Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, September 15, 1993 TAG: 9309150044
SECTION: BUSINESS PAGE: B8 EDITION: METRO
SOURCE: SANDRA BROWN KELLY STAFF WRITER
DATELINE: LENGTH: Medium
The two-story shop with its cherry shelving and relaxed university-town attitude became a downtown hangout for book and music lovers, especially those after hard-to-find titles. It was the place to stretch a lunch hour or kill time on a Saturday. It was where people who knew people met.
But for owner Richard Walters, a Virginia Tech graduate who opened the Blacksburg store while he was a student in the 1960s, the expansion to Roanoke was "approached from the heart more than from the pocketbook." It left investors with too much debt, he said. "But as long as people bought lots of stock, we just cranked."
The store was one of the first on the Market to open on Sundays, and on quiet Sunday afternoons the chairs tucked into nooks formed by bookshelves were almost always occupied.
Until recently.
The shelves have been emptier because suppliers wouldn't extend the store credit. And even loyal customers stayed away.
"Our working capital has never been what it should be," Walters said. And when business began to drop off last fall after it appeared the Dominion Bank sale might mean fewer people working downtown, the store couldn't sustain itself.
Several downtown Roanoke merchants have said their businesses suffered when consumer confidence dipped in the months following the announced sale of Dominion to First Union Corp.
Walters said the original debt - more than $500,000 for renovation and inventory - kept the Roanoke and Blacksburg stores "right on the line" financially.
Last year was the Roanoke store's best year ever - it had sales of more than $1 million - but the profit went to pay on the loan.
Then, after the first of the year, business slowed even more because of bad weather and a sluggish economy. Neither store did well. But Walters said the Blacksburg store would have handled the downturn better if it had not had to feed the debt of the Roanoke store.
He also said the company didn't "properly trim overhead costs."
The result was little money to buy new stock, and without new stock, the stores couldn't attract customers.
The situation has grown worse in recent months, Walters said. For almost a month, the Roanoke store closed earlier on Mondays and quit opening on Sundays; it resumed Sunday openings this week.
Other cost cutting also has taken place.
Where there were 37 employees at the two stores in the late 1980s, there now are 18, and Walters took over as manager of the Roanoke store when Chris Henson, who had worked there seven years, left to manage the Grandin Theater. Walters' wife also works at the store.
"We're turning the corner," he said, "but people can't expect miracles. I don't want to say we're immediately fixed, but we're on our way. We're getting more stock in."
He said the shelves are back to two-thirds to three-quarters full. Music stock is thinner than book stock, though.
Walters said he is looking for more investors to join the more than 20 people who already have a financial stake in the company.
He said the business needs $50,000 to $100,000 "to make it all go well."
Walters, who this week was named to the board of Downtown Roanoke Inc., says he's in Roanoke "for the long haul."
"We just need to recapture our market niche and get back the customers that have been exasperated with us," he said.
by CNB