Bookstores

Barnes & Noble Reports Fiscal 2017 Year-End Financial Results

22 June 2017

From a Barnes & Noble press release via Business Wire:

Barnes & Noble, Inc. today reported sales and earnings for its fiscal 2017 fourth quarter and full-year ended April 29, 2017.

Total sales were $821 million for the quarter and $3.9 billion for the full year, decreasing 6.3% and 6.5% over the prior year periods, respectively. Comparable store sales declined 6.3% for both the fourth quarter and full year. Online sales increased 2.9% for the quarter and 3.7% for the full year.

The consolidated fourth quarter net loss improved to $13.4 million, or $0.19 per share, compared to a loss of $30.6 million, or $0.42 per share, in the prior year. For the quarter, Retail generated an operating loss of $15.9 million, while NOOK incurred an operating loss of $7.9 million, for a total operating loss of $23.8 million.

Fiscal 2017 consolidated net earnings from continuing operations were $22.0 million, or $0.30 per share, compared to net earnings from continuing operations of $14.7 million, or $0.05 per share, in the prior year. For the full year, Retail generated operating income of $90.7 million, while NOOK incurred an operating loss of $36.4 million, for a total operating income of $54.3 million.

. . . .

“While fiscal 2017 proved to be a challenging year for the company, we reduced costs by $137 million, enabling us to sustain our profitability level,” said Demos Parneros, Chief Executive Officer of Barnes & Noble, Inc. “In fiscal 2018, we are focusing on ways to improve the business and reignite sales through an aggressive test and learn process and companywide simplification process that will take out costs.”

. . . .

For fiscal year 2018, the Company expects comparable bookstore sales to decline in the low single digits and full year consolidated EBITDA to be approximately $180 million.

Link to the rest at Business Wire

Demos Parneros was named CEO in April of this year. At the time he was named, he had been BN’s chief operating officer for five months. Paneros had no experience in the book business at the time he was hired, having spent his prior business career with Staples.

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What 15 years at Foyles taught me about the future of bookselling

21 June 2017

From The Bookseller:

The book industry has never really been simple. But looking back to over 15 years ago, when I started my career at Foyles, it certainly felt simpler. It felt like all you had to do was make sure that you stocked the right books and put them in the right place on the shelf. In those days you could build huge stacks of text books and watch them disappear (hopefully through the tills, but not always).

However, from 2002 onwards the change was rapid and, sometimes, unforgiving. I experienced the ensuing disruption from  the sharp end of the business: the growth of the internet and online retailing, the explosion of ebooks and print on demand, the surge in availability of smart phones and tablets, rising rents and rates, economic challenges, large structural changes within the publishing industry and increasing political instability. I was lucky enough to work on numerous projects at all levels, including delivering the design and build of the flagship store on Charing Cross Road. And over those years, Foyles developed from a quaint bookseller to a serious contender with multiple sites.

. . . .

Intelligent and pragmatic design has always been essential in physical retail, but online retailing has really pushed this up the agenda. Retailers have been forced to demonstrate the worth of stepping through their doors.  Simply put, people like being in pleasant and stimulating environments; it is why we go to the beach, or take a walk in a park.  So while working on a new store it is important to consider details such as shape, light, colour and even the grain of the wood that makes up the furniture. These are all parts of the medium through which the bookseller communicates desirability of the product to the customer.  If the environment is inviting and sparks something in our customers, there is a better chance they will return.

. . . .

In the past booksellers and librarians were the custodians of knowledge, gathering titles and influencing the public through their roles.  This still happens – in many ways it is more important than ever – but now readers come to store better equipped, knowing full well they can always source it somewhere online.  This has changed the dynamic of the retailer/customer relationship from what was traditionally more pedagogical to one of collaboration.  You now work alongside the customer helping them arrive at the best possible result using information you share.

What made this change difficult for many booksellers is that traditionally the people drawn to the industry are reserved consumers of arts and literature who are not naturally outgoing. The former more powerful pedagogical role suited them, as it afforded some form of protection by way of authority. After all, only booksellers and librarians had access to the catalogues and databases. It is important to remember that, as much as we love them, bookshops are in fact intimidating places for many, and this feeling of intimidation is actually felt by the bookseller as much as the customer.  A bookseller or librarian can be asked any question on any topic and be expected to have some sort of answer; I can tell you from personal experience that this can be very stressful.  Therefore the older position of authority afforded the bookseller/librarian a sort of shield to hide behind.

Of course, knowledge is still important for librarians and booksellers. Indeed intelligently filtering information is critical. Yet in this new world of retail we require workers who are open and sensitive to people’s needs, emotionally intelligent enough to adjust their manner, and comfortable with not always knowing as much as the customer in front of them.  For should the customer feel that the experience was negative, should they feel intimidated or sense they are being judged, it is easy enough to leave the shop and order online.

. . . .

The price of books should not really be an issue – although aggressive discounting, always a ridiculous game, has made it one. People happily pay a premium for coffee and alcohol or food. An upmarket hamburger can cost more than the price of a paperback book, and will be consumed in minutes.  Cost is all down to a market educated perception, in the end.

But the perceived value of the experience of reading is different nowadays.  Perhaps this is down to time available – something you often hear is that people don’t have the time to read. Yet they have time for social media, emails and TV box sets. What we face then is the challenge of explaining that reading and buying books has a value that ranks as highly as other pursuits.

So as booksellers and publishers we find ourselves in the position of considering value from a more philosophical angle that that of just cost.  Essentially the instrumental value of shopping in a bookstore has been heavily challenged, because you can simply sit on the sofa and order the product online, or download it onto a device in a couple of clicks.  With the development of hand held devices and streaming, even the instrumental value of reading a book is being questioned. So as an industry we have to continue to demonstrate the intrinsic value in reading books and visiting a bookshop.

Link to the rest at The Bookseller

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Jittery trading on Barnes & Noble

20 June 2017

From Seeking Alpha:

  • Investors are bailing on Barnes & Noble in front of the company’s FQ4 earnings report due out Thursday.
  • The retail company is expected to post revenue of $778M and a loss of $0.17 per share.

Link to the rest at Seeking Alpha

PG is reminded of how quickly Borders collapsed.

Here’s an excerpt from an earlier post on TPV about the last days of Borders:

When Mike Edwards stepped onto his flight from New York back to Ann Arbor, Michigan, in July 2011, he was the still CEO of the second-largest bookstore chain in the U.S. But the 40-year-old retailer was crumbling fast beneath his feet.

Edwards was in New York that day to submit a plan of reorganization and refinancing for Borders Group Inc. to a bankruptcy judge. Since filing for Chapter 11 bankruptcy in February 2011, Edwards spent months courting investors, asking them to throw Borders’ sinking business a buoy of capital.

The deal was 90% done, Edwards thought in the days leading up to that flight. But at 5 p.m. the day before he was going to meet the judge, the CEO found out he would need to file an altogether different document: a plan for liquidation.

“It was at the last minute where [investors] backed out because they weren’t comfortable with the publishers’ support going forward — and they thought that would put the investment at risk, so they pulled the plug,” Edwards told Retail Dive in an interview about his last days as Borders’ CEO.

Up to that point, Edwards maintained optimism that the once family-owned, Michigan-grown bookshop would emerge from its decline into bankruptcy. Under the turnaround plan he was spearheading, the idea was that Borders would come out smaller yet profitable. Now, Edwards found himself coming back to Michigan empty-handed — unsure of what he would tell his waiting employees.

. . . .

When Borders finally fell, Edwards said his “eyes were wide open” to what retailers need to do to avoid the pitfalls that led to the bookstore chain’s demise. If there’s just one lesson retailers should take away from Borders’ fall, it’s this: never underestimate a transformational trend.

“What I mean by that is you can be the best ice salesman in America until the refrigerator comes out,” Edwards said. “You can be driving your taxi one day and Uber knocks you out the next day. You can be in the hotel business and then Airbnb can surround you with 20 properties with a great size at a lower cost. I think you have to face the digital impact head on and not go through denial and don’t rely on past tactics to change the trajectory of the company because it doesn’t work anymore.”

The retail industry has evolved rapidly over the last decade thanks to mobile phones and the “looming Amazon effect,” which Edwards says is having a massive impact on all searchable product categories. Store traffic is under tremendous pressure, and for retailers who haven’t already, they need to downsize their store footprints and adopt a digital culture as quickly as possible. From experience, Edwards says crafting the right omnichannel experience for an over-stored traditional retailer is no easy task.

“A lot of retailers, if they are publicly traded, they can’t take that earnings hit, so they just do just enough to have an online presence, an omnichannel presence, develop marketplaces and try to turn their stores into marketplaces,” he said. “But it kind of goes beyond that because now the customer wants a digital relationship with their brands and that’s a very different thinking than the marketing in the past.”

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Barnes & Noble, Inc. Moves -3.55% Over the Past 5 Days

20 June 2017

From Concord Register:

Barnes & Noble, Inc. closed at $6.80 after seeing 1106588 shares trade hands during the most recent session.  This represents a change of 2.26% from the opening.  The shares have moved -3.55% on the week.

. . . .

Year to date Barnes & Noble, Inc. is -39.01%, -27.66% over the last quarter, and -44.72% for the past six months.

Over the past 50 days, Barnes & Noble, Inc. stock’s -28.04% off of the high and 5.43% removed from the low.

Link to the rest at Concord Register 

So Barnes & Noble has lost almost half its value during the last six months.

The stock traded at over $28 two years ago. The current share price is lower than it has been at any time since Barnes & Noble went public in 1993.

Think of how badly Barnes & Noble would be doing if book stores weren’t experiencing a resurgence because people don’t want to read ebooks any more.

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Doors Open at Belmont Books In Center

19 June 2017

From The Belmontian:

The long sheets of paper have been taken from the windows, the shelves are almost all filled with books and while you will need to wait a little bit longer to get a cappuccino, the Town of Homes has seen the return of its very own bookstore as Belmont Books opened officially for browsers and bibliophiles on Friday morning, June 16.

“It has taken us five years to get to this point,” said Belmont resident Chris Abouzeid, who with his wife, Kathy Crowley, own the general bookstore.

. . . .

Abouzeid, who was a bookseller for Porter Square Books for many years, said it’s “basically scary” opening up a new store. “We’re new to retail, and we don’t make any pretense otherwise,” he said, noting they had plenty of help from friends in the business.

The two-floor store – large children’s and young adult sections upstairs – with its new bright interior at 75 Leonard St. is the second business to settle in the renovated Macy’s/Filene’s building following Foodies Urban Market by a month.

. . . .

“We knew this was a community that wanted a bookstore after fighting to try and keep the last one,” said Abouzeid referring to the Charlesbank Bookshop that closed in January 2010. “We wouldn’t have tried this if they community didn’t seem to care.”

And town residents have been eagerly anticipating the opening, many following the daily updates via Twitter and other social media sites.

“All we’ve heard for the last eight months is ‘when are you opening? when are you opening?’” said Abouzeid.

The opening came at an advantageous time as “[w]e really wanted to open this weekend because of Father’s Day and give people an opportunity to buy their summer reading before leaving town [the] schools closing,” said Abouzeid, who along with Crowley, is an author.

. . . .

“E-book sales have flattened, and folks are showing that they prefer to hold a real book and that includes young people that you might not expect. They are on electronic devices all day long, so a book is more relaxing.”

He also spoke of the environment of a book buying experience is heightened by searching for a new book in a store, especially in one that is new to the community.

“Just the colors, the feeling, the atmosphere. You can’t get that shopping online,” said Abouzeid. The staff, who will be making recommendations and emphasizing customer service, will also be a draw for shoppers.

Link to the rest at The Belmontian

PG wishes all new small businesses well. However, he can’t help but wonder whether if the oft-repeated Big Publishing myth that ebook sales have flattened harms the people who put their hard-earned capital into a new business based upon such erroneous information.

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In the good books

18 June 2017

From The Bangkok Post:

A former Amazon employee once said that the traditional book market was “an absurdly inefficient model, worse than my uncle sending his laundry home from college”.

Amazon grew from a stereotypical garage business led by a Kool-Aid-drinking skinny kid to the largest book retailer in the world. On its way to the top, Jeffrey Bezos wiped out the market shares of Barnes and Noble, Walmart and hundreds of other national and international book retailers.

Kinokuniya and other large booksellers like Se-Ed, Nai-In and B2S have been scrambling to adapt to digital media, with some shifting the bulk of their business online, others closing down locations to keep the heads above water.

Even Dokya, the first country-wide bookstore chain, has turned its business around and become a publishing house as vintage bookstores were simply out of sync with their customers’ lower disposable income and changing media consumption preferences.

The entry of Amazon and other e-book providers into the market has given consumers unlimited choice. But as Brad Stone, an American journalist who has been covering Silicon Valley for over two decades, said: “In a world where consumers have unlimited choice, you need to compete for attention. And this requires something more than selling other people’s products.”

This is precisely what independent booksellers provide, and they have fared amid market forces well. Independent bookstores are not dead. In contrast to their more commercial counterparts, they provide readers with warm, knowledgeable staff — some with a lifetime of experience in the book racks. While these bookstores cannot emulate the convenience of Amazon, they provide readers with an experience and a community of readers that a six-inch screen just cannot match.

Charun Hormtienthong, president of the Publishers and Booksellers Association of Thailand (Pubat), puts is concisely: “The value of the independent bookstores lies in its meticulous decoration, and its extensive and expertly curated inventory. Independent bookstores can also offer customers unique places to sip a coffee while browsing through shelves, or comfortable nooks to read in throughout the day.”

Link to the rest at The Bangkok Post and thanks to Val for the tip.

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Chicago’s Seminary Co-op Sees First Sales Growth Since 2000

14 June 2017

From Shelf Awareness:

The Seminary Co-op Bookstore in Chicago, Ill., has seen its first year of sales growth since 2000: an increase of 5% for the 2015-2016 fiscal year and, since the beginning of this year, sales have been up an additional 10%, reported Jeff Deutsch, director of Seminary Co-op Bookstores, which operates both Seminary Co-op and 57th Street Books, in a letter to Seminary Co-op shareholders earlier this month.

Deutsch traced the boost in sales to a request he made in a shareholder letter sent at the end of May 2016, asking that shareholders and members help ensure the Co-op’s survival by buying one more book than they otherwise would and convincing family, friends, or colleagues to do the same. The response, Deutsch wrote, was “overwhelming”–in addition to the almost immediate jump in sales (June 2016 was up 28% over June 2015), he “received direct replies from hundreds of [shareholders] throughout the world, voices from four continents and from nearly half our states.” In response to that feedback, the organization now accepts direct financial contributions and has compiled a list of advocacy ideas for those looking for ways to further support the store, and in this year’s letter Deutsch once again called for community members to buy additional books and support the store’s mission.

Link to the rest at Shelf Awareness

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Women Booksellers Rule

4 June 2017
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From Publishers Weekly:

In fall 1917, a group of 15 women booksellers—excluded from membership in the ABA and the Booksellers’ League—met at Sherwood’s Book Store in Manhattan to form the Women’s National Book Association. Membership was open to women in all areas of the book world: publishers, editors, booksellers, authors, librarians, illustrators, and production people.

. . . .

The following bookseller quiz is condensed from a Depression-era issue of the WNBA newsletter, The Bookwoman, and is a reminder that some things seem never to change.

. . . .

A Quiz for Bookwomen, from the Bookwoman, vol. 3, no. 1.

Are you employed in a bookshop? And how good are you at finding solutions to such vital questions as those given below? Send your answers to the editor, on or before January 15, 1939.

Quiz

1. What is the correct answer to the pompous, “I want to talk to someone who knows the stock”?

2. What line of action do you pursue when you are told of a book you recommend, “Oh but that got an unfavorable review”?

. . . .

Answers

1. The correct answer to the pompous, “I want to talk to someone who knows the stock” in my case is “I believe I shall be able to help you Madam (or, Sir) as I ordered the entire stock myself and I am in the book business because I do want to help people select books.”

2. When the retort is “Oh, that got an unfavorable review!” my answer is “Well, reviewers are human, you know and perhaps the reviewer whose opinion you read did not like whimsy (or satire, or Texas, or realism in inland Mississippi, or whatever it may be) but I really believe that this is a book you will enjoy. Frankly, it demands a discriminating reader.”

Link to the rest at Publishers Weekly

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James Patterson Expands Bookseller Bonus Program

2 June 2017

From Publishers Weekly:

As booksellers gather for the opening of BookExpo in New York City, bestselling author and philanthropist James Patterson is looking to make their upcoming holiday season a little brighter. Patterson has renewed his Holiday Bookseller Bonus Program, which launched in 2015, and is giving away more money this time around.

As he did the past two years, Patterson is partnering with the American Booksellers Association to distribute “holiday bonuses” to individual booksellers. To receive a bonus, a bookseller can be nominated by store owners, managers, fellow booksellers, publishing professions, or customers.

This year, in an effort to reach more booksellers, Patterson has increased the amount of money he is donating by $100,000. In total, the author will give $350,000 to booksellers this holiday season. To stretch those dollars even further, this year’s bonuses will range from $750 to $1,250, rather than the larger amounts ($1,000 to $5,000) of the past.

“Because of the overwhelming response to the Holiday Bookseller Bonus Program these past two years, I’m thrilled to increase the donation amount,” Patterson said, in statement. “Booksellers continue to face many challenges in an ever-changing retail environment, and these bonuses are my humble acknowledgment of their perseverance and dedication to putting books into the hands of readers.”

Link to the rest at Publishers Weekly

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Indigo Fiscal Year: Revenue Up 2.6%, Net Earnings Dip

1 June 2017
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From Shelf Awareness:

In the fiscal year ended April 1, total revenue at Indigo Books & Music rose 2.6%, to $1.02 billion (about US$755 million), and net earnings were $20.9 million (about US$15.5 million) compared to $28.6 million (US$21.2 million) last year.

Total comparable sales, including both online sales and comparable store sales, increased 4.1%.

The company said that sales grew primarily because of “continued double-digit growth in general merchandise, most notably lifestyle products and toys. Book sales remained solid as sales for Harry Potter and the Cursed Child partially offset the declining trend for adult colouring books.”

Link to the rest at Shelf Awareness

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