A link on Twitter took me to the Dear Author blog recently. Of course the churning of books is a big, often-lamented subject of mine, as is the whole "returns" topic, so I had to check it out. But this got me thinking...why is it that bookstores have such a difficult time staying in business?
As a recovering bean-counter, I'm driven to imagine the business model of a shop. The basics are inventory stock, payroll and general business expenses. For inventory, the shops get the flip side of the publishers' returns scenario, so slow-moving stock, bad buying decisions and overstocked items are easily cured. If they buy direct from publishers, they start at about a 40% discount. If they go through Ingram or BT, it's less, but usually there is the mixed pallet advantage, and they can churn titles (a la the legal case referenced above).
It's hard to imagine payroll expenses being a deal breaker. No snark intended, but my guess is most of the staff works at a rate just slightly higher than minimum wage. And there usually isn't a staff of thousands, but maybe one or two people on duty at a time. The priciest employee would be the manager, and I'm betting he/she doesn't get a Rick Wagoner-level salary...nor a jet for running errands. Further bet -- probably not a lot of shops offer retirement accounts and group insurance.
For general expenses, the thing that pops out to me is the amount of rent the shop might be paying. For those mall stores, I'm betting the rent is a huge item. Many malls charge rent plus a percentage of sales, somewhat diminishing the gleam of a big sales month. Destination stores, the ones in downtown areas that are no longer hot spots for shoppers, may pay less rent but may also give up a lot in general traffic. This goes back to that old saw, "Location, Location, Location," I suppose.
Or, is none of this key to the demise of bricks and mortar stores? Is it, in fact, a shift of volume to online sellers, especially Amazon?
When you think about it, this isn't isn't just idle wool-gathering. If publishers and authors want to sell books (and we do, we do!) we need to know why people buy where they buy. So, going back to the thrust of this post...what is it that makes it so hard for a bookstore to stay in business?