Friday, February 12, 2010

The Week In Books: Why Does Everyone Hate The Small Bookstore?

Sublime like a tiger's stripes. And as endangered? Micawber's is a gem of American bookselling.

Where does this leave the bookstores?

Tongue in cheek title, no doubt, but buckle up nonetheless. Some shit is about to go down.

There is only one conclusion I have arrived at after the dust of the first battle of the e-book wars has come to a close. It is a simple one. Like all modern wars the reason it came about is control. Control of pricing, auspiciously, and control of format in reality.

Just like all the bright faced lefties when Bush II invaded Iraq, screaming about blood for oil, many of the commentaries about this publishing conflict fall short of addressing an important aspect of this discussion. Essentially the format has been accepted and now the big players are jockeying for control. So I ask you, nostalgia shelved neatly at the dusty back next to poetry, what the hell is happening to bookstores in all this?

After reading the observations of the Wall Street Journal and Washington Post I found one consistent theme, the latter of which contains the best summation by Steve Pearlstein:

With a higher price for both the tablet and the books, you wouldn't expect this new model to pose much of a challenge to Amazon's dominance in digital books. But then over the weekend, Macmillan told Amazon that if it didn't agree to the same terms it had hammered out with Apple, Amazon would no longer have access to new books from the publishing house until several months after they were released through bookstores and Apple. Amazon's initial response was to prevent users from buying Macmillan books on its Web site. By late Sunday, however, Amazon had raised the white flag and announced that it would go along with the new arrangement. Other publishers are now expected to follow Macmillan's lead.

Never mind the lack of a comfortable reading screen or anything resembling the e-ink technology. Apple is gaining ground with a thin computer, essentially half the creature that a netbook is, simply through packaging and loyalty to the Apple brand.

Wait... I seem to remember an adage about this sort of thing.

Sad joke aside, what is consistently nagging at me is the total lack of a long view commentary on what will happen to bookstores. You know, those places you wander into, have long arguments with the proprietor and find books you've never seen advertised on Amazon or faced out in a Barnes & Noble.

The technological reality is solidifying. I will not argue about that. In fact, I am excited about it. As e-books become the norm the big question I hear being asked is how will small publishers get their important works to market with success. A small publisher will not be able to pay for the front page of or buy into a Barnes & Noble TOPPS (you think those endcaps are picked by booksellers?) style program. Then again, I guess they never have. Good old word-of-mouth and advertising in magazines, blogs and whatever the future newspapers look like has been good enough to this point. Let alone the fact that the press is often free on blogs and webzines.

So bookstores... Pragmatically I can foresee a sort of hybrid bookstore/blog that serves the role of literary muckraker (ahem), selling e-books online. Let me revise that. I can imagine that scenario. Problem is though, that this is about control and not the object itself. Not blood for oil but blood for strategic command. As things stand now, if a small bookseller wants to join the e-book world they will have to settle for pitiful affiliate links that are dubious income streams at best.

This is because the major players in all this are retailers and not wholesalers. The small bookstore (you know the place you met your great love or found out OMG! that he/she also loves Samuel Pepys) is largely reliant on wholesalers to consolidate inventory monitoring and billing. Lord knows they help with monitoring billing.

This leads me to the second aspect of this depressing war. Not only are small independents unable to engage in any e-book commerce they are also unrepresented in all the talk about pricing. As someone who ran a book business for six years, three of which were bricks & mortar, I can tell you that the retail book business is geared for nearly everyone except the small bookstore. There simply is no other area of retail that expects the retailer to purchase products at a 40-50% discount. A healthy 2.5x markup is considered retail norm. In books the store is expected to purchase a $24.99 book at $14.99 and bring home $9.99. That's a lot of cash flow to manage for a short profit. Quantity then...right.

And you wonder why Barnes & Noble carries board games and hard sells coffee.

So... Amazon wants to control the pricing of books in Walmart fashion to forever bar smaller (or even larger) retailers from the equation. Apple wants to keep business as usual, because they simply don't have to fear other retailers, as they control the device itself. Barnes & Noble is slangin' Nookie with smug awareness that they have always had both the leverage of price setting and consumer interface all at once. And now with a new technological platform the old B&N seems to be in not too shabby a spot for the impending battle royale.

The publishers have a right to be worried about this situation. They lament caving for returns and remaindering in the past and truly it was damaging to the book business when it happened. The remaindering system is bad for both small booksellers and publishers.

So this time some publishers have drawn a line in the sand and that's noble, or smart. How so the little guy? When bigtop stores and internet monsters can buy tons of books at deep discounts and return those they don't sell, it is the small bookstore, making ten bucks on a hardcover they had to outlay fifteen for that is getting the proverbial shaft.

It's like a small bookstore is a consignment shop. Oh, and the returns system is harder on them too. Much of the time the wholesaler or publisher asks them to eat 10% of what they return.

And what is left to the small booksore? To ask communities to get behind them? To hope people are willing to buy something at a higher cost that they can have for cheaper online?

Let me tell you, he says sadly, one of the biggest kicks I have ever received to the nuts happened every day I received the mail of the neighbors who lived above Wolfgang Books. Once a week without fail, sometimes twice, there would be a book shipped from Amazon.

I don't blame them for buying it from Amazon. A bookstore does not have a right to consumers. That's one of the biggest mistakes I see small business owners make. They believe that since they are doing the right thing (organic food, good books, or free trade coffee) that consumers should buy from them. There is nothing more untrue.

I blame the system that seems to get harder and harder for small bookstores to survive. And it seems that the system, despite recent developments, is business as usual.


Micawbers said...

Well, we're excited our picture made it into this piece even if our name didn't.

We're a real, living, bricks and mortar bookstore in St. Paul, MN

Check us out at

The Devil's Accountant said...

Sorry good book people. I failed to put a link in there to your store. I fully meant to.

Micawber's was a big influence on the philosophy and layout we implemented when creating Wolfgang Books.

Problem corrected and link placed above.

Bart King said...

Come on, D.A., confession time:
Why do you hate Micawber's?

The Devil's Accountant said...

Because...they're just

** Runs from room sobbing **

Bart King said...

There, there— we ALL feel that way about them. (You'll get yours, Micawber's...some day.)

Great blog, BTW.

The Devil's Accountant said...


But it isn't nearly as great as your picture.

Enjoyed perusing the grossness too.

Carry on.

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The photo with BJ and the puppy is PRICELESS!! I love the one in the snow too. I think BJ is an OK kinda cat--thanks for introducing him to us..
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