That was the part that stood out to me. But I'll get to that in a minute. First, let's put some context on everything.
Mike Richardson originally opened his first comic shop, called Pegasus Fantasy Books, in 1980. He renamed the store Things from Another World in 1993 after expanding to include several locations across multiple states. (This expansion was partially buoyed by the success of Richardson's other noteable venture, Dark Horse Comics, started in 1986.) The TFAW website launched in 1997, making it one of the earliest places you could order comics and comic products online. (I can't confirm if they were the very first, but they took payments online before most other shops. If you ordered from, for example, Mile High Comics you would put in your order online but then had to call or fax them your credit card number for payment. Online payment processing was a rarity back then.) Because they were an early adopter of what would eventually become standard online business practices, they became a go-to site for a lot of people looking to buy anything in the monthly Diamond catalog. And having possibly the best collection of Dark Horse back issues didn't hurt either!
This setup served the store well, I think, in 2020 when the pandemic hit. Many physical comic shops were forced to remain closed in the early days of the pandemic, severely limiting their income, but TFAW had an infrastructure already built up for delivery comics by mail. Not that in-store customers switching to online -- even if only temporarily -- was easy, of course, but they didn't have to build up an alternative from the ground up. But this is why I think many people are surprised by this announcment. Why would they close a venue that almost certainly single-handedly kept the overall business afloat as recently as five years ago?
Some people have pointed to the 2021 purchase of Dark Horse Media (the legal entity that owns TFAW) by Embracer Group as the instigator here. That they spent the past few years buying up too many different companies too quickly, and not being able to manage juggling the operations of all of them. However, given that Richardson remained CEO of Dark Horse, I don't think that's a sufficient explanation. Certainly, the Embracer board of directors could pressure Richardson into making bad decisions that ultimately led to financial challenges here, but I don't think that could explain shutting down this entire venue.
One of the other notions that's come up is the recent problems with Diamond. As I noted earlier, TFAW was one of the first online shops where you could basically order anything from the Diamond catalog. Not just new comics, but t-shirts and toys and games and statues and whatever else. With Diamond going into bankruptcy, that could potentially impact TFAW sales. But, at first blush, wouldn't that also impact their physical locations, too? They're all making orders from the same place, after all. And the physical locations need to maintain their storefronts, too, so wouldn't that have additional expenses tied to it that a simple warehouse model an online store offers be more cost-effective?
I've checked all the outlets I can get to that are discussing this, and the only formal word from anyone actually at TFAW is some generic "significant market changes" boilerplate. So anything I -- or anyone else -- can offer is speculation. But I have a few ideas.
First, because of TFAW early online adopter status and their significant relationship with Diamond -- who until very recently maintained an effective monopoly on comics distribution -- I'm betting TFAW's back end database system that processed new orders is/was largely dependent on Diamond's database systems. That is, Diamond loaded all their catalog items into a database and then offered an export file of that once a month that TFAW.com used to populate its own site quickly. They'd certainly have some options for manual entries and editing, but my guess is that the bulk of the work was automated years ago.
... which would mean that, in lieu of Diamond's issues, that much of the TFAW.com database would need to be loaded manually. Where this would've been something that could be handled on a decidedly part-time basis a few years ago, it would be a much larger endeavor now, bringing in data from Lunar and Penguin Random House and whoever else. Is that an additional salary? Maybe two? Depending on how lean things were running before, it might not be possible.
If that were indeed an issue, they could theoretically also automate data entry from Lunar, PRH, etc. but that would necessarily require a developer -- or, more likely, a developer team -- to come in to build out that functionality. That's almost certainly not talent that TFAW has on-hand. And while that would be a one-time expense, it wouldn't be cheap.
The second possible issue was something I saw somebody bring up on Mastodon -- namely, that sales tax structures are becoming increasingly complex when dealing with interstate commerce. At a physical location, you'll have state and municiple taxes tacked on, but they're going to be the same for every customer who walks in the door. They're all in the same physical location, so local taxes apply. But if you have to apply taxes based on whether the transaction takes place -- and that can occur anywhere an internet connection is available -- well, then you'd need to set up a database of every set of state and municiple taxes, and keep that up to date based on hundreds of thosuands of constantly changing laws. You pretty much need a third party firm to manage that on an ongoing basis. That would also be an additional expense a physical retail location would not have.
The final issue I'd like to bring up stems from a response I got when I first posted the news on Mastodon. The person, who is a comics/sci-fi fan, had never heard of them. Now, you obviously can't expect every potential customer to know every online shop or retail location, but it does make me consider TFAW's business model. They were, as I said, one of the earliest adopter's of what have become standard online business practices. They were one of the earliest online stores to offer pretty much everything in Diamond's catalog. But that was a quarter century ago. There is literally an entire generation of fans who have never known online shops to not do this. Is there much that differentiates TFAW's online presence from any other retailer? With a physical location, you've got some measure of geographic exclusion -- if there's not a competitor physically close by, you become literally the only game in town. But online, you're effectively neighbors with every other retailer. Maybe we're just looking at TFAW.com no longer having a sustainable business model?
As I said, this is all just speculation. Probably very few people outside of Richardson himself and Embracer's board know the real reason(s) for the closure. But there are some hints out there on possible reasons.
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