Minimum wage and rent (high in the very places we most want such stores to exist) seem to set a lower bound on performance below which such things simply can't exist today.
Perhaps if one operated as a non-profit or a co-op so people who loved this stuff could realistically volunteer and keep it going?
Yes, if there were no expenses then that would change things.
However, some factors mentioned which you omitted were, paying the network of basement pickers to find a supply, paying for new stock, and government subsidized street parking. Those also affect the lower bound.
You also left out paying for employee health insurance. Perhaps if there were single payer health care then more small companies like this could keep on going?
I'm pretty sure that only people who love music and records work at a record store already. You need a lot of volunteers to replace a full-time staff position. A lot of volunteers means more management overhead and more time spent on consensus building.
Is that an answer? Rent so high a business can't afford to pay it's staff. Are the staff not working for free to give the banks more than can be had for a given piece of land?
Perhaps if one operated as a non-profit or a co-op so people who loved this stuff could realistically volunteer and keep it going?