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Betting on Books: Can the Indie Bookstore Revival Last?

By October 2017, Buffalo Street Books, a community-owned bookstore in Ithaca, New York, had been losing money—about 50,000 dollars per year—for nearly a decade. One hundred thousand dollars of debt had piled up; publishers had stopped selling books to the store. The shelves were growing barer every day, and the store didn’t have sufficient funds to stay open until the new year. On the evening of Thursday, October 12, the board called an emergency meeting, inviting community members and the business’ more than 700 shareholders to help brainstorm solutions.

That evening, rows of green plastic chairs filled the store’s event space, as they do every week or so, for an author talk or a communal gathering. Shareholders and concerned customers filed into a spacious, rectangular side room, lined with light wooden shelves holding a variety of nonfiction titles. Notes in hand, Rob Vanderlan, president of Buffalo Street’s board, stood at the front, where the current events section collides with works of history.

Twenty years ago, Ithacans enjoyed more than 20 local independent bookstores. The city is home to two major colleges—Ithaca College and Cornell University—which, according to conventional wisdom in the publishing industry, makes it a particularly suitable place for bookstores. But by the fall of 2017, Buffalo Street Books, located in a squat red-brick building attached to a local mall in the heart of the downtown, was the only independent bookstore left. National chains, like Borders and Barnes & Noble, had come to the city in the late ’90s and had slowly squeezed local stores out of business. The convenience and low prices of Amazon—the giant online retailer that has grown every year since it was founded in 1995—proved impossible for many independent shops to compete with.

Originally called The Bookery II, Buffalo Street Books had been successful in the ’80s and early ’90s but started to face economic trouble when national competitors arrived. An optimistic new owner bought the store in 2005 and rebranded it with its current name. But he couldn’t halt the decline in sales, Vanderlan told me. In 2011, Buffalo Street was on the market again. No one stepped up to buy it, so the community intervened, pooling its money—about 250 dollars a share—to convert it into a co-op, in a “somewhat quixotic, last-gasp effort to keep the store going,” Vanderlan said, seven years later.

Heading into the meeting that Thursday in mid-October 2017, Vanderlan was nervous. He didn’t know how many of the store’s shareholders would show up. On average, only about 15 or 20 attended annual owner meetings; he feared this one would be no different.

He also dreaded delivering the bad news. “It felt like an admission of failure,” he told me. “I didn’t know if people would feel betrayed.” He worried that owners would blame him personally. “How could you have let this happen?” he imagined they’d ask. “Why haven’t you done X or Y or Z?”

Vanderlan’s bookselling career began in 1990 with a gig at one of Borders’ very first stores, in Philadelphia. He enjoyed working there; Borders had fewer than ten outlets at the time, and the company’s stores ran like community-centric, autonomous independents, he told me. But in the five years Vanderlan was employed there, Borders went from operating nine stores to over 200. Company culture turned corporate. Vanderlan left for the University of Rochester for graduate school  and he moved to Ithaca three years later to write his dissertation. Compared to Rochester—where Vanderlan can’t recall seeing “two interesting books in the 25 apartments we looked at”—in Ithaca every apartment he visited was stocked with books he had read or wanted to read. “It’s just a community that is oriented around books, ideas, literature,” he told me.

Although Vanderlan had settled on a career as a historian, his dissertation centered on an issue dear to many booksellers’ hearts: the relationship between intellectualism and commerce. Vanderlan had little reason to suspect that the subject of his graduate studies would someday bear on his non-academicl life—that he would land on the front lines of a battle with a corporate giant, in one of the defining cultural struggles of 21st-century America. Yet there Vanderlan stood, in 2017, upright despite his nerves, in khakis and a navy blue quarter-zip sweater, preparing to tell a crowd of loyal community intellectuals about their beloved bookstore’s commercial failures. To remain open, the store needed—at a minimum—a fresh infusion of 75,000 dollars.


In the spring of 2011, around the same time the Ithaca community rallied to take control of Buffalo Street, my parents purchased Politics and Prose, or P&P, an independent bookstore in Washington, D.C. P&P went up for sale not due to financial hardship, as Buffalo Street did, but because its two original owners were aging. Still, business had plateaued. The store was coasting on its celebrated reputation and leaning on a committed neighborhood following. It needed a burst of energy and a new batch of ideas.

When my parents told my older siblings and me, in the fall of 2010, that they had submitted a bid to buy P&P, I was startled. Thirteen years old at the time and an avid soccer player, I was decidedly not the kid crawling around the cozy children’s section in the basement of P&P—or any bookstore, for that matter. “Don’t tell mom and dad,” I whispered to my siblings deviously, soon after our parents announced the news, “but I hate books.” Besides, I thought, their plan didn’t make sense: Why would a journalist (my dad) and a speechwriter (my mom), neither of whom had ever expressed interest in running a business, buy a bookstore?

Since opening in 1984, Politics and Prose, tucked away in a residential neighborhood in the heart of Northwest D.C., had become one of the District’s main cultural destinations. Joyce Carol Oates once tweeted that P&P is “someplace between a bookstore & a small college.” Ann Patchett, the prolific author and herself an indie-bookstore owner, wrote in The New York Times that P&P is “where the movers and shakers of our nation’s capital come to see what’s really going on.” Several friends have told me, since my parents bought the store, that it’s their favorite spot to shop, read, write, or hang out—and for some, their favorite spot, period.

Looking back, it’s now easy to see why the store appealed to my parents. Over the years, as my book allergy subsided, I came to cherish P&P, not only as a token of familial pride but also as a space for dialogue and discovery, where tales and treatises and traveler’s guides converge and where a gooey tomato-pesto grilled-cheese sandwich might facilitate a conversation with a friend. By the end of high school, I had packed boxes in the shipping room, shelved books on the floor, and manned the register at the front.

As writers and Washingtonians, my parents had long admired P&P, as Vanderlan had Buffalo Street, for its commitment to community and to intellectual and political discourse. But what my parents didn’t fully realize when they bid for the store is that they were taking a tremendous risk—one they have not fully mitigated to this day. Although they researched independent bookselling before taking charge—my dad visited half-a-dozen indies during the bid process—they knew relatively little about the industry, and especially little about the mechanics of operating a bookstore. One experienced owner cautioned my dad, “You should be prepared to lose your entire investment. If you’re O.K. with that, then go ahead and buy the store. It could at least be fun!”

Between 1995 and 2009, according to the American Booksellers’ Association, a national trade organization for independent bookstores, the number of indies nationwide fell by nearly 50 percent, from more than 3,000 stores to just over 1,500. At first, in the ’90s, the rise of big-box chains, like Borders, constricted the market, forcing small retail businesses across the country to close. After Amazon released the Kindle in 2007, many experts suspected e-books would push print books out of circulation. Some even predicted print books would become obsolete. When the Great Recession struck in 2008, the demise of the indie book industry seemed next to certain. My parents invested in a bookstore when the future of bookstores was ominous at best—when many stores were closing, and others, like Buffalo Street, were barely afloat.

The struggling bookstore, like the one in the hit comedy You’ve Got Mail, is a well-known phenomenon. But what many people don’t fully appreciate—and what my parents didn’t know when they bought the store—is just how difficult bookstore management is in the age of Amazon. My dad recently told me, only half in jest, that he’s not sure he would have bid on the store if he had been fully aware of the obstacles independent booksellers face.

As rent and employee wages rise, a bookstore, like any small business, needs to boost its revenue. Doing so, however, is uniquely difficult for bookstores. Most retailers can mark up prices to compensate for increased costs. The price of a book, though, is set by publishers and printed on every physical copy, meaning a bookseller can’t adjust it to reflect the higher cost of living in, say, Washington relative to Ithaca.

Bookstores must be more than stores for books. Bookstore owners need to be especially innovative: since buying P&P, my parents have revamped the store’s website and renovated its café, adding seating, expanding the menu, and obtaining a liquor license. They increased the number of literary class offerings and cultural trips to global destinations, like Cuba and France. They grew the number of author events to more than 700. In the last two years, they opened two branches at new developments around the city and expanded the flagship store by about 25 percent.

The most outlandish—or desperate—“business-savvy” idea my dad considered was “gifting” marijuana along with books. (Although selling marijuana isn’t legal in D.C., a loophole in District law technically allows transferring less than an ounce, leading some local entrepreneurs to attach a small amount of weed to the sale of cheap items, like stickers, at wildly marked up prices.) Worried that our dad’s drive for innovation had gone too far, my siblings and I quickly disabused him of the idea.

But my dad’s marijuana scheme, however fanciful it may have been, highlighted the pressure bookstore owners feel to generate profit in creative ways. So far, my parents’ approach has been effective:  P&P has posted revenue gains every year since they bought it, with 2018 as the most profitable yet. But even a comparatively successful bookstore like P&P cannot count on continued growth at a time when in-store shopping and brick-and-mortar retail are suffering across the board.

Economists and media pundits have referred to the post-Great Recession business climate as the “retail apocalypse.” In the book industry, Borders declared bankruptcy in 2011, and Barnes & Noble’s total revenue has fallen by about 280 million dollars a year since 2012. Across other retail sectors, in 2017 alone, about 20 major companies declared bankruptcy—more than twice the number that did so in 2016. And other giants, like J.C. Penney and RadioShack, closed more than 100 stores.

But to a remarkable degree, the independent bookselling industry has defied conventional economics, experiencing a resurgence over the last decade. News articles about the industry often cite the fact that between 2009 and 2018, the number of independent bookstores in the U.S. grew by nearly 50 percent. On average, sales at independent bookstores have been up every year since the recession, and membership of the American Booksellers’ Association has grown in each of the last nine years.

What makes the rebound of indie bookshops so astonishing is that the industry had been considered all but dead just 10 years ago. So how did the indies make a comeback?

Ryan Raffaelli, a professor at Harvard Business School, has been researching this question for the last three years and thinks he has found an answer. Raffaelli studies the effects of technological “shocks” on retail industries. He observed the rise of the Kindle and e-books—and online shopping, more generally—as one such shock, on the traditional locally-sold-and-bought print book market.

The demand for retail products hasn’t declined in recent years; overall retail spending has actually grown, along with GDP. Only the face of retail has changed. Raffaelli was intrigued by the fact that, despite the shifting landscape, indies have not only survived but are growing again. “The reason I’ve been studying the independent bookselling industry is because it is an anomaly,” Raffaelli told me.

Before studying the bookstore market, Raffaelli researched the Swiss mechanical watch industry, which took a massive hit in the ’70s after the invention of the digital watch. Economists predicted Swiss watches would die off—by 1983, two-thirds of Swiss watch industry jobs had disappeared—but by rebranding mechanical watches as high-end luxury items, the industry rebounded in the late ’80s. Raffaelli has observed a similar phenomenon with independent bookstores.

“What you begin to see is a bifurcation of the industry where the indies represent this high experience, a chance for the consumer to engage on a set of very personal dimensions, versus Amazon, which is really about, ‘Can I just get something quickly at the cheapest price?’” he told NPR’s Paddy Hirsch in March.

Raffaelli, who has conducted hundreds of interviews with bookstore owners, customers, publishers, and authors, attributes the success of indies to the “three C’s”: community, curation, and convening. Independent bookstores forge connections with their local communities; they offer a more personalized and hands-on browsing experience, enabling a sense of discovery lacking online; and they provide a gathering space, hosting author talks, book signings, and school events.

Even so, Raffaelli told me, it’s not impossible for a store like Buffalo Street Books, which checks all the above boxes, to be dealing with financial hardship. Small businesses face many challenges, like rising minimum wages and real estate rental prices, and even if an industry is growing overall, there still might be variability at the individual store level. Still, while some stores continue to struggle, Raffaelli is optimistic. In a November 2017 Harvard Business School video, Raffaelli, with boyish hair and a suppressed grin, remarked, “What independent booksellers do for us is that they really provide us with a story of hope.”


Roxanne Coady, one of the most respected independent bookstore owners in the nation, doesn’t exactly share Raffaelli’s optimism. On a late October afternoon, we were driving from New Haven, where Coady lives, to her bookstore, R.J. Julia, in Madison, fewer than 30 minutes east along the Connecticut coast. While the “three C’s” have certainly helped Coady stay in business, she thinks Raffaelli’s positivity about the “indie revival” is premature. Like my parents’ store, R.J. Julia relies on a fiercely loyal local customer base. Coady would be the first to acknowledge that her store’s engagement with the Madison community has been vital to its financial success. But she also is a staunch pragmatist: Selling “community?” That’s “bullshit.” In her mind, her product is the same as Amazon’s: A book is a book, and at the end of the day, that’s what people go to her store to buy.

In 1990, Coady quit a successful 20-year career as a partner at BDO Seidman, a major New York City accounting firm, to fulfill her lifelong dream of opening a bookstore. A self-proclaimed “data person,” she analyzed several towns along the New York-Boston corridor that she thought might be a good fit for the store, taking into careful consideration each town’s distance from New York and Boston, its proximity to I-95, and its demographics, among other factors. She settled on Madison, a wealthy, aging community nearly equidistant from the big cities and close enough to the beach and the highway to attract tourists and commuters.

“What’s the deal with Amazon and books?” I asked, as we cruised down I-95 in Coady’s sleek navy-blue Volvo sedan. (I expected an impassioned response: Just about any mention of Amazon turns my rather-shy dad into a man of many words.) Coady, dropping an F-bomb or two, told me what Amazon means for indies—and why the indie resurgence might be cause for only muted optimism.

Amazon has an advantage over independent bookstores on two fronts, she said: pricing and convenience. Amazon’s business model is, simply speaking, to lose money or make only slim profits on retail. The company marks down prices to draw customers, gain market share, and appeal to investors. Only in recent years has it actually started to turn a profit; for the first seven years it was in business, the company consistently lost capital.

Unfortunately for local bookstores, the difference between their prices and Amazon’s can be significant. Take the recent bestseller Sapiens by Yuval Noah Harari: On Amazon, a new paperback copy sells for 13.90 dollars; on R.J. Julia’s website, it’s 22.99 dollars—more than 50 percent more. Or Pete Souza’s Obama: An Intimate Portrait, another bestseller: That’s 28.99 dollars on Amazon, compared to 50 dollars at the average local bookstore.

Amazon can afford losses, or razor-thin profits, on book sales because its continued commercial growth and mammoth share of the retail market attract investors. As David Streitfeld of The New York Times reported in 2015, “Amazon’s stock price doesn’t seem to be correlated to its actual experience in any way.” Lately, though, the company has been posting net gains—in the billions of dollars—mainly by hosting websites and storing data on its cloud computing service.

Amazon is, in terms of sheer market dominance, becoming a modern-day Standard Oil. In 2017, Lina Khan YLS ’17, then a student at Yale Law School, published an article titled “Amazon’s Antitrust Paradox” in the Yale Law Journal. Back when Rockefeller and the monopoly men were seizing markets, Congress passed laws designed to protect industries from the same sort of strategy that Amazon employs today: lowering prices to draw consumers away from competition. In the 1970s, though, a new school of corporate-friendly thought shifted the focus of antitrust policy away from market structure and toward consumer welfare, meaning that a company would be held responsible only if its practices hurt consumers—for example, if it raised prices, as a monopoly might do once it had annihilated all competition. This thinking has enabled Amazon to use the same predatory pricing scheme for which Standard Oil was broken up. Given Amazon’s increasing success and retail dominance—by 2017 it controlled 46 percent of e-commerce in the U.S.—Khan’s work gained immediate traction, including extensive coverage by national media outlets like The New York Times and The Washington Post, and it has sparked a new debate over the country’s antitrust laws.

Pricing has always been an issue, Coady said, but now convenience is the “real competitive advantage” and, for indies, “the real danger.” Amazon Prime, she told me, is like a “cudgel” to any store selling the same items. In June 2017, Forbes reported that 64 percent of households in the U.S. have Prime memberships, although more modest estimates say the percentage will be at about 50 by 2020. (Amazon has not disclosed the actual number.)

Go to Amazon’s site, Coady said, and you can buy a book, or music, or games. “You come to our site: You want a book, or you want a book? Pick.” She laughed. “These companies are geniuses at psychological manipulation.”

Users, according to one study, increase their Amazon purchases by about 150 percent after subscribing to Prime. Coady doesn’t believe independent bookstores can compete. Still, some have tried: Harvard Book Store, an almost century-old independent in Cambridge, Massachusetts, offers a same-day bicycle-delivery service, according to the owner, Jeff Mayersohn. The store also has a machine that produces out-of-print or self-published books in minutes.

Coady and I pulled up to the back of R.J. Julia. The store straddles the line between a vast shopping-mall parking lot lit by a Stop & Shop’s neon lights and a row of small, high-end boutiques along Madison’s main street.

We headed up a flight of forest-green stairs to Coady’s office, which she shares with her general manager, Lori Fazio, and other staff. The bulletin-boarded walls were littered with writerly posters and book-themed quotes. “A bookstore is larger than the universe,” one read. Not as large as Amazon, I thought with a grimace.

In 2017, Amazon reportedly sold just over 45 percent of all print books purchased in the U.S.; by comparison, indies make up about six percent of the print book market. If you factor in e-books and audiobooks, Coady said, Amazon’s share is significantly higher, given that the company controls 65 percent of the e-book market.

Coady really is a data person. She has calculated how much money each square foot of her store makes, and she rearranges shelves and display tables according to their profitability. When you own a bookstore, Coady knows, every little detail counts. “The stores that were shitty,” she said, “Amazon just pushed them over with its finger.”

Coady’s knack for business explains why she hired Fazio, an ex-saleswoman, as general manager. When Fazio took over in 2011, she focused on creating a culture in which the store’s booksellers—the staff who interact with customers—acted more like salespeople, always asking customers if they would like to become store members, always dropping subtle hints about buying more.

“I’m more optimistic than Roxanne [Coady],” Fazio told me recently. “I do think that people are realizing the importance of downtown, community, and human interaction. I’m not worried yet.”

R.J. Julia has survived—and like many independent bookstores, it has posted some of its best numbers in recent years. But there is a caveat: its in-store sales are declining. Luckily, “special sales,” including books sold online to businesses and schools and at events, offset the in-store losses. Still, Coady worries about the future. She fears the day when the store won’t pay for itself—even if online and off-site services remain profitable—and when the physical space won’t be worth its keep.


By the time the October 2017 meeting at Buffalo Street Books commenced, nearly 120 owners and community book lovers had filed into the store. Every green plastic chair was occupied; bodies were cramped between the shelves and behind the seats. Vanderlan, the board president, remembers looking out across the room and not being able to see the whole audience. Some people could find space only where the store snaked like an “L” behind a wall.

Vanderlan announced to the crowd that someone had anonymously pledged 5,000 dollars, prompting a round of energetic applause.“The meeting was one of the more—I don’t think this is hyperbolic—it was one of the more inspiring nights of my life,” he told me.

The audience eagerly offered suggestions, including “themed festivals” and “pop-up” stores at public events. A local potter, Carol Schmook, designed and donated Buffalo Street Books mugs, which display, on one side, the store’s logo—a buffalo reading a book—and say, on the other, “Thousands of books. Hundreds of owners. One great bookstore.”

At the meeting, over 90 people signed up to volunteer at the store. And within six weeks after the meeting, the board raised nearly 90,000 dollars—15,000 more than it needed to survive for the near future. “The reception was very positive; people felt that they could make a difference and keep it going. At the time, there was a lot of optimism,” said the store’s founder and a current shareowner, Jack Goldman, who attended the meeting.

Still, a year later, Vanderlan said, “The question is very much up in the air whether we are on a sustainable path.” The 2017 fundraising was “amazing,” but it didn’t pay down all of the store’s debt. “It still left us in a hole.”

In 2018, Buffalo Street Books made over 650,000 dollars in sales—about 17 percent more than in 2017. But the business has yet to break even. In October, the board, still 80,000 dollars in debt, decided to relinquish the store’s event space to save on rent. Board members hope to expand online sales, which, at the moment, are virtually nonexistent.

“I’m deeply pessimistic and hopefully optimistic at the same time,” Vanderlan said.

While Buffalo Street Books hangs in limbo, the U.S. independent bookstore industry continues to grow. Nationwide, indie book sales increased in 2018—for a tenth consecutive year—and more bookstores were founded than closed.But you’d be mistaken if you thought my parents, or Roxanne Coady, or Rob Vanderlan, or any of their thousands of book-selling colleagues were sleeping soundly every night. There are debts to pay, sales-per-square-foot to track, authors to greet. But thankfully—for now, at least—there is no weed to sell.