Thanks to the pandemic, a surprising number of consumers are devouring books – printed – again and Barnes & Noble is benefiting from it.
The 125-year-old chain, which was pulled two years ago for $ 683 million by billionaire Paul Singer’s hedge fund Elliott Management, has seen double-digit book sales growth this year so far compared to 2019 , before the coronavirus epidemic.
Even more surprising for skeptics who had seen the channel wither in the face of Amazon’s rise to power, the retailer says teens and tweens are helping fuel the surge. Sales of manga, or graphic novels, at Barnes & Noble have increased by up to 500% in some stores where young adults crowd the aisles on Friday and Saturday nights.
Industry-wide, US book sales are up 12% so far this year through August compared to the same period a year ago – and 20% compared to the same period a year ago. to 2019 over the same period, according to NPD Group, a market research company.
“Double-digit growth on the books hasn’t happened since Amazon came on board,” Barnes & Noble chief executive James Daunt told The Post in an interview.
These kinds of numbers are encouraging for Elliott, a fund known for taking big positions in public companies and campaigning for change: in this case, he bought B&N entirely as a repairman. A source familiar with the matter says Elliott is halfway through his plan to end up bringing the bookseller back to the public market – or selling him to another private buyer.
Daunt, who ran Elliott’s Waterstones book chain in the UK before being hired to run B&N, says he’s already seeing the fruits of his changes, including an interior overhaul of the chain’s more than 600 stores. and a new management philosophy that allows local bosses to make more decisions about the books they store.
Barnes & Noble is also moving away from its green color scheme which in older stores dominates carpet, wallpaper and even signage on book shelves. The redeveloped stores are brighter with abundant overhead lighting and more open floor space.
Barnes & Noble’s total sales were up about 6% from 2019, Daunt said, and that with fewer stores – 605 from 628 in 2019. He declined to give an exact dollar amount for revenue or profits.
Elliott’s portfolio manager Paul Best, who is the company’s European head of private equity, said Barnes & Noble is now “more profitable” than it used to be.
“He was going through a prolonged period of declining revenues and profits – for a decade at least,” he told The Post. “Two years later, the team halted the decline and now have a base from which to increase revenue and profits.”
B & N’s Daunt plans to open up to 12 new stores in February and March alone – having opened eight and also closed some stores in 2020 and 2021. Some of the new stores will also be about a quarter the size of the 25. 000 typical squares. foot, Daunt said, adding that the chain can now generate the same volume from an 8,000 square foot store as a 25,000 square foot store.
“We are ready to open a lot of new stores,” he said.
A source familiar with the matter said Elliott was excited to fund the bookseller’s growth and the business was profitable. It has gone through a “long period” of declining revenues and profits, the source said, but in the past two years under Elliott the declines have come to a halt.
Most of the growth has come from increased foot traffic in stores – not online sales, Daunt said.
“I’m sure Amazon is doing very well, and so are independent booksellers,” Daunt said. “The pie is much bigger. ”
Publishers are also noticing the turnaround in B&N.
“We are seeing the positive effects of better store layouts, recommendations, updated selections, livelier merchandising and display, as well as operational improvements, all of which lead to increased sales,” Michael Pietsch, CEO of Hachette Book Group, said in an email.
The big question is whether book sales remain strong after the pandemic ends.
“Everyone is wondering if this is a permanent change or how long it will last, but right now almost every category is on the rise,” said Jane Friedman, book publishing consultant.
At B&N, the large rectangular tables that held stacks of books – sometimes at a reduced price – have been replaced by small round tables which Daunt says are more conducive to browsing – and shopping. (And the discount books have been moved to the back of the store, freeing up valuable real estate up front.)
Once cluttered with non-book items, such as batteries, Vera Bradley handbags and Fiji hot water bottles, stores are now set up by managers who are supposed to reflect the tastes of their local communities.
At the White Plains store in Westchester, that meant moving Spanish books to the front of the store from a corner in the back to attract the community’s large bilingual community, store manager Sean Carroll told The Post.
At the Cortlandt Manor store, the managers decided to move the entertainment bios – which were selling better than the other bios.
“If you’re excited about Julie Andrews’ new book, you’re not looking for something about presidents, then we’ve taken all of our entertainment books out of the other biographies and put them in the movies section,” the director said. of the store, Allison Demato.
These types of changes would have been prohibited under the old B&N method whereby orders as specific as which books could be posted and where they were to be posted were forwarded through head office. But that’s the type of ownership that Daunt says it encourages.
Admittedly, Barnes & Noble has many hurdles to overcome, not the least of which is the crater of its coffee business and kiosk sales.
Magazine sales are “slightly” down from 2019, Daunt said, while cafes have struggled to retain both staff and customers as the Delta variant makes off-duty hours in the city less attractive. a restaurant. Music is also a declining segment, according to a person familiar with the matter.
“There is still work to be done and there are parts of the stores that are not where they need to be,” the person said.