Beyond the Big Box, or, A Plan to Save Barnes & Noble

With both Barnes & Noble and Amazon building smaller bookstores, one might think the day of the big box bookstore is over. Matt Blind, formerly a bookseller with B&N, has a different opinion.

The following post was originally published in 2012, and has been updated and minimally edited for context.

I think it's as valid today as six years ago, and I would like to know why it wouldn't work.

Beyond the Big Box, or, A Plan to Save Barnes & Noble Barnes & Noble

What might be next for bookstores, if the chains fail?

Let’s take a typical metropolitan area – say, 4 million people spread across multiple counties in mostly suburban densities and nothing like Atlanta, as this is a just a model & not specific to where I used to work. Say you have 12 big box stores spread across the region, but nothing too close to each other — you know, standard retail practice, at least 5 miles between outposts.

As stated, despite the glories of a Big-Box Bookstore (I’d have killed for one anywhere near my hometown in 1986) if we’re only stocking 100,000 books, the store is too small.

Thankfully, I work for a big bookstore chain and so, there are other locations. Sadly my customers also know this so the very first thing out of their mouths when I say ‘we don't have it in stock’ is, “Well, does another one of your stores have it?”

[*sigh*]

With 12 stores across our sample metroplex, that’s 12 sets of all-but-duplicate inventory — and it’s great that we can treat our extended storefronts as a single ‘store’ and search the million-or-so books in town like it’s a single inventory. We want to sell you the book. But there are problems: 50% or more of the inventory store-to-store overlaps. Still, and as is most often the case when a customer has to have a book, sell-outs are temporary, and likely another store does have it. We call around, we find a copy, we pull it off the sales floor and hold it for you.

There is a disconnect & breakdown before we close the sale, though, and the deal-breaker (apparently)  is the distance between stores. Out in the ‘burbs individual stores may be 15 or 20 miles from each other, but only 8-10 miles from the in-town location — which also partially explains my increased call volume (for my theoretical bookstore located in the center of town, not where I used to work, blah blah yeah I’ll stop pretending)

After we’ve tied up booksellers at two stores, for however long the search took, and found your book or books — you don’t bother to pick it up. (Stuff happens, we all know that, and I know 5 miles is so far and what book was I asking for again? I’ll just ask again later or order it online.)

We’ve pulled a book off the shelf that might have sold to someone else, too – particularly if you heard about it on TV or the radio. Alltogther this is a major headache — and yet, it’s the obvious thing I have to do for every customer when the question is asked. In fact, I bring more pain upon myself by offering to search our entire chain for the one copy of your book without ever being prompted.

##

When I say current bookstores are too small, that’s exactly what I mean: A typical B&N store could easily stock five times its current inventory and still not quite meet current demand, even for books that ‘most’ stores would carry – as any one store cannot match the gestalt selection across the chain.

And when I say chains are too large, again, that’s exactly what I mean: why maintain duplicate inventories with only small differences (typically books we’ve sold & are out of today but would’ve had in stock) across a dozen stores when a single, landmark location could encompass all the stores, actually stock less dollar-wise, but stock more individual titles?

Don’t just rethink the box, rethink the chain. Instead of opening up a smaller, pale imitation of a New York 5th Avenue bookstore everywhere, open up just 50-80 landmark bookstores. That might mean just one each for many cities – or one in a nearby city for some. Why dilute your single best selling point: stacks packed from one end to the other and to the ceilings, chock full of books. Double down on that bet – forget the ‘standard big box retail’ model and think big.

Sure, right now a bookstore clerk can special order books for customers from the warehouse. Takes about a week, down here where I’m currently located. (I’m sure it’s better up at corporate HQ, since they built the damn warehouse in the state next door — fine for you, sucks for 200 million of your potential customers.)

Let me turn it around though: If all the books are in the warehouse, why not throw in a coffee shop right there inside the distribution center and open it to the public?

##

I would aver that the bookstore chain is too big, too spread out, and also played out: our customers don’t care enough anymore to support neighborhood bookstores at that scale. We need to open a truly humongous bookstore. Much like amusement parks (Six Flags, Sea World, Disney, et al.) maybe each US Census MSA would only support one – or rarely two or three. While we all love a neighborhood bookstore (and there is a place for such; I personally could generate business plans for bookstores on a sliding scale from bistro to Strand) the real need of most communities is for a single landmark bookstore like the Tattered Cover in Denver or Powell’s in Portland — or yes, the Strand in New York.

I’m looking beyond books, however.

The future of retail depends on managing inventory, especially in the face of internet competition. Let’s consider a new model, a truly humongous bookstore that doubles as a distribution center: with a little advance planning you could open up a very small chain that covers hundreds of millions.

Let me give you a list of zip codes — my book oases, or nirvanas — and show you 1-day UPS ground delivery times covered by each.

  • 32816 Orlando
  • 30305 Atlanta
  • 27514 Reasearch Triangle Chapel Hill
  • 19104 Philadelphia
  • 02467 Boston
  • 43201 Columbus, OH
  • 60607 Chicago
  • 92102 San Diego
  • 94305 San Jose
  • 97212 Portland

Beyond the Big Box, or, A Plan to Save Barnes & Noble Barnes & Noble

So. 10 stores — 10 Massive Stores, each equivalent to 3 or four football fields, or equivalent to a regional book distributor’s warehouse, or to the all the outposts of a chain bookstore in their own particular metros.

The 3 stores on the west coast are within 1-day UPS delivery of 48-50 million people.

The 3 stores in the south east are within 1-day of 48-50 million people.

Two stores in the midwest are sufficient for another 48-50 Million customers.

A single store in Philadelphia is within 1-day of about 35 Million, as is the single store in Boston.

Not everyone would be willing to drive to a bookstore just to pick up a book — even if that bookstore was 4 acres of bookshelves under a single roof (about the size of a large IKEA, for scale). But if you could pick up a phone and call (or use a website) and know the book you need is there, that might change your mind. If you could know they had 20 copies of the book, and you needed 20 copies for your employees or clients, you’d be sending some lackey driving the 2 hours before he could sit down at his desk in the morning.

If this huge bookstore had not just a coffee bar, but also a pub, sit-down restaurant, hot dog cart, and ice cream shop — you’d plan your weekend around a trip.

There would be other ways to maximize the investment and key into “bookstore tourists” — topics I hope to cover in other posts. My point here was to build on an earlier column and show that there is a future for bookstores past the Big Box chain model. Additionally, if you chose to compete with Amazon on the internet, your massive bookstores are also fulfillment centers.

You don’t have to compete nationwide. Pick a market, serve that market. A single store in the right place can be the best bookstore for 30 million customers — in person or with guaranteed 1-day delivery (at UPS ground rates, or via the post). A small chain of just 3 stores could easily serve 50 million.

The 10 stores outlined above are within a 1-day delivery zone for 220 million people, and within 2 days of another 70 million customers. Looking at the map, a nice store in Denver would certainly plug in most of the rest to your network.

So, you want a nationwide brand that makes the most of internet searchability, access to customers, and that also features truly amazing bookstores that have the potential to be not just storefronts, but destinations?

Do we need a chain of 500 stores or do we just need 50? Or do we just need 10?

image  by sputnik 57

15 Comments on Beyond the Big Box, or, A Plan to Save Barnes & Noble

  1. Powell’s is not only a destination bookstore w/cafe for new books, but also used, and also takes advantage of Amazon’s subsidiary Abebooks to sell books nationwide as well as selling through their own website.

    Powell’s was an early adopter of computerized inventory and offering new&used together and it shows.
    https://www.abebooks.com/powells-books-portland-or-u.s.a/9859/sf

  2. Powell’s success doesn’t disprove any points in the article: the point is more that there are 30 or so *other* metropolitan areas in the US that could use a Powell’s.

    • Disgusting Dude // 4 March, 2018 at 4:40 pm // Reply

      You described Amazon.
      Except they don’t make drive you hours to the store. They send the book to the reader.

      Your model is good but it needs a solid online component.
      People will no longer drive for even an hour to a bookstore, even knowing they have a book they want, because they can (as they used to say) let their fingers do the walking; order online and use the driving time to read. Or download the ebook and have it instantly.

      The reason B&N is in its death spiral is because of “declining traffic”. Consumer behavior has changed. Too many think their time is too valuable to spend on a day trip to a distant bookstore. Not when other players bring the bookstore to them.

      B&M alone won’t do it.
      As I’ve heard repeatedly lately, “stock it and tbey will come” no longer works. There is a reason Powell’s has a big online business. And they have still been squeezed.

      https://artsbeat.blogs.nytimes.com/2011/02/09/powells-books-announces-layoffs/

      Add a good online/ebook component and it’ll work.
      Without it it won’t.

  3. I agree. market forces have been at work and conditions on the ground have changed in the six years since this was originally published. [six years – you might have missed that]

    and your link to Powell’s layoffs is also six+ years old [so maybe you didn’t miss the vintage, and are instead just in a time loop]

    My original post dates to 2 July 2012, so was written 16 months after the NYT blog article you link and, presumably, reflects a changed book business climate that fully encompassed a staffing change in one local/regional market more than a year prior.

    My suggestion was that “a solid online component” might include turning bookstore salesfloors into warehouses, and the stores themselves into online distribution centers. And making the bookstores themselves larger. Much larger. “Stock it and they will come” doesn’t have a proof yet – at this scale.

  4. You know, this idea is actually more doable now then it was in 2012.

    I spent some time today, pondering how one would find the real estate (it’s the first major hurdle). At first I thought we’d need new construction at the edge of warehousing and industrial areas, but then I realized there was a better option.

    Kmart stores.

    These typically run 90,000 square foot or larger, and you can find them all over. You will absolutely be able to find several in each of the ten chosen cities, and they will be located in strip malls where you could put the pub, restaurant, and coffee shop components.

    Good idea, do you think?

  5. With the current retail-and-real-estate market, it wouldn’t be impossible to buy/lease a whole damn shopping mall. Many are distressed, with local governments wondering what to do with the local cash-cow-turned-white-elephant. We are actually a few years too late (mall conversions are getting more expensive as developers realize the possibilities) but yes:

    the anchor spots in older malls/strip centers that once held K-Marts are going to become available – and for exceptional discounts. They won’t always work for retail (there’s a reason they’re not K-Marts anymore) but honestly I’m surprised Amazon isn’t already snapping up these leases just for distribution centers – local, large-ish, and cheap.

  6. One thing that B&N and Borders – and Amazon – got ‘right’ is to position books as a premium product.

    So while we could open a bookstore in an old K-Mart – even a best bookstore in cavernous, absolutely best k-mart location with a million books – it’d fail. You have to meet the customer base both where they are, and also at their expectation.

    So add that to the difficulty level.

    • I don’t understand what you are arguing here.

      Customers come to those strip malls still – they just don’t come for big box stores. So if we create events for them to attend at the bookstore, they will come to the bookstore.

      And anyway, getting people in the door is only half the issue. These are warehouse stores, remember? If it can sell enough books online to turn a profit then it is not a failure.

  7. Powell’s is located in the urban heart of Portland, the “Skid Row”, “Bum Town”, or “Gas Town” neighborhood (“Burnside” in Portland). Back in the ’70s it was not the most comfortable location for college co-eds alone after sundown. Bus access is excellent and they’ve benefited from gentrification of the area. Parking is still a pain. There’s more clubs, art galleries, etc. in the area and the street people have been pushed over a few blocks. A trip to Powell’s is part of a fun urban day of gallery and park hopping and experiencing Portland as a city. Powell’s used book selection and selection of collectible books and art diaries makes physical browsing worthwhile; especially if one is looking for used books or small-press and condition is important.

    A K-mart in its island of parking lot hmm, not so much. Maybe if it was surrounded by food carts.

  8. Matt,

    A really interesting post. Here are some additional thoughts. You also can’t forget community stuff: i.e. book signing, readings for kids, writing workshops, the ins and outs of ebook publishing; hosting a St George’s day (April 23 aka International Book day) for massive books selling/book signing events with merchandise (ebook readers, roses, bookmarks, posters, etc etc)

    There needs to be ‘fun’ stuff for the family so you hook the little ones to read as well as make it worth the while for everyone else to scope out the place even if it’s out of curiosity.

    xavier

  9. I ask myself whether I would go out of my way to either order from or visit such a store. And the answer is no. If I happened to be nearby with time to spare I would probably do so. I might buy a coffee. But I doubt I would buy a book. Because I like my ebooks. And even if I wanted a printed book, which is most unlikely, I would still buy it on Amazon if it was cheaper. And you probably cede all the business outside a short drive from the city itself to Amazon. If you are suggesting that you are going to do a better job than Amazon online, then why do you need the physical stores. The only company in a position to implement this model easily (ie; fulfilment centres with integrated bookstores) is Amazon, and I’d be surprised if they didn’t look at this idea and discard it in favour of smaller stores.

    Your competition would be Amazon. It is not enough to setup or convert warehouses to incorporate massive stores. You want Amazon customers. You are going to have to do things at least as well and probably better than Amazon. You would need free delivery. You would need superb customer service. You would need your warehouses setup to get books out quickly as Amazon does. The investment required would be extensive, and the risk enormous. You would need superb customer service and be prepared to take losses for the sake of preserving customer goodwill. And if you looked like succeeding? Amazon would not be sitting still.

    The short answer as to why it would not work? You would need to do things at least as well and probably better than Amazon, and Amazon’s infrastructure is second to none and developed over time during which dividends were not paid.

  10. The argument that paper books are “a premium product” is, to borrow Nate’s comment on an element of B&N’s reorganization plan, “straight out of 2005.” Paper books are not a premium product that will drive foot traffic. Paper is not dead simply because Amazon has made it incredibly easy for a paper book to show up on my doorstep in a day or two. If paper drove foot traffic B&N wouldn’t be openly planning to file for bankruptcy protection and Borders wouldn’t be a distant memory. There’s absolutely no way I’d drive out of my way to visit your store. In fact, the only reason I might visit one or both of Amazon’s planned physical stores in the DC area is because they’re relatively convenient to get to, and I’ll likely only visit them once just to see them.

    As the above comment by Darryl asked, why do you need the physical stores if you plan to do better than Amazon online? If you’re suggesting some sort of model where you’d use a web presence to lure people into your physical store, unless your physical store is really convenient for me all that model will do is guarantee I ignore your web presence too. Unless I can stop by your store on my way home from work or while doing other necessary errands during the weekend, it’s not convenient and even then I’m unlikely to visit your store much because doing so takes time. Amazon will meet me quite literally where I live.

  11. I’m not sure what benefit this plan would have over Amazon. I live in Indianapolis, I don’t have a car, and traveling to Chicago (as I’ve done twice) is a major time commitment. Why would I want to travel all the way to Chicago to visit a bookstore? I’d stop into a local bookstore because it’s a convenient place to go to browse a limited selection of books. Traveling to Chicago isn’t “convenient.”

    And if I’m never going to see the inside of this warehouse bookstore, I can’t see what advantage it would have over Amazon for me.

  12. I think the proposal is an inferior and ineffective solution to a problem long solved.

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