In the first years, the blockbuster movies would cost him about $65 each to buy and they did creep up over the years. While in theory you could rent them several times per week for about $3, in reality the newest releases (maybe less than a month old) only completely rented out on the weekends. It was hard to get most people to walk into the store to get a deeply discounted new release most weekdays. Once the movie had been released for a month or so, most almost-new-releases would have some copies that sat on the shelf on the weekends too.
The "sell through" movies - those that sold retail at $15 - $30 - were better. He would buy a large number of them and they would rent well for a few weeks. After the initial flurry of heavy rentals for a few weeks, he would start to sell them off. I think there was a small profit - better than the expensive movies which were almost always money losers.
Then there was this small little box in the corner (or under the counter in one location) where some other movies were kept. The movie cases for maybe 50 movies were all collapsed. Each of these movies rented for nearly the same cost as a new release, with little discounting for old titles. $30 was a very expensive one, most were about $15. They would rent well throughout the week, mostly to very loyal customers. There was only ever one copy of each title per store and the stock rotated between stores with occasional swaps with stores owned by others in neighboring towns until the movies wore out. Certain portions of scenes would wear out before others, presumably due to replaying action shots. Had it not been for this little box of porn occupying maybe 10 square feet of a 600(?) sq ft store, he would have been out of business long before Hollywood Video threw him a lifeline.