It seems to me that kids now are buying up the Magic cards in the same way we used to buy baseball or other sports cards when we were kids. I think that's a big part of the problem with the local shops, but they can absolutely leverage it in the way your local shop has to continue bringing in customers.
My son is always asking us to get him more Magic cards, but he never wants to go to a card shop (even when I offer to take him). He'll see some at Target and ask for a box then, or look on eBay and ask me to get him some cards then. I don't know why he's not interested in going in the shops. I took him to a couple of tournaments at the shops but he said he felt out of place because most of the people there were older, in their 20s (my son is 12).
I think another part of what's causing shops to struggle financially is the Internet. For better or worse, it's just easier and cheaper to do business online. I complain a lot about how much I have to spend on servers to keep my sites running, but if someone's running an ecommerce shop it's even less expensive. Even so, my server bill is a fraction of what a shop will pay in rent. And that doesn't even get into the inventory you need to keep in a shop compared to online where you can have a much higher turnover.
Anyway, the obvious truth is that shops need to evolve or they're not going to survive in the long run. They need to do what will get warm bodies in the door, whether that means Magic tournaments or whatever else.
