down, if your building is reassesed at a lower value it may help the owners tax rate, but not help if they want to sell soon. If you move out does the owner have someone waiting to move in? Probably not.
I think the City and Loop need to remain in competition to lower the cost of doing business and the City may not have the same traffic, but they may have better incentives if you are willing to move east. If you are in the City, you may want to contact Andrea Riganti, Lehman Walker or maybe Joe Edwards to find out what incentives U. City has to offer? Either way the City and Loop should be competing for your store!
U. City does have a Loop Special Business Tax Rate that is higher than the 8.425% regular sales tax rate and this does nothing to help you compete, but in April 2010 the City raised their sales tax rate by 1%, this needs to stop!
Maggie Stanley Majors
8:09 pm on Sunday, February 27, 2011
These are great suggestions, 3rd Ward Rogue! You're right, the City part of the Loop and the U-City part of the Loop should be competing to have such a great institution in their midst. Given the number of vacancies on the Loop and current property values, no one should be talking about high rents with no room to budge. Just 2 cents from another 3rd warder here!
3rd Ward Rogue
10:40 pm on Sunday, February 27, 2011
Thanks Maggie Majors, It has been a while since I shopped at Subterranean, just before they brought in new books and had great little punch cards. Great collection of old WWII history books! Considering the campaign to keep it open, I must stop in soon. I agree with the other "old book" supporter, but I understand that it's not "hip" to read old books and that may be the general feeling of loop visitors.
There may be some out-reach measures we can attempt if Ms. von Plonski would agree?
My husband and I belong to the House Rabbit Society and we rescue abandoned domestic pet rabbits. I could propose a rabbit day and Ms. von Plonski could collect a bunch of her books about rabbits or Easter and set them outside or near the front and I can bring one of my big bunnies for people to enjoy. It may be necessary to do this a few weekends in a row. It is something to think about, but I think free or cooperative outreach measures may help the store. I have a few ideas for community involvement, but there are many creative minds out there in U. City! Non-profits tend to like to work with places that can bring them visibility in conjunction with sales for the stores that carry products relating to their cause.
This may be too much for the space I have, but these are some of my suggestions, and I am willing to help however I can!
Maggie Stanley Majors
12:31 am on Monday, February 28, 2011
Love the bunny idea. I've offered to help Ms. von Plonski with a good old-school flyer campaign on the WashU campus. Students don't monitor local comings and goings, but I know I will be hearing a lot of "Man, I loved that place, why'd they leave" on the WashU campus if Subterranean is gone. So, inform them of the situation. They might act.
The used bookstore I cited elsewhere as a potential model for Ms. Plonski does a DJ night. Now, that is because they also sell music. But, you get the point. Doing this type of community outreach consistently can have a big impact.
Non-profits should totally team up with Subterranean. Anything can help.
gena ellis
11:14 am on Monday, February 28, 2011
Agree 3rd Ward about taxes here. We have moved 15 times and U city property taxes are the highest of anywhere we've ever lived. When we think of retiring from military (tho looking for another job) we will consider all of that- the mortgage, the taxes, etc. I see many more homes for sale here than when we moved two years ago. And on our street alone, prices have dropped 70K-100K. That is scary! Esp if you have to move due to job, again.
Also know a person looking for a location for business but U city makes it difficult with rent prices. In my neighborhood a building has sat empty for at least a year while there are people looking to open businesses but with 1100 a month rent for a small space, well, not feasible for those I know. One went to Webster where rent is less than half that with a high traffic area. As a newcomer here, love the loop but i find myself going there less than the first year. i want the funky and eclectic, but also need to buy milk, house items, (ACE hardware sets up in places like this) need a more 'main street' area sometimes. I heard a grocer was coming but not seen it. And this is probably not feasible, but have they ever thought about closing the Delmar street and making it an entirely pedestrian area? part of it? I think traffic/parking keeps people away sometimes. I don't know the history or if there is a street to reroute, probably not, but in other areas I've lived, those have been available and big pedestrian draws.
3rd Ward Rogue
12:24 pm on Monday, February 28, 2011
Thanks Gena for the info, hopefully we will have a Chamber of Commerce in the near future, our Mayor Shelley Welsch proposed the idea while campaigning. We also have a shopping area on Olive that needs redevelopement, but the powers that be, (Joe Edwards), don't want U. City to expand beyond the Loop. A Chamber of Commerce would really help businesses such as Subterranean and help mold the Loop into something more family friendly without becoming a franchise row. Economically people are looking for staples more than fun stuff which the Loop is full of, and higher rent causes higher prices for fun stuff; not a good way to do business at the moment. A Chamber of Commerce could help with rent price management, but unfortunately it may be a few years away.
The City does have a taxpayer funded account to pay for a Delmar/Olive Trolley but unfortunately the previous City Manager and Council under Mayor Adams redirected money from it to the General Funds. This is not illegal but unethical. This fund is supposed to pay for shutting Delmar down to only foot traffic with a trolley. I could go on and on about corruption in U. City's govt., but this is not the place! U. City isn't business friendly, but it takes years to undo bad policy.
Great observations on your part, and if you feel like expessing these concerns to anyone, call City Hall and ask for Andrea Riganti or Lehman Walker, we need a Chamber of Commerce!
Michelle
12:32 pm on Monday, February 28, 2011
FYI: the grocery store that was schedule to open on the East side of Delmar is no more. Here is bit from Sauce Mag posted on NextSTL blogsite on February 3, 2011.
“We have ended our negotiations with Washington University. They have allocated building funds to other residential projects and commissioned a study to explore the retail environment in The Loop which will be completed in October 2011. Without their upfront funding to whitebox the building shell, our project appears dead.” Washington University currently owns the property which was formerly occupied by Dobbs Tire and Auto Service." Sad, I know. I was really excited.
Here is the link to magazine. http://www.saucemagazine.com/blog/?p=8223
Myra Lopez
12:41 pm on Monday, February 28, 2011
Michelle, thanks for the update about the grocery store. I've been asked about it, so glad for the info.