The horizon is not so far as we can see, but as far as we can imagine

Why Bookstores live or die

In my experience, this is why they live, if they do:

Munro has since bought the building, which Walker described as an astute move that has provided various options for managing its future.

Bookstores almost always fail not because of e-books, but because of rent increases.  This is true of a lot of interesting, marginal businesses, especially in cities with housing bubbles (and Victoria is not cheap.)  Prices go out of line with income, rents follow, and interesting stores which need low rent die. So you wind up with a whole bunch of chain stores or boutiques operations selling overpriced goods and services who can make the rent.

I shopped at Munro’s many times over the years, as an aside, since my parents lived in Victoria during their retirement, and my grandmother in hers.  A great bookstore, with a good selection, knowledgeable and friendly staff.

But all those things aren’t enough when the rent goes up, and rent is set, in effect, by the value of the lot of land if turned into overpriced condos.

In general bubbles are bad for everyone who isn’t in on the bubble.  If you are winning, they’re great, but the people who don’t participate are screwed.

And bookstores are, somehow, never participants.

Drive enough similar business out, because they can’t make the rent, and soon the great neighbourhood you moved into isn’t, it’s an overpriced condo hell of glass and concrete and soulless chain stores.

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  1. Celsius 233

    Walter Powell did the same thing around the same time in Portland, Oregon. Walter was my ex’s godfather, so I actually knew him. His son Michael took over and as far as I know is still in charge. Powell’s was a place I spent hour and hours hanging and reading.
    You make excellent points regarding the demise of the “book store”; pity really.
    Those that survive I can picture as tourist destinations, for the well heeled and back packer alike…

  2. Formerly T-Bear

    Recently traveling through London, encountered Waterstone’s books on Piccadilly. In that edifice there were six floors of about 5 to10,000 square feet filled from floor to ceiling in numerous alcoves with books. Thought I had died and gone to heaven and found great difficulty resisting asking for one of everything, would definitely have to remortgage the ranch for that.

    Finding a bibliophile bookstore operator is getting to be a rare treasure and all effort to support and give custom to such enterprises is a seldom granted privilege, wherever those establishments are found. Whenever a book is referred, providing the ISBN will allow all book dealers to access that product, whereas links to amazon limit access to amazon only. Some refuse to give amazon their custom.

  3. there is nothing like denying a good article to an inquiring mind. they get so bottled up inside its wonderful to watch.

  4. Tony Wikrent

    I have been a book seller for 18 years now, and that wonderful run is about to end. I never had a store; rather, I was very specialized and sold online, and at 20 to 30 special events each year, such as antique tractor shows, antique tool shows, blacksmith hammer-ins, and ham radio shows. It was a living, up until the financial crash.

    The business actually supported both my wife and I until about 2004 – 2005, when Dick Cheney’s secret energy tack force made its impact, and gas prices tripled. We had been driving each summer clear across USA, from Virginia to shows in Pennsylvania, Wisconsin, Illinois, Missouri, Iowa, Minnesota, the Dakotas, Montana, Oregon, Washington, and California. We did that three years, then the increase in gas prices made it impossible. The best year we had was about $150k in sales. Cost of goods sold was just over fifty percent, and I drove that down steadily by offering more and more of my own titles, which are photocopied booklets I staple and trim myself. These are obscure titles in metalworking or blacksmithing, or manuals for old engines and tractors. For example, an operators’ manual or a service manual for a 1950s International Harvester Farmall H tractor. Or the 1906 sales catalog of Steam Traction Engines by the Northwest Thresher Co. Or “1926 – Gas Engines on the farm – Running Troubles & Their Remedy”. Out of the the $75K of so left after COGS, we then had to cover show fees and travel expenses, which usually ate up about half. That left around $30k for the two of us to live on.

    That was the situation for only a few years, from about 2003 to 2007. Previous to that, my wife and I both had full time jobs, and the travel to events was only on weekends, and only within a few hours drive.

    After the financial crash, sales collapsed to half what they had been. The only way we survived was by moving to North Carolina and paying cash for a double-wide from the proceeds of selling our home in the hyper-inflated market of Northern Virginia. If we had to carry a mortgage, we would have been out on the streets. We also were at the point that our vehicles were paid off. So, we had no monthly housing expense, and no monthly vehicle payments the past few years. Even so, we’re broke. Just plain flat broke. It scares me how much other expenses amount to, and wonder how other people manage if they have a house payment or rent due each month.

    Now, why did my sales drop by half? And, was it just me, or is it affecting other book sellers. I’m not sure of the last question, because I’ve seen reports that new book sales are at all time highs. But I deal in new, used, and my own reproduced books. And I’ve seen almost all independent book stores, everywhere I traveled, go out of business. One anecdote: one show I used to do was in October, in Vermont. I love New England, and would take a few extra days to stay and visit in the region. One year, probably 2006 or 2007, I came across a huge used book store located in a barn outside Salem, Mass. I spent a few hours in there, picking out books for myself, and to resell, and negotiating and talking with the owner. He said the only reason he was able to stay in business was because his father had started the store, and owned the barn, and it had passed to him. He noted that not many years ago, there were 12 or 13 bookstores in and around Salem, but now there were only two others besides himself.

    That was fairly typical of what I found in my travels. The best used bookstores were located in college towns, and were plentiful in the 1990s. Now, most college towns only have one or two. Salem is a college town, by the way.

    My sales depend on hobbyists. Some of these hobbies have pretty much died off, especially antique tools and ham radios. I haven’t sold at an antique tool event for years, and there is only one ham radio show left worth traveling to to sell at. Steam engine enthusiasts are dying off, but there is lots of young blood still coming into antique tractors, and into blacksmithing. Unfortunately, not metalworking.

    There is also the impact of e-books, which I feel especially in my online sales. I let my website expire earlier this year; sales had fallen to just 3 or 4 books a month. My eBay store is doing that every day, so that’s what I have concentrated on. But the shows have been one disaster after another, and I blame the economy above all else. Most events now charge $7 to $15 to get in, and a frigging hamburger, fries and drink now costs $10 or more. Bring the family to an event, and you’re going to pay nearly $100, if not more, just to feed them for a day, not to mention the tribute to Exxon-Mobil, and the admission to get in. Not many people want to spend much more money after all that. Attendance at events is down. And, so, of course are sales. The best show I used to sell four or five thousand at. Now I’m selling around two thousand, and flirting with break even. The shows that I used to sell two to three thousand at, are now money losers for me, and I have stopped going to them.

    Sales declined about ten percent last year, and I expected a similar decline this year. And it’s what I’ve seen so far. There is no economic recovery I can see.

    So, I’m looking for a new livelihood for the last few years of my working life.

  5. Ian Welsh

    Victoria used to be packed with used bookstores in the early 90s. Hog Heaven when I visited my parents. Most per-capita in Canada, iirc.

    They’re mostly gone now.

    I don’t care what anyone says, I’ve always had far more serendipity in bookstores than in online catalogues, no matter how pretty the algo, they’re always pushing the algo too hard to sell me what they get the most comp on.

  6. Ian Welsh

    Also, Tony’s data fits with the rest of the picture I have. With a few regional exceptions, the US economy has not recovered for the vast vast majority of folks. Simply has not.

    And it won’t for the next cycle, either. Not enough new jobs, but more importantly, they suck and don’t pay well.

    (The plural anecdote is “case studies”.)

  7. guest

    So true about bookstores and neighborhoods. I left DC in ’90 and Dupont Circle in the 80s had lots of bookstores (actually, the chains died out worse than the independent ones), small independent movie theaters, lots of places for a broke non-cooking bachelor to each cheap. I didn’t live in that neighborhood, but I went there all the time. I went back 18 years later and it’s almost all gone. All the eating places are now Starbucks (not cheap and not any good options for breakfast, let alone a quick lunch or dinner). No young people either, just rich middle aged folks walking around in a dull but still nice looking urban neighborhood without the amenities that made it so great when the real estate cost less than half as much.

  8. someofparts

    A great bookstore in my neighborhood had the wisdom to buy their space when it was still possible forty years ago. Local rents have indeed climbed steeply but the store is doing well. It is now in the charming hands of a second generation of owner/proprietors.

  9. astrid

    Absolutely. This ties back to the Hanson article too. If you have an “invasive species” actor in competition in an ecosystem with stable actors, the invasive actor group will win and disrupt the entire ecosystem, sometimes completely destroying it as has been the case for some parts of central London. Hanson weirdly declared it to be genetic destiny, it’s not. It’s evolution 101 and we see it play out in everywhere.

  10. astrid

    Libertarian types (even, or perhaps most likely, the sort who don’t believe in evolution) like to talk about competition and winning as though it’s an unadulterated good. It absolutely is not. It causes death and destruction for everyone else in its pathway, and it can devastate the ecosystem so much that it eventually kills invasive species itself.

    There is absolutely no moral imperative to change when the change is for the worse for most existing actors in the ecosystem. Yet, we in the West have an insane government and culture that worships winners at all cost.

  11. wondering

    The great thing about Victoria is that despite how small we are, we are able to support 2 large independent bookstores: Monroe’s and Bolen’s, even with Cole’s and Chapters and the other giants in town.. Plus lots of little used book stores (and not so little, like Russel’s!). Nonetheless, we’ve seen a lot of book stores vanish over the last decade or so.

  12. Brian M

    Not a single used bookstore in my outer suburb of 100,000 people in NorCal. One cheap paperback and mass market hardover kind of place in the next town. Only one brick-and-mortar new bookstore-Barnes and Nobles-and one can see the writing on the wall for that chain as well.

    Oh well. I mostly read stuff on line anymore. So, I guess I am part of the problem. And, there are still quite a few good bookstores in the inner Bay Area who somehow survive 🙁

  13. My last neighborhood in the USA had a big chain bookstore, a Borders, and yeah, even though it was a big chain bookstore and all and probably had the blood of innocent smaller bookstores on its hands (actually not, there were not many I gather before it moved in), it was a major attraction. It was purely coincidence that I left at around the time Borders folded up, but I’ve been back since and while the neighbourhood is actually richer and more expensive, it’s not what it was. So even the big chains suffer from rent bubbles. The space is occupied by an expensive clothing boutique now.

    I nowadays mostly use an ebook reader, though not from Amazon, as I now live in a country where English-language books aren’t exactly common — I have to order them delivered long-distance, and it’s too expensive.

    France is in a continuous and probably losing battle against Amazon. I hear via NC’s links that Amazon is trying to circumvent the anti-free-delivery law by charging one cent. Then there’s the whole thing with Amazon’s dispute with publishers, which is pretty much everywhere right now.

    Kleber doesn’t understand what all the fuss is about. Were the discount supermarket chain Lidl to stop selling coke because the discount supermarket could no longer agree on a price with the Coca Cola company, Germany wouldn’t start clamoring for new laws and lobbying antitrust authorities. Books, soft drinks — it’s all the same to Amazon.

    Kleber also insists that Amazon continues to ship Bonnier titles, merely with a delay. The reason he gives is that the company has to order inventory from Bonnier if there is no stock on hand. What Ullstein, Piper and Carlsen see as a boycott is what Amazon sees as its right to buy whatever print inventory it likes. Every item on its shelves costs Amazon money, and right now, it’s not willing to spend that money on Bonnier. In Amazon’s lingo, its “overall profitability” is not currently to its satisfaction.

  14. In big cities, just as major restaurant chains and retailers have their own, or contract for, demographic research about where to locate, major commercial property management companies often look at the same type of info to see how much they think they can charge in rent.

  15. Senator-Elect

    A wise man once told me that if you want to control your own destiny you have to be an owner. That maxim applies to small businesses and individuals alike. If you get the chance, buy the building or the house. More responsibility, but more control.

    Great blog, Mr. Welsh! Thank you.

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