The second largest US bookstore chain released their annual report on Thursday and it would seem that they're not in much better shape that Barnes & Noble.
Books-a-Million reported that fiscal year 2013 (which ended 1 February 2014) revenues decreased 5.6%. Total revenues were $470.3 million, down from revenues of $498.4 million in the previous year. Comparable store sales declined 6.8%, and BAM reported a net loss from continuing operations of $8.7 million compared with net income from continuing operations of $2.6 million in the year-earlier period.
As much as I would like to compare B&N and BAM, the former's fiscal year doesn't end until April. But I do have the latest quarterly report, and when you look at the report just for B&N's retail revenue it shows that BAM is in almost as bad of a state.
Barnes & Noble reported that in their latest fiscal quarter, which ended on 31 January, their retail division (including the bookstores and BN.com) had revenues of $1.4 billion for the quarter, decreasing 6.3% over the prior year. B&N College, the 600 odd college bookstores which are operated under contract, had revenues of $486 million, decreasing 6.0% as compared to a year ago.
According to the BAM press release, revenues for the 13-week period which ended 1 February 2014 wee down 3.7% to $157.9 million, compared with revenues of $163.9 million in the 14-week year-earlier period.
Both companies saw a drop in revenue, but BAM reported a less severe loss. This doesn't tell you much, but when you look at these reports in comparison to other retailers I think we can learn a thing or two.
Walmart, for example, reported revenues up 2.4% for that quarter, and up 1.6% for the fiscal year. Kroger revenues up 4.8% for the quarter and 4.3% for the year. And Indigo, the largest Canadian bookseller, reported revenues up 3% for the quarter but down a fraction of a percent for the first 3 quarters of FY2014.
It's curious, isn't it, that 2 general retailers reported that they were doing just fine, isn't it, and that even another bookseller reported that they were struggling but at least able to tread water.
If you looked at this data and reached the conclusion that chain bookstores may be a doomed retail niche, I don't think you would be wrong.
Sure, Indigo is holding their own, but they have repeatedly said that they aren't just a bookseller any more; they are trying to become more of a general retailer by adding Apple products and revamping their stores:
Indigo said it plans to revamp many of its large format stores, turning them into a series of smaller shops — including its existing Indigo Kids brand, as well as new labels such as Indigo Tech and Indigo Home.
The book seller has been trying to boost its profitability by stocking more high margin products such as gifts, toys and lifestyle items as consumers shift more towards digital reading.
Given the ongoing trend of decreasing revenue at B&N and BAM, the death of Borders, and the general health of the retail industry, I have to wonder if the big box bookstore is dead.
At the very least it does not seem to be in good health in North America.