No Minister, bookstores will not disappear in 5 years … Andy McCourt commentary

There’s a book shop on a corner in Pittsburgh, Pennsylvania. So what? Well Guy Mitchell sang the song on his 50s album ‘Singin’ the Blues’ – but it was a Pawn shop then. Australia’s Minister for Small Business Nick Sherry has been singin’ the Blues for book shops lately, citing the Borders and Angus & Roberston collapses as evidence that physical bookstores are history, finished, kaput. Well, it seems bookstores are one small business enterprise this government does NOT support. Andy McCourt countermands the Hon. Mr Sherry’s statements and fills you in on the Pittsburgh connection.

The day before Borders Australia and New Zealand collapsed (or more correctly, their private-equity backed parent REDgroup Retail), Borders USA filed for bankruptcy. In Pittsburgh, PA this left a sizeable 24,000 square feet store vacant in the neighbourhood of East Liberty.

Within a few days of Borders vacating, a new tenant moved in, retailing guess what? Books. Jodi Morrison and her independent Flying Pages team snapped up the site and even inherited Border’s shelving. Crazy, suicidal idea?

Hardly. 45 minutes before opening, a man was rapping the door with his umbrella, demanding to be let in. He walked out having bought five books. Fleeting Pages also sells art and media. On that first day they sold 321 works of local art. They planned to close at 9pm but ejected the last reluctant-to-leave customer at 9:15.

Fleeting Pages is community-focused, they mesh with and nurture authors, publishers, artists and anyone who has a literary or artistic bent and a brain. This is the essence of good bookselling. It’s the quintessential community-based small business and that, Mr Sherry, means that you need to know about it before making rash predictions.

Politicians make poor prophets don’t they? Remember Bob Hawke and ‘by 1990 no Australian child will live in poverty?’ Bob lives not far from Kirribilli where the CEO executive sleepout in aid of St Vinnies campaign against homelessness takes place each June. (Attended by a not insignificant number of book printing and supplier suits.) 12,000 kids in Australia sleep rough each night and it’s 2011. Bob, we know you cared, and still do, but some things are beyond even political leaders, aren’t they?

Okay, the Fleeting Pages ‘swallow’ doth not a ‘summer make,’ but back to the Hon. Nick Sherry’s statement: “I think in five years other than a few speciality bookshops in capital cities you will not see a bookstore. They will cease to exist because of what's happening with internet-based, web-based distribution. What's occurring now is an exponential take off - we've reached a tipping point.”

Now I’ve met Nick Sherry when he kindly attended the launch of a new printing facility at Click Media, Penrith in his dual capacity as Assistant Treasurer. He seemed like a savvy and nice bloke for a pollie, showed a genuine interest and a displayed a personable disposition. Why has he got this call so wrong?

Perhaps he has swallowed the line from REDgroup that the only reason they collapsed and had to close Borders and the non-franchised A&R stores (dozens of independently-owned A&R stores are still open), was because of online competition and eBooks. Business fail because of poor management, much the same as Governments.

The private-equity model for Borders and A&R was flawed from the start…a personal, culture and community-based enterprise such as a book shop, does not sit well with the master-of-the-financial Universe-with fat bonuses model of PE. It’s not simply plain retail, shifting boxes. Books are an endemic part of our culture and way of life and are quite capable of co-habiting the media sphere with any new technologies.

Of course people will and do buy books online. Of course some will download to their iPads or e-readers, but the printing of books in short runs using digital production is growing at 14% CAGR (source Caslon Research) and accelerating – why else would Australian companies such as SOS Print & Media, Griffin Press, McPhersons, Ligare and so many others invest huge sums in digital production and finishing?

Book retailers have not been slow to adopt online selling to accompany their bricks-and-mortar stores. In fact the earliest adopters of online sales, much to their profit, were Antiquarian and Rare booksellers. I know; I’ve spent enough with them since the late 1990s. However, they still have physical premises. Visit a Berkalouw shop in Leichhardt, Paddington or Berrima and you will find a cultural paradise worthy of Alexandria (Egypt, not NSW), complete with coffee and cake. And they sell online too.

A physical book shop is like a treasure cave of knowledge, education and entertainment. Australia has some of the best in the world along King Street, Newtown, Glebe Point Road, Paddington, Carlton and Prahran in Melbourne and so on. They succeed because the owners or operators are educated, committed to their communities, business-smart and also engaged in online commerce.

Mr Sherry, I believe you have swallowed what is called ‘Silicon Snake-Oil’ – the misinformation touted for commercial gain by sectors of the online community that believe ALL retailing will shift to online acquisition and paid for via the likes of Paypal (whose President Scott Thompson was coincidentally in Australia at the time of Nick Sherry’s comments, preaching the Paypal-for-everything mantra.)
Paypal is great; I use it myself but it is but one choice of transaction completion online.

I urge your Department and Government to re-think its beliefs about the future of good book stores, do the research properly, and support this essential sector of the small business community.