Krystallina checks out bookstores and how they're doing (or not doing) in this week's Please Save My Money
Depending on who you ask, the economy is either booming or on the brink of disaster. If you are concerned or believe the latter, then you’ve probably heard about the Retail Apocalypse, an arguably ongoing or upcoming wave of stores shutting down. Sears/Kmart announced another 100 stores will close. Employees at 63 Sam’s Club stores were shocked to find out they were closing. Meanwhile, workers at Toys R Us are wondering if they’ll soon be out of a job. To give you an idea of how the Retail Apocalypse may change brick-and-mortar shopping, this mall is down to just single anchor stores. On the other hand, most stores were celebrating a better-than-expected holiday season.
Reading the Future for Bookstores
One chain certainly didn’t though: Barnes & Noble. Same-store sales slid over 6 percent during the holiday season while online sales dipped 4.5 percent, making it one of the few e-retailers that lost business. Their stock is at or near record lows and costs about as much as a meal at a fast food restaurant.
Books-a-Million, the second largest book chain, is a private company, so determining its sales figures is much more difficult. However, to give you an idea, Book World, a small regional bookstore chain, recently shut down all their stores even though some had only opened very recently. According to executives, no one was interested in buying them.
Bookstores are no doubt being hit by the multiple whammies: the shift toward online shopping, increased competition, and digital alternatives. Barnes & Noble has stated they want to get back to focusing on books, but even that sector’s figures showed it was “underperforming the overall book market”.
With Barnes & Noble posting its seventh decline in as many quarters and having almost all sales declines every year since 2013, it seems surprising that the only major Canadian bookstore chain would want to enter the U.S. market. But Indigo may open up to five stores in the next two years — the first in a mall in New Jersey — and then will evaluate their future from there.
While Barnes & Noble wants to focus on books again, Indigo seems to prefer a mixture of books and other entertainment. One of Indigo’s subsidiaries did enter the U.S. market before in the late 80s, and 52 of those locations were eventually sold to K-Mart and turned into Waldenbooks.
“So What? I Buy Manga Online Anyway!”
Any manga fan or industry insider can tell you how Borders’ bankruptcy in 2011 had a huge effect on publishers. It was one of the major factors that contributed to TOKYOPOP initially shutting down, and it caused the publishing business as a whole to contract. Barnes & Noble isn’t in danger of going broke, but it certainly needs a turnaround.
I wrote about Barnes & Noble’s 20% books for Members/10% non-Members test previously. Although the original promotion was scheduled to to end in October, it was extended to December and now has been extended again indefinitely. This probably means that this is doing well, but Barnes & Noble hasn’t addressed some of their other issues: lack of good coupons (25% offs are super rare now, let alone the amazing 40% offs), poor sale promotions, an awful website that makes it hard to determine what is actually in stock without wasting time, and the conflict between store and online prices.
I keep repeating myself because they’re just not getting it. Assuming Indigo keeps its Canadian policies at its American stores, Barnes & Noble and Books-a-Million could face some steep competition: Indigo matches Books-a-Million’s superior 30-day return policy (compared to Barnes & Noble’s 14 day policy) and any order can ship-to-store free, matching major retailers like Walmart’s online approach and beating Books-a-Million’s shipping charges. Canadian orders ship free on $25+ (slightly better than Barnes & Noble when you take in account conversion), but perhaps they can also ship U.S. orders for $25 US once they start opening physical stores.
For manga fans, Indigo has manga promotions like the current up to 40% off VIZ deluxe manga and buy one, get one 50% select titles including Tokyo Ghoul, Attack on Titan, your name., and more. Like any store, some prices appear to be higher than (Canadian) Amazon’s and some lower, so manga fans certainly have reason to look forward to their arrival.
Whether Retail Apocalypse 2018 comes or not, the shuttering of more physical stores is inevitable. With Barnes & Noble trying to shake off its slumping revenue, it wouldn’t be surprising that they may close some underperforming stores or some locations that have another store a short distance away. But perhaps in a few short years, fans will have another local option to pick up the latest volume of One Piece and other hit manga. But considering Book World opened up stores just months before it had to become defunct, Indigo may be facing an uphill battle in the age of Amazon.