Book Business Is Growing Story In Orange County and Nation
Most bookshop owners are in the business because they love the printed word.
With a profit margin of only 3% before taxes as the national norm--unchanged in the past 20 years--one doesn’t open an independent bookstore to get rich.
But people are opening bookstores, more and more every year. The American Booksellers Assn. counts 50,000 retail booksellers and $15 billion in retail sales across the nation and says the number of stores is increasing by a steady 2% to 3% annually.
In Orange County, one of the biggest book markets in the nation, the increase has been steady and sizable over the years. Several of the county’s shopping malls, for example, have two bookstores. At South Coast Plaza and its Crystal Court annex in Costa Mesa there are four, and all four claim to be doing well. Most of the new stores, nationally and locally, are specialty shops, striving to serve a particular market segment rather than the general market.
In Orange County, where literacy, disposable income and levels of education all run higher than average, there are about 140 bookstores, up from less than 50 in 1971, according to estimates from the State Board of Equalization.
Those 140 stores did about $100 million in sales in 1986, the last year for which figures are available from the state. And that works out to an average annual gross of $714,285 per store. After paying the bills, including salaries for the help and the owners, the average store posted a profit before taxes of just more than $21,000.
“We get at least 50 calls a week from people who say they want to open a bookstore,” said a booksellers association spokesman. “After we explain the economics, I’d say that only about one-tenth of them follow through.”
For that one-tenth, there are other rewards.
“We’re in it because we’ve always wanted to have a bookstore,” said Jane Conway, co-owner of Courtyard Books in Tustin.
The 10-year-old store, which Conway and her sister, Pat Cook, bought in November, is an established, profitable neighborhood shop, a general bookstore that carries best-sellers and a broad range of other fiction and nonfiction titles.
As independents, Conway and Cook can sell whatever they choose, and to stay in business, they make a point of knowing the likes and dislikes of their steady customers. “We go with the flow of demand in this area, and we try to keep a good back list of popular authors, like Louis L’Amour, and local authors, like Dean Koontz,” Conway said.
A “back list,” or supply of titles no longer in print, is essential to most bookstores because readers tend to be loyal to favorite authors and, upon discovering a new favorite, immediately want to start reading the writer’s older works.
But at any given time, there are only about 750,000 books in print, meaning that more than 95% of all the books ever published are no longer being produced. And with 52,000 new titles being published each year, the list of books in print turns over almost completely every 15 years.
Thus, the ability to select a mix of titles that will satisfy customers is critical.
But ask Conway about the store’s specialty and she doesn’t mention books: “It’s service, that’s what brings the customers back.” At Courtyard, like other Orange County independent bookstores, customers can get their purchases gift-wrapped, special order a book that isn’t in stock, obtain assistance in finding books that are no longer in print, or ask the proprietors for recommendations for a friend who is having problems growing roses or raising kids.
Paula Campbell, co-owner of the Little Professor Book Center in Irvine, throws autograph parties regularly, generally featuring local authors. The store recently hosted three Southland mystery novelists. In June, Campbell said, she will have five authors on hand to sign books and talk with fans.
Conway describes stores such as Campbell’s and her own shop as dinosaurs in today’s retail book trade. “There aren’t many of us left,” she said.
And indeed, the independently owned general bookshops in the county are only a small portion of the total number of bookstores.
Of the 140 stores in the county where bookselling is the primary business, only about 50 are general-interest shops and only about 20 of those are independently owned.
The rest are specialty stores, which increasingly have come to dominate the business. These days, according to the booksellers association, the hot categories are mystery and science-fiction shops, stores specializing in so-called New Age books, tapes and music, and, hottest of all, children’s books.
“At one time not too long ago, having a bookstore devoted to children’s books was too specific to be viable,” said Jill Herrlein, co-owner of the Children’s Book Cottage in Laguna Niguel.
“But now we have an upswing in the number of kids, and in the number of kids who read. Children are pulling away from TV. And this is an upscale area where people have a lot of education and they want their kids to read, so we do very well.”
So well, Herrlein said, that she and her partner have been wooed by the Rancho Santa Margarita Co. to open a second store in the planned community’s retail center.
Herrlein, whose store is divided about equally between books and other children’s items, including educational toys and stuffed animals, said she carries several hundred titles and is continually filling special orders for customers.
“We special order twice a week,” she said, “and the orders range from $100 to $500 worth of books each time. That’s really what we do here. We give a service. If we don’t have it, we’ll get it for you. Service, really, is all you can offer (to compete) against the big chains and the discounters.”
One bookseller who has taken service to heart is Mary Joseph, owner of Books for Professionals.
Her office in Fountain Valley is a sublet cubicle. The only books in her inventory aren’t for sale--they are her catalogues and reference works, like Books in Print, a hard-bound directory of every book currently being published.
Joseph’s customers are corporations and individuals, generally in technical fields, who need the latest volume on construction standards for gabled roofs or the technical aspects of medical laser beams.
They call with their orders; Joseph locates the book either at a local distributor or from the publisher, orders it and, when it comes in, hand delivers to her customer. For business clients, she bills on a 30-day cycle, just like the rest of their vendors.
But working more like an intermediary than a retailer, Joseph has cut her overhead tremendously and is able to offer such personalized service without having to charge a premium. The books she sells her customers are sold at the publisher’s list price.
Joseph, who apprenticed for four years at a chain-owned bookshop, said her business, now 2 years old, “is just about at the break-even point.”
The financial uncertainty of the book retailing business is one reason chain operations are proliferating. Most are owned by a single company and operated by local managers, but a few, such as the Little Professor centers, are franchise operations.
The differences are considerable.
A franchise owner generally has more latitude than a chain manager in ordering, decorating and setting prices.
Bill and Paula Campbell, owners of the Little Professor Book Center in Irvine, for example, are the only franchisees in the entire chain to discount their best sellers. They do it because they set up shop right across the street from a Crown Books, which pioneered discounting.
But a large single-owner chain, such as B. Dalton Bookseller or Waldenbooks, can afford to steeply discount books while paring down costly special services. Their lower per-unit profits are offset by sheer volume.
For almost a year in the early 1970s, Times staff writer John O’Dell ran a small, independent bookstore. He sold best sellers and Bibles, romances and art books, and learned quickly that just because his taste ran to Herman Hesse and Harlan Ellison, there was no percentage in looking down his nose at those who preferred Georgette Heyer or Rod McKuen.
He found that the job involved much more than ringing up sales on a cash register. And while the paycheck was important, it wasn’t long before discussions with customers about style and substance, the thrill of hunting down hard-to-find books and the opportunity to help parents get their nonreading Janes and Johnnys interested in the printed page came to equal the paycheck in his scheme of things important.
He also learned about retailing. About sales, advertising, ordering stock, keeping accounts and taking advantage of current events to help push sales.
But mostly, he learned that the recipe for retailing success is to always remember that whatever it is you are selling, what you really are selling is service.
He left the book business to tackle a reporting job shortly after graduating from college. Now, 17 years later, O’Dell has found that things haven’t changed much.
