Min Wage increase kills a SF small business

[cabri]

Link

An independent San Francisco bookstore says it will be closing its doors by March 31, despite having its best year ever in 2014. And it’s pointing at San Francisco’s newly enacted minimum wage law as the reason

Borderland Books, which specializes in science fiction and horror, says it has withstood a host of challenges since it opened in 1997, including the rise of Amazon.com and e-books, a landlord who supposedly doubled their rent while dotcoms were first booming, and a deep recession that the owners say “hit us very hard.” A higher minimum wage, though, would take the business from being modestly profitable to being a money loser, the owner says.

You live on the edge for the enjoyment of the business and interaction with the customer.()

Then the legs are pulled from under :thumbsdown:

 

[nickqt]

Small businesses fail all the time.

I guess we should just go back to indentured servitude so that businesses that can't currently compete can do so.

 

[Jimzz]

A small book store closing, that has to be due to minimum wage. I mean small book stores have been thriving, there's just no other explanation.

 

[zinfamous]

--sci fi and horror bookstore? check
--rise of amazon and ebooks? check
--standard rent increase all across the city? check
--decline of print media and book stores all across the country, for a decade plus? check


--new minimum wage has killed us in one year! D:

Uh, OK. sure.

No.

 

[zinfamous]

lol--they open in 1997 (the "book bubble," if ever there was one in these decades, has just ended), and they claim that last year was their best year ever?

I'm willing to bet that 95% of their sales, in a SciFi/Horror limited bookstore were Game of Thrones, the Hunger Games, and the other 2 or 3 series that had major releases.

 

[DucatiMonster696]

Small businesses fail all the time.

I guess we should just go back to indentured servitude so that businesses that can't currently compete can do so.

You are right in that small businesses fail at a much larger rate than larger sized businesses. However creating a business environment that is hostile to small businesses (even if it is done indirectly and with well intentioned goals) is not conducive to creating a healthy marketplace for consumers.

In fact such actions usually just create a stratification of businesses where the dominate businesses are mega businesses who can negotiate heavy handed action by government with greater ease versus smaller businesses.

Of which it is the smaller businesses who find it difficult to deal with government imposed costs as compared to much larger businesses and so this does not help lower or stabilize that rate of failure or improve the number of choices and opportunities for consumers or people looking for employment.

 

[werepossum]

Everyone knows this will happen; an increase in wages whether mandated or market-driven is going to take out some marginal businesses. But it should be noted that evidently this store's "best year ever" in 2014 must not have been very good (e.g. in 2014 I managed to set myself on fire only sixteen times, a new personal best!) if it's shutting down without even attempting to adjust its business model. I hate it for the owner, who might have been living his modest little dream, but everything government does has winners and losers. We can hardly give up government just because government inherently shuffles the deck.

 

[DucatiMonster696]

--sci fi and horror bookstore? check
--rise of amazon and ebooks? check
--standard rent increase all across the city? check
--decline of print media and book stores all across the country, for a decade plus? check


--new minimum wage has killed us in one year! D:

Uh, OK. sure.

No.

The minimum wage hike was basically the tipping point for this business and many others. Yet people in SF will complain how small bookstores are few and far in between and then they will complete and solely blame Amazon for the demise of this businesses (which they certainly had a part, no denying that part) but will ignore the other direct causes such as the increase in operating costs via the newly passed minimum wage hike that finally drove this business (however niche it may have been) out of the SF marketplace.

 

[nickqt]

You are right in that small businesses fail at a much larger rate than larger sized businesses. However creating a business environment that is hostile to small businesses (even if it is done indirectly and with well intentioned goals) is not conducive to creating a healthy marketplace for consumers.

In fact such actions usually just create a stratification of businesses where the dominate businesses are mega businesses who can negotiate heavy handed action by government with greater ease versus smaller businesses.

Of which it is the smaller businesses who find it difficult to deal with government imposed costs as compared to much larger businesses and so this does not help lower or stabilize that rate of failure or improve the number of choices and opportunities for consumers or people looking for employment.

Large megabusinesses shut down small businesses simply because they can do most things that small businesses do, for cheaper. If you want to help out small businesses, then make being a megabusiness more expensive. Period, end of story.

Everyone knows this will happen; an increase in wages whether mandated or market-driven is going to take out some marginal businesses. But it should be noted that evidently this store's "best year ever" in 2014 must not have been very good (e.g. in 2014 I managed to set myself on fire only sixteen times, a new personal best!) if it's shutting down without even attempting to adjust its business model. I hate it for the owner, who might have been living his modest little dream, but everything government does has winners and losers. We can hardly give up government just because government inherently shuffles the deck.

Pretty much this.

I'm not sure why we always have to focus on the stories where some member of the rabble gets paid as much or even better than ourselves and our tribe members. If a libruul does it while pointing at a CEO making 450x what the worker makes, we're being jealous and just want to take someone else's stuff. If we point to someone trying to support themselves on $15 an hour, then it's some dumbhead loser getting paid far above their station.

 

[MongGrel]

Link



You live on the edge for the enjoyment of the business and interaction with the customer.()

Then the legs are pulled from under :thumbsdown:

Nothing new here.

The wife was an office manager for a travel agancy that was doing very well for years, but online things for that pretty much gutted the business.

She has recovered pretty well getting in a financial investment firm now though, and is working her way up pretty fast.

 

[blastingcap]

Considering how expensive it is to live anywhere near SF, and how the federal min. wage hasn't kept pace with inflation for decades, I'm not sure I would pin the blame on SF min. wage laws that raised it to $11.05/hr recently.

You know what's a bigger problem is the business climate. The CA franchise tax/fee whatever you want to call it, is basically a minimum $800/year charge just to establish an LLC, PLUS a percentage of profits over $250k. And the local county/city often wants a cut as well. Plus the cost of related paperwork and filing. It all adds up to a hostile business climate that is a much larger problem than a minimum wage.

And that's for a healthy business!

For a small bookstore specializing in geeky stuff like sci fi and horror? You're toast. Your audience is a) SF'ers and b) into sci-fi kind of stuff. That makes them doubly likely to be web-savvy and order from places like Amazon. You were screwed not from a bump in min. wage but because your business model is obsolete.

 

[CPA]

Small businesses fail all the time.

I guess we should just go back to indentured servitude so that businesses that can't currently compete can do so.

Hey, let's go to the extreme to make our point!

Fact is, a higher minimum wage destroyed a business. We were led to believe that this never happens by many liberals on this board.

 

[brycejones]

Hey, let's go to the extreme to make our point!

Fact is, a higher minimum wage destroyed a business. We were led to believe that this never happens by many liberals on this board.

I call BS on your last sentence.......

 

[nickqt]

Hey, let's go to the extreme to make our point!
We were led to believe that this never happens by many liberals on this board.

Going to extremes to make our point, indeed.

Brilliant example.

 

[cabri]

Hey, let's go to the extreme to make our point!

Fact is, a higher minimum wage destroyed a business. We were led to believe that this never happens by many liberals on this board.

I call BS on your last sentence.......

If the search function is working; look for references to min wage threads here over past couple of years.

There was support for the NYC wage increases, Seattle increase and SF increases.

Those supporters were stating that either the business should/would/could absorb the extra costs or shift the costs to the consumer.

The opponents were stating that the business would shutter or drop employees if they were unable to cover the increase by increasing sales costs due to competition.

 

[nickqt]

If the search function is working; look for references to min wage threads here over past couple of years.

There was support for the NYC wage increases, Seattle increase and SF increases.

Those supporters were stating that either the business should/would/could absorb the extra costs or shift the costs to the consumer.

The opponents were stating that the business would shutter or drop employees if they were unable to cover the increase by increasing sales costs due to competition.

Hey, let's go to the extreme to make our point!

Every single librul done did says that a higher minimum wage would never ever affect any business at all, anywhere, ever. Especially ones that have terrible business models, such as being a small bookstore in large cities in the time of Amazon.

I'm sure you could find a couple dozen libruuls who might say that they don't think paying people a living wage is going to destroy any business that should exist in the first place.

Also, there should be thousands of businesses with excellent business models that are going out of business, right? Not just some garage bookstore that sells D&D cards.

 

[maddogchen]

Science Fiction bookstore in San Francisco closing.....

I'm so there for their closeout sale!!!

 

[sandorski]

Major B&M Bookstore chains are going under and the blame for some small highly specialized niche bookstore is an increase in the Minimum Wage?


Sounds like not seeing the big picture and an ideological axe to grind.

 

[fskimospy]

Oh good. Anecdotal evidence about a macroeconomic policy.

That seems smart.

 

[Atomic Playboy]

I always weigh my voting decisions on whether they negatively impact even a single small business. "Millions of people will get a pay increase and a slightly higher standard of living... but a single small, niche bookshop has decided to close its doors. THIS IS AN OUTRAGE."

If the politicians who talk about small business owners really gave a shit about small businesses, they'd start using legislation to counter off-shoring of manufacturing and multinational corporate structures designed to skirt income tax that small businesses legitimately don't have access to and that allow larger corporations to out-compete their smaller brethren. No one is doing that. Why? Because they don't care about small business owners; they care about large business owners. Borderland Books isn't donating millions of dollars to anyone's election campaign. They're useful as a martyr, to invoke on the altar of the bullshit rhetoric of "taxes are literally killing us." But these same politicians will gleefully sacrifice hundreds of Borderlands to keep Wal-Mart or Amazon chugging along and donating to their campaigns. It's all a complete lie that we gladly buy into because the truth of our powerlessness and the death of the American Dream is far too depressing to contemplate. So, yeah, minimum wage increase? Kills business. Bad move. UnAmerican, frankly.

 

[Fern]

For those that couldn't be bothered to read about it and just posted the usual political party message:

The change in minimum wage will mean our payroll will increase roughly 39%. That increase will in turn bring up our total operating expenses by 18%. To make up for that expense, we would need to increase our sales by a minimum of 20%. We do not believe that is a realistic possibility for a bookstore in San Francisco at this time.

If those numbers are correct it the claim the new min wage drove them out of biz could be legit.

Fern

 

[Fern]

Considering how expensive it is to live anywhere near SF, and how the federal min. wage hasn't kept pace with inflation for decades, I'm not sure I would pin the blame on SF min. wage laws that raised it to $11.05/hr recently.
-snip-

From what I'm reading the new min wage in SF is going up to $15, not $11.

Fern

 

[ivwshane]

Hey, let's go to the extreme to make our point!

Fact is, a higher minimum wage destroyed a business. We were led to believe that this never happens by many liberals on this board.

You think a ~.25 increase is what did it? Lol!

 

[blastingcap]

From what I'm reading the new min wage in SF is going up to $15, not $11.

Fern

http://sfgsa.org/index.aspx?page=411

The bookstore owner is shutting down in March when the min wage would still be $11.05.

By the way the SF min wage was already $10.74 as of 2014.

 

[ivwshane]

From what I'm reading the new min wage in SF is going up to $15, not $11.

Fern

Lol! Minimum wage increases to $15 by 2018. Saying minimum wage killed a business when that minimum wage hasn't even kicked in is laughable.

Not only that but an owner who doesn't think San Francisco residents would be will to pay a 20% increase in prices on books! is the most retarded thing I've ever heard. How much are these books? $5-15 equals $1-3 increase. Good lord people are retarded!