In The News
BOOK STORES EXPAND, OPEN NEW LOCATIONS; BILL’S BOUGHT OUT
Village Books in Bellingham, Washington, has expanded by one-third, moving part of its two building inventory into a third, larger building. The expansion has increased store size by 30 percent. As a result of the change, used books and remainders are now integrated with the rest of the stock.
Books of Wonder in New York City moved to a new location two doors down from its previous site, into a building that more than doubles sales-floor square footage at 18 West 18th Street. The store will use part of the added room to open a café and a larger event space.
Tatnuck Booksellers & Sons has opened a new store in Westborough, Mass. that features more than 30,000 square feet of space. The store will be stocked with 150,000 titles, including a large children’s section and selection of computer books, a gift shop and a café, which will be open in a few months. Tatnuck is one of the nation’s largest independent bookstores.
Denver-based Tattered Cover has opened a third store in the suburban Highlands Ranch area in an effort to challenge Borders and Barnes and Noble. For the first time, the store will be discounting 25 new titles by 25 percent at all three store locations. The new location is 21,754 square feet and will carry nearly 100,000 titles.
Palm Beach, Fla.’s Books & Books is opening a 1,000 square foot boutique inside Levenger, a privately held company in Delray Beach that sells products for readers and writers. Analysts say the shop will help the under-served Boca Raton market, which has not had a major independent bookstore since Liberties Books & Music left Mizner Park in 2001. The store will feature a selection of fiction and nonfiction, including Book Sense’s 76 selections, which are the top recommendations of independent booksellers nationwide.
Bill’s Bookstore, one of Tallahassee’s oldest locally owned bookstores has been purchased by Nebraska Book Company, one of the nation’s largest used textbook wholesalers. The sale became final at the end of October, with no figures yet released on the sale. The Nebraska Book Company has been in the retail college bookstore business for nearly 90 years.
Sources: Bookselling This Week, Denver Post.com, Palm Beach Post.com, Tallahassee.com.
THOMAS NELSON SALES, EARNINGS DIP IN 2Q
Sales and earnings at Thomas Nelson dipped in the second quarter that ended Sept. 30, with revenue in the period falling three percent to $61.9 million. Net income declined three percent to $6.4 million. Nelson had only one major new hit in the quarter, Max Lucado’s “Come Thirsty,” which sold roughly 244.000 copies. Company president Michael Hyatt said he does not think the soft quarter will prevent the publisher from having a solid FY 2005.
Source: PW Newsline
USED BOOK SALES INTEREST GROWS AT BRICK-AND-MORTAR CHAINS
Bargain hunters have long enjoyed the option of browsing Internet sites such as Amazon, Abebooks, eBay and Alibris for used books, where prices for newer hardcover titles can be 30 to 50 percent less than cover prices of unread copies. The virtual book market, in fact, seems to be fueling interest from brick-and-mortar stores that buy and sell used books.
Several major book chains have started selling used copies of titles along with new books, causing worry among publishers who count on original sales.
Barnes and Noble has begun selling used books on an experimental basis at more than half a dozen of its locations nationwide. Borders customers can place orders for used books over the phone or in person for pick-up at one of its stores, with delivery taking two to three weeks.
Readers are becoming more comfortable with the notion of buying used books and are selling them, too. Publisher’s Weekly in September published survey results showing that $614 million worth of used books were sold last year and that used books make up roughly 14 percent of trade book purchases.
Sales have been driven in large part by double-digit growth at some online used book businesses. Physical used bookstore sales are also strong.
At most used bookstores, buying rates are lower than might be imagined. A whole box of trade paperbacks, for example, might yield five or ten dollars, partially because bookstores take a risk in buying used books in that if no one buys the book, the store suffers a financial loss.
There are few rules in the industry about what stores will accept or reject. Hardcover mysteries, for example, aren’t bought back at several used bookstores because of resell difficulty.
Used book buying and selling, however, has been described as much an art and culture as a business. Everything about the process is subjective, and often personal. And that leads to a quirkiness that can’t be measured in dollars and sense.
Source: Tyrone Beason, The Seattle Times.
INDIGO BOOKS SEES QUARTERLY LOSS WIDEN
Indigo Books & Music Inc. posted a wider loss for its fiscal second quarter, blaming the weakness on the loss of its campus bookstore division, which it sold during the quarter to focus on “core” retail operations.
The country’s largest bookseller, which operates under the Indigo, Chapters and Coles banners, lost $8.2 million during the three month period ended Oct. 2.
Sales fell to $168.5 million, from $170.1 million, with representatives saying that $2.2 million in sales were generated last year from the company’s campus books division.
LIFEWAY BUYS EVANGEL
Evangel stores, formerly owned former CBA board chair Steve Adams, have been sold to LifeWay Christian Stores.
Source: CBA Marketplace
AMAZON CEO HIGHLIGHTS COMPANY INNOVATIONS
The success of Internet giant Amazon.com can be traced to the skills of company CEO Jeff Bezos. Bezos said in New York recently that the company’s successful improvements over the years have not been directly visible.
“About 90 percent of the innovation has been on the back end,” Bezos said, pointing to the fact that Amazon has five giant fulfillment centers in the U.S. alone, each of which is 600,000 to 700,000 square feet. Using original software and processes, the company can pack any two items, however dissimilar, into the same shipping box if so desired.
Also, 28 percent of the company’s products are drop-shipped by companies other than Amazon from their own warehouses or affiliated stores. Bezos also said that the company and other Internet-based companies are able to fill a niche by providing customers with items not easily found elsewhere.
“People use Amazon disproportionately to find things they couldn’t find any other way,” Bezos said.
Despite industry speculation otherwise, Amazon reported $54 million in profits last quarter and was awarded the highest customer satisfaction score ever recorded in any service industry online or off, by the American Customer Service Satisfaction Institute at the University of Michigan.
“There’s no tradeoff in our business between increasing service and lowering cost,” Bezos said.
Source: David Kirkpatrick, Fortune.
RISING CREDIT CARD COSTS HURT MERCHANTS
The rising cost of credit card usage fees is hurting merchants. Norco Express Shops, for example, paid 25 percent more to process electronic transactions this year than they did last year, today paying 1.635 percent plus 18 cents to credit card companies.
In 1999, cash and checks accounted for nearly 60 percent of payments to stores. Today, they account for 47 percent according to the American Bankers Association. At the same time, the popularity of electronic payment, especially debit cards, is rising.
Consumers made 31 percent of payments last year using a debit card, while credit cards accounted for 21 percent of transactions. Costs for processing these payments continue to increase.
Source: The Buffalo News
THOMAS RYDER TO OVERSEE BOOKS ARE FUN
The Readers Digest Association has announced that chair and CEO Thomas O. Ryder will assume direct responsibility for the company’s Books Are Fun Division. Books Are Fun president Joel Feigenbaum will report directly to Ryder.
The announcement comes as Consumer Business Services president Robert E. Raymond announced his resignation, citing personal reasons.
Source: MySan.de International
TIME WARNER 3Q PROFIT DIPS EIGHT PERCENT
Time Warner Inc., the world’s largest media company, reported an eight percent decline in third-quarter earnings as it set aside a $500 million reserve in anticipation of settling government investigations into its bookkeeping.
Time Warner’s AOL division reported more losses in subscribers, a trend that has troubled investors as users abandon AOL’s dial-up service for faster broadband connections to the Internet. As of Sept. 30, AOL had 22.7 million subscribers, a decline of 646,000 from the last quarter and 2 million from the period a year ago.
Other divisions turned in solid results and earnings from publishing companies, which include the Time Inc. family of magazines and a book publishing group, rose 15 percent on a 3 percent gain in revenues.
Source: Associated Press
BORDERS, BARNES AND NOBLE OPEN NEW STORES
Borders will open its third store in Puerto Rico in December. The 15,180-square-foot store will be located in Mayaguez, at the Mayaguez Mall at State Road 2 and State Road 343, on the western side of the island. The new Borders will offer nearly 200,000 book, music, DVD and periodical titles, including “a comprehensive selection” of Spanish-language titles. The store is located near the University of Puerto Rico.
Barnes and Noble plans to open a 26,400-square-foot store in Fairbanks, Alaska, next October.
Source: PW Daily
BOOKS-A-MILLION ANNOUNCES THIRD QUARTER RESULTS
Books-A-Million Inc. announced financial results for the third quarter and nine months ended Oct. 30. Net sales increased 1.8 percent to $104.3 million from sales of $102.4 million in the year-earlier period. Comparable store sales for the quarter increased 0.6 percent when compared with the same period for the prior year. Net loss for the quarter was $1.1 million, or $.0.07 per diluted share.
For the 39-week period ended Oct. 30, net sales increased 4.1 percent, to $326.1 million, from sales of $313.3 million in the year-earlier period. Comparable store sales increased 2.4 percent when compared with the same period of FY 2004. For the 39-week period, the company reported net income of $1.1 million, or $0.06 per diluted share.
Source: Business Wire
THE BOOKSOURCE TO CEASE RETAIL DISTRIBUTION
St. Louis, Mo. - based The BookSource will close its retail distribution division and focus instead on the K-12 educational market, its library-binding division (San Val, Inc.) and its publishing division, Peaceable Kingdom Press. The move will be effective Dec. 23.
The move will reduce the company’s title base from between 45,000 and 55,000 to roughly 25,000 titles.
Source: PW Daily
MOST SMALL COMPANIES CAN’T PROVIDE BIG BENEFITS
The rising cost of health care insurance costs is causing strain among small businesses. While workers may gain flexibility of schedules or greater responsibility, in many cases they also pay more for health insurance and other benefits.
The difference in benefits can depend on the size and maturity of the company. It is unlikely that any company will be able to offer as lucrative a package as it could even a decade ago, as health care coverage soars and 401(k)s and other programs replace traditional pensions.
Exceptions include Mirror Show Management, where the company’s 30 employees don’t pay a cent toward health insurance.
“Our view has always been if we treat our employees better than any other employer out there, they will give us 110 percent and then we’ll have no turnover,” said CEO Donna Schultz of the trade show exhibit company.
Most small businesses, however, struggle to keep benefits packages strong.
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