A Gallon of Gas or a Comic? How Rising Oil Prices Affect the Comics Inudstry

No one wants to be Batman anymore. The Batmobile is cool, but the darn thing runs on premium unleaded and gets horrible gas mileage.

OK, CBR can't confirm the price of gas in Gotham City, but here in reality, gas prices have shot up from coast to coast. Americans are witnessing the highest gas prices on average they've ever seen. The AAA recently reported gas in the U.S. costing an average of $2.93 a gallon, a jump in price of 16 percent.

But does the price of ultimate unleaded matter to the Ultimates? Or, more specifically, does it have an affect on the people selling "The Ultimates" to make their living?

The answer is yes - gas prices are more dangerous than a back-stabbing Black Widow.

"Our customers have a certain amount of discretionary income," Chuck Rozanski, owner of the Mile High Comics chain in Denver, CO, says. "When their fixed costs go up - like heating, electricity, gas - their discretionary income has to be diverted. It doesn't take rocket science to figure out that it's having an effect."

Consumers are hit, but what about behind the scenes? The comic book store guy sees this too, right?

"Everything is shipped, and the cost of shipping goes up incrementally with gas," says Jud Meyers, owner of Earth-2 Comics in Sherman Oaks, CA. "When you load up a standard SUV, gas is normally $35 to $38 a tank. When the price goes up to $50 a tank, right there is an extra $200 a month I'm spending."

Like the Transformers - also fuel dependent, mind you - there's even more than meets the eye. Consider:

  • The price of comic book bags - made from oil - is going up, adding an expense to the retailer first, the comic book reader later.
  • More customers are buying with credit cards now. Credit card companies charge retailers a percentage to use their services, eating into their bottom line.
  • To save gas, customers are making fewer trips to the comic stores, asking their retailer to hold their comics for a longer period of time. Meanwhile, the comics that sit in pull bins are already paid for by the retailer, leaving the retailer with the burden for weeks or in some cases months.
  • The heating, cooling and overall upkeep of a store increases in price with the increase in cost of oil.
  • Comic supplies you might not think of - like T-shirt displays made of acrylic - have tripled in prices.
  • The average cost of a comic book is now $2.99, up from $2.50 last year.

Money for entertainment

But that doesn't mean comic stores are sitting empty, or even that sales are down. It's just costing everyone more to read comics these days.

"This is an entertainment industry," Meyers says. "When times are tight, people don't stop going to the movies, or reading… they need entertainment even more."

Rozanski says if it weren't for the hot books being produced by DC and Marvel right now, things would be harder.

"Retailers may actually be having a little boon right now. There are two excellent projects out right now - 'Infinite Crisis/52' and 'Civil War'- with the absence of those two projects, I really think retailers would be suffering," he says. "The publishers have proven themselves at being very adept at coming up with stuff not worth a damn. But Marvel and DC both have good projects out at the same time. Think to yourself: When was the last time that happened? Stores are doing well, but, the long term looks a little dubious."

As oil increases, so do comic bags

While the publishers - Marvel, DC, Image, TokyoPop and so on, all either did not return phone calls or promised that the gas prices weren't affecting them (Rozanski agreed, saying the publishers have an advantage that they simply turn their products over to Diamond for distribution), a comic book industry that has been slammed by rising oil prices is the comic book bag industry.

Matthew Hersh with Bill Cole Enterprises, a comic book bag producer, estimates the cost of producing bags has seen a 10 to 15 percent increase in recent months.

"Comic bags are an oil-based product, and oil is shooting sky-high," Hersh says. "It's impossible to give that 10 to 15 percent increase to customers. We have absorbed most of the increases ourselves. I don't know what other companies are doing, but if they're not absorbing them, they're not going to be in business for long."

Earth-2 Comics knows well the fact that comic bags are getting hit. Meyers has had to raise the cost of bags and boards for the first time in almost four years.

"Comic bags and boards are like our French fries," Meyers says, comparing the comic book industry to the fast food industry. "We had to raise prices - a nickel per bag and board. Just a little raise, but we go through thousands of bags and boards. You add up all those nickels…"

Mile High Comics goes through millions of comic book bags - that's a lot of nickels.

"[The cost of bags] ripples through the entire economic perspective," Rozanski says.

While the cost of bags has risen, comic book bag companies are also faced with the same problem as other businesses - increases in utilities, equipment and supplies.

"It's not going to get any better. We watch it everyday. Our suppliers are just telling us it's the cost of doing business," Hersh, who has been with Bill Cole Enterprises for 15 years, says. "I don't mean to try and put out the fear of God… but it's been scary."

Hersh touches on a topic dear to Rozanski's heart - people don't want to drive right now. "More people are going to mail order than driving to the store," he says. In fact, he recently missed a meeting because it was a 40 mile drive away from his office. "In the past we would have gone."

Point and click

That's not a bad thing for Rozanski, who has been operating Mile High Comics since 1974. In 1996 Rozanski decided his huge comic book stores would soon go the way of the dinosaurs with the internet becoming more popular by the day. Today, www.milehighcomics.com gets over a million hits a day.

With the cost of gas shooting up, up and away, Rozanski believes that the popular way to get comics will be with a point and click. Pointing and clicking doesn't require any gas, after all.

"Have you ever gone to Vegas?" the comic book mogul asks, "The point is, if you go and play long enough, you'll lose. The reason being, the odds are stacked in favor of the house.

"As energy goes up, the same thing will happen to retail stores. Vis-à-vis, the internet store. The belief is that the customer has always wanted to touch and feel the product. The reality is as energy increases, the tables tilt more to the on-line retailer."

So long as Mile High Comics is willing to subsidize the cost of shipping - the retailer currently charges $4 for a shipment between $10 to $40 - Rozanski says he has the advantage on his side. If that comic book store is over a gallon of gas one-way from the customer, it becomes more economical to buy on-line.

"As long as I'm willing to subsidize freight, it's a win-win for my customers," Rozanski says proudly. "There's no energy cost, just point and click. And we have no sales tax. So we have a 15-percent advantage over a retail store."

Work smarter, not harder

Meyers thinks his store, and stores like his, will be fine if they work at making each sale.

"This is forcing every retailer to be smarter about how they display, what they buy, and the layout of their stores," he says. "We have to be less reliant on a customer just buying, and more on making the sale."

Meyers also sees the advantage of selling via the web, and has his entire stock for sale at www.earth2comics.com.

Travis Sweeten, a long time comic book collector who lives in Enid, Okla., says he won't quit his comic store, even though his shop - Legendary Comics in Stillwater, Okla. - is a solid 45-minute drive for him.

"My guy there will mail me my comics at a flat $5 rate," Sweeten says. "It has affected me in that I don't go in and pick up stuff that's new, that I didn't know about… but it hasn't lessened my spending. I still spend about $60 a month."

Sweeten says that his comic store owner always gives him a deal and is also "always looking out" for him. Because of this, he says he is loyal to his shop. Which brings another point - many comic readers are loyal to their comic store owner, like some people are loyal to their regular barber or perhaps bartender.

And maybe collectors can justify their comic book buying because comics are collectable. It's the whole reason the Overstreet Price Guide exists, after all.

"These are investments, and they make the buyer feel good," Meyers says. "But I'll tell you what I have seen… lots of girlfriends and wives are wincing more frequently when the guy pulls out his wallet. I see that a lot more often.

"If we don't get smarter, the smaller retailers aren't going to last. I monitor gas, stocks, interest rates," Meyers says. "The question is 'What do we have to do this week to get by?' It's a gentlemen's bet."

Meyers says that the rising gas prices and outside competition has forced the comic book retailer industry to depend on each other and form more of a community. While in the past comic retailers were quite secretive with one another, these days more of them share information to help advance their own operations. This is done through comic book retailer organizations, such as the Comics Pro mailing list and the Comic Book Industry Alliance.

"We're getting things accomplished as a group rather than as individuals," Meyers says. "Strength in numbers. Our real competition isn't each other, it's Barnes & Noble, Borders - the big boys that are able to write this stuff off."

So whether you choose to blame Barnes & Noble, George W. Bush, on-line mail order companies, or even the Red Skull, one thing is for sure: employees at the Mile High Comics warehouse will be wearing an extra layer this winter when the temperature dips down in Denver. Rozanski says physically turning down the thermostat is one of the few things left he can do to save expenses.

"There's not a damn thing we can do. I wish there was a way to mitigate expenses, but there's not," he says. "Most cost-saving has been implemented years ago… weather stripping, fuel-efficient vehicles… that's already been done.

"It doesn't do any good when gas jumps from $1.89 to $2.89."

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