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Staying local may save independent book sellers

Weller Book Works, a family owned business located in the historic Trolley Square in Salt Lake City, has endured its share of economic ups and downs since it first opened in 1929.

Seemingly every business cycle has brought with it predictions of collapse along with expressions of sympathy from the store's loyal following.

“All of my life, including the time prior to working here at Weller’s, I have heard of the demise of the independent bookstore,” said Katherine Weller, the new-book manager and wife of Tony Weller, the current owner. “In fact, my father-in-law Sam could cite several times when people told him, ‘Oh, bookstores are going to die.’ ”

But they haven’t.

Weller’s and many other local bookstores have survived radio, television, chain bookstores — and now they are finding their way through the digital age.

While some book retailers have responded to the Internet and electronic reading devices by either scaling up to Wal-Mart sized chains or scaling down to an online only outlet, independent bookstores have found a viable void staying just as they are — local, intimate and independent.

Buy-local campaigns persuading customers that neighborhood shops are an integral part of the community have definitely helped. By staying small, independent sellers have shown they can more nimbly adapt to the unique interests of a local clientele than a larger, impersonal national chain. Embracing the Internet as a source of sales along with the decline in large stores like Borders and Barnes & Noble has also restored business once thought lost.

In the past five years, the number of indie bookstore companies has grown by 16 percent, according to the American BookSellers Association.

“It’s still a very competitive market that we’re in,” said Oren Teacher, CEO of the American Booksellers Association. “We got lots of competition. There is no doubt that our world is changing rapidly, so we have got to continuously adapt and change. But there is a formula in 2015 for independent bookstores to not just survive but to thrive.”

Indie advantages

The growth in indie bookstores has been preceded by an uptick in sales.

“2013 was better than 2012, and 2014 was better than 2013,” said Katie Orphan, general manager of the Last Bookstore in Los Angeles.

She said the closure of the nearby big-box bookstores created a book desert in which the Last Bookstore has flourished in its 20,000-square-foot building located in downtown Los Angeles.

With the big bookstores out of the way, the Last Bookstore was one of the few places in the area to peruse shelves of real books and purchase one. With the area attracting a large business sector and young-professional class, the Last Bookstore stocked lots of what its clientele would be interested in reading.

Being small and independent, retailers like Last Bookstore can more easily identify and cater to the needs of the surrounding market than a larger, national chain.

“There was this assumption that bigger is better but now that tastes change quickly being smaller is now a competitive advantage because it allows you to adapt and change,” said Teacher.

As a neighborhood's demographics change, so does its tastes. A neighborhood that has a large religious population would benefit from a bookstore that was well stocked in religious books. Or, if a younger or more ethnically diverse population moves in, the local bookstore can adapt to the change more easily than a larger chain, retailers said.

Orphan said that another factor to surviving changes in the industry is the success of the Buy Local movement in America. The Institute for Local Self-Reliance published survey results showing how local-first movements benefitted local stores.

“Businesses in places with a Buy Local initiative reported an average sales increase of 9.3 percent in 2014, compared to 4.9 percent for those elsewhere,” the ILSR stated. “Among the independent retailers surveyed, those in cities with an active Buy Local initiative reported higher average holiday sales gains (5.7 percent) than those in cities without such a campaign (4.2 percent).”

The idea behind Buy Local is that local companies contribute more to the community and therefore supporting local businesses supports the community.

And research shows Buy Local is not just sales pitch.

Civic Economics, a research group based out of Austin Texas, conducted a survey in Las Vegas, Nevada, showing that local companies contributed more revenue into the local economy than their corporate counterparts.

“Eleven businesses participated in the local survey, all of which can be categorized as storefront retailers,” said Civic Economics. “Collectively, these businesses return a total of 47.5 percent of all revenue to the local economy.”

In comparison, corporations seem to contribute significantly less to the community. According to the survey, Barnes & Noble, Home Depot, Office Max and Target only returned 13.6 percent of their revenue back into the local economy. Darden, McDonald’s and P.F. Chang’s scored slightly higher with 30.4 percent.

The Buy Local movement has been a major contributing factor to the indie bookstore success and could be capitalized by other industries, according to Teacher.

Katharine Weller said that the indie bookstore community has been at the forefront of the local-first movement.

"The shop local movement has also been extremely important to all indie stores," said Katharine. "The product they buy off the shelf enables us to do things like pay accountants, to sometimes advertise, to contribute to the local tax base and people have begun to value that more and more, which has helped us."

Indie disadvantages

While independent bookstores have survived the scare of the big box chains, they have a more formidable force to navigate in the Internet, with its advantages of convenience, speed and discount pricing.

“Amazon is our biggest nemesis,” said McKenna Jordan, the owner of mystery genre bookstore Murder By The Book, located just outside of Rice University in Houston. “I think that if any independent bookstore owner you talk to doesn’t immediately say Amazon, they’re fooling themselves.”

Part of ILSR’s survey asked independent retailers to rank threats to their business from 1 to 5, with 5 being the worst.

“Among independent retailers, which comprised almost half of the survey responses, ‘competition from Internet retailers’ not only received the highest average score (3.98), but was ranked as a 4 or 5 by 71 percent of respondents. Only 40 percent ranked ‘competition from large brick-and-mortar chains’ at the same level of significance,” wrote ILSR.

Jordan echoed this sentiment. She said that despite Murder By The Book's struggles to keep its ledger in the black, she has no problem referring customers to the local Barnes & Nobel when necessary.

“At this point, we don’t consider Barnes & Noble a rival,” said Jordan. “As a matter of fact we’re happy to pick up the phone if we’re out of something and call Barnes & Noble and see if they have it because we want to send shoppers to brick-and-mortar bookstores and the stores within our community.”

The Wellers have combated the Internet by embracing it. Katharine Weller says that was a major part of their rebranding as a company.

“We actually have been selling books over the Internet pretty early for an independent bookstore; back in the ’90s we started that,” she said.

In addition to selling via a website, Weller's has a deal with Kobo Books, a Canadian eBook company, to sell its eBooks and eReaders.

To be sure, there are independent bookstores that haven't been able to adapt, some for reasons beyond the changes in the industry or competition from the Internet.

Los Angeles-based Borderlands Books posted on its blog in February that it planned to close due to the minimum wage increases approved in last year's election.

“The change in minimum wage will mean our payroll will increase roughly 39 percent,” the blog said. “That increase will in turn bring up our total operating expenses by 18 percent. To make up for that expense, we would need to increase our sales by a minimum of 20 percent. We do not believe that is a realistic possibility for a bookstore in San Francisco at this time.”

Borderlands later retracted that statement and launched a program where customers could become “sponsors” for $100. Sponsors will receive a handful of benefits including special seating at author events, special events and free Borderlands apparel.

Borderlands later posted that program will help get it through March 2016, unless the store comes up with a new plan.

“There are still a lot of independent bookstores that are struggling and have not been able to keep going after the last four or five years of struggling with ebooks and struggling with kind of being with the times," said Jordan. “I feel like those who have made it through the last couple of years, we probably have a pretty good prognosis for moving forward, but we’ve lost a lot in the last few years.”