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Powell's turns the page

The legendary bookstore in Portland, Ore., has been a how-to guide for surviving Internet and chain rivals. So why is its owner so nervous?

December 03, 2007|Scott Timberg | Times Staff Writer

PORTLAND, ORE. — The cash register at Powell's City of Books, the nation's preeminent independent bookstore, rings thousands of times a day as customers pick up new and used books, funky British editions, local literary journals and obscure zines.

It's a scene that has repeated itself, with some variation of scale, many times since the store opened in 1971. Powell's, which takes up a city block, has managed to thrive in this era of bookstore busts, thanks in part to a decision to move early and aggressively into online sales.

So why is there a creeping fear that Powell's, which has five other locations and a 60,000-square-foot warehouse, could soon get lost? According to Forbes magazine, "a cloud hangs over the business."

Michael Powell, 67, who founded the company and took over the main store from his father, Walter, a quarter-century ago, announced last year that he would gradually pass the operation to his 29-year-old daughter, whose business experience is limited. Although locals applauded the decision to keep the store in the family, it's hard to ignore the fact that generational handoffs rarely go as planned.

"Businesses don't transition very well," Powell said. "Most of them fail." But he didn't think twice when his daughter, Emily, told him she wanted to come back to Portland and take over. "I didn't have another option," he said.

Some customers think Powell's formula assures its future no matter what twists and turns the book business takes. To a certain kind of rabid reader, Powell's is an almost perfect blend of the massive scale of a chain bookstore and the bohemian vibe of a neighborhood independent.

The mystery section includes popular fare and rare early editions, and is stocked by someone well-versed enough to recognize that William Irish was one of noir author Cornell Woolrich's pen names. The staff is known for its bibliophilism: Jon Guetschow, 36, the store's head buyer and a comics fanatic, says that he can't afford to leave Powell's because the loss of the employee discount would ruin him.

Between staff, stock and its online muscle, Powell's looms over other beloved independent stores such as Denver's Tattered Cover and New York City's Strand.

But Powell, the man closest to the action, is not celebrating. He listed some of the things that have made the store noteworthy and successful -- the mix of new and used, the early Web presence, the symbiotic relationship with the city of Portland, with which he remains very involved -- and concluded: "That has carried us well to the moment. The moment is full of trepidation and uncertainty."

Hunched protectively and built like a bull, he played nervously with a rubber band around a baseball he keeps at his desk and spoke into his chest.

"I'm at heart a pretty shy guy," said Powell, who launched the first Powell's in Chicago while a political science graduate student at the University of Chicago with a $3,000 loan that came from several faculty members, including Saul Bellow. "I'm not a glad-hander." He is into noir novels set in other countries, and you can see his brooding temperament enjoying heroes such as Henning Mankell's soulful detective or Alan Furst's elegant, elusive spies.

But the challenges he faces are not fictional. His goal, he said, is to keep bookstores, and his in particular, "from being marginalized the way music stores have been marginalized."

Powell's has a head start on this one: The company started selling books online in 1994 -- before Amazon -- and ships millions of dollars of books, about 90% of them outside the Pacific Northwest, each year. (The company, privately held, does not release its financial data.)

"The key was identifying what the Web was going to mean and putting a lot of resources into it," said Jim Milliot, business and news director at Publishers Weekly. "Recognizing that a neighborhood bookstore, to survive in the long term, needs to do more than sell books to people who walk in the front door."

But the Internet has gone from being a clear winner for Powell's to a source of apprehension. Powell described his business as being "flat," and said he hoped there was a way to "reenergize" it but couldn't imagine how. He's getting it from both sides: Amazon has posted enormous gains this year, just as consumers have begun selling used books directly on the Web.

"The Internet has allowed anybody to become a used-book seller," said John Mutter of the blog Shelf Awareness (shelf-awareness.com). "Go on EBay and set up an account. The sheer availability does press the prices down."

New books present their own problem. Powell's customers are charged "market price because we pay market wages, market benefits, market rents," Powell said, but that puts the store at a disadvantage against chains and online outlets.

And union woes -- the staff has been unionized since 2000, a one-day strike took place in 2003, and a new contract has just met tentative approval -- have contributed to Powell's weariness. "I won't miss that," he said.

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