Tuesday, June 24, 2008

Infoshop / bookstore economics

Let me put on one of my other hats for a second:

Well, it didn't take long for me to get involved with a bookstore in Portland. I seem to be well on my way to joining the collective at Laughing Horse Books, a radical bookstore with an ideologically diverse inventory and staff. Like pretty much all independent bookstores, Laughing Horse is trying to figure out how to adapt to present conditions, keep the wolves at bay, be useful in a perplexing political climate, etc. After visiting my first collective meeting, I found myself right back in the mode I had been in for so many years at my own bookstore, calculating break-even points, prioritizing payments, etc.

Infoshops and independent bookstores are still extremely important, as centers of distribution of information, as meeting places, as art and music venues, as quasi-public space where free political discussion is not only allowed but encouraged. Volunteer collectives have the economic advantage of not paying wages, but, if you are considering attempting such a thing, there is one basic rule of the book business to consider:

At any given moment, if your sales are mostly books, mostly at the industry-standard 40% discount, you need to be making 2 1/2 times in gross sales what you pay out in fixed expenses (rent, insurance, utilities, regular advertising, etc.) That means that if you have $1000 in fixed expenses each month, you need to be making $2500 in order to simply stand still (pay bills, keep the lights on, replace inventory). In order to grow the business, increase inventory, capitalize any of your labor in equipment, or savings for a rainy day or slow spell, you have to make more. And unless you take some satisfaction in treating your own labor as pure expenditure, it makes sense to at least try to recoup something from it. It makes good sense to invest individual labor in group resources, as long as those using the resources are also contributing in one way or another to the collective effort, and as long as those resources are being cared for. Labors of love are fine, and the first goal is always simply to keep the operation going as long as it serves a useful function, but it is perhaps easier on the volunteers if they are explicitly planning to have their labor "compensated" by growth in the project.

All radical and independent projects that function in the business sector have to behave more or less like a business, at least as far as making sure the incoming and outgoing funds (and inputs of other sorts) balance out in a sustainable way. Beyond that, they have to be flexible, ready to reach out to like-minded businesses and organizations, able to counter, in one way or another, their disadvantages in the broad marketplace, and so on. Enthusiasm, expertise, openness, willingness to network with and advertise other projects: all of these things are increasingly absent from the parts of the business world that most consumers see on a regular basis. There is no reason that the corner infoshop can't serve the fuctions once served by a number of now-defunct small businesses, and expand its power to serve community needs in the process, with a little attention given to taking care of the bottom line and the work-satisfaction of collective members.

1 comment:

Anonymous said...

Excellent comments, Shawn. I had never seen a ratio that outlines what an indie bookstore should be making in terms of sales versus expenses. Tonight at our infoshop meeting here in Kansas City I was trying to explain why we needed to increase our income in order for us to pay debts to AK and be in a position to buy new books. As you somewhat know, I've been involved with two infoshop projects and worked for one successful radical bookstore. Throw in my library experience and you would think I know everything, but the business end of running an infoshop/bookstore is a daily challenge for me. One important insight I had several years ago with our current infoshop was that in order for it to be sustainable, several core volunteers like myself had to treat it like a business, even if being a business wasn't our goal.

There are two factors which I think put us in a sustainable situation. Three factors, if you include our excellent volunteers. One is that we pay very little in rent for the size of our space. The mistake we made with the first location for our infoshop was to pick a space whose rent was too high for us.

The other factor is something your new comrades should consider. We make most of our money right now off of the sales of used books. We've been able to fill up our bookstore through donations of used books. Yeah, we don't look like a radical bookstore if you look at our selection, but I think that selling more used books now will put us in a position next year to switch to selling more new radical titles.

About a year and a half ago I started selling some of our used books on Amazon.com. I'm the one who has to do all of the legwork on this sideline, but Amazon sales account for half of our sales right now. I think that any radical bookstore with access to used books (or other materials) should aggressively pursue online sales of selected items.

Chuck
Crossroads Infoshop
Kansas City