Natural Retailers Can Learn from Community Bookstores

Image courtesy of Trust Transparency Center.

Why start this article in WholeFoods Magazine with a shout out to the recent Independent Bookstore Day, August 29th? There are several initiatives and ideas that independent bookstores have benefited from in the past, as well as new emerging trends from the booksellers, that deserve attention by independent health store owners who read WholeFoods Magazine.

First, the mere fact that Independent Bookstore Day is a recognized event deserves consideration. As described on the Independent Bookstore Day website, this is a one-day annual party that normally takes place on the last Saturday in April at indie bookstores across the country (this year it was moved to the last Saturday in August due to COVID-19). As stated on the website, independent bookstores are celebrated because “they’re community centers and local anchors run by passionate readers and small business owners. They are entire universes of ideas that contain the possibility of real serendipity and connection. They are lively performance spaces and at the same time, quiet places where aimless perusal can be considered a day well spent.”

Small businesses, including natural health stores and bookstores, provide individuality and character to the communities they serve. While small businesses bring uniqueness to towns, they also perform an important economic benefit.

Start ID: Image is labeled "Why Buy Local?" It portrays two circular charts, both segmented into Wages, Taxes, Services, Supplies, and Donations. The first chart, labeled "Local," shows that if $100 is spent at a local business, $58 goes to paying wages, local taxes, and paying for local services, local supplies, and donations to the community; $32 leaves the community, to import supplies. The second chart, labeled "non-local," shows that out of $100 spent at a non-local business, $43 stays in the community as wages, local taxes, and donations; $57 leaves the community to pay for non-local services and supplies. End ID.
Image courtesy of Trust Transparency Center.

Bring On Powell’s Books

One of the most famous independent bookstores in America, Powell’s Books of Portland, OR, celebrated Independent Bookstore Day with a surprising and strategic announcement that should be watched by many independent business owners on Main Street. Powell’s Books has been in business since 1971. They celebrated Independent Bookstore Day by announcing they will no longer sell books on Amazon’s marketplace. Powell’s CEO, Emily Powell, communicated this message to the community:

“For too long, we have watched the detrimental impact of Amazon’s business on our communities and the independent bookselling world. We understand that in many communities, Amazon—and big box retail chains—have become the only option. And yet when it comes to our local community and the community of independent bookstores around the U.S., we must take a stand. The vitality of our neighbors depends on the ability of local businesses to thrive. We will not participate in undermining that vitality. We hope you will join us in celebrating this year’s Independent Bookstore Day by buying books at your favorite independent bookstore.”

It is too soon to tell what the long-term impact of Emily’s words might be or if Powell’s Bookstore can be a catalyst of change for other independent bookstores. One bookstore owner, Steve Salardino of Skylight Books in Los Angeles, recently told Book and Film Globe:

“Independent bookstores have good reason to despise a monolithic corporation that has enough money and power to short sell books and lay waste to its competitors in a manner that is unfair to any store that does not have billions of dollars. Personally, I think any corporation that has that much information on so many people, owns the servers that the government uses, and is owned by a guy who makes $2,000+ every second but still underpays much of its workforce is pretty evil and has too much power.”

The sentiments expressed by Salardino are echoed by many in the independent bookstore community, and beyond. Harper’s Magazine featured a cover story in September 2020 entitled The Big Tech Extortion Racket – How Google, Amazon and Facebook control our lives.” This article takes big tech companies to task by comparing them to the monopolies of the late 1800s. The author, Barry C. Lynn, points out that tools such as the Sherman Antitrust Act of 1890 and the Interstate Commerce Act of 1887, used to curb monopolistic practices, were essentially made useless in the internet platform community by Section 230 of the Communications Decency Act of 1996. In that bill, Congress simultaneously exempted internet platforms from any responsibility to police the content on their sites and failed entirely to impose on them any requirement to provide equal and just service to all who depend on their network.

This left the big tech companies the ability to manipulate pricing, inventory, and sellers to provide the maximum profit without government or legislative interference. Like the railroad monopolies that controlled price and availability based upon an inability for others to compete effectively, Amazon has increased its fees to offer product on its site to over 40% of the sale price, over triple what that figure was just a few years earlier. At the same time, Amazon has increasingly removed sellers from their site that stray from the strict guidelines that control both pricing and messaging as dictated by Amazon market practices. The result is the organizational entities such as Amazon, Facebook and Google continue to grow in power and significance with little oversight or guidelines to insure a free and just marketplace. In short, small businesses across the country are growing tired of the unbridled power of the high-tech companies and demanding change and control.

There are a number of lessons to be learned from this most recent Independent Bookstore Day:

  • There is power in community. The independent bookstores have demonstrated an ability to build a following to support their local and industry community. By coordinating the nationwide event, messaging is unified. From tote bags to talking points, the American Booksellers Association (ABA) provides independent booksellers organization and communication to deliver the message to other communities.
  • Messaging is important. The ABA is dedicated to the empowerment of the independent retailer, not just the advance of the bookselling industry. Just like independent health stores, the pressure on the small stores is increasing from big tech and big box retailers. The ABA is striving to provide strength in numbers to shed light on the issues that are important to their members.
  • In viewing the featured Independent Bookstore Day “Party” plans, a callout to other independent retail store owners in the community to join the celebration was met with approval from local business owners. The power of independents within the local geographic community can be impactful. Utilizing messaging and graphics like the one in this article reinforces the economic importance of local businesses. 58% more revenue stays within the community when local business is supported. This local revenue supports local taxes and programs unlike big box or big tech retail purchases.
  • Local business owners are more likely to support local initiatives supporting youth and education.
  • This local business owner activism promotes local wealth and vitality to the community. A glimpse at the shuttered businesses in the beginning of the pandemic can be a foreboding view of a local community that depends on a big tech marketplace.

While Independent Booksellers Day 2020 has come and gone, the messages learned from the celebration and actions from industry leaders such as Powell Books in Portland, OR, remain. All local community retailers can, and should, group together, to fight to protect and provide an element of community that is vital to all of us, no matter what industry we serve.

5 key takeaways & recommendations for independents

Additional key learning from the independent bookstore can be found in a Google search for the following: Why are independent bookstores important? The answer provides a myriad of insights from a variety of sources. My favorite and a must read for all independent store owners:

This study examines how community-based brick-and-mortar retailers can achieve sustained market growth in the face of online and big box retail competition. The appearance of Amazon.com in 1995 led to a significant decline in the number of independent bookstores in the United States, leading many analysts to predict the demise of the sector. However, between 2009 and 2018 independent bookstores proved to be far more resilient than expected. The American Booksellers Association (ABA) reported a 49% percent growth in the number of “indie” booksellers, from 1,651 in 2009 to 2,470 in 2018.

This study identifies “3C’s” that contributed to the independent bookstore resurgence:

  • COMMUNITY: Independent bookstore owners promoted the idea of consumers supporting their local communities by shopping at neighborhood businesses. Independent bookstores won customers back from Amazon and other big box players by stressing a strong connection to local community values.
  • CURATION: Independent booksellers began to focus on curating inventory that allowed them to provide a more personal and specialized customer experience. Rather than recommending only bestsellers, they developed personal relationships with customers by helping them discover up-and-coming authors and unexpected titles.
  • CONVENING: Independent booksellers started to promote their stores as intellectual centers for convening customers with likeminded interests—offering lectures, book signings, game nights, children’s story times, young adult reading groups, even birthday parties. Some bookstores routinely host over 500 events a year.

Simultaneously, the ABA played an important role in disseminating best practices and data, reinforcing the sector’s core values, setting up external partnerships, and advocating on behalf of its independent bookstore members. Given these findings, the study’s main takeaways and recommendations are:

  1. Communicate the value of community and encourage customers to participate in a broader movement to shop local.
  2. Compete primarily on experience and quality, not on price and inventory.
  3. Establish the bookstore as a gathering place by offering events that consumers view as unique experiences. Events should cater to local tastes and the specific interests of the community.
  4. Contribute to (and utilize) industry data on emerging independent retail trends.
  5. Share leading practices with other independent retailers (e.g., through industry/ small business associations, local Chambers of Commerce/institutes, etc.).

Conversely, conducting that same Google search for the importance of independent health food stores provides few responses. But, if you replace much of the wording mentioning books with health food, a picture of similarity can emerge.

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Scott Steinford, Founder, Trust Transparency Center
Scott Steinford has built a career of leading, learning and mentoring. Through immersion in many aspects of the supplement and pharmaceutical industry Scott has worked to redefine and improve business practices within the healthcare industry with an emphasis on transparency. His experience ranges from entry level to CEO and positions include organizations representing ingredient supplier, ingredient manufacturer, retail brand, private equity, M&A due diligence expert and trade organizations. Scott has a Pre-Law Bachelor’s Degree from the University of Texas at Arlington and a Master’s of Science Degree in Law from Champlain College. Scott currently is Executive Director for the CoQ10 Association and President of the Natural Algae Astaxanthin Association (NAXA) and Founder of Trust Transparency Center, a boutique consulting organization dedicated to assisting companies seeking to improve both their internal and external trust transparency. Scott’s prior experience includes CEO of Doctor’s Best and maintained a pivotal role with a variety of ingredient manufacturers including Eisai, Kaneka and was a founder of ZMC-USA.

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