They cleared $3k in profit for 2013 (read down a couple posts on the blog) while paying themselves next-to-nothing - and that out of the cafe profits and not the bookstore. I think the term "successful" is very questionable here.
If you're clearing $3k in profit a year you have a very expensive hobby, not a viable business.
We can all be sad that a bookshop is closing, but the real culprit was a lack of sales and marketing savvy, and a lack of customer interest in the product/experience being offered.
Minimum wage may have thrown a few rocks onto the coffin, but it certainly didn't dig the grave.
There a lot of new booksellers making a living on Amazon. Some of them trade internationally. (I buy a steady stream of specialist titles from US sellers.)
If I wanted to buy from Borderlands, not only would I be paying far too much for every book in their list, I'd also be charged $25 for shipping.
Somehow everyone else in the world can ship me a book for less than half that. But Borderlands hasn't figured out how to.
That's where the fail is. Not in hand-wringing about having to pay staff an amount that still isn't close to a fair wage.
Depends on whether you pay yourself before the profit or not.
First thing, they say that a move from $10.74 to $15.00/hr will cost them $28,000 (from +$3k to -$25k), which implies they're paying over 6,000 hours worth of hourly labor.
Another option to make up that $28k would be to increase sales by 20%, which means their current annual gross margin is somewhere around $150k.
"[R]ent, payroll, and credit card processing represent 68% of all [their] expenses" and since they're basically breakeven let's say that merchandise costs are 30% with 2% miscellaneous costs (utility bills, etc).
So their gross margin is probably something around 65% as CC fees should never be more than 5% and merch is around 30%.
With $150k of gross margin at 65%, it looks like this store, employing 3 FTEs worth of part-time labor, is grossing about $225,000 per year.
If the average book in that store costs $15 (they say they're limited on what they can charge based on the sticker price, so this may even be low) they're staffing 3 people in the store at all times, all year round, to sell 42 books per day.
I think I found why you're having to pay yourselves out of the cafe money, sirs.