The Fall of the Independent Bookstore and the Rise of the New School
Independent bookstores, as the name suggests, are not part of large chain retailers. Most bookstores have only one store, but some independent bookstores have several stores. Some notable examples include Powell’s Bookstore in Portland, Shakespeare & Company in Paris, and other well-known independent bookstores around the world.
For most of the 20th century, most bookstores in the United States were independent. But as suburban malls grew in popularity in the 1960s, so did mall-based bookstore chains, which expanded even more rapidly in the 1970s and 1980s.
The number of independent bookstores was at an all-time high until Amazon was founded in 1994, yet by 2000 the number of independent bookstores had declined by 43%. While both large bookstore chains and Amazon played a role in the decline of independent bookstores, Amazon soon began threatening the survival of even the big bookstores, with Borders, B. Dalton and Waldenbooks closing their doors for good between 2010 and 2011.
Being the owner of a bookstore, in the eyes of others, is a matter of far more emotion than business. The word “feeling” means that most of this matter is not profitable. A large number of chain or independent bookstores have closed down, and even a well-known brand like Eslite Bookstore only realized profitability after 15 years of losses. Sisyphe Bookstore is considered to be a relatively good traditional Chinese bookstore, with more than 5 million active members, but in addition to books, it also needs to rely on the high gross profit margin of cultural innovation and coffee to survive.
The biggest disadvantage of independent bookstores is that many of them are still in the habit of thinking and have not expanded their thinking to run their own online stores, even though everyone knows that e-commerce has become mainstream. Their inventory and shipping capabilities remain in last-century ‘dimensions’, and arguably independent bookstores don’t even want to participate in e-commerce: the older generation thinks that romantic bookshelves and reading nooks and staff who meticulously recommend books to readers are The core of the existence of independent bookstores.
Although there are Amazon in foreign countries, and online booksellers such as Taobao, JD.com and Dangdang Books in China, when it comes to this, the windmills of the giants will occasionally encounter the little guy “Don Quixote”. In recent years, an online bookstore has sprung up. It is called Bookshop, and more than 130 bookstores have cooperated online. The founder of Bookshop, Andy Hunter, wants to prove that small businesses can expand without selling to giants.
Bookshop provides another option for some small businesses under the tide of e-commerce: Suppose you are a small bookstore owner, you can set up a digital storefront on Bookshop’s website in just a few minutes, list the books you want to sell, And if the store is willing, it can also plan the table according to the store’s book collection.
The innovative operation is that the bookstore operator does not actually have to buy any books in person, Bookshop cooperates with the wholesaler Ingram to fulfill the order, without having to worry about inventory and shipping. Get 30% off quoted prices on any book sold through the storefront. If you’re a blogger, author, influencer, or other type of person who likes to read, you can join Bookshop as an individual and get a 10% discount even if you don’t have a physical bookstore.
This isn’t the “Karate” series, the Bookshop itself actually sells books, and users enter a name into the search bar at the top of their homepage and soon find themselves faced with an “Add to Cart” button. Brick-and-mortar stores can also profit from those sales if they join the company’s profit-sharing pool, which Bookshop distributes 10 percent of those sales to affiliates. Technically, Bookshop doesn’t require independent stores to join its platform. If the goal is simply to sell books online, it’s exactly like Barnes & Noble or early Amazon, whose business motivation is to help independent developers.
Bookshop’s partial win won’t be easy
Hunter initially discussed the idea of challenging Amazon with a nonprofit model with industry insiders, but was met with ridicule. You should know that Amazon’s sharing model has been established for many years. For every magazine sold, Amazon takes 60% and suppliers get 40%, which is settled monthly (Apple’s sharing rule is that developers get 70%). The success of Amazon’s Kindle series products in Europe and the United States is inseparable from its massive book resources, and independent stores cannot compete in terms of quantity and sharing model.
In 2019, by chance, Hunter came into contact with veteran magazine publisher David Rose, who had worked for the London Review of Books and Lapham Quarterly for many years. He thinks Hunter’s proposed business model is rudimentary, but not impossible. So for a while, the two teamed up on the startup, with Ross managing the details and Hunter handling the logistics of launching an e-commerce site on a modest budget.
After raising some capital, they hired operations staff to package the company’s social media presence and develop partnerships with booksellers. Before the launch in 2020, the Bookshop team felt like “the weirdo in the corner”, working hard for daydreams. Everyone understood that this might just be a joke that I don’t know how long it can last, because the goal of the confrontation is after all with Amazon.
Some VC investors, including William Randolph Hearst III (grandson of the founder of The New York Times), didn’t hold out much hope. But Hunt managed to secure financing, persuaded about 200 bookstores to sign up for digital storefronts ahead of a new book’s release, and struck a deal with book wholesaler Ingram to ensure that books get delivered to buyers without being overwhelmed by competitors. Pressure becomes a problem.
The opportunity came after Bookshop.org was launched in 2020. Due to the blockade of the epidemic, many independent stores that had hesitated before took the initiative to create digital storefronts on Bookshop, and handed over orders and taxes to Bookshop for fulfillment. The latter was suddenly the birthplace of e-commerce, and despite not spending a dime on advertising, the site grew at a pace that surprised even its employees. The bookstore smashed Hunter’s million-dollar goal in the first quarter. He recalled that from that year to March, Bookshop’s daily sales were about 510,000 yuan (equivalent to RMB), which showed that the business model was successful.
How long can Amazon Books dominate?
According to the fourth quarter results of fiscal year 2022 announced by Amazon in February this year, net sales in the fourth quarter of last year were US$149.204 billion, an increase of 9% compared with US$137.412 billion in the same period in 2021, excluding the impact of exchange rate changes. Increased by 12%; net profit was 278 million US dollars, a decline compared to the same period.
But Amazon is still the largest bookseller in most English-speaking countries. According to NPD Bookscan’s assessment of book sales, as of the end of November 2022, the number of print book sales in the United States has decreased by 595 million compared with the same period in 2021. In the book publishing industry, consumers’ preference for paper books has not benefited physical bookstores, and the overall market conditions have led to Amazon’s online sales not being ideal.
Although Amazon Kindle has withdrawn from China, the content is still available
As we all know, the three initiatives of building a logistics center, advancing into AWS (cloud services) and e-book business are the magic weapon for Amazon to re-enter the list of Wall Street celebrities. After Bezos acquired the Washington Post, he continued to increase investment, providing both funds and Amazon’s software engineers. However, it has been accused of obtaining favorable tax policies for Amazon in order to gain political influence.
In addition, Amazon’s setback in the Chinese market is also where Bezos is controversial. From July 18, 2019, Amazon China will stop third-party seller services on the Amazon China website. Amazon will stop operating the Kindle e-bookstore in China on June 30, 2023. After that, consumers will not be able to purchase new e-books. For e-books that have already been purchased, consumers can download them before June 30, 2024, and continue reading thereafter.
From the digitization of batch text to the content generated by artificial intelligence, knowledge dissemination and content production have undergone tremendous changes. Companies like Bookshop.org in the previous article will try to create new business models and have been earning money for e-books for ten years. Amazon may have to make a change.