A New Chapter
Three years ago, Barnes & Noble was bought by the private equity firm Elliott Management and taken private for $683 million. Now, in a rare moment where the sequel beats the original, the bookstore has announced that it’s opening more than 30 new stores in 2023. The announcement follows the company’s first year of net growth in over a decade.
In a moment of poetic irony, a handful of the new stores will open in locations formerly owned by Amazon (AMZN) Books stores. The tech giant, arguably responsible for the recently-diminished success of physical bookstores, closed all of its own brick-and-mortar locations last year.
Since B&N is now a private company, it is not required to report financial information to the public. However, a spokesperson for the company stated that the company is currently experiencing tremendous growth. This expansion is a testament to the bookstore’s success.
B&N’s New Strategy
Barnes & Noble’s strategy for success was twofold: cut expenses and improve their selection.
In particular, Elliott Management took advantage of the COVID-19 pandemic and used the quarantines as a time to refurbish stores, reorganize layouts, and reassess stock. At the same time, it cut layers of corporate management and excess expenses including office space and extraneous products.
On top of that, the new owners allowed local store managers more control over which books each store sells and promotes. By localizing these decisions, Barnes & Noble has helped tailor its selection to specific subsets of readers and cut back on low-demand books.
Here to Stay?
Bookstores are in a similar situation to movie theaters. On paper, both industries should be suffering. Streaming and online bookstores are typically much more convenient and offer a wider selection than theaters or physical booksellers.
However, it’s becoming clear that there are intangible factors at play in both industries. For bookstores, there’s something about the experience of browsing the aisles, flipping through the options, and walking out with a new book in hand that keeps customers coming back.
Luckily for those customers, it looks like bookstores aren’t going anywhere. Unless, of course, you live near a new Barnes & Noble location, in which case, they’re coming even closer.
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