How a Local Bookstore Can Make your Town Richer — in More than One Way

January 9, 2019

When people ask me what I did for a living before I started working for Strong Towns, sometimes I tell them that I had a job where, on any given day, I might talk to a neighbor about their rent getting raised, a tourist about how hard it was to find a place to buy Asprin within walking distance of their hotel, and a national journalist about the neighborhood segregation line that ran just a few blocks from my workplace. Other times, I tell them only that I worked a job that gave me the best training in many aspects of community development and social work that I could have gotten outside of a master’s program. Or I might say that I probably met a more diverse cross-section of my home city of St. Louis in my daily work than most local politicians do—and in some ways, I got to know many of these people better than many of their leaders ever could.

Sometimes, I mention that this workplace was an independent bookstore. Sometimes I don’t.

Recently, Commonwealth Magazine ran an article speculating on the economic role that independent bookstores play in our downtowns, particularly in small and mid-sized city neighborhoods. The author, Amy Dain, is a public policy researcher who was “studying zoning for multi-family housing in 100 cities and towns in Greater Boston” when she noticed a strange phenomenon: that “many of [the] region’s little downtowns—and not just those in the most affluent communities—boast independent bookstores, even in this age of online shopping.” As a researcher, Dain could only offer confident speculation based on these observations, but as someone who had spent an enormous amount of time spending cities, it certainly seemed to her that these stores were functioning as economic mainstays in their communities, riding out the rise and fall of the chain bookstore and the shopping malls in which many cities placed their faith (not to mention their tax incentives) over the course of the last generation. Anecdotal or not, what she observed was compelling. Dain said, “I am happy to find that, for the moment, independent bookstores are anchoring our charming, antique village centers and other places, too.”

Unlike Dain, I’m not a researcher. But what I am is a former bookseller who now spends my days talking about what it takes to make our communities financially stronger. As someone who’s been a student of cities for years—as well as someone who’s spent a thirteen hour day managing a signing line for Chuck Palahniuk—the longer I study, the more I believe that independent bookstores have a lot to teach us. They are a case study in the power of small, incrementally-built retail to anchor our local economies and social communities. And in my years since stepping out from behind the counter, I’ve come to believe something even more radical: if we want our places to be strong, third places like independent bookstores are exactly the kind of investment that our towns should be making. And we should be making them way more often.

The Resilience and Staying Power of a Local Bookstore

First, to address those of you who think I’m crazy: I know how nuts it sounds to say that a corner bookshop will make your city richer. If the way you measure community wealth is on volume of sales alone, the Walmarts of the world will beat the Women and Children Firsts of the world every time. I have sat in bookstore staff meetings worrying over spreadsheets, watching the 40-46% profit margins on $27 hardcovers get eaten up by rent, salary, utilities, and kibble for the adorable but not particularly hard-working bookstore cat. Booksellers are in one of the only industries on earth that can’t adjust prices upward in the face of consumer demand: publishers set the prices, so that Michelle Obama memoir will cost you the same amount in San Francisco or Skokie, whether or not it’s backordered at the printer and the customer would gladly pay a premium to have it today. Between that lack of market plasticity, an inability to leverage other profit streams to offer much in the way of discounts on other items (sidelines like greeting cards and literary-themed socks are cute, but they’re not often a huge part of the business model,) and the intentional inefficiency of employing human beings to dust shelves and offer better recommendations than an algorithm, most bookstores can’t expect to do better than a 5% margin, even in an excellent year. That’s not exactly the kind of money that draws out the venture capitalists.

But when you shift the conversation to economic resilience—a business’s power to endure, to gradually grow, and to continue creating long-term prosperity for a region, across generations—indies win every time. The last bookstore I worked for, Left Bank Books in St. Louis, will be celebrating its 50th anniversary in 2019, and I don’t think it’s coincidental that both their original location in the Delmar Loop neighborhood of St. Louis and their current long-time home in the Central West End have grown to be among the city’s most vibrant retail neighborhoods.

So why have small stores like Left Bank outlasted larger retailers that often seem like more of a sure bet to the municipalities, despite the advantages of hefty tax breaks and multiple locations? And why do indies, so often, seem to inspire adjacent development that make neighborhoods richer, both in culture and in terms of the proverbial bottom line?

As a Strong Towns advocate, I can’t help but look back on my years as a bookseller through the lens of an economic development approach that is incremental, ultra community-responsive, and constantly making small bets.

In terms of their physical footprints, the economic realities of small bookstores often all but require businesses to grow by square feet rather than by acres. Left Bank, by way of example, started in a smaller storefront on the Delmar Loop before leveling up to its current, larger location in the Central West End and slowly growing to become the biggest independent bookseller in the region. A wall in that Central West End store was knocked down to make way for what, today, is the children’s room; the basement was turned into office space and a cozy corner for a used book selection, and another for new book overflow.

The store even had a go at a second location in St. Louis’s downtown for seven years. When its new landlord raised the rent and the bottom line didn’t make sense anymore, the store shrunk its footprint and refocused on its flagship store, where its beat its previous sales across both locations in the very next year. That’s a far cry from our dominant, all-or-nothing retail development strategy that, often, requires clear-cutting a brownfield former industrial site, pouring millions of dollars and pounds of steel and concrete, and putting up a big box that is often difficult or impossible to retrofit if the original business fails.

But real estate isn’t the only realm in which bookstores are intentionally adaptable. A local general-interest bookstore, more than almost any other retailer, is under constant pressure to shift their inventory to meet the needs and wants of their immediate community. Customers don’t always realize that virtually every single volume in their community bookstore is handpicked by the store’s buyers, usually in person-to-person meetings with publisher sales reps, diligently solving the problem of building the perfect shelves for their customers. My desk at Left Bank put me directly next to the frontline buy during these meetings, and every day, I listened to her name-check individual customers who’d be eager to buy that coffee table book about Cy Twombly that’s coming out in six months, or exclaim about how much the Read the World book club would love that new Polish memoir translation. Bookstores are constantly updating their inventory, returning books that don’t sell and shifting in ones that people will love, and they’re doing it at a volume that most clothing retailers and other shops can’t fathom. Constant customer feedback and infinite small experiments are built into the independent bookstore model by design; it’s one of the secret ingredients that makes a community shop feel so special, and its absence is what makes an airport bookstore with a thin selection of celebrity cookbooks and the top ten bestsellers feel, relatively, so soulless.

How Bookstores Anchor And Strengthen Community

But the harder thing to quantify about the strength of the independent bookstore model is this: bookstores are never really just stores.

Many bookstores are among their region’s most prolific event producers. My job at Left Bank was to supervise the production of about 200 events per year, which means that I can say on my resume that I spent my days dusting shelves, but also that I helped produce events with Ethan Hawke, Judy Blume, Andy Cohen, Joe Buck, Jon Hamm, Krista Tippett, the manager of the St. Louis Cardinals, a handful of Real Housewives, and at least three frontmen for very popular hair metal bands. And that’s not even to mention the dozens upon dozens of smaller events that doubled as mixers for the neighborhood, live pet adoption events (at the request of the author of every cat-themed mystery novel who ever did a book signing), informal job networking events, potential political organizing meetings, crucial educational opportunities for countless kids… the list goes on. Of course, more traditional community centers like the library down the street perform this function as well. But the unique incentive power of being a for-profit business that is constantly stretching itself to be even more valuable to its home community is a powerful catalyst for creativity that can’t be undersold.

The Economic Multiplier Effect of Local Business

Of course, all of that creativity takes real work. Independent bookstores often employ relatively large staffs, at least in comparison to their chain and no-box counterparts. The Institute for Local Self Reliance reports that for every $10 million in sales, local bookstores create 47 jobs. Contrast that with Amazon, which creates just 19, and you might realize that quirky girl hand-selling you a book of poetry is a representative of a powerful economic engine. (And before you ask: the bookstores in my region, at least, pay a living wage, and many offer strong employee benefits, from paid health insurance premiums to a monthly book credit and all the advanced reader copies you could want. I’m still working my way through my free book stash.)

And all those indie bookstores jobs act as a multiplier to other local businesses, too. Local employees tend to keep their money in the neighborhood: according to the 2018 Small Business Saturday Consumer Insights survey, “for every 10 jobs at a small business, another seven are supported in the local community.” Ditto the customers; speaking anecdotally, I can’t tell you how many times a shopper came into our store to pick up the latest volume of their teen’s favorite vampire series and ended up getting lunch at the taco place across the street, then browsing the gift shop down the block, then venturing to the coffee shop on the next corner to read the book they bought three stores ago. There’s something about the pace of the small bookstore that invites lingering even after you’ve wrapped up your stack of novels and ventured back out into the neighborhood.

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So am I arguing that cities should dump money into building brand new mom and pop bookstores in the middle of nowhere and hoping a cluster of Main Street businesses spring up spontaneously around them? Far from it. As much as I love bookstores, there is no magic pill to city building—or at least, the magic is the ghost in the machinery of thousands of small decisions being made every day in a real, vital market. I think part of what makes small bookstores so enduring is that the best ones are opened and developed at strategic locations, making the most of their 5% margin in their real estate choices: at the outskirts of emerging neighborhoods that are just starting to see some good foot traffic, or at the end of that nice shopping street that peters out as you walk north.

But what cities would be wise to do, I think, is to recognize the powerful neighborhood-wide effect of the independent bookstore model, and soften the ground for more small businesses operating, by their nature, on small margins and small bets.

Provide micro-grants to offset the cost of rent and improvements to little stores that are starting to get a foothold. Lend them an unused theater space for free, and host an author event that will bring the store a lot of stability—and, likely, bring some real business to the nearby restaurants and shops on what’s likely to be a random weekday (at least in my city, there is a weird unwritten law that most author events happen on Thursdays). Help them cultivate a walkable streetscape outside their doors to make sure their customers can get there safely; slow down those cars. Landlords, too, should recognize that offering a lower rent to a low-margin but highly trafficked small business like a bookstore will often bring the foot traffic you need to keep the higher-paying coffee shop that you also known next door open and paying you rent. At the very least, it’s probably worth an experiment in a temporary rent reduction.

These things won’t make the same splash as a ribbon cutting on a new mall. But they might make your town stronger and richer for the long haul—and it can all start with something as small as a corner bookshop.

(Cover photo by John Michael Thomson on Unsplash)

Kea Wilson

Kea Wilson serves as Communications Manager for Strong Towns. She's based in the great city of St. Louis, Missouri, but she's lived everywhere from Santa Fe, New Mexico to coastal Maryland to far northern Michigan. She became passionate about the question of what it means to build a better world when she was in college, where she volunteered at a co-op bike collective and studied (most of) the great works of western civilization, roughly in chronological order. She's worked in community outreach and development for six years, most recently at a small independent bookstore where she coordinated a not-so-small author events series. She's also an avid (if somewhat slow) cyclist, an armchair economics nerd, and a novelist.

Tags: books, building resilient local economies