Saturday, October 18, 2008

Excellent essay on the economics of the bookstore, and why some books get skipped by buyers.

Those of you reading this blog who work in the book industry know may know my friend Andrew Wheeler, the former senior editor for the Science Fiction Book Club, now a marketing manager for John Wiley. He's one of the more astute observers of the book industry and keeps an excellent blog where he often posts excellent critical - and informative - essays on why things are the way they are in publishing and bookselling. If you don't have a background in bookselling or publishing, his blog is a great place to start if you'd like to understand the business better.

Recently there's been a lot of discussion among genre writing professionals about the decision by buyers at Borders to skip certain new genre titles. Yesterday Andrew posted a reasoned and thoughtful argument as to why a large chain bookstore would make that decision:
But bookstores are businesses, not public conveniences. No store has the responsibility to carry every book published -- although, to be honest, that's a straw-man argument, since no one is asking for that. (They're just wishing that their books, the books they like, and the books by their friends be spared the chopping block.) I market books for a living, so I can tell you an unpleasant truth: the order for any book, from any account, starts at zero. The publisher's sales rep walks in the door with tipsheets and covers, past sales figures and promotional plans, to convince that bookseller's buyer to buy that book. In many categories -- SFF is still one of them -- the chain buyers say "yes" the overwhelming majority of the time. But not all the time. Sometimes, that buyer is not convinced, and the order stays at zero.
He effectively breaks down the economics and the thought-process behind the decision to carry a sequel to a first book whose sales were disappointing. As a former book buyer for an independent store, I often skipped titles whose predecessors didn't sell (or "turn") well enough to merit giving the author additional shelf space. It's purely a business decision: the number of new titles divided by the linear feet available.

Andrew is also quite blunt about the myth of the supremacy of the independent bookstore:
One thing is indeed true: about eighteen years ago, there were 7,500 independent bookstores; now there are 1700. Sure, some good stores closed. But the rosy-colored view of the wonderful lost indy bookstore, land of miracles, where enlightened, Buddha-esque bookmen and -women sold only the finest of literature to a happy and contented audience is pure bunk. Most of those vanished stores were too small, undercapitalized, badly run marginal businesses run by cranks. They went out of business because they were bad at business, lacking any point-of-sale systems or serious inventory tracking at all. If they didn't return all that many books, it was because they had no idea what they had or where it was. Oh, and most of them -- as those of us who remember those days without the gauzy light of nostalgia -- were actively hostile to science fiction and fantasy. (Remember? This is the era when SF sold mostly in paperback, through entirely different channels, or in small hardcover editions to libraries. Those supposed wondrous independent stores of yore didn't carry SFF.) The independent stores still open are probably 90% of the well-managed independent bookstores that ever existed; there's a serious selection bias in looking at what's still around and extrapolating that back to all of the stores that didn't survive -- most of them didn't survive for a reason.
As someone who worked in independent bookstores in the San Francisco Bay Area from 1984 through 1999 and who has always been an outspoken supporter of the independent bookselling community, I couldn't agree more with the above paragraph. People are often quick to blame Amazon or chain bookstores for the downfall of the independent booksellers, but a closer look at the history of individual stores often tells another story.

The first bookstore I worked for eventually went under, not because of chain bookstores (there was no Borders, and B&N was a small East Coast-based chain) or Amazon (the Internet didn't even exist at that point!) but because the owner - who was a very decent man - was a terrible businessman. The second bookstore I worked at went under a couple of years after I moved to New York. Once a thriving indie with several locations, each location went under for an entirely separate reason. Location #1 was situated in the Silicon Valley; when the dotcom bubble burst, this location effectively lost all of its customers as the surrounding businesses laid off employees. Location #2 had it's rent increased to the point that it no longer made sense for the store to remain open. The store wasn't doing enough business at the time to justify the increase in overhead. (And for the record, there is now a different independent bookstore operating successfully in this same location.) Location #3 was located in an out-of-the way part of a thriving college town. The main shopping and foot traffic area for this town was fully a mile to the north, just off the campus of a major university. Book buyers coming to this store had to make a concerted effort to get there, driving out of their way to a location that had little else to offer a busy working person who needed to squeeze a lot of errands into one trip. It made sense then for shoppers to prefer to take their business to the Borders a mile to the north. (That Borders has since closed and been replaced by an independent store which is doing quite well.)

In any case, Andrew provides much food for thought and you can read the entire post here.


Anonymous said...

Having worked in retail management for a number of years, I can tell you that Andrew's exactly right. What is often overlooked in the tales of small retailer woe is that so many of the small businesses that are being squeezed out are not victims of the big-box retailer, but of their own mismanagement.

True, the large retailers can buy items in bulk at a discount and demand more of the vendors than the independent, but many of the problems facing the small business are of their own creation, resulting from a reluctance to change with the times and adapt to an ever-changing environment. In their desire to compete with the big boys, the independents reach too far and forget that every item they carry must pay for the space given to it. Every book in a bookstore, for example, must pay its own rent to stay there. That's why few debut novels (sigh) are easily accessible--not as good a return on investment as a proven author.

Anyway, great article!

Bobbie said...

Great post and article. I need to send it to my brother, who owns an independent bookstore in Virginia that my parents opened more than 30 years ago.

Two years ago, Borders came to town, and my brother thought that would be the end of him. The truth is, it hasn't affected his business at all b/c my family figured out over the course of 30 years that the image of the cranky old man sitting behind the counter wasn't going to make the business successful. My brother and my sister who manages the store (and is the primary buyer) put in ridiculously long hours to keep it not just afloat but ahead. They attend conventions, visit other successful independents across the country, and always try to come up with fresh ideas. And customer service--connecting with those who come into the store and (gasp) actually reading some of these books--is almost as important as having a good head for business.

Other independents have come and gone in the 30+ years my family's store has been in business, but each of them was a victim not of big boxes but of poor decision-making.

That's not to say I like big boxes or that I welcome their competition, but I believe that if an independent has something unique to offer and is willing to do the work and the research, they *can* and do stay in business.

Anne R. Allen said...

I can't tell you how refreshing it is to read this. I hate being guilt-tripped for failing to shop at my local indie store, where the owner is a cranky, arrogant nutjob who heaps scorn on genre fiction readers. So shoot me, but now I do my book buying online.

I also worked in my share of bookstores in the 90s, most of which were like the "Black's Books" of the BBC TV series. One owner had temper tantrums when somebody bought one of his favorite books and "ruined his collection."

"Independent" doesn't doesn't always mean "customer friendly." Sometimes it means "owner is unemployable but has spouse/parents with big bux."

Sabina E. said...

I feel so bad. I always hang out at Borders, because it's so close to my house. There are no locally owned bookstores in my area, and I should go downtown and hang out at one, but I have no car and no way to get there. but I try my best to support local businesses, so I'm guilty of hanging out at Borders.


richgoldstein13 said...

I sell my books by giving them away for free on the internet. I'm still waiting for my check.

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