The Craig Fahle Show

New Opportunities for Mom-n-Pop Bookshops

by: Laura Weber Davis

Friday, August 2, 2013

Photo courtesy of Literati

Borders shuttered its last bookstore nearly two years ago, after a drawn-out process of restructuring and liquidation. The Ann Arbor-based international franchise suffered during the recession and amidst conjecture that physical books were going the way of the dinosaur. But the dissolution of Borders may have incidentally created new areas of growth for the book industry, even right where Borders got its start.

At Literati bookstore in downtown Ann Arbor, a colorful mosaic of books spreads over an eclectic set of tables. There are sections of local authors, staff picks, and signed children’s books. Chalk-marked signs section the store by genre. Then there are the shelves… they look vaguely familiar. That’s because they came from Borders’ flagship store. Literati owners Hilary and Mike Gustafson put in a bid on the shelves not long before demolition started on Borders.

“We hadn’t even signed the lease,” Hilary says.

“Well not only had we not signed the lease, we had no idea really where we were going," says Mike. "I mean, we knew we wanted this space, but we had no idea where we would go, we just knew we were going to open a bookstore somewhere.”

The Gustafsons are recently married. They’re in their mid-twenties and opened Literati while planning their wedding earlier this year. Hilary says to get the store up and running they reached out to family, academics, former bookstore owners, and residents to find out what the community wanted in a new independent bookstore.

“And I think getting that feedback from people was really helpful, and it helped us feel more confident in doing this crazy thing," she says. Although the launch of the upstart seemed quick, Hilary knew the market was ripe for independent bookstores. She grew up in Ann Arbor and recently worked with independent bookstores for Simon & Schuster in New York. “Indies were actually rebounding and picking up a lot of customers that used to frequent Borders and creating a new niche for themselves.”

Mike Gustafson says many people who come into Literati often want to use a set of typewriters displayed behind a glass case. Literati’s logo includes a picture of a typewriter. He says people want to see their own words typed out on a page. Mike says nothing can replace holding and reading off of a piece of paper… not even e-readers or tablets that may seem more conducive to modern life. He says, “My own lifestyle reinforced the belief in real books, because I sit in front of a computer all day, 12 hours a day, and the last thing I want to do is sit in front of a screen at night.”

“The owners of Literati are correct that there is screen fatigue,” says Oren Teicher, CEO of the American Booksellers Association. The ABA represents independent booksellers. Teicher says book sales at independent shops were up 8% in 2012, and the number of stores with the association is growing.

“It is changing rapidly," says Teicher. "I’ve been in this business a long time and the rate of change today is unprecedented, given where it had been in the past.” Teicher says even though large stores find it more difficult to pivot with a changing industry... mom-n-pop bookshops are often portrayed as underdogs compared to behemoths such as Barnes and Nobel and Amazon. “That kind of David and Goliath story often gets thought of by many, but in fact our members have had a few pretty good years.”

“And it’s interesting to note that ebooks themselves have plateaued," says Bill Cusumano, the longtime buyer for Nicola’s Books. Nicola's is another independent bookstore in Ann Arbor. Cusumano says industry insiders see e-book popularity waning, but he says online purchasing of books still puts a stranglehold on many independent shops. Nicola’s has thrived for many years, even with the flagship Borders store down the street.

“Well, needless to say we have increased traffic since their closing," says Cusumano. "The biggest barrier that we had to cross all through the years, the idea we had to fight, was that [Borders was] a local bookstore. The population in this town felt that way. Even though they weren’t [local] since 1991 when Kmart bought them.”

Cusumano says ultimately online retailers and massive franchise bookstores such as Borders simply cannot meet the needs of a community or individual readers. He says even though the end of a bookstore chain may seem to indicate less demand for books, there is still plenty of book-buying to go around. He views the new store in town – Literati – as a boon to the local industry, not as competition.

“We’re very hopeful for Hillary and Michael that they are tremendously successful," he says. "It’s going to be better for everyone in the general community and the book-selling community if they do succeed. So we’re very hopeful for them.”

So what is “success” for a new independent bookshop if not accompanied with dreams of expansion and franchise? Hilary and Mike Gustafson say they’re still figuring it out.

“I mean yeah, we don’t expect to be making tons of profit here," says Hilary. "We just hope to continue to provide the service to community as booksellers, so I think as long as we are surviving and continuing to support the community in this way, then we were successful."

“I was going to say as long as we can pay off our debt," says Mike. “But in terms of a tangible thing… as long as we’re here I think we’re a success.”

A third general-interest independent bookstore – Bookbound – is expected to open its doors in Ann Arbor this month.