How to Start a $360K+/Year Comic Book Store

  • by Brandon Boushy
  • 3 weeks ago
  • Blog
  • 0
Comic book store

Are you a fan of comic books and graphic novels? I bet you have wondered how to start a comic book store.

Ilan has been in the comic book industry since the ‘80s. He started in 1982 when he started Fat Moose Comics.

After 32 years in New Jersey, he moved to Washington and started Mighty Moose Comics. He’s got tons of experience and knowledge to share with us.

We’ll discuss some of the great strategies we learned from Ilan and some strategies he doesn’t use that would make it far easier to make money in the comic book industry.

We’ll discuss:

  1. What is a comic book store?
  2. Products that comic book stores sell
  3. Resources necessary
  4. Licensing and legal requirements
  5. Funding your comic book shop
  6. Hiring employees
  7. Marketing

Step 1: What is a comic book store?

A comic bookstore with people walking in the street

Comic book stores are places for fans of comic books, graphic novels, and other collectibles to go to find new and rare comics.

Comic book lovers would commonly start their own comic book store as a cheap way to get comics, but Ilan said:

Most of the people who got into the comic book industry to get cheap comics lost their shops years ago.

Today there are fewer open comic book stores than in the past, but if you know what you are doing, you can still make a great living. 

If you sell rare comics, you can make over a million per year, but you have to be able to find the rare books that people want at a rate where you can sell them for more. Otherwise breakeven is what most comic store owners make until they find that gold mine.

There are more fans than ever due to the huge success of the Marvel Comics movie franchise and other popular franchises. You just have to find them.

Before you start looking for potential customers, let’s discuss the types of products you want to consider selling.

Step 2: Products that are sold in the comic book industry

Opening a comic book store is going to require stocking inventory. There are a ton of options to choose from, but let’s go over some of the more popular options:

  • New Comics
  • Rare Comic Book Issues
  • Marvel Comics
  • DC Comics
  • Dark Horse Comics
  • Graphic Novels
  • Dungeons and Dragons

Let’s look at each!

New Comics

Comic books have consistent release periods like most types of magazines. 

New comics come out every Wednesday, and most series release the next number in the series on a monthly basis. The Best Comic of 2021 (So Far) is a great list of new comics to consider carrying at your comic book store.

Rare Comic Books

I asked my brother-in-law what he loves about the comic book store he goes to. He told me:

Cosmic Comics used to be my spot. They had all the valuable comics you never thought you’d see in person. They loved comics and would talk about them for hours. They’d let us read them in store. One time they even let me borrow Watchmen #6 without paying.

Comic book collectors can do very well if they decide that it is time to pass their comic books on to a new generation of hardcore comic book fans.

Wealthy Gorilla has a list of 20 comic books that sold for over $100,000. The top 4 were over $1m. You can make some real money if you happen to have them lying around.

You might want to consider auctions or online sales for these high-value comics though. Places like eBay and Sotheby’s are good places to start. Here’s a list of the top 10 Auction Houses by Artprice.com.

Marvel Comics

Customers in a comic book store

As I already said, Marvel has a huge fan base. To give you an idea, here are 3 statistics from Statista about the Marvel Universe:

  • 32.2% of comic book store sales are Marvel titles
  • 62% of people 18-29 claim to be Marvel fans
  • 87% of Americans recognize Spider-Man

These statistics show some real love for Stan Lee’s comic book characters. If you want to start a successful comic book store, you’ll have to carry Marvel titles.

Penguin Random House and Hachette Book Group will be the wholesale comic book distributors for Marvel starting October 2021 after Disney cut ties with Diamond Comic Distributors.

DC Comics

Another staple potential customers will expect are DC Comics, including favorites like Batman. You can order new DC comic books from Lunar Distribution

The comic book industry is kinda being shaken up this year because publishers are changing distributors, so new businesses will be starting with similar relationships to the distributors as existing comic book shops.

 Covid also drove a lot of shops out of business so you might be able to buy rare comics at a discount if you can hold on to them for a while.

This makes it the perfect time to become a new comic book store owner.

Dark Horse Comics

Dark Horse is most famous for the  Hell Boy comic books, but they also have action figures for the Witcher and Game of Thrones.

Dark Horse uses Diamond Comic Distributors for their comic book store customers and Penguin Random House for all other book store and library customers.

Graphic Novels

Graphic novels are typically released by the same companies as comic books, but they have a couple of differences including:

  • The plot is normally fully contained within a graphic novel while comic book plots normally span numerous episodes or even multiple series.
  • The length is typically longer than a comic book.
  • The spine is more like a standard book than the comic book genre.

Dungeons and Dragons

Dungeons and Dragons is a role-playing game that appeals to similar demographics as comic books. They are owned by Wizards of the Coast, which also owns the popular game Magic the Gathering.

A friend of mine used to work at a comic book shop in Dallas, and they would host games for the regulars, including ones with entry fees and cash prizes.

He also was nationally ranked for Magic the Gathering, so it helped to draw new business to the comic store when he would do well in tournaments.

Whatever you choose to focus on, comic book enthusiasts are going to expect a decent collection or they’ll look for somewhere that meets their needs more.

Step 3. Resources needed when starting a comic book store

The resources necessary when starting a comic book store are fairly consistent wherever you are. They include:

  • A comic book store business plan
  • An online presence
  • Time
  • Money
  • Retail Space

A business plan for your comic book store

An iPad and a set for coloured pens on a desk

Opening a comic book store can be a challenge because it is a very niche field, and most of the people who consider opening a comic book store don’t have a business degree.

That’s not to say you need a degree, but you need something to guide your business decision-making.

Ilan told us:

Without a business plan, you will fail. You need to have it if you want to get loans so make sure to get one.

Bplans.com has a great article laying out the facts about planning:

  • Companies with business plans tend to grow 30% faster.
  • Companies with business plans are 120%-260% more likely to move past the startup stage.
  • Business owners who have a business plan are 271% more likely to walk away before it becomes a major loss.

Basically, if you want a successful store, write a business plan. Read our blog and use our template to write your plan.

Time

Running a comic shop will take a lot of your time. Because revenue might be slow at first, a business owner should expect to be at the brick and mortar store during business hours. It may be a while before the business owner can afford to pay employees.

Any hours you advertise you are open, make sure you or an employee can be there. You’ll typically need an hour to open and an hour after you close to handle any accounting and administration.

How much does it cost to open a comic shop?

According to Ilan, a small retail store can cost almost $20,000 to start up. He told us,

It took nearly three years to break even because I was building my inventory.

If you’re enthusiastic about comic books, understand today’s market, and already own some vintage comic books, then you’ve got a good chance of selling some comic books.

Retail Space

Every comic book retailer is going to need a small place to sell to comic book customers. Ilan told us:

My comic book shop is about 840 square feet and cost’s $3,500/month

The space should have decent foot traffic. Places that tend to have the traffic you need include malls, comic book conventions, and online. 

You’ll need that traffic to make people aware of your collectible comics.

Hardcore collectors interested in finding new comic shops might hunt you down, but the less avid customer base will check out your physical store if it looks welcoming.

Step 4: Licensing and Legal Requirements

Now that you’ve learned about how to start a comic book company, let’s look at the licensing and legal requirements the business will need to meet. Like every business, a comic book store will need to meet certain requirements, including:

  • Business Formation
  • Getting a free Employee Identification Number (EIN) from the IRS
  • Getting a state/local business license
  • Unemployment Insurance
  • Workman’s Comp (if necessary)
  • Business Insurance/General Liability Insurance

We go into more detail on starting a business in our video:

Business Formation

You need to establish a legal entity, or business structure, when you want to open a comic book store.

For best results, hire legal representation that has experience starting a business, like an attorney, accountant, or tax specialist.

They’ll help you get your business started quickly so you can focus on selling comics.

Let’s discuss the most common types of business structures.

Sole proprietorship

A sole proprietorship is the easiest way how to open a comic book store, but the structure doesn’t protect the owner’s personal assets from legal issues.

That means if something goes wrong, you could lose both your store and your home.

I’d only do this if you really need to save some money at the very beginning. As soon as you can, convert it to an LLC.

To start a sole proprietorship, fill out a special tax form called a Schedule C. Sole proprietors can also join the American Independent Business Alliance.

Limited Liability Corporation (LLC)

An LLC is the most common business structure used in the United States because the company protects the owner’s personal assets.

It’s similar to partnerships and corporations but can be a single-member LLC in most states. An LLC requires a document called an operating agreement.

Each state has different requirements. Here’s a link to find your state’s requirements. People may register in specific states due to the cost of doing business.

Delaware and Nevada are common states to file an LLC because of their business-friendly laws. Here’s a blog on the top 10 states to get an LLC.

Partnerships and corporations

Partnerships and corporations are typical for massive organizations or legal firms. Unless there is a specific reason you need a partnership, it is better to do a multi-person LLC.

Investopedia has good information about partnerships and corporations.

Apply for an EIN

Every business operating in the United States needs an employer identification number.

It’s like a social security number for your business. Apply for it on the IRS website. It’s used on tax forms when filing taxes and to tie employees’ pay to the proper employer.

State/Local Business Licenses

Each location has different licenses, permits, or tax forms required. Use the SBA License and Permits page to identify what your business needs. Keep reading for information on different legal structures.

Unemployment Insurance

The U.S. Chamber of Commerce has a ton of information on unemployment and also offers links to each state agency that handles state unemployment.

You’ll have to pay $420 per employee on a federal level plus any state UI.

Workman’s Compensation

Workman’s compensation is basically insurance against injury or disability. Each state has different requirements. Check your state requirements.

Business Insurance/ General Liability Insurance

Approval of business insurance

Contact your current insurance agent and ask them if they can provide these. Most will be able to provide a quote or refer you to someone who can.

Basically, you want $1m/2m general liability unless you have reason to need more (protecting personal assets).

You might also want to purchase some insurance to protect valuable comics against theft. Given a comic book collecting business could have comics worth up to a million dollars, you might want those insured.

Step 5. Funding Your Store

Funding a comic book store can be done like any other business. The primary ways of funding are:

  • Personal funds
  • Loan from family or friends
  • Business partner(s)– inc.com has a great blog on considerations about a partnership
  • Business loans- Check out our partners

Step 6. Hiring Employees

There is a ton of work to do in a comic book store. If you have the funds to cover employees, you’ll want to hire them.

It will help you focus on other aspects that are more valuable to the business, like implementing your marketing plan, managing accounting, and finding new rare issues.

You can find employees using different resources:

Step 7. Marketing

Marketing is where Ilan really showed how old school he is. He described his initial marketing strategies as:

I put out a sign with the name as soon as I got my retail space so that people knew a comic book shop was opening soon
I tried running some tv ads out here, but the return just wasn’t there.
I have a website, but I don’t sell comics online.
I pay someone to manage social media…

Insert Social Media Video Here

Let’s discuss marketing in the 21st century.

Marketing essentials include:

  • Identifying target markets.
  • Creating a website that allows you to sell online.
  • Creating and using your social media wisely.

Identify your target market

Comic book stores have some natural target markets. You are looking for fans of the brands you sell.

Fortunately, ICv2 did the research for us. You’re looking for white males between 30-50 years old with some education that make more than $35,000/year. Super easy. 

If you’re selling manga, target under 30 and you can remove the $35k minimum. There’s enough diversity that you should include all genders and races in your targeting. ICv2 is awesome!

Let’s move on.

Find the Best Way to Reach your Target Market

To find your target market, there are a few great places to look.

Participate in comic conventions — you’ll find a bunch of like-minded people. Here’s a list of upcoming comic shows.

Also, do some low-cost targeted ads on Facebook. Advertise your grand opening and target the demographics I listed above that live in your area.

You aren’t trying to sell to them right now — just get awareness.

Your goal is for them to like your page and maybe get a mobile or email subscription to your newsletter and business updates. Once you’ve interacted more, you can turn them into new customers.

Create a website

An entrepreneur creating a website for his business

Regardless of who you market to or how you do it, you have to get the marketing in front of your audience.

According to the SBA, you should spend 8-10% of expected revenue on marketing. Make sure to factor this into your costs.

You’ll want to make sure to have a website, which you can get from the following companies:

To learn more about building websites, check out our blog about website design. Make sure they can buy anything they can buy in-store through the site. 

Also, consider allowing a trade book marketplace where people can trade or sell their comics and you get a commission for handling the processing and the online page.

You should also sign up with Google My Business so that people can find information about your comic book store directly from Google.

Create and Use Social Media Well

Your demographics are going to be Facebook, Instagram, and TikTok users. Each post should be different. It should be fun. It should communicate your personality. No one wants to be sold to — they want to connect with you.

Use it to share things that excite you about the industry. Use it to show new releases and digital comics. Have fun with it. Only make every 5th post (or fewer) about business.

Influencers

There are so many influencers in the comic book industry that I don’t even know where to start.

From actors known for roles as superheroes to CEOs of companies like Disney, Marvel, and DC. Even the comic artists and editors are influencers. Here are some I love though.

Put Your Customers First

A man writing on a white notebook

I’m going to leave you with this. Comic books are a beloved part of our world, and with some creative thinking, you can make a great living selling them.

The best advice Ilan gave us was regarding his reserve system. Basically, he always bought enough of each new release that each of his regulars was guaranteed a copy. He’d save them for them until the next time they came in.

If they want them, they know they are here. If they don’t, someone else will buy it.

That’s the kind of customer service that creates lifelong customers. Find ways to make that much of an impact on your customers.

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