Turning the Page on Bookstores
The current upheaval we’re experiencing with booksellers reminds me of those nature documentaries where the host talks about what happens when a giant tree in the forest comes crashing down, leaving a gaping hole in the forest canopy. In those instances, dozens of smaller trees and plants spring up to take advantage of that gap and soak up the new light. With bookselling giants like Barnes & Noble losing money and closing stores by the hundreds and Borders liquidating, I think there’s plenty of new light available for small bookstores to open up and take advantage of the new and evolving market. Question is: Will those smaller independent bookstores capitalize on those book superstore closings? I think they will, and they should.
Let’s face it, from an historical perspective, the book superstores were overbuilt for the category. Combine that with the one-two punch of CDs giving way to digital music, followed by Kindles and other e-readers taking over the book segment, and these brick-and-mortar giants were bound to feel the pressure. Given the rise of digital bookselling, a falling tree might seem like the right metaphor -- but I believe there is still a sizable market of folks out there who still like to read the “old-fashioned” way: book in hand, cover to cover, literally. These same people also still enjoy the bookstore “experience.” I’m not talking about the “25,000-sq.-ft. Starbucks-and-couches” superstore experience we’ve gotten so used to, but more the smaller neighborhood mom-and-pop bookstore experience that offers an intimate and quiet setting in which we can actually read the books we purchase.
I think the independents have a few advantages their superstore counterparts never did: They have the ability to take up smaller shop space, allowing them more flexibility. They can also have an edited selection of books. Many even carry used inventory. It’s this old-school/small-scale formula that can really work. Think about it: At roughly 1/10th the size of the superstores (I’m talking anywhere from 1,800 sq. ft. to 3,000 sq. ft.) these independent stores don’t need to do a massive volume of business to be profitable, and they have the freedom to be very convenience oriented.
I think the ideal locations for these independents today are going to be selected based largely on overall convenience and ease of access -- strip malls, freestanding stores or a downtown/village center location where bookstores originated. Their growth will likely be dictated by the actions and the absence of the big names, those markets where Borders has closed and Barnes & Noble has pulled back the most. What’s really interesting about this full-circle, back-to-basics small and independent store phenomenon is that it’s something we just don’t see all that often (if ever) in the retail world. The shift away from big names and big stores back to small neighborhood specialty stores may have seemed about as likely as Google giving way to the rolodex and the Dewey Decimal system -- but it is happening. The big challenge is a familiar one for small business owners everywhere: Financing can be difficult. Aspiring store owners may need to rely on incentives and programs through small business associations and other groups to get their businesses off the ground.
It will certainly be interesting to watch as we “turn the page” on the retail book sector. What do you think? Will the smaller independent bookstores of old be revived? Have you seen any open up in your market? Email me at email@example.com.
Jeff Green is president and CEO of Phoenix-based Jeff Green Partners (jeffgreenpartners.com), a leading consulting firm specializing in retail real estate feasibility, retail expansion planning, medical retail planning, location analysis and commercial land use.