Bookstore Self Audit
Two very brave booksellers--Sylla McClellan, owner of Third Street Books in McMinnville, Ore., and Wendy Hudson, owner of Nantucket Bookworks in Nantucket, Mass.--opened themselves up to public scrutiny during the illuminating session Bookstore Self Audit: A Critical Look at Your Own Operations, intended to draw booksellers' attention to details they may overlook in the day-to-day running of their shops.
On a questionnaire, McClellan and Hudson evaluated their stores by seven criteria: ambiance; convenience; service; financial health; inventory; price; and marketing. (ABA members may get their own copy of the self-audit and other Winter Institute handouts by contacting the ABA's Kristen Vlahos at Kristen@bookweb.org.)
Both booksellers looked at their shops critically, but at the same time, recognized what makes their stores special. McClellan took a store that was low on inventory and style and created a highly merchandized, warm space that she feels is meeting her goals.
Hudson also took an existing store and stamped it with her own imprint, while keeping the community in mind. Both stores carry a wide variety of sidelines (from plush animals and puzzles to silk scarves and jewelry), which not only makes the space more creative and colorful, but also boosts the bottom line.
The two booksellers emphasized the convenience factor as important to the success of their stores, including the ever-challenging search for parking and expanding store hours. They agreed that staffing and training were very important.
McClellan trains staff to understand every detail of the business. She takes each new employee on a tour of the shop, beginning on the street in front of shop, explaining every decision she's made about the store. The "whys" are just as important as the "hows." This not only helps staff members understand the operations better but gives them a sense of appreciation for the detailed thought that has gone into the shop.
Most evident from the session was that there are universal best practices to consider in any self audit, and each store needs to cater to its community. The importance of the self-evaluations was clearly evident in the things the booksellers learned about themselves.
Hudson said that "the exercise was useful on many levels, but most important for us in hindsight was that it was a great way to open a dialogue with staff by getting their feedback. Then we could involve everyone in looking at ways to improve the store and to make some real changes. Exciting stuff!"
McClellan also gained a new focus and thoughts about how to go forward. "The self audit is a tool that we should use periodically to review aspects of our store that may escape our attention during day-to-day operations," she commented. "I like the idea of having senior staff (or my whole staff) do the self audit as I may see things from a totally different perspective."
Growing Your Business
At the beginning of Growing Your Business--Why, When and How, moderator Avin Domnitz, the ABA's CEO, made a convincing plea for members to file ABACUS numbers. Through this financial audit, booksellers can understand better many aspects of their bookstores, including when to expand. (To learn about the confidential ABACUS report, a tool available only to ABA members that creates benchmarks for the measurements of store operations, visit bookweb.org.)
The focus of the session was on booksellers learning the right time to expand their business, whether it's buying a new building, renovating an existing store or shifting the emphasis of the business.
Domnitz pointed to Maria's Bookshop in Durango, Colo., as a shining example of a shop that built out its space to maximize business. Co-owner Andrea Avantaggio explained that she and her husband, Peter Schertz, re-designed their store to create a better selling and working environment, within their budget and with strategic planning.
By focusing on four main areas to determine the health of a store--sales, margins, compensation and occupancy--you can determine when the right time is to expand. Noting that the average bookstore becomes profitable at about $500,000 in sales, Domnitz emphasized the "sweet spot" is $750,000 to $1 million in sales.
At this point, a store is able to have better selections, improved systems, smarter procedures and an improved business model. It's the perfect environment to take a look around and see how to create an even better store. Domnitz commented, "Take time to re-examine issues when things are going well. When things are calm, it's time for you to get a little nervous and get busy." Knowing when to expand is both an art and a science, he added.
Gayle Shanks of Changing Hands in Tempe, Ariz., noted that she brought in an expert to help determine the best expansion plan and said that the money she spent on consultants saved her so much in the long run.
Domnitz suggested using an "unemotional consultant"--someone not personally involved in the business--who can help create a clear vision.
A lively discussion ensued as many in the audience shared their experiences--from opening new shops with different names in different communities to create a new reputation, to opening shops in the same neighborhood to increase customer service.--Susan L. Weis