Why Comic Shops Can’t Afford Larger Discounts

Comics, every kid's best friend

I recently sent out a survey (here is the survey, and here are the results), and one of the choices I let people choose was “give a larger discount”. I also suggested we might start a referral program, and the overwhelming choice there was “give a % discount on my subscriptions”.

Unfortunately I don’t think it’s possible to do either one of those things, but let me explain why I am not ridiculously rich from my comics empire.

On average we get about 50% off the US Cover price of a comic book, paid in US dollars.

On a $3.99 comic, it costs us $2.00 US, with the exchange that’s about $2.14 right now.

We sell that comic to you for $3.41 (a 20% discount).

$3.41-2.14 means we make $1.27 (37% profit).

We give you a free bag and board (that’s about .10 combined)

The payment gateway takes another 3.5% off the top.

We’re left with about a 28% profit, meaning we earn about .28 on every dollar we spend to bring a comic into the shop.

So on a $70.00 order, we make about $20 in profit.

Packing materials work out to about 2.00 per shipment

If you live in Ontario, Quebec, or Manitoba, we spend $8.00 – $14.00 sending your comics to you, outside of those areas it’s much more, and pretty much wipes out any profit at all.

That leaves us with a gross profit of $0 – $12.00 on that $70.00 order (with an average of around $6.00).

Even on those who DON’T qualify for free shipping, we’re still subsidizing it a little bit (check out the price that we paid for your shipment, and then factor in the fact that we pay for packing material, and you’ll see where the subsidy comes from).

It costs a couple hundred bucks a month JUST to keep the website running (payment gateways, hosting, and a little bit of advertising to bring in new users).

That usually leaves Peter and I with very little money left over. There’s simply not a lot of cash to go around, and there have been months where a couple of delinquent bills have entirely wiped out our profit.

Pete and I funnel most of the money we earn back into the business, in the 5 years we’ve been running this thing, neither of us has ever earned even minimum wage from running All New Comics (half minimum wage is closer to the truth, and that’s not counting the five or ten minutes here and there that we might spend from anything from responding to an email, to packing up a package to ship out).

Now our accountant recommends that we either eliminate our discount, or start charging full pop for shipping, we don’t want to do that, but he’s right in that we can’t really turn this business into a full time passion if we’re giving a 20% discount, and an effective additional 20% discount for shipping (leaving about 10% for us).

So what can we do? How do we continue to provide our customers with great service and have any hope of being paid for our time?

I am seriously all ears. If anyone knows how we can make our customers happier by giving them cheaper comics, and make my wife happier by me bringing something into the house other than comics and the rewarding experience of running a business…please let me know.