In a surprise twist I certainly didn’t see coming, Barnes and Noble’s new owners may have taken the only action that might just save the teetering brick and mortar bookseller chain from oblivion.
In 2018, it seemed like the days of the United States’ last major bookstore chain were numbered. A decade of falling sales, brutal layoffs, 150 store closures, six chief executives, and a $1 billion loss on its Nook e-reader had left Barnes & Noble in the throes of an identity crisis.
A crisis that few corporations, let alone corporations in competition with Amazon, manage to survive.
Everyone expected the hedge fund that bought B&N a few months back to strip out and sell the copper pipes and wires then burn the place down for the insurance. But Elliot Advisors seem to be playing against type by naming James Daunt the beleaguered chain’s new CEO.
A 55-year-old Englishman, Daunt has spent nearly three decades in the bookselling business. For most of that time, he was exclusively Team Indie, overseeing an idyllic, boutique book-buying experience as the founder of Daunt Books, which has six locations in well-heeled neighborhoods in London.
Despite his small-business bona fides, Daunt has in the past decade emerged as an unlikely savior for big-box bookstores, first overseeing the revival of Waterstones, a UK chain with close to 300 branches, and now at Barnes & Noble. His turnaround strategy is centered on a simple premise: In a world where Amazon offers unbeatable convenience and prices, big book chains will only survive if they act more like independents.
You may want to screencap that excerpt, because it isn’t just a block of text. It is a unicorn. Chances are, you’ll never again see a big corporation not obstinately doubling down on ruinous stupidity.
B&N has, against all odds, come up with the right answer. Oldpub’s consignment-based lumber mongering business model is dead. It’s just not broke yet, though following it was just about to land B&N in bankruptcy.
Now the company is steering away from the cliff by adopting a superior, viable business model.
America’s biggest box book store is going indie.
Why not? It worked when Daunt ran Waterstones.
Daunt’s changes eventually paid off. In 2016, Waterstones turned a profit for the first time in eight years. In 2017, annual profits rose 80% over the year before, and in 2018 it was sold to Elliot Advisors. The turnaround was all the more remarkable because Daunt essentially convinced Waterstones to think locally—a reversal of the usual formula for success in big retail stores.
If your formula’s not working–change it. How novel!
The UK consensus is that Daunt brought Waterstones back from the brink. Now Elliot Advisers is hoping he can do the same for Barnes & Noble. B&N operates at a much larger scale than Waterstones, with 627 locations, and its stores take up more square footage. Nonetheless, Daunt sees clear parallels between the two chains. As with Waterstones, he thinks this turnaround should start with giving booksellers autonomy over what they sell and display.
“That strategy has worked well for Waterstones, and it could work for B&N, which in its heyday gave some autonomy to regional and store managers and had regional buyers,” says John Mutter, editor in chief of Shelf Awareness. “Unfortunately in cost-cutting moves, buying has been centralized and made less personal, and most display ‘ideas’ come from headquarters. It’s one of many reasons that the company has had problems.”
The takeaway: Daunt plans to do what he did successfully at Waterstones–run Barnes and Noble as a series of indie book shops. It’s a bold move, but less so than you’d imagine. Indie bookstores have actually enjoyed something of a comeback on Amazon’s watch.
These days, Daunt is philosophical on the subject of Amazon. In his view, the company’s unmatchable scale is liberating for booksellers; it means stores can focus on curating books that communicate a particular aesthetic, rather than stocking up on things people need but don’t get excited about. “They’re allowing us not to have the boring books in our shops and just be places where you discover books and talk about books,” he says. “We don’t have to clog up [stores] with medical textbooks.”
Translation: “We can’t hope to out-compete Amazon, so we’ll stop trying and focus on bookstores’ inherent strengths.”
That too, is the right move. Amazon may account for 80% of book sales in the anglophone world, but let’s face it. Thanks to Amazon’s algorithm, the top spots in fantasy and science fiction are cluttered with approved texts that bug people consume to signal their status in the cult, and space marine shovelware/chick porn billed as sci-fi for binge-reading whales.
If Daunt can transform B&N into a place where bibliophiles can connect for deep discussions about books, he’ll earn my admiration. With the deck already stacked deep against him, the outcome of his grand experiment to indie-ify B&N remains uncertain. But it’s worth the old college try.
I still see the mid-to-long-term future of publishing as a modified neo-patronage system. At the very least, my third successful Indiegogo campaign tells me the crowdfunding model isn’t a fluke.
Support indie publishing. Claim awesome perks, and help lock in Series 3 CF trading cards. Back the project today!
I'm also surprised. I didn't think the new owners would want to go through the trouble of trying to save it. The deal had that "let's sell off the assets while they still have value" smell to it. Glad to know I was wrong.
It sounds like they hired a guy who not only knows he's in the book store business (not the toy store, coffee shop, or restaurant business), but also knows that said business must adapt to the real world of book buying. You can't wish ebooks and Amazon away. You have to offer what Jeff Bezos isn't. Interesting enough, if the new business plan works the big 5 still end up taking it in the shorts. Reality can be such a bitch sometimes.
Yeah. People saying that Daunt's hiring gives oldpub a reprieve should take a closer look at his stated plan.
No business model has any right to exist. Particularly not at retail. Production is of primal importance, followed almost immediately by correctly matching product with consumer demands. But the Oldpub, or any other, large, specified business/logistical structure? They are little more than artifacts.
Smart move! I hope it works out for them. Mindlessly carrying water for Olbpub is what was killing them. Now they have the chance to turn it around.
With this and Voidpoint snapping against their decision not to censor it is nice to see more faces try to do what needs to be done.
Some folks may have been smacked in the face with enough rakes to finally learn.
I don't think it will save our B&N. They're already removing whole bookcases so you don't see all of the empty shelves. They've also reduced their staff to no more than 2 people in the entire store. It's been on a drastic decline over the last year. I'll be surprised if it lasts the year.
Even Daunt made no secret of the fact that B&N's situation will get worse before it gets better. His first act at Waterstones was to slash staff and shutter stores.
A few months back, I stopped at a new B&N, so pre-Daunt but post-crisis. While I didn't care for the layout — it was like an airport bookstore escaped and was in hiding at a suburban shopping center — the store was packed.
Of course in typical B&N fashion, there was one cashier to handle a line at least 20 people long.
Brian
Sounds all good. The wildcard is Nook. He either needs to sell it to say Kobo or keep it and strike deals with new publishing.
My view is he'll sell Nook to Kobo and strike a deal. You sell the ebook for a cut.
xavier
He plans to keep it for now.
Brian
Ok. Let's see what he does. I still have my nook account but haven't bought anything in years.
xavier
It's funny. Here in Oz the supermarket chains are becoming the biggest fuel retailers. And there was this flurry of VERY CONCERN because of this UNPRECEDENTED MARKET CONSOLIDATION…. right back to how it always used to be, when the general stores sold everything including fuel. Hell, there are still one or two out in the regions that never stopped.
Then there was a huge shift to online retail; which is mail-order; which is how it was all done in the late 1800s.
And now, bookstores that sell books according to local tastes, demands, and markets?
ZOUNDS.
All this hyperchange is making me dizzy with its hyperstaysthesameness.
All keen observations. 19th century book stores offered print on demand services.
Three cheers for meatspace! My gut has always told me this wasn't a good front to retreat from. That indie bookstore renaissance thing really threw me for a loop. Did it make sense? I thought for a moment about the local bookstores that shuttered in the last two decades and realized I was thinking of Borders, Waldenbooks, and B. Dalton. Whoops! We didn't have any. Nowhere to go but up, for us.
Hopefully B&Ns that actively pursue esoteric books will help create (or maintain?) distribution infrastructure that effectively connects indie authors and small publishers to interested retailers. This sort of thing is what's kneecapping the comic shops.
But it's bound to be a mixed bag. Book stores organically attract flakes, and flakes today are a particularly closed minded group. Fingers crossed!
An especially pernicious zombie meme states that newpub authors can't get their books into brick and mortar stores. Even more annoying, oldpub types usually hold it as an unstated a priori premise: "I'm seeking traditional publication because I want to see my book on store shelves."
My books are on store shelves. Even pre-Daunt, all readers had to do was request that store managers stock copies.
In my area there are a few used book stores and nothing else. Every chain attempt has closed in record time.
There are clearly readers who want physical products. They merely aren't being afforded the ones they want.
*offered, not afforded
My spelling has been atrocious this week. lol
I know a good editor 😉
Careless Whisper
The local bookstore serving the local neighborhood has been done for years in Spain. This trend has accelerated during the 2008 crisis.
If you read Spanish take a look at libelista.com. there's a link to cultural agendas. See if this is what you have in mind. The only thing I don't yet see is the print on demand for neighbour authours.
xavier