DCBS Breakeven Analysis

This is the place to discuss the episodes of the Comic Book Page podcast, the Comic Book Page website or pretty much anything else of interest to the Comic Book Page community...

Moderator: JohnMayo

User avatar
JohnMayo
Host/Owner
Posts: 3295
Joined: Mon Mar 12, 2007 3:12 pm
Location: Texas
Contact:

DCBS Breakeven Analysis

Post by JohnMayo »

On the last Previews Spotlight, Bob commented on how he didn't think it made sense to use DCBS below some number of titles because of the overhead costs of shipping. One of our listeners emailed us with an opposing point of view and I realized I hadn't done the math to find the breakeven points. And it is multiple points based on cover prices, if you get weekly shipping or not and if you get bags and boards or not. The point of this analysis isn't to cover all of the possible cases or to determine any sort of specific breakeven point that makes DCBS worthwhile for everyone. Each person will have different criteria which determine when and if makes the shift to mail order is a smart move for them.

I decided to keep things reasonably simple and did the analysis using the standard 40% discount DCBS offers on most comics from the premiere publishers. DCBS usually offers a number of door buster discounts each month but to keep things simple, I didn't include that in my analysis. For that level of granularity, each person should just download the monthly Excel order form and plug in the specific comics they want to see how it stacks up for them. I also kept the cover price consistent across all titles and only looked at $2.99 and $3.99. As far as bags and boards, I only considered with or without the $0.12 option. Since sales tax varies from place to place, I left that out of my analysis. Clearly, this is kind of an ideal case comparison and not as completely real world situation analysis. Again, for that, download the Excel order form from DCBS and plug in your potential order and compare that against how much those comics would cost you locally and see how things stack up.

It might be a bit surprising just how low the financial breakeven point was. With as few as half a dozen $2.99 comics a customer can save a little bit of money using DCBS provided they go with monthly shipping and no bags and boards. So if saving $0.95 on $17.94 worth of comics, a 5% savings, is worth the effort of preordering then go for it. If, however, you aren't pinching pennies that tightly and/or you live in an area where the shipping results in getting the comics almost a full week later, maybe DCBS doesn't make sense with just six comics. (Which was the point I think Bob was making.) Different people have different thresholds for how quickly they want the comics and how much they need to save for it to be worthwhile preordering comics.

Adding in bags and boards on a DCBS order of six $2.99 comics with monthly shipping reduces the savings to $0.23. Again, it is cheaper but depending on numerous other factors, it might not be enough of a savings to justify the switch to mail order.

Personally, one of the advantages of DCBS is that getting my comics involves ducking into the UPS Store where I have a mailbox to pick up my box each week. The UPS Store is easier and faster to get to than any of the comic shops in town and has plenty of parking. It usually only takes me a minute or two to get my box and be on my way. As great as some of the shops are here in town, parking can be limited and they are not particularly convenient to where I work and live. So, in that regards, getting my comics from DCBS is much more efficient in terms of time than shopping at a local store. It also has helped keep my impulse purchases under control.

Shifting to twice a month shipping, the breakeven point is 11 comics at $2.99 with no bags and boards with a $0.70 savings and 12 with bags and boards having a $0.46 savings. Shifting to weekly shipping, the breakeven without bags and boards is 16 comics costing $47.84 cents locally and through DCBS. Adding in bags and boards shifts the breakeven point to 18 comics with a $0.24 savings.

Here is a chart which shows the breakeven points for $2.99 comics at a 40% through DCBS:
Image

Here is a chart which shows the breakeven points for $3.99 comics at a 40% through DCBS:
Image

At the higher price point, it obviously takes fewer comics to make DCBS worth considering with 4 comics being the breakeven point for monthly shipping, for twice a month shipping it is 8 (without bags and boards) or 9 (with bags and boards). With weekly shipping it takes only 12 (without bags and boards) or 13 (with bags and boards) to breakeven.

So, even at the very low end of the scale, DCBS is a viable choice. At the higher end of the spectrum, it can stretch your comic book spending dollar much further.

But at what point is it worth doing? The will vary from person to person. For me, if the cost is roughly the same, I'd strongly consider getting my comics locally since I'd get them on Wednesday instead of the following Monday (or Tuesday if Monday is a holiday). The savings needs to be above both a flat dollar amount and some percentage of my total spending to justify the transition to mail order. I'm not entirely sure what those threshold are for me.

One of the more perplexing comments I've heard over the years is that my purchasing comics through DCBS is somehow bad for the comic book industry. I've never understood that mindset. For the most part, it seems like it is more helpful than hurtful.

Any reader with the choice of two local stores is likely to mainly shop at just one of the two stores. Is that second store bad for the comic book industry? Of course not. Likewise, DCBS is just another retail alternative available to a geographically wider group of readers. So, while shopping at DCBS versus some local store is obviously not good for that local comic shop, it is no worse than if you shopped at some other local comic book store. So, at the retail level, shopping though DCBS is no more or less harmful than shopping at any specific store over another. In the case of readers with no local comic book store as an alternative, mail order services like DCBS are a huge benefit the industry.

The publishers and creators are getting the same percentage of the cover price regardless of where a reader buys it within the direct market. As a result, where a reader purchases a comic and how much the reader pays has no impact, either good or bad, on the publishers and creators. If anything, the less a reader pays for a comic, the more money they potentially have to spend on other comics. Obviously not all of the savings will be spent on other comics but any that is spent on more comics clearly benefits the publishers and creators.

My personal stand on the subject is that readers should by what they want wherever they want for whatever price they are willing to pay. For me, DCBs has worked out great and I would recommend them to people looking for a good mail order comic book service. That having been said, if you have a great local comic book shop that you are happy with, support the local store.
Last edited by JohnMayo on Sat Jul 21, 2012 11:14 am, edited 1 time in total.
Comic Book Page: Website || Podcast || RSS || Episodes Archive
BobBretall
Master Reviewer
Posts: 5522
Joined: Mon Mar 26, 2007 7:44 pm

Post by BobBretall »

For me, factoring in that I don't want to get books only once a month, and even with weekly shipping I get my books the tuesday after they come out (6 days after they hit the LCS) PLUS the fact that my LCS does give a discount, my perceived benefit of using DCBS is going to have a higher break-even than someone else who (a) does not mind getting books once a month (b) lives somewhere with a shorter lag-time between shipping from Indiana to receipt (c) does not have a good LCS nearby that gives some kind of discount & offers a pull list -and/or- (d) is on a budget so that every dollar saved means they can buy more, so is looking for a very clear cut price advantage.

Since I'm not looking to save every penny possible the intangibles like getting my books quicker (not once a month and getting them about a week late with weekly shipping) are a higher disadvantage in the $ to time decision matrix than they are to other people.

I might also point out that the DCBS benefit is less for books in the back half of Previews that have lower discounts (typically) than Marvel/DC books. AND you need to factor in the quality of & discounts offered by the LCS. I'm fortunate that I have a really great LCS. I can get 15% off just walking in the door and buying off the rack. This means I have a decision of 15% vs. 30% off for many indie books AND my LCS has a wonderful indie selection. This is not something that factors in for everyone.

I actually have a pull list at my LCS and spend ~$20 per week there. I get stuff that I could get from DCBS but I'd rather pay a bit more and get the covers I want for Dynamite books and get the DC "normal" variant covers for Batman, Flash, Green Lantern, Action for cover price less ~15%.

It's a personalized choice for everyone. For me, I love DCBS, but if I cut back to < $100 I'd almost certainly be getting mostly indie books and would rather just pay a few dollars more and get them when they come out.
Trev
Master Reviewer
Posts: 1233
Joined: Mon Feb 18, 2008 9:15 pm
Location: Austin, TX

Post by Trev »

I did a bunch of analysis on this when I went to DCBS and the thing that I forgot to factor at first and played a major role was sales tax.

No sales tax at DCBS, but 8.25% where I live. Plus factoring the 'try it' deals at DCBS where you get the 75% off items made it worth it for like 8-10 books a week.

Plus the other good option is the ability to have them randomly drop whatever trade you decide you want into your shipment at like 30-35% off. Very nice.

Now that I'm down to 3-5 books a week, it makes less sense, but when I was spending $100 or more a month retail it was a no brainer. Even with weekly shipping.
Gilgabob
Special Reviewer
Posts: 356
Joined: Thu Jun 02, 2011 7:28 pm
Location: Chicago

Post by Gilgabob »

My typical DCBS order is between $50-$60 per month. I get bags and boards and I use monthly shipping.
I'm in the far NW suburbs of Chicago and even here my closest LCS is 20 miles away. I would condsider popping in there occasionally but at that distance DCBS is a no brainer.
The only downside is obviously I'm not reading my books "hot off the presses" while this is an inconvenience, it's only a slight one.
DCBS has also delayed my shipment when Previews comes out late. Other than the patience you need to be a monthly customer with DCBS I find their service top notch.
BadDeacon
Reviewer
Posts: 248
Joined: Wed Jul 29, 2009 2:44 pm
Location: San Frantastic, CA
Contact:

Post by BadDeacon »

Those are sweet charts!

I always "felt" like the break even was around 5 books a month, this detailed look is great.
Image
spid
Special Reviewer
Posts: 437
Joined: Tue Dec 09, 2008 2:26 pm

Post by spid »

Nice writeup John. This is the kind of thing DCBS should probably put on their website somewhere. I personally have never been a local comic book shopping guy with any regularity. As a kid I either got my comics from the drugstore, grocery, directly from Marvel, or from a catalog company.
torchsong
Special Reviewer
Posts: 445
Joined: Wed Apr 30, 2008 4:45 pm
Location: Out in the Desert, Arizona
Contact:

Post by torchsong »

As mentioned, everyone has a different rationale/reason for how they buy. I don't buy as many singles, but I do buy trades, and DCBS often heavily discounts at least one of them.

a) I buy monthly and have no problem waiting. New Comic Wednesday has been replaced with Big Box at the End of the Month Day.

b) I live (fairly) remotely from the DCBS offices, but as I'm willing to wait a month for my books, what's one week?

c) I lie to myself and say I budget to $50 a month, but honestly I usually wind up around $100.

As a rule the general discount on one trade (assuming a hardcover @ 24.99) will take it down anywhere from $16 - 18. That tends to take care of the $7 monthly shipping. Everything after that is gravy. Essentially I've bought one trade at full retail to buy the rest of my order on discount.

We're blessed out here in Phoenix to have a lot of great local comic stores (several of which are Retailer of the Year award nominees this year at the Eisners) - unfortunately none of them are near where I live. I would probably be spending upwards of $7 a week on gas to get to and from one of them. So for that, DCBS also makes a lot of sense for me.
"That...that HAIR!!!" - Deadpool, Deadpool #11
IanG
Special Reviewer
Posts: 436
Joined: Fri Aug 15, 2008 7:37 pm
Location: Boston

Post by IanG »

Thanks for posting this info, John. I've always wondered what the figures would be for a DCBS to LCS comparison.

I've found using DCBS, in addition to being less expensive, to be more about convenience and getting the comics I want. It's so easy to create an order online. And you can add or delete comics as much as you want until the order due date. My local comic shop is mainly all about mainstream Marvel and DC comics. So, if you want something outside of that, good luck getting it. I'd have to beg and plead with them to get any of my comics. With DCBS, if it's in Previews, and your pre-order it, you get it (unless it's an IDW artist's edition).

In addition to my DCBS order, I also spend about $20 to $40 a month at my LCS.
mguy1977
Fan
Posts: 45
Joined: Wed Aug 20, 2008 1:15 pm
Location: Plaucheville, LA

Post by mguy1977 »

I buy about 17 titles a month on average w/ bags/boards (0.12) with 2 $3.99 titles (JL & Action), 1 3.50 (Fatale) & 14 at $2.99.

I also buy 2 to 3 trades a month or 1 trade & 1 HC in addition to that w/ my order totaling anywhere between $56.00 on the low end to $86.00 on the high end is my last 6 months average.

Since I do NOT have a LCS & don't have a car, DCBS is the only option that makes sense.

Matthew
User avatar
JohnMayo
Host/Owner
Posts: 3295
Joined: Mon Mar 12, 2007 3:12 pm
Location: Texas
Contact:

Post by JohnMayo »

IanG wrote:I've always wondered what the figures would be for a DCBS to LCS comparison.
I have an Excel workbook with all of my DCBS orders and a rough estimate of how much I've saved versus if I'd stayed with the local comic book shop. It is a staggering amount over the course of a nearly decade.
Comic Book Page: Website || Podcast || RSS || Episodes Archive
BobBretall
Master Reviewer
Posts: 5522
Joined: Mon Mar 26, 2007 7:44 pm

Post by BobBretall »

IanG wrote:My local comic shop is mainly all about mainstream Marvel and DC comics. So, if you want something outside of that, good luck getting it. I'd have to beg and plead with them to get any of my comics.
When I visit shops like the one you describe above it's generally my 1st & last visit. I'm not a fan of shops like this.

I'm lucky to have the LCS I have. Very indie-friendly.
boshuda
Special Reviewer
Posts: 341
Joined: Mon Apr 04, 2011 8:59 am
Location: Western NY

Post by boshuda »

Trev wrote:I did a bunch of analysis on this when I went to DCBS and the thing that I forgot to factor at first and played a major role was sales tax.

No sales tax at DCBS, but 8.25% where I live. Plus factoring the 'try it' deals at DCBS where you get the 75% off items made it worth it for like 8-10 books a week.
I thought there wasn't any sales tax because they're considered 'periodicals'... At least the federal portion should be true in every state. Maybe each state applies the sales tax differently. I don't really know, I just know that here in New York state none of the shops I've visited have charged me sales tax. One of my local shops doesn't even put anything in the back-issue bin anymore so they don't have to charge sales tax.

One of the things I personally need to recalculate is the difference between Amazon/InStockTrades and pre-ordering trades from DCBS as I switch to trades for almost everything. This analysis is great - it tells me I don't really need to spend any time on my analysis until I get to less than ~10 monthlies.
BobBretall
Master Reviewer
Posts: 5522
Joined: Mon Mar 26, 2007 7:44 pm

Post by BobBretall »

boshuda wrote: I thought there wasn't any sales tax because they're considered 'periodicals'... At least the federal portion should be true in every state. Maybe each state applies the sales tax differently.
It varies by state.

In California we pay full sales tax rate on periodicals/comics, our sales tax rate varies by county. Los Angeles has a tax of 8.75%, San Francisco is 8.5%, Orange County & San Diego are 7.75%

On the west coast, I know Oregon has no sales tax at all.
User avatar
JohnMayo
Host/Owner
Posts: 3295
Joined: Mon Mar 12, 2007 3:12 pm
Location: Texas
Contact:

Post by JohnMayo »

Sales tax in Austin, Texas is around 8.25%. It is amazing how much that can add up to over the years.
Comic Book Page: Website || Podcast || RSS || Episodes Archive
boshuda
Special Reviewer
Posts: 341
Joined: Mon Apr 04, 2011 8:59 am
Location: Western NY

Post by boshuda »

I just looked it up - I was incorrect about there being a federal sales tax. I got it confused with a state sales tax with the addition of the county and/or local municipality tax. So I incorrectly moved that tax up one level (state became federal, county became state). All periodicals are exempt in NYS:
Newspapers and periodicals

If you sell publications that qualify as newspapers or periodicals for sales tax purposes, you don't need to charge sales tax because they're exempt. The exemption also applies to charges for electronic versions of newspapers or periodicals if you sell a hard-copy version, and both versions contain the exact same information (except for advertising).

<snip>

To qualify as a periodical, a publication must:

be published in printed or written form at stated intervals at least four times a year;
have continuity as to the title and general nature of the content from issue to issue;
contain a variety of articles by different authors devoted to literature, the sciences or the arts, news, a special industry, profession, sport, or other field of endeavor;
be available for circulation to the public; and
not constitute a book, either singly or when successive issues are put together.


A newsletter may qualify as a periodical if it conforms generally to the above standards. If a newsletter has no signed articles, but has a staff of writers who prepare articles, it will be considered to have articles by different authors. Whether a publication has been classified by the United States Postal Service as one that is entitled to second-class mailing privileges will also be considered in determining if it is a periodical.

Publications that don't qualify as newspapers or periodicals include:

listings and compilations that are information services (see TSB-M-10(7)S, Sales and Compensating Use Tax Treatment of Certain Information Services, for more information);
publications issued at stated intervals but that are actually books or parts of a book;
and publications that were originally periodicals, but that are sold at a price that does not reflect the normal selling price (i.e., sold for collection or investment purposes).
Post Reply