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"I think it's wrong to put all the blame on Blockbuster for the death of the mom-and-pops, though," Tornabell expounds. "People see sell-throughs [titles such as The Flintstones or most Disney films that studios market directly to the public] for fifteen or twenty dollars and they think that's what we pay for every tape. When I first started, we were paying $50 to $54 for tapes. By the end [four years later] we were up to $60 to $65. Most people have no idea that video stores pay that much. Maybe Blockbuster gets a discount of a few percent, but even they have to pay a lot. At two dollars a night, that's an extra five nights you have to rent it out. But the popularity of most new releases drops off rapidly after two weeks. How can you make any money like that? You'd have to rent a tape every single night for a month just to break even."
Rene Curbelo, owner of Video Pursuit on Miami Gardens Drive in North Miami Beach, agrees that it has become much harder to make a profit renting new releases, and bemoans the fact that movie-lovers are inundated with opportunities to see their favorite films. "Five years ago you didn't have to worry about pay-per-view, you didn't have Encore [a commercial-free 24-hour movie channel]. Customers don't perceive video as a novelty any more. When I first opened, they would come into the store and find a movie on the shelf they hadn't seen in fifteen or twenty years and be so happy they'd rent it. By now they've probably been bombarded with it. So the business has become new-release driven. Some small stores do as much as 50 percent of their business in new releases. Those are the stores in the deepest trouble. It gets very expensive."
The reflective, soft-spoken 47-year-old hasn't thrived for ten years by making the same mistake. While Curbelo is quick to agree with the overall view that the attrition rate for independent video stores has been extremely high, he has somehow managed to prosper amid the carnage. "Since we opened our doors on February 15, 1985, 22 stores have come and gone in the area from 163rd Street to County Line Road," he explains. "When video was emerging [in the mid-Eighties], it was a time in the overall South Florida economy when a lot of money was being laundered. A lot of people jumped into video without doing their homework. But just because you have the money doesn't mean you've got the smarts."
Today there are only two independent video stores serving that same territory (as well as one Spec's and two Blockbusters). "It's a much tougher business today than it was a few years ago," Curbelo allows. "I see my competition not as Blockbuster but as anything that attracts my customers' leisure time. The Marlins, Dolphins, Heat A we notice dips in business during big games. Weather is a big factor, too. It used to be that just about anybody with a few thousand dollars could run a successful video store. You have to be smart and stay on top of the technology. You can't run it like a mom-and-pop business. If you do, you probably won't survive."
Curbelo is probably not typical of the average mom-and-pop store owner. He has a bachelor's degree in business administration from UM, and was working as a licensed commercial contractor when he decided "to drop out of the rat race." Following the advice of a friend of his brother-in-law who owned a small chain of video stores in New Jersey ("Every day you wait to start is a day you're throwing money away," the friend advised him), Curbelo invested his $30,000 nest egg in opening Video Pursuit in February 1985.
"It's amazing that I succeeded," he admits. "A lot of decisions that I made, like picking this location [in a busy strip mall just west of Biscayne Boulevard] were dumb luck. It was my first retail venture. I started with 450 tapes. We were one-third the size we now are. Maybe the construction business gave me a sense of professionalism that a lot of other stores didn't have back then. You can't make as much money in video as you can in construction, but you'll live a lot longer and you'll be a lot happier. I'd never go back."
Curbelo has embraced diversification along the way. As you enter his colorful, brightly lighted 2400-square-foot store, you are immediately tempted by eye-catching displays for candy, popcorn, greeting cards, gourmet lollipops, sell-through titles (Jurassic Park, The Nightmare Before Christmas, The Flintstones), and beepers. Rentals of laser discs, adult films (Curbelo is a little more circumspect than Zeeman on the topic but freely admits that they are the most profitable segment of his business, contributing between 12 and 25 percent to his gross income even though they make up less than 10 percent of his inventory and cost a fraction of the price of general releases to buy), video games, and CD-ROM software are essential ingredients in the product mix. As if all that weren't enough, Curbelo runs a second business, a computer consulting and software design firm he calls Digital Pursuit.