Dean Winegardner, American Book Company
 
The story of Dean Winegardner’s success in the remainder book business begins with banking and Bibles. In a recent conversation with Bargain Book News, Winegardner explained how he tapped his own entrepreneurial spirit and the expertise of a few key industry pioneers to build one of the nation’s largest remainder book wholesale companies.

How did you get started in the book business?
 
I was working for First Union Bank down in Panama City, Florida in 1987. I worked in a loan branch. We did mortgages and small business loans. Dan Mendenhall’s office was located next to mine, so that is how I got to know Dan. Through Dan I got started in the business.
 
Are you from Florida originally?
 
No. I actually grew up in Indiana. My wife, Wendy, had lived in Panama City. I met her in Indiana. When we got married we ended up moving to Panama City where her parents lived.
 
Can you tell us a little more about your connection to Dan Mendenhall?
 
Dan Mendenhall was an interesting man. If it weren’t for Dan, I wouldn’t be in the book business. I’d probably still be working in banking. I sure appreciate him for getting me involved in the book business.
It was fascinating to watch Dan work. He had no staff. I remember he had six desks in this shotgun-shaped office. When one desk got too messy he would move to the next one. When he finally got back to the original desk, which could be months later, he would just take everything off that desk and throw it into the trash can.
Dan had no payables, no receivables, everything was cash. He was an interesting entrepreneur.
 
How did Dan actually get you into the book business?
 
I was still at the bank. Dan had just bought some Bibles from England. For whatever reason the company that the Bibles were sold to here had gone bankrupt and somehow he got these sixty-dollar Bibles for about, and I didn’t know that then, two dollars and fifty cents a Bible. He ended up selling me 3,000 of those for about five dollars a piece. Within a week I had sold all those Bibles for at least ten dollars or more. I’ve never had that good of a week since.
To buy the Bibles, I borrowed the money from a friend who was saving up for a down payment on a house. His wife about divorced him over lending me the money. But he sold some of the Bibles too, so we both ended up doing very well that week.
That was my first deal. I forget how much money I made that week, but compared to my salary at the bank it was a lot. That really piqued my interest in the book business.
 
So how did the Bible sales translate into a book career?
 
I ended up leaving the bank and going to work for Dan. I opened stores for him in Florida and then I ended up going to Ohio to open stores for him. I only worked for him for about six months.
 
Were those temporary stores you were opening?
 
No. The leases were month-to-month but he kept the stores open for quite some time. At that point he was starting to do permanent deals.
 
In your opinion, how influential was Dan to the Bargain Book industry?
 
It’s like a family tree. When you take a look at a lot of people who are in the remainder business, especially in this area, you can trace it back to Dan. Dan kind of got Paul Cowell involved. Larry Austin was Dan’s brother-in-law and he got him involved. Larry May was working for Paul Cowell. So you can see a direct connection between Dan and a lot of people in this business.
 
What did you do after you worked with Dan?
 
When I went to work for Dan I ended up going to Charleston, South Carolina and actually was working for Larry Austin. During that time, I met Paul Cowell. He and another business partner bought all of the stores in Florida. I was there opening a store and that is how I met Paul Cowell.
I called Paul after Dan and I parted ways and Paul and I went in partnership in a store in Jacksonville, Florida. I borrowed $25,000 from my wife’s uncle to do that. After that store opened and I ran it for a couple of months, I got very bored with running the store. I wasn’t a very good store manager. Paul had me doing some projects for him in Knoxville before that store opened. After a while he just asked me if I would move to Knoxville and go to work for him, which I did.
 
What made you decide to move to Knoxville?
 
The opportunity to work with Paul. I never met anyone like Paul Cowell in my life. He is a pied piper. If you meet Paul, it takes about five seconds and you are drawn to him. He just has a tremendous, charismatic personality. I was really interested in going to work for Paul. But at the time I went to work for him at National Book Warehouse I told him that I was looking to be more of an entrepreneur and this was something that I would not want to be doing long term. He understood that.
I also fell in love with Knoxville. I have traveled all over the place, but there is no place I would rather live. I should work for the chamber of commerce.
 
What kinds of things were you doing for Paul?
 
When I started, he was paying an accounting company to come and set-up his books on the computer. They were charging him something like eighty dollars per hour. I was no accountant but using the manual I could figure it out. I worked with that accountant and they finally ended up letting me finish the project. 
Then Paul had me running the accounting department, which again I was not very efficient at because I am not an accountant and didn’t claim to be. I also bought books from Paul and sold them at the flea market on the weekends. This satisfied my entrepreneurial spirit. I did that for a while. Then there was a situation where Paul had sold a bunch of books to a company that ended up folding. A lot of the books came back and so I set up the first temporary bookstore in Champaign, Illinois, where I had also lived while working in banking. We did that to turn those books into cash. After that I asked Paul if I could do the temporary stores, because I wasn’t an accountant and I felt Paul needed a “real” accountant.
So he hired Mike Hodges to do the accounting and I started doing the temporary stores.
 
How did these temporary stores work?
 
Basically we would rent an old grocery store or some other building on a month-to-month basis. We would go in with several tractor trailer loads of books, advertise heavily in the paper, and have a big book blowout sale.
 
How long did you work for National Book Warehouse?
 
I worked for Paul for a year-and-a-half, probably a little bit longer.
 
When and why did you leave?
 
It was 1990 and the company was growing. I had come here to work with Paul and at some point the company got big enough that I was not working directly with Paul. I felt like it was time to go back out on my own again as I had planned when Paul and I started the store in Jacksonville.
 
What did you do next?
 
I started Publishers’ Warehouse. We ended up having 73 stores nationwide in about 32 or 33 states. They were located from Washington State to southern California and on the East Coast we had one as far north as Connecticut and one way down in the Keys.
 
Were these all permanent stores?
 
Yes. They were located in outlet stores. I also did 20 or so temporary stores per year.
 
How long did you run that national chain of stores?
 
Until December 1997.
 
Now those stores were all retail. When and why did you decide to make the transition to wholesale?
 
How that happened is that we were growing in retail and I saw that if we bought in larger quantities we could get a better price. My purpose when it started was not to build a wholesale business, but to buy heavier quantities to get a lower price so the retail stores would have a lower cost of goods. That is when Bob Walker came to work for me. His job then was to wholesale the titles that we could not use for the stores.
 
Do you own any retail stores now?
 
Yes. I own 12 stores under the W.D.W. Book Company.
 
Your next venture is your current business, American Book Company. How did that get started?
 
We incorporated in early 1997 but actually started doing wholesale in 1996 under Publishers’ Warehouse. I never looked at being a large wholesaler. I looked at being a big retailer and doing some wholesale on the side. Obviously that’s flipped now to being a wholesaler and doing a little bit of retailing on the side.
 
Can you tell us how much you do in volume sales?
 
Approximately 30 million a year.
 
Where and how large is your warehouse?
 
The warehouse is in Knoxville, Tennessee. We have about 250,000-square-feet and I’m guessing about seven million books.
 
Do you buy hurts, remainders, and promotional books?
 
We have some exclusives with some publishers and we bid on remainders. We buy hurts skids as well. We don’t print promotional books, but we buy them from other companies.
 
What is the biggest buy that you made?
 
Not counting long term contracts, about $1.8 million.
 
What is the most of any one title you have bought?
 
Now this is funny. We bought the Stephen King book Regulators in 1998 or ’99. That was from Penguin Putnam and there were 650,000 copies. We didn’t mean to buy it when we bid on it, but we ended up being the highest bidder. When we found out we won the bid it really scared us.
In fact, Mel Shapiro (owner of Book Sales), who had the next highest bid, called me and told me I was crazy for buying that many at that price and I would be wiping my fanny with that book before it was over with.
Actually, it probably took us three years to finish selling that book, maybe even more. I felt like that book was a rabbit. The more we sold, the more there seemed to be.
I remember Chris Eaton sent me a copy from the warehouse and said, “This is the last copy.” It had been run over with a forklift. The dust jacket was torn off. It was just the book. I wrote “toilet paper” on the cover and sent it to Mel who had made the comment to me when we first bought those books.
It ended up being quite a profitable deal, but it scared me to death at the time. Now I find it an amusing story.
 
How many employees are in your retail operation?
 
About 60 employees.
 
What about wholesale?
 
About 110.
 
Did Bob Walker help the company? Can you explain who he is and what he did for American Book Company?
 
Absolutely. Bob Walker came on as the first employee of American Book Company. His title was Company President. Before he came here he worked for World Publications for many years. Bob is one of the greatest guys you ever want to meet. He is a very hard worker. I consider him one of my best friends and always will.
What’s interesting is that when I had the retail stores I was one of Bob’s biggest customers at World Publications. He really jump-started American Book Company. At that time I was much more involved in the retail side than I was the wholesale. I never imagined the wholesale being the size that it is today.
 
What is Bob doing now?
 
Bob had said when he came on that he was only looking to stay for about five years. He and his son had started some postal service stores, which his son ran at the time. But Bob wanted to retire after five years, enjoy life, not be on the road so much, and spend time with his wife, two daughters, and his son. Now he is working with his son in their postal service business.
I probably talk to Bob a couple of times a month and when I go to Boston on business I always see Bob. He is a tremendous friend.
 
What is your position at American Book Company?
 
I am the president and CEO.
 
Chris Eaton was also an integral player in the success of American Book Company. Can you tell us about him?
 
Chris is our Senior Vice President of Purchasing and he goes back with me a long time. He is like a brother to me. He and his Dad owned several stores in Georgia. I met Chris when I was working for National Book Warehouse. So we probably met in 1988-89. When we both had stores sometimes we would do joint buys together. I remember I had a little temporary warehouse here in Knoxville; it was probably 2,000-square-feet or something. I remember selling him a skid of books. This was back in 1990-91. We were trying to get the skid into the back of his van. We had to borrow a forklift and then we discovered that his van wasn’t quite wide enough so we shoved until it went in. We still laugh about that today.
Chris does a tremendous job. He knows his books very well. I think we compliment each other.
 
Any other key management people you care to mention?
 
Oh I don’t want to leave anyone out. I have a GREAT team. Salespeople, all the support staff, clerical, and warehousing – it takes everyone to make a successful company. Our biggest challenge several years ago was warehousing. Scott Cornett, Senior Vice President of Distribution, has done a tremendous job.  Scott came in and within six months had things running efficiently. And I probably shouldn’t brag, but I believe we probably have the most efficient warehouse operation in the remainder industry. We advertise at the shows that non-chain orders are shipped within 72 hours. Customers place an order at the show on a Wednesday or a Thursday and by the time they are back to their store on the following Monday the shipment is there or en route. That is due to Scott and his staff.
 
Are any of your family members involved in the business?
 
My daughter, Alycia, does sales.
 
I understand you are a pilot. Is that a hobby or purely for business?
 
Flying is my passion. I say “anything to get high,” legally that is.  I have a small, four-seat, single engine airplane, which has been a great business tool. I also enjoy it for pleasure. If I need to be in New York, I can be there in four hours. I don’t have to worry about flight schedules or very expensive flights.
 
You also own a helicopter?
 
This is a 1966 Army trainer. It spends more time in maintenance than it does in the air. I also have what they call a powered parachute, which is a type of ultra-light that I fly.
 
Where do you see your company in five years?
 
We want to continue to grow. When I look back five years ago, I never would have imagined where the company is today. If I go back ten years, I never would have believed where it was five years ago. I think that has a lot to do with the talent of the people I have in the company. I was telling somebody today that if I have any talent it would be bringing people together who are a lot more talented and smarter than I am to build a company.
 
If you have a business philosophy, what would that be?
 
Definitely bringing people together but also being aggressive and taking risks.
 
Tell us about someone you admire.
 
There are so many people I admire both in and out of the business. In the business, I admire and get the biggest kick out of Mel Shapiro with Book Sales, because he is the godfather of the remainder business. I appreciate Dan Mendenhall and Paul Cowell. I think in life there are people who you meet that if weren’t for them you sure wouldn’t be where you are today. I mean if Dan Mendenhall hadn’t had that office there, I still might be in Panama City working at the bank. I admire Paul Cowell for his people skills. Outside of business, I admire Charlie Wagner. He’s a good friend as well as the company attorney. I also admire my pastor, Dr. Bradley Price.
 
Dean, how would you describe yourself?
 
I told somebody one time that on my tombstone I want to put: “If I was your friend, I was your best friend and if I was your adversary, I was your best adversary.” I don’t mean that in a vicious way. Business is like a football game or another sport. I like the competition, but I also like my competitors. I’d rather have friends than adversaries.
 
How would your colleagues portray you?
 
I was doing an employment interview one time and somebody asked me what my colleagues think of me. I said, “If they do a good job I feel like they love me and if they are doing a bad job, they dislike me.”
 
What is the greatest challenge to your business?
 
To keep growing. I want to be the best remainder book company out there. I wouldn’t mind being the biggest, but I want to be the best. We obviously want to make a profit, but I want my suppliers to want to sell to me rather than to anyone else. And I want our customers to want to buy from us rather than from anyone else.
 
What is the greatest challenge to the remainder book industry?
 
For the remainder side of the business, it’s for us to do our best to protect the publishers’ frontline business. When you take a look at the entire book industry, I think it is important to market well. When you see what else competes for a person’s recreational time, we need to keep reading in the forefront.
 
Which trade shows do you attend and how important are they to your business?
 
We attend Book Expo and CIROBE, also The Spring Book Show and ONBOARD. Then there are probably 10 to 12 other shows that we probably attend throughout the year that are a lot smaller but we do good business.
Attending these shows is very important. Sometimes these shows start out inexpensive and profitable, but then it seems that costs get out of hand over time, but attending is not optional. You need to be there.
Several years ago Book Expo was the biggest show and we wrote more business there than at any other show. That show was also the most expensive. Today we will do more business at CIROBE than at Book Expo. CIROBE is more expensive than it used to be, but it is still cheaper than Book Expo.
 
Is the bulk of your business domestic?
 
Yes.
 
Do you sell throughout the world?
 
We sold to 17 foreign countries last year.
 
What is your favorite book and why?
 
My favorite book is one I give away. I probably have 50 to 100 in my office all the time. It’s a book that takes about a half-hour to read. It was published in 1921 under the title The Blue Vase. It has been re-titled, The Go-Getter. I try to read that book at least once every three months. I keep a copy in my airplane.
I read this book for the first time when I was 22 or 23-years-old and it came to be sort of a life philosophy. It’s interesting. You let some people read it and they’ll say, “That is the dumbest book I have ever read in my life.” And other people go, “That is a fantastic book.” Very few people go, “Eh.” They either really hate it or really love it.
Peter B. Kyne wrote the book and it is published by Henry Holt. It is a book from the beginning of the last century and it is very interesting. For me, it is a very motivational book.
 
Who first gave you the book?
 
Actually, I was at an Amway party. Somebody was trying to get me into Amway and they gave me the book to read. I’d love to send you a copy to read, but you have to call me and tell me what you think about it.
 
Sure. I’m intrigued.
 
It’s a deal. It’s on its way.
 
Maryellen Duckett is a Tennessee-based freelance writer for National Geographic Traveler, Family Fun, and On the Road with Hampton magazines. She and her husband, Randall, are co-authors of the family travel books 100 Secrets of the Smokies and 100 Secrets of the Carolina Coast (Rutledge Hill Press).