The reason is margin really slim. The gross profit is 5% at most. Even you see some movie sell like hot cake, if a single DVD is leftover and doesn't sold, it will take the gross profit of another 20 DVD to cover this. Item not sold had to be discount heavily in few months.
Then combined with the falling of price of movie: a new big hit movie VCD (legal) sold for $20 ten years ago now only sold for as cheap as $7. That mean the gross is 35 cents instead of $1 per disc (and the gross was higher before, mostly 10%), but sales volume stay the same.
As operate on slim profit, stock control is very important but extremely difficult: new titles come and go (~10 new titles per week), there's no barcode (or the barcode is not scan-able), so making computerize very expensive. E.g. MAL has to redefine a new code, manually write it and stick it on every disc. (Each anti-shoplift barcode sticker cost 8 cents each, which seriously eat into the already slim 35cent gross profit.)
As CD/DVD is small, stealing is very bad in some area, like Chinatown and Burnaby. In some high school, there are gangs that offer 30% off of the price tag of any items find in shop, and they will steal it for them. They are professional shoplifter and very hard to catch.. even the shop catch them, there's nothing much they can legally do as they operate as big group (5-10 people), and they will just laugh even the shop find out and walkout with the goodies (except in Chinatown the shopkeepers will chase them and beat them up). One disc stolen mean no gross profit for another 20 disc.
Then finally come the tax: For some strange reason all the tax people believe any business should have at least 30% gross. (Chinese use to be operate on smaller margin, 20% at most) There's very common Revenue Canada will force as much as hundred thousands dollars of plenty on the shop in advance (the alternative is frozen asset), even the shop send in all evidents. To the get the money back, only way is hire an accountant to present an audit report to wave this plenty, which takes 6 month to one year (if don't have to go to court, otherwise 2 years). For the shop owner point of view, it's cheaper to just close down the shop and rest the case, instead of have hundreds of thousands cash flow lockup (if they have the cash), and have to spent 10K hire an accountant to get the money back from the Revenue Canada.
[ 本帖最後由 jiujai 於 2008-6-10 13:50 編輯 ] |
發表於 2008-6-8 02:22
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