Once upon a time, there was a heartfelt indie bookstore in a busy college town in upstate New York. The people of the town were educated and active and relatively prosperous. They prided themselves on their progressive politics and their resistance to despots, and they loved to support their local merchants and artisans. And yet, despite the favorable conditions, the indie bookstore was forever on the brink of crisis and failure. Day after day, the townspeople came into the store and purchased books, but no matter how many books it sold, the store never turned a profit. Was the store under a wicked enchantment?
The answer is no, not unless you consider capitalism a curse upon the land. But I would say that Buffalo Street Books is a paradox: a small, quirky, relatively unique bookstore that is nonetheless representative of broad national trends in indie bookselling.
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If you visit Ithaca, NY, a college town in upstate New York, chances are high that you’ll pass by Buffalo Street Books. Perhaps after you have lunch at the famed Moosewood Café, one block away from Ithaca’s pedestrian Commons, you’ll wander through the rest of the building, an old brick high school that has been repurposed into apartments and shops now called the Dewitt Mall. There you’ll find our bookstore, 2600 square feet of bookshelves plus assorted games, cards, notebooks, and candles.
The story of Buffalo Street Books begins across the hall at a different bookstore. In 1975, Jack Goldman opened The Bookery, a used and antiquarian bookstore in the center of the Dewitt Mall. In the early 1980s, he rented a second space in the corner of the mall to sell foreign language books to universities, and in 1991, this second space became The Bookery II, a full-scale new bookstore. In 2000, its peak year, The Bookery II grossed annual sales of just about one million dollars. In other words, Jack Goldman backed into the new book trade, and he did so because it was profitable.
But then, of course, Amazon changed the rules of the game, and in 2002, Barnes and Noble and Borders both opened stores in Ithaca. Goldman adapted as best he could, but eventually he sold The Bookery II in 2006 to Gary Weissbrot, who renamed the store Buffalo Street Books and ran it as a quintessential neighborhood bookstore, with author events and children’s story hours. But in February of 2011, Weissbrot announced his intention to close the store. He began returning books to publishers and selling the bookshelves.
A week later, Bob Proehl, one of the store’s employees, wrote a letter proposing that the community buy the bookstore and convert it into a cooperative. The letter flew around town, and Proehl’s idea worked with astonishing swiftness. On March 13th, the store closed its doors. On March 25th, the Buffalo Street Cooperative was incorporated and began selling shares for $250, quickly raising $260,000 from over 600 people. On May 26th, the cooperative purchased the store from Weissbrot for $220,000, with the rest of the money used as equity. The cooperative has grown steadily over the years and is now over 900 owners strong.
Here’s another paradox: the coop has flourished yet has never made money. Buffalo Street Books has always had a lively roster of events, including Drag Story Hour, a holiday party with literary-themed cocktails, book clubs, and author events with everyone from local novelists Eleanor Henderson and Brian Hall to national figures like Viet Thanh Nguyen and Mary Beth Keane.
In 2017, the bookstore found itself nearly $100,000 in debt to publishers, which meant it could no longer order new books to sell. The Executive Board held an emergency meeting to gauge whether there was enough community support to keep the bookstore open. The answer was another loud and immediate “yes.” The Ithaca community pledged $50,000 in five days and a total of $90,000 in six weeks. The bookstore stayed open, and the Board hired General Manager Lisa Swayze. 2019 was the best year of the coop. After years of careful budgeting and trimming costs, the bookstore finally made a minuscule profit of $11,000—but only on paper, because that number didn’t include debt service or taxes.
And then came the pandemic of 2020, which complicates the bookstore’s story and requires subtlety to parse. The bookstore closed and Lisa was forced to lay off the staff. It could have been the death of the store, as it was for other indies. But for a third time, our community stepped up; owners and non-owners donated $25,000 in three weeks through a GoFundMe campaign. This money helped the bookstore complete a years-long project to launch its online sales website in April—a crucial development that allowed the store to keep selling books through the closure. The store also benefited from grants and forgivable loans. Against all odds, during this time, Lisa expanded the Ithaca Is Books program. It began as an ambassadorship for community leaders to represent the store and recommend their favorite books, and it has grown to a year-round schedule of workshops and events, including the Ithaca Is Books Festival, which celebrated its second year in 2022. So the pandemic and lockdown both hurt the store and gave it access to new funding that it would have needed anyway.
Since then, the staff have been adjusting to the new reality of operating two overlapping businesses—online fulfillment and in-store sales—during an ever-fluctuating global pandemic and inflationary market. Now that the pandemic-era aid has run out, Buffalo Street Books faces the question of how to adapt to an unfriendly economic landscape.
But two things are clear: our bookstore’s history proves that our owners and customers fervently want us to stay alive, but we need to get off the roller coaster of plunging sales followed by heroic rescue. Indie bookstores are in trouble, but they don’t need saving—they need sustaining.
This history serves up a messy handful of disparate truths that, when tossed up in the air, fall down into a pattern that indicates the future for independent bookselling, truths such as: changing our legal structure was necessary but not sufficient to Buffalo Street Books’ survival; cutting costs and streamlining operations has also been useful, but such measures can’t be driven endlessly downward, because the only way to run the bookstore that our community wants is to spend money on a diverse inventory of books and a living wage for knowledgeable staff; the aspects of our store that our customers most value—readings, book clubs, classes, partnerships, philanthropy—are precisely the activities that don’t make money; our store comes alive when it operates like a literary nonprofit with deep connections to other community organizations. Our definition of success, the one toward which we are currently aspiring, is to so thoroughly and richly meet the needs of our community that we elicit the regular, loyal support from our owners that we need for sustainability.
Buffalo Street Books is still writing its idiosyncratic, untidy story. Keep reading.
The Quandary of Independent Bookselling
Why is running a successful bookstore so hard?! Indie bookselling should be dead simple: books are beloved, consumable items and if you like them, you like them a lot—you might even be addicted, and you’ll try to addict your friends and family. So why are indie bookstores struggling?
You know the answer: Amazon. As we shall see, that’s only (a mammoth) part of the answer.
The biggest threat to indie bookstores, defined as independently owned businesses as opposed to chain bookstores or corporate monstrosities, is Amazon’s predatory practice of selling books at a loss. Customers can buy a book on Amazon for cheaper than Buffalo Street Books can purchase it from the publisher to resell. Read that sentence again. Second, it is preternaturally difficult to resist the lure of two-day “free” shipping (free after you’ve paid the annual Prime fee). Third, Amazon dominates the eBook market at somewhere between 68-83% of sales. Fourth, they directly compete with publishers by selling original books, audiobooks, and eBooks that can only be purchased through their site and read or listened to on their devices.
But there are other structural impediments to sustainable bookselling which come from inside the industry. Books produce vanishingly thin profit margins. Indie bookstores are squeezed in the tight crevice between the fixed list price set by publishers and the discounts that publishers offer stores, which is generally 42-45%. Perhaps you’ve wondered why stationery and art supplies and games and toys jostle with books for retail space that used to be solely devoted to books. It’s because bookstores make more from a $30 box of greeting cards than they do from a $30 book, on average about 50% of retail price. Publishers control these terms, a situation not likely to improve in this era of consolidation, in which the Big Five publishers keep swallowing their competition (though not each other, now that the Justice Department has thwarted Penguin Random House’s bid to buy Simon & Schuster).
A 2020 study of the indie book industry by the Harvard Business School lists two other external challenges: indie bookstores’ struggles to paying living wages to attract and retain knowledgeable staff, and the rise of rents in high-traffic areas.
All this adds up to a stark fact that independent booksellers have begun trumpeting from the rooftops: independent bookstores cannot make a profit by selling books alone; almost all independent bookstores are undercapitalized. Buffalo Street Books is perpetually floundering, and the absolutely berserk truth is that selling more books is not enough to solve the problem. If every owner of the cooperative bought ten books a week for a year, we’d still be struggling. It is too expensive to sell those books to you.
When you purchase a book from an indie bookstore, on average:
54.5% goes to the publisher or distributor (of which 7.5-12% goes to the author)
23.6% goes to payroll and personnel expenses
9.4% goes to rent or occupancy expenses
11% for other operating expenses (marketing, coupons, credit card fees, phone and internet)
Net operating profit from the sale of a book = 1.5% before taxes
(Source: ABA Abacus-21 Financial Benchmarking Report)
Next month we’ll talk about why even that tiny figure is aspirational.
Let me put that as strongly as I can: independent bookstores are doing as much as they possibly can yet still nearly failing because the system is aggressively structured against them. Capitalism does not care if indie bookstores die, though capitalism makes plenty of money off the idea of indie bookstores (exhibit A: You’ve Got Mail and all the other films and books in which indie bookstores are the equivalent of puppies, children, and gardens, i.e. morally unassailable).
Bookstores are a cultural good which cannot be sustained by a market tilted toward monopoly and corporate profits and away from community-minded small businesses. Independent bookselling needs radical rethinking to survive.
If the quandary of indie bookselling were a book, what genre would it be? I think it would be a romance: booksellers who are passionate about what they do, readers who can never have too many books, and a market that thwarts them at every turn: we’re at the beginning of the story with an insurmountable obstacle keeping apart those who are destined for one another. But there is still so much of this suspenseful plot left to go, and it is being collectively written by the many creative booksellers and customers who are its very protagonists.
The Next Chapter of Open Book
Next month, I will do a deep dive into Buffalo Street Book’s 2022 financials, and compare them to the American Bookseller’s Association ABACUS reports. Each year, the ABACUS reports analyze the finances of participating bookstores and also issue a report on the industry as a whole. How does BSB compare to other bookstores its size? I’ll also look at what sits invisibly inside those numbers, the value of bookselling that transcends costs and prices.
How to Resist Amazon and Why by Danny Caine: This book, written by a bookstore owner, inspired me to write about indie bookselling and can be considered a matched pair to Open Book. Caine makes the eloquent, brutally simple case for the harm inflicted on literary communities by the thirst for cheap convenience. I take the need to resist Amazon as an absolute given in the pages of this newsletter, while I build the parallel case for supporting indie bookstores in ways that go beyond simply buying all your books there.
Mr. Penumbra’s 24-Hour Bookstore by Robin Sloan: my favorite novel about a bookstore, because it manages to be optimistic—even triumphant—without being sentimental or nostalgic. Sloan makes excellent use of a feeling I have every time I step into a bookstore, that there is something lurking in the shelves, some deeper meaning that exists behind or between the books, and if, with my incredible discernment, I pull the right books out in the right combination, I will unlock a dazzling story.
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brilliant idea to do this!
I am very impressed by the commitment of the 900+ owners of Buffalo Street Books, and your staff and board to keep this institution going and continue working towards sustainability. Bravo!