The Business of Bookselling with BrocheAroe

A Bookselling Glossary

Intro: Welcome to the Business of Bookselling! In this podcast episode, I get to do my best impression of a dictionary and define some commonly used book industry terms that may or may not be familiar to you. If I don’t define something you’ve always wanted to know about or if your definition of a term differs from mine, shoot me an email at hello@businessofbookselling.com [hello@businessofbookselling.com], and I’ll try to address it in a future episode. Now let’s dive in! Transcript: We’re starting off with some very important basics – frontlist and backlist. These two terms – frontlist is one word and backlist is another – are probably two of the most used, industry-specific terms you need to know. Frontlist refers to books that are forthcoming. They’re not yet published. Quick aside here that not yet published is sometimes abbreviated to the initials NYP. Frontlist titles are new titles coming out on this season’s or a future season’s list of books from a publisher. Let me back up a minute, in case words like “season” and “list” in this context are also new to you! So, each publisher has books grouped together every year by season. Season refers to the time of year the book comes out. You might think this would be standardized across the industry, but surprise! Every publisher defines a season in their own way, and it’s a happy coincidence when multiple publishers have seasons that coincide. So, a spring season of books may be publishing between January and April or between March and August. Publishers might have two seasons – Spring/Summer and Fall/Winter, or 3 seasons – spring, summer, winter, or 4 season – spring, summer, fall, winter. Regardless of how many seasons a publisher has, each season is comprised of a list of books being published over a certain set of months, and THAT list is what is known as frontlist.  Now, you might think to yourself, “If frontlist refers to not yet published titles, surely backlist means ALREADY published titles.” And you would be right in thinking that! Mostly. It’s not quite that simple. Each publisher also defines backlist as separate time periods as well. One publisher might define it as anything published the season prior and older. Another might define it as anything published before today. And another might define it as anything published last calendar year. Why is it so important for you to know how a specific publisher defines backlist? Because publishers often offer independent bookstores backlist and frontlist specials! So a backlist promotion might say something like, “Stock up for the holidays! Receive an extra 3% off on orders of 20 units or more placed in October. Use promo code BLSPEC25. This code may be used twice between October 1 and October 31, 2025.”  Now, if you saw that special come through and you wanted to plan out your two orders – say, one for the first week of October and one for the last week of October – you would need to know if books published DURING October counted as backlist or if you should use whatever frontlist special is on offer to order those titles. Don’t confuse the word backlist with the word back order. Those are two different things. Here’s what a backorder is: any time you place an order with a publisher or distributor, they’re going to try to fulfill that order immediately by sending you the books they currently have in stock. If a book is not yet published or if a book is out of stock at the warehouse and they are waiting for reprints to come in, the books they can’t send out to you yet will be backordered for you until they’re able to do so. I’ll do a whole separate episode about how to make buying decisions, but for now, let’s keep moving on to other definitions. In addition to backlist and frontlist titles, there’s also a special phenomenon called drop-in titles, or drop-ins for short. These are books that the publishers didn’t announce as part of their original season of titles, but they’ve announced them now and the book is going to be coming out very soon, so get those orders in now. Drop-in titles are usually really hot titles that publishers are trying to keep details under wraps about so that information doesn’t leak before they’re ready to publicly announce the titles, but that does mean that bookstores have to stay on top of whether or not they’ve ordered that special drop-in title once it IS announced because you’re probably going to want to carry it and not miss out. Because these are hot titles, publishers could run through their first printing, and if you haven’t ordered it quickly, you won’t get it during the first rush when customers are really looking for it. A lot of celebrity memoirs are drop-in titles, or more recently a lot of self-published authors who have really blown up on TikTok and other social media channels and have been offered publishing contracts from traditional publishers to help with sales and distribution of their hot titles into a wider market have been dropping in never-before-published titles, or reprints of old titles, or collector’s editions of their old titles as well. So far I’ve been defining terms that refer to new books. Books that come from a publisher or wholesale distributor are considered new because no one else has cracked that spine and read that copy yet. Wait, what’s the difference between a publisher and a wholesale distributor, also known as a wholesaler, you might be asking? I’m going to back up again for a second: in common language practice, the word “publishing” usually refers to everything up to and including the point of printing, warehousing, and shipping the book. But, not all publishers have the ability to do all of those things for themselves, because costs. If that’s the case, Publisher A may be the publisher of a book, meaning they edit, design, and print the book, while Publisher B may be the distributor of the book, meaning they store, sell, and distribute the book for Publisher A. Penguin Random House, Macmillan Publishing Services, and Hachette are just a few examples of publishing companies who also act as distributors, meaning smaller presses, such as Beacon Press, publish their own titles while Penguin Random House distributes them. A distribution client, however, is not the same as an imprint. An imprint is the name for a collection of books being published under a certain theme, idea, or person’s direction. To stay with our Penguin Random House example, they have more than 300 imprints that they publish, meaning they have more than 300 distinct departments or groups working together to put out books under a certain imprint name every season, such as Berkely, Crown, DK, Knopf, or Penguin Classics (all examples of PRH imprints). PRH distributes all their own imprints’ titles, of course, in addition to their distribution client’s titles, and usually when a bookstore orders from a publisher, they can order any of the books published by that publisher AND distributed by that publisher, but sometimes there are special deals for certain publishers’ books only. A publisher that is selling or distributing the book would let you as an independent bookstore know, through your rep that you were assigned when creating an account with them, about this special offer. A wholesaler, or wholesale distributor, is an organization that stores or warehouses books by multiple publishers, also often distributing self-published authors (books that remain self-published, not ones brought into traditional publishing) as well, and it’s usually easier to meet the minimum requirements for placing an order at a wholesaler because they have so many more books on offer. This is why many independent bookstores who are just getting started begin by ordering from one wholesaler, rather than through many different publishers. Admittedly it gets tricky sometimes to figure out and remember what imprint is published by which publisher, and what publisher is distributed by which publisher, especially because large publishers often buy and sell smaller publishers and also buy and sell other publisher’s imprints. The American Booksellers Association (also known as the ABA) has a resource on their website called the Book Buyer’s Handbook (https://www.bookweb.org/ [https://www.bookweb.org/]), which lists publishers, imprints, distribution clients, and even discount terms, and it’s mostly up-to-date at any given time. I believe publishers are in charge of updating their own entries into the handbook, so anything that’s out of date is because the publisher hasn’t updated it yet. You do have to be an ABA member in order to use the Book Buyer’s Handbook. It’s one of the biggest resources available to independent bookstores, so becoming an ABA member is highly recommended. Before I continue on to defining other types of books other than “new” books, I’m going to define a really important word just used. That word is “terms,” which is short for “discount terms.” Basically, it means how much do I have to buy this item for as a wholesale customer, as whatever that cost is will then impact my profit when I turn around and sell it to my retail customer? What you might not realize is that you as the independent bookstore are also a customer; you’re a wholesale customer purchasing books from publishers and wholesaler distributors. When you’re wearing your wholesale customer hat, you’re going to want to purchase from the place that gives you the best discount because as a retailer – that’s when you’re operating as the bookshop selling books to your individual customers – you can’t charge more for your books than what’s printed on the book, also known as the MSRP or manufacturer standard retail price. In the case of books in America, the publisher sets the price of the book, it’s printed on the book, and no one can sell it for more than what’s listed on the book. Used books and antiquarian books are a different case, but this is focused on new books. You can charge for more than the book itself, if you’ve bundled the book into an event ticket of some kind, but in that case, it still has to come with something extra; you can’t actually charge more for the book itself. You can always sell it for less, and there’s where Amazon has significantly devalued books, by selling them as a loss leader to get customer information so that they can then sell additional products to them not at a loss for the company, and this is why retailers discounting products is so dangerous – it’s a very slippery slope, it devalues the product, and it trains customers to not want to pay for the full value of a product. But I digress. Back to terms.  Because I am an independent bookstore owner talking on a podcast about the business of bookselling to an audience of, I’m assuming, mostly other bookstore owners or bookstore owning dreamers, I need to be careful about what I say about terms thanks to the Sherman Act’s antitrust guidelines, which say that competitors – which we technically are from a business perspective, even if we don’t necessarily feel like competitors in our hearts –  can’t discuss price or pricing policies. I’m going to use general examples from this point on in order to illustrate what terms actually look like from a financial perspective. Most independent bookstores are getting their books at between a 40 to 50% discount, which means they’re paying 50 to 60% of the cover price for that book. That’s one part of terms offered – how many units of a product the wholesale customer has to order in order to receive the largest discount on offer. So one publisher may have their terms defined as an order of 20 units equals a 45% discount, meaning you as the wholesale customer would need to place an order for 20 units of the product, and in meeting the order minimum quantity, you would receive a 45% discount off the MSRP, meaning you would pay the publisher or wholesaler 55% of the MSRP. I’m saying “units” because you can purchase multiple copies of the same title, and you also might be ordering more than books – you might order stickers or toys or puzzles or games at the same time – so the word “units” covers all those bases. So to keep this simple, let’s say a bookstore ordered 20 copies of a book priced at $18.99. The retail cost is 20 x $18.99, or $379.80. The wholesale cost is that $379.80 minus your 45% discount, which equals $208.89. When the store charges their individual customer the $18.99 for that book, their potential profit on that book is the wholesale discount that you received on that book. So the most a bookstore could make in profit on 20 copies of an $18.99 book would be $170.91. The publisher or wholesaler would make more than you; they are making the $208.89 on those 20 books. As a side note, wholesale customers are exempt from paying tax on the products they purchase as their stock, so we don’t need to factor tax into this equation yet. As a retailer, you will still charge your customers tax though; that’s sales tax. Now, all of that is just one type of discount term offered. Another part of discount terms being offered by a publisher or wholesaler is what’s called “dating,” which no, doesn’t mean candlelit dinners and long walks on the beach, but the amount of time you have to pay the invoice for the product you purchased. Standard dating is usually 30 days from the time the product has shipped out, not 30 days from when you ordered that. Thais said, you might not even receive the product until 7 days into its 30-day invoicing countdown. If you order a book on standard terms and it doesn’t sell before the invoice is due, as a bookstore, you’re going to be paying for that book out of your own bookstore pocket. This means that you could be paying for the majority of the books in your inventory, on your shelves, upfront, before anyone purchases them. This is one of the main reasons that it’s so expensive to start a new book bookselling business. Of course the hope is that a customer is going to buy that book at the MSRP, thus covering the cost of that book and putting extra money into your account, technically called profit, above and beyond the price you paid for the book. But if you’re receiving only 40-50% of the MSRP of a $18.99 book after you’ve paid for its cost to your store, that’s not a lot of profit leftover for you to pay your bills, including line items like staff salary, your overhead (that’s line items such as rent and associated costs for your physical space and physical running of the business), and the rest of your as-yet-unsold inventory. Independent bookselling runs on really thin profit margins, sometimes called just “margins” for short (like how discount terms is shortened to just “terms”), and that’s why it’s so important to order from the place that’s going to give you the best overall terms for the product you’re purchasing.  In addition to the discount and the dating, the other terms piece to consider is freight costs. Most book inventory publishers and wholesale distributors will throw in free freight as part of the terms you receive when you’ve met the minimum unit order quantity. Freight charges can really add up and obviously cut into your as-already-discussed very limited profit margin, so it’s really important to try to meet the minimum order required for maximum discount benefits.  Another side note – if you’ve met the free freight minimum for your book order, but not every book on your order is ready to ship right away, you could be charged freight on your order if the terms specified that all books ordered need to ship together to meet the free freight minimum. You may still receive the discount terms and dating, but freight can sometimes have its own stipulations. If you’re lucky, you’ll still get free freight on subsequent orders shipping out when the books are ready. This is why it’s so important to know all the little details of the terms. Also, whenever you’re calculating cost-of-goods-sold (also known as COGS, for short, or also known as your margins) in your accounting system, it’s important to factor in those hidden costs, such as shipping. The cost for the book or other product may be more than just 50-60% of the MSRP if there are freight costs for physically getting the book to your store. That said, staff time for physically processing and receiving the inventory into your point-of-sale system and shelving the book into its appropriate display or section does not count toward your COGS.  Depending on what the order minimum is, it can be difficult to meet, especially if you’re a smaller shop, a novel model, or niche store, and it can be time consuming to track the terms for the different publishers, which is hard to commit to if you’re a one person or smaller staffed store. This is why so many stores simply use the wholesale distributor Ingram, because they have so many books by so many publishers, and as noted before, also by self-published authors. But for the sake of adhering to the Sherman Act, I’ll just say, please do your due diligence in checking which publisher or wholesale distributor gives you as their wholesale customer the best discount on the books you want to order from them, and it’s up to you to decide if convenience is worth paying more upfront for your books or if the higher discount is worth more and worth ordering direct from a publisher.  Also, sometimes when looking at books on a wholesaler’s inventory website, you might run across a short discount book. This means that for a variety of reasons, the standard, or regular discount (often represented by the initials REG, short for regular), does not apply to this book, and if you order it, you’re going to get a smaller discount on the book, meaning you’re going to have to pay more for it and you won’t make as much money when you sell it.  One other bottom line advantage of ordering directly through publishers, is that they often offer more special promotions at even higher discounts (such as backlist or frontlist specials), extended dating opportunities (that’s invoicing that is not due in 30 days, but could be due after 60, 90, or even 120 days), and waived minimum order opportunities than wholesalers, so it’s a money game that you should commit to playing if you want the most optimal COGS, or cost-of-goods-sold, for your inventory. Now back to defining types of books! Of course the opposite of a new book is a used book – one someone else has read before. Some bookstores sell new books only, some sell used books only, some sell new and used and remainders. And there’s another word to define – remainder. Remainder is basically a nice word for leftover, though no one calls them that. Sometimes remainders are called hurts or bargain books, in addition to remainders, though. Whatever they’re called, and I’m going to keep using the word remainder, these are books that remained in a warehouse as they either never made it onto a bookstore shelf or made it on to a shelf but didn’t sell and so it was returned to the publisher. This often happens with hardcovers, for example. Say a publisher prints 100,000 copies of a book in hardcover but then the paperback comes out a year later (as it often does), and the publisher still has 3,000 hardcover copies left in the warehouse. What are they going to do with them? Well, they sell them! But not directly to us bookstores, usually; they sell them to a remainder company, usually by the pallet for basically pennies. Then the remainder company has to sell them on, so they sell them to bookstores for probably around a quarter of the cover price. The exact prices differ by book and remainder company. Then we, as independent bookstores, sell those remaindered books to customers at a reduced or sale price that’s less than the cover price but more than we paid for it. Why not sell it for the full cover price, as it’s a new book? Because remainders all have a small bit of damage done to them intentionally to indicate they’re remainders. This can look like a dot or a slash somewhere on the edges of the book with a permanent marker, or a pen slash through the bar code, or a box cutter gash on the barcode or cover itself. But however it’s marked, that imperfection declares it’s a remainder and so it should probably only be sold at a reduced price. Since I just talked about a paperback coming out after a hardcover, let’s really quickly define industry standard language for the types of books out there. Hardcovers are, of course, books published in hardcover. A hardcover can have a dust jacket – that’s the cover of the book that’s detachable or often covered in plastic (called mylar) at the library – or it can be what’s called “paper over board,” which is less common, but it means there’s no dust jacket on purpose. The reason I’m defining hardcover is because sometimes publishers publish a book in both hardcover and in a library binding. While a library binding is technically a hardcover book, the binding is actually reinforced to last longer, and that is why a library binding book will cost more or have a higher MSRP than a standard traditional hardcover book. A paperback book can come in a few different trim sizes, meaning how tall and wide a book is from top to bottom and side to side (the depth – front-to-back – of the book is determined by how many words a book is and the font size), but the only trim size that’s really called something different is a mass market paperback. The term trade paperback or just paperback usually do NOT refer to a mass market or pocket-sized paperback. The mass market paperback sized books are the ones in the spinner racks most often found in airports, convenience stores, and big chain stores, though indies can certainly sell them, too. They’re usually the cheapest format of an adult title; though a lot of genre books – those are books published in the romance (bodice rippers, for example, as they used to be called – the historical romances with a half-naked woman on the cover), fantasy, science fiction, and mystery genres – were traditionally published in the mass market size, it’s been many years now that genre titles are being published in the more traditional paperback and hardcover size book. A traditional publishing schedule for a fiction title might look like this – first version, hardcover; a year later, trade paperback; anywhere from 6 months to several years later, a mass market version; somewhere in that span of time, possibly a collector’s edition. And don’t get me started on reprints with new covers, etc.! A book can have a thousand different publishing lives if it’s what’s been identified as a classic or if it’s having a hot moment. Anyway, those are the standard formats for most adult titles.  Young adult or YA and middle grade titles also have hardcover and trade paperback editions, and though publishers might play around with the trim size of book, YA and middle grade are usually not published in mass market format. Graphic novels come in various trim sizes and formats, including hard cover paper over board, hardcover with dust jacket, and paperback, and books called beginning readers or leveled readers – those can be books that are literally printed with level 1, 2, 3, or more on them and are in a spinner rack, or they can be books intended for the age 7-to-9-year-old learning to read on their own, shorter chapter book-style books – often have trim sizes that are the same if they’re going into those leveled reader spinners, but can also be published in varying trim sizes and book formats if they’re not intended to be part of one of those leveled reader series – I’m thinking of the “I Can Read” series that goes into spinners vs the Elephant and Piggie series by Mo Willems (which has its own spinner) vs the Mercy Watson books by Kate DiCamillo and Chris Van Dusen. Picture books and board books also go rogue on the sizing and format. A hardcover picture book with a dust jacket is often a larger trim size and price than a paper-over-board picture book, both of which are going to be more expensive than a paperback picture book. And board books come in all kinds of exciting sizes and shapes and interactive elements nowadays; I personally believe board books are one of the most creative book art forms out there today. Activity books and work books are mostly paperback with some hardcovers thrown in there, and while hardcover cookbooks have their own binding style to make them lay flat, they’re still just considered hardcover or paperback in format. I’m sure there are a million exceptions people will think of, but I’m trying to give a general overview here, so I’m going to stop there for describing general physical book formats. There are also audiobooks and e-books, of course. These are both book products that you can sell your customers, and they’re also formats you can explore when reading books on your own. By that, I mean you can sell them to your customers thanks to Libro.FM for audiobooks and Bookshop.org for e-books (you do need to open a wholesale bookstore account with each of those places, but then you can direct your customers to purchase their audiobooks and e-books from your Libro.FM and Bookshop.org stores), but you can also receive free ALCs, or advanced listening copies, of frontlist audiobooks that publishers select for booksellers via Libro.FM each month, and you can download DRCs, or digital review copies, which are free e-book versions of frontlist titles that publishers make available for booksellers on Edelweiss (or NetGalley, but Edelweiss is the primary book ordering ecosystem for independent bookstores, so I recommend using them over NetGalley once you become a bookseller). Publishers will also send out ARCs or arcs, while I’m defining book-related acronyms, also known as Advanced Reading Copies or sometimes called galleys, to bookstores and specific booksellers. Picture book advanced copies are also called ARCs, but they used to be called F&Gs, which stood for folded & gathered, which was essentially the different sections of picture book pages that hadn’t been bound into a completed book yet. That’s more of an old school book person term; not many still use it in a bookselling context, but sometimes it’s fun to learn things like that. The publishers make ALCs, DRCs, and ARCs available to booksellers because they want you to read upcoming titles, they want you to submit reviews for them to the Indie Next List put together by the ABA, they want you to choose them for staff picks, for upcoming book clubs, for events, for preorder campaigns, and ultimately, they want you to sell the heck out of them and then report your sales so that the books can become bestsellers. The more you as a bookseller interact with a publisher by telling them you love their books, you’ve chosen their books for store opportunities, etc., the more likely the publisher is to send you advanced copies of your favorite author’s not-yet-published titles, and that is one of the very best perks of independent bookselling.

Novel Model Bookstores

Intro: What is handselling? How much do I sell a book for? Should I open a brick-and-mortar, a bookmobile, or a pop-up shop? How do I host author events? And most importantly, how can I turn my passion for books and reading into a profitable and sustainable, independently-owned, small business? Welcome to The Business of Bookselling, a live-workshop and interview-style podcast about business and book culture. This podcast uses a diversity, equity, and inclusion lens, combined with triple-bottom line sustainability business principles, to offer actionable advice, bookselling basics, and deep dives into the book ecosystem. Learn from bookstore, business, and book industry experts about how to turn your book-loving dreams into a profitable and sustainable book-selling business. Transcript: I want you to close your eyes. Not if you’re driving, obviously, or doing something else that needs your eyes to be open to be safe, but if you’re able, close your eyes. And even if you’re not able to do that, you can do this next part – imagine your dream bookstore. Imagine your favorite bookstore or the bookstore where you’ve spent the most time throughout your life. I’m going to guess that this bookstore you’re imagining is what’s known in the retail industry as a brick-and-mortar space. That means there’s a physical location with four walls and a roof and a bunch of nearly floor-to-ceiling bookshelves all around it; in other words, a pretty traditional bookstore space. There’s absolutely nothing wrong with having that vision! And you can open your eyes at this point, if you haven’t already.  But sometimes, some times, people with dreams of opening an independent bookstore of their own don’t have access to a traditional brick-and-mortar space. Sometimes the right physical space isn’t available in the general location you want to open, or sometimes you don’t have access to the financial capital you need to invest in starting up a bookstore business that is the size of a 1,200 square foot or larger physical space, or sometimes you want to test your consumer market before committing to a full space, or sometimes your community would be best served by not having a brick-and-mortar physical space, but instead a mobile space that would travel to serve different areas of your community rather than requiring the community to come to the one physical space, or sometimes a traditional brick-and-mortar space has unique qualities or characteristics about it that requires some outside-the-four-white-walls-retail-box-space thinking. Those unique alternatives, whether born of dreams or necessity, those nontraditional bookstores, are a type of business that’s recently been termed “Novel Models” by Candice Huber, owner of Tubby & Coo’s Traveling Bookshop, one of those very novel modes. Yes, the term “novel models” is a pun, but it’s so much more than that – it’s a bookstore business that fits your current set of circumstances.  Let’s be honest here – novel models are usually born out of necessity, and that necessity is most often a lack of access to traditional funding due to systemic injustices that have made generational wealth, educational opportunities, amassing capital, and access to financial resources harder to attain and obtain. If you had access to capital for your business, if you didn’t need to draw a salary from day one as a single person to support your entire family (however many people that may be), if you didn’t have a significant debt load due to higher education costs, if you weren’t the kind of person who, as an adult, has created community, lived in community, and shared resources with your community, you would probably open up that 3,000 square foot bookstore, cat cafe, and yarn store tomorrow. But in reality, novel models are most often owned and operated by people from traditionally underrepresented, marginalized, and historically excluded groups, such as people of color, members of the LGBTQIA2S+ community, immigrants, neurodivergent people, differently abled and disabled folks, and people who are from historically and generationally impoverished communities, who often don’t have access to capital, who don’t have generational wealth, who do carry a significant debt load, and who are often taking care of friends, family, and community with the limited resources they do have, instead of hoarding them. This is why novel models are SO important, this is why novel models are legitimate bookstore business models, and whether you’re considering a novel model as a stepping-stone or as your final end game, there is absolutely no shame and only celebration attached to you creating a bookstore business that fits the life you are currently and aspire to be living. To help support you on that bookstore dream journey, in this podcast episode, I’m going to try to describe some of the different types of novel models that exist so that as you consider what type of bookstore reality best fits your bookstore owning dream, even if you haven’t experienced one of these in person, hopefully hearing about them will provide some additional suggestions for how to turn that dream into a reality. Here we go: Bookmobiles Whether you’re riding a bike, driving a van, bringing a bus, or have outfitted a truck or trailer, if your shop is on wheels, you’ve got a bookmobile! A lot of libraries have these, even today, and sometimes you purchase decommissioned ones online. Businesses on wheels really exploded with the food truck revolution, and while you can certainly retrofit a space for yourself, you can also pay a ton of money (it’s most likely worth it) to have an expert build one out for you. You’ll see this as a theme of most of these types of novel models – they can be done on a shoestring budget that shouldn’t stress your personal finances too much to get started, OR you can choose to spend a lot of money investing in the various accoutrement for that specific type of store model. Up to you, but just beware that if you are choosing a specific store model due to budget, it is easy to quickly blow past that if you’re not careful. Boutique Locations This is having a shop within another shop, but is different from popping up in that this space is permanent/semi-permanent. So you may have a boutique location inside a coffee shop, for instance, or a grocery store, where you have carved out a specific retail merchandising space for your own products, in addition to whatever type of business the leaseholder of the space is running. Most of the time, your product is run through the larger store till, and then you’re paid a percentage of the retail price for your product. You may pay rent on the space, or you may pay a percentage of your product sales to the leaseholder. Some boutiques have their own register and staff that share the space. Some bookstores have multiple boutique locations! For instance, at one point through River Dog Book Co., I had a used book boutique location inside a consignment shop, a selection of new releases at a coffee shop, books on crafting at a craft store, books on essential oils and organic lifestyles at the CBD shop, and I still did pop-ups around town. Co-ops In short, co-ops, or co-operatively owned businesses, are member-owned. It’s a little like having stakeholders and selling shares only less “corporate America” feeling. Every co-op member gets a voice (if they choose to use it) in how the business is run, but the business can still create a day-to-day management hierarchy and have membership meetings on large decisions instead of having 200 members mill about looking for something to do every day. I used to belong to a grocery co-op, for instance, and got a little monthly newsletter, a discount on my groceries purchased there, could attend a quarterly membership meeting, and occasionally got paid a small slice of profits from the business earnings. Co-ops, while having a board and running similarly to non-profits, are not, in fact, 501(c)3 nonprofit organizations. Employee-owned Like a lot of things in the bookselling and business worlds, this is a catch-all term for a broad concept that can look like many different things. At its core, an employee-owned business is a business in which the employees own shares of the business. These are sometimes called ESOPs (employee stock ownership plans), so if you’re looking to learn more about the various types of employee-owned businesses out there, search for that term. Project Equity (https://project-equity.org/ [https://project-equity.org/]) is a great resource for finding out more about how to structure a business of this type. Events-only What’s fun about this one is that some bookstores choose not to do events because they don’t work in their community, while other bookstores choose to be events-only businesses, because that’s what they love to do best and they’re in a community that supports this model. This type of bookstore will both put together their own author events – often festivals or large panel events or even book clubs and school/adult bookfairs – at which they sell books, and they can also be the book provider for authors who tour or have events of various types (such as school author events or again, festivals, or even events the authors have put together themselves maybe at a library or a private home or for an organization) in the store’s service area. These bookstores may want to consider having non-returnable accounts with publishers, as they receive a larger discount this way; any books leftover from the event, they can make sure the author signs, put them into their store stock housed somewhere (usually these types of stores do not have a physical presence of any kind), and sell those autographed copies online. They can also offer the autographed copies up to other stores for them to sell; if they choose to do that, it’s customary to sell them to other stores at cost + shipping, the original store isn’t making a profit of their bookselling colleagues, but they are recouping losses and not losing money on the shipping. Microspaces I love this concept and wish more communities would create these types of opportunities for locally-owned businesses! Microspaces are exactly what they sound like – a very small space in which a bookseller can test out their idea, get started as a business, slowly grow their presence in the community, and not have such drastic overhead costs from a physical space before they can afford them. The size of the space can be everything from a few shelves to a few hundred square feet, but they all have one thing in common: they’re extremely curated spaces that offer only a select range of books in the physical stock. This could mean the store is focusing on a niche (more on that in the next section) or simply that they’re testing the concept of a store in that market area. Portkey Books in Coral Gables, FL is a great example of a microspace: they have about 180 square feet of bookstore space, but regularly participate in city-wide events, host book clubs, organize 300+ people midnight release parties, etc., as well as having a great website and vibrant social media presence. Small can be very mighty! Multi-concept Store A multi-concept store is a bookstore that is also a _______ store (you fill in the blank). This could be a bookstore-slash-yarn shop, -plant store, -cat cafe, etc. There are many bookstore cafes/coffee shops, bookstore wine bars, etc. already out there; the novel model angle comes in when making this concept more your own with your unique interest as the second (or third!) business concept that is part of your shop. This might feel like splitting hairs because a lot of bookstores regularly sell sidelines. So the concept of a book-and-toy store has been around forever and a lot of general interest “bookstores” (with no other “official” concept) sell everything from puzzles to stationary to chocolate to tote bags–how would a multi-concept store be different from this? It’s the intentionality of the store. If half the store is dedicated to fiber arts with cubbies for yarn and shelves of various types of hooks and needles and other fiber art supplies, and you as the owner want to call your shop Knit Two, Read One (or whatever, I made that up, feel free to use it if you like it or judge it as the worst name in existence), then your store is a bookstore-slash-fiber arts/yarn shop, and that’s a multi-concept store. Niche Store As promised in the previous definition, here is more information about a niche store. The definition of “niche” in this context (thanks to Dictionary.com) is, “a specialized segment of the market for a particular kind of product or service.” In this case, that product is, of course, books, and niche would refer to a romance-only bookstore, children’s only bookstore, LGBTQIA2S+-only bookstore, etc. etc. etc. Basically if the focus of the bookstore is more concentrated than “general bookstore,” that’s a niche bookstore. That niche can be as inclusive (genre-only) or narrow (cookbook-only) as you the owner would like it to be. Sometimes niche stores develop out of market demand – a general bookstore could find that they have a readership that leans more towards a specific genre, and decide to reduce or remove sections that are not earning their keep so to speak (having poor sales figures) – or you could choose to launch a store that celebrates that one genre you specifically love and, like a siren, draw all the other specific-genre-loving-readers to your bookstore’s physical or metaphorical door.  Nonprofits Some bookstores operate as nonprofit entities. Some for-profit bookstores choose to have affiliated nonprofit organizations they start to support their events program or their community activism or their school visits, etc. Opening any business is not for the faint-hearted, and a nonprofit does have a few additional bells and whistles that will need to be considered before officially launching one, such as deciding which type of nonprofit your organization is going to be (there are more options than the standard 501(c)3, and a different 501(c)# could be better for what you’re try to accomplish) and putting together a board. Of course, there are also some potential perks, such as grants – but those are tricky to apply for, not guaranteed, and come with a lot of reporting rules as well. The National Council of Nonprofits is a great way to find out more–and it should be noted that federal legislations around nonprofit entities often change with each new president, so what may sound like a good idea under one president may not always have the same federal support and benefits under another. Of course, the same could be said for small, independently-owned businesses. Online/Virtual-only This model is the one that usually gets the most pushback from traditionalists, when considering the concept of an independent bookstore. People will throw around words like “third space” (you can read more about that here, if that’s a new term for you) and say that an online/virtual-only bookstore can’t possible be creating the same type of community as a bookstore with a physical presence. But as the pandemic showed us – and I personally believed this was true long before the COVID pandemic began in 2020 – community can be created anywhere and everywhere, and online is certainly no different. That all sounds very altruistic, however, and the truth is, if you sell books online, even if it’s on eBay or on “the platform that shall not be named”*, you’re a bookseller, and it’s your choice how much or how little community around books you want to build or even be a part of. Some stores that are online/virtual only do everything from having Discord and other server groups, online book clubs, virtual events, etc., while others are truly focused on solely selling/reselling titles, and neither of those are wrong, and both are still independent bookstores. I’ll continue to state this until you’re tired of reading it – no one else can decide if your bookstore is a bookstore other than you. THAT SAID, the American Booksellers Association (ABA) does differentiate between their “Online Bookstore Members” and their “Bookstore Members (Core)” (among others, such as “Used Bookstore Members” and “Provisional Members”), so that’s something to keep in mind when deciding if you want to join the ABA and make use of their resources (find out more here: https://bookweb.org/membership [https://bookweb.org/membership]).  Pop-Ups A pop-up bookstore is one that does not have a permanent physical space, but “pops up” at various opportunities, such as fairs and markets, within other businesses (such as coffee shops or any other business with a storefront willing to let you bring boxes of books and set up a table or other display) for a few hours or a few days, or, if in a physical space, is a temporary location with a clear end date (some business incubators offer spaces like these, some malls do this for empty storefronts over the holiday season, etc.). River Dog Book Co. has popped up in a women’s consignment boutique, a crafting store, an organic health-focused CBD store, at the Chamber of Commerce building for 3-day-long pop-ups where I outfitted the Chamber rentable room as a full-service bookshop for that length of time, at a Christmas market (no, it was not a “holiday” market, it was a full-on CHRISTMAS MARKET, and yes, I did bring generic winter books, Chanukah titles, etc.), and I’ve got my eye on a booth space at the local garden expo. Make no bones about it – these are a TON of work and while they can begin with nothing more than a foldable table, a selection of used books pulled of your own shelves, and a sheet from Walmart in one of your logo colors (ahem, personal experience talking here), they can also be a rather large investment in foldable/rollable shelving and/or additional fixtures, a tent that withstands various weather conditions (if you’re doing outside markets), crates or totes for moving books and merchandise around safely and securely, a vehicle that can fit everything you’re bringing, additional decor items such as rugs and chairs, signage, etc. Pop-ups are a great way to test a market, see what demand there is for what types of books/merchandise, and dip a toe into the bookselling water; it can also be extremely lucrative if you focus on doing hundreds of markets a year and make this your entire business model. Basically, it’s a great place to get started and feel out where you want to go next with your bookselling journey, if a brick-and-mortar, for whatever reason, is out of your reach at the moment. Traditional brick-and-mortar with novel aspects Can a traditional brick-and-mortar space be a novel model? Absolutely it can! In the first place, some of the above types of stores exist as brick-and-mortars (such as microspaces, boutique spaces, niche stores, micro-concepts, etc.). If your bookstore is general interest in books but has any kind of additional novel model aspect to it, you’re more than welcome to consider yourself a novel model because, why? Say it with me! Only YOU get to choose what type of bookstore you are! Clearly there is no one set definition for what a novel model bookstore is, so if you’d like to consider your personal bookstore dream a novel model, you are welcome to! Website: https://businessofbookselling.com/ [https://businessofbookselling.com/] Instagram: https://www.instagram.com/bizofbkselling [https://www.instagram.com/bizofbkselling] Links + resources mentioned in the episode: * Project Equity: https://project-equity.org/ [https://project-equity.org/] * National Council of Nonprofits: https://www.councilofnonprofits.org/ [https://www.councilofnonprofits.org/] * American Booksellers Association: https://bookweb.org/membership [https://bookweb.org/membership]

The First Five Business Things

Intro: What is handselling? How much do I sell a book for? Should I open a brick-and-mortar, a bookmobile, or a pop-up shop? How do I host author events? And most importantly, how can I turn my passion for books and reading into a profitable and sustainable, independently-owned, small business? Welcome to The Business of Bookselling, a live-workshop and interview-style podcast about business and book culture. This podcast uses a diversity, equity, and inclusion lens, combined with triple-bottom line sustainability business principles, to offer actionable advice, bookselling basics, and deep dives into the book ecosystem. Learn from bookstore, business, and book industry experts about how to turn your book-loving dreams into a profitable and sustainable book-selling business. Transcript: Once upon a time, someone had the brilliant idea to open a bookstore. For the purposes of this podcast episode, it’s not really all that important when and why and where someone else did that. The important part is when and why and where YOU want to open an independent bookstore. There is no one right answer, but I highly recommend having a think on it and writing it down for future reference. You want to know what the wrong answer is? “To make money.” This is probably the biggest, not very well kept, secret of independent bookselling: it’s a terrible, horrible, no-good, very bad way to make a living. (If you get that book reference, give yourself some bookseller bonus points.) Making money as an independent bookstore is not strictly impossible. Just highly improbable. Quite unlikely. The odds are stacked against you. You’re probably getting the point. There are many legitimate financial, circumstantial, and industry-specific reasons why that is the reality, which I will go into in a later episode, I’m sure, but for now, let’s proceed as if you’ve taken me at my word – no one opens an independent bookstore solely for the money. So, back to the original question: why do you want to?  If you can’t answer that question immediately, that’s okay! This podcast episode is here to help. Here are some questions for you to consider when wanting to open your own independent bookstore: I’m going to repeat that big one – WHY do you want to open an independent bookstore? – and – What type of store were you thinking of opening? When I say type of store, if you’re thinking, “Bookstore. Duh.” that’s not quite what I mean. I mean get more specific! Spe-ci-fi-ca-ly, what type of store? * A brick & mortar bookstore (i.e. one with a physical location), a pop-up boutique, a bookmobile, or something else entirely * A bookstore/café/event space * A bookstore + some other type of shop or organization (art supplies, crafts, games, animal adoption agency, etc.) * A children’s bookstore, genre-only bookstore, or other specialty bookstore If you’re not quite sure or if you already feel overwhelmed making that decision, would you consider purchasing an existing bookstore for a more turnkey operation where not every single decision has to be brand new and on your shoulders? Here’s something else to consider – WHERE do you want to open your bookstore? If there isn’t one already in that specific location, why not? If there IS one there already, will the consumer market support more than one? Some markets can absolutely support more than one independent bookstore, so simply because the answer is yes, doesn’t mean you’re out of luck. Instead, consider, if there’s already one or more than one bookstore in the area already, what are the others carrying and how will you set yourself apart (used vs new, adult vs kids, genre vs general, etc.)? Speaking of which, what ARE you planning on carrying in your bookstore? Again, books, duh, but are those new books, used books, remainders? Are you going to carry sidelines, also known as gifts, stuffed animals, toys, greeting cards, art supplies, t-shirts, tote bags, etc., puppies? (Don’t carry puppy mill puppies, please, but do consider holding pet adoption events.) Here’s a fun question for ya – How do you plan on funding the opening of your independent bookstore? Do you need to start drawing a salary from day 1 or can you wait 2-5 years before paying yourself a living wage? And finally, do you enjoy spending time with your family and friends, or are you okay with the concept of never having a day off again as long as you live? If you don’t know the answers to some (or even all) of these questions, or you now find yourself overwhelmed by the entire concept and don’t really want to continue listening – good! That’s literally the whole point of this podcast. I want to help you be as prepared as you can be prior to opening your independent bookstore so that you have a greater chance of actually making enough money to succeed (and by succeed, I mean you can afford to stay open and in business), so put on those big girl/boy/trans/nonbinary/genderqueer panties/pantaloons/boxers/briefs/thongs/underpants/undies/unmentionables/intimates absolutely no judgement whatever you want to call them or wear – or not – these can be metaphorical if that’s your thing, but either way, gird those loins, keep listening, and don’t panic (more bookseller bonus points for you if you get that reference, too).  In the many many conversations I’ve had with new bookstore owners and bookstore owning dreamers, I hear time and time again that one of the scariest, most confusing parts of business is understanding the actual legal business pieces of it. We’re going to try to gently and in an overview fashion dive into some of those details, but first, a huge disclaimer that I am not a lawyer, business advisor, a registered accountant, a financial advisor, or in any other way officially qualified to give business or financial advice; I am simply presenting factual information and you will need to do your own research and/or work with a professional to make these decisions for yourself and your business. Now, on to the business of bookselling!  If I were to ask you – what type of legal structure is your business going to be – do you have a ready answer?  On one hand, you may want to become a nonprofit to apply for grants or register as an LLC in order to protect your personal assets. But you must also consider how you plan to have your business pay taxes. That is because a legal business structure does not always mean that you pay your taxes using that same structure. Some business types allow you to pay taxes as if you’re a different type of business entity, and some states recognize certain types of business structures differently than other states, so what state your business is incorporated in matters just as much as what business structure you’ve chosen. As if that wasn’t confusing enough, some business structures require a separate registration at the federal level, in addition to registering the business at the state level. Because this can all be really complicated, again, I cannot stress enough the importance of having a business lawyer, accountant, and/or business advisor to help you with this. Your nearest Small Business Development Center (SBDC) should have free appointments available with business advisors who can give you free advice (did I mention these are free??) and they can also recommend local lawyers/accountants who can provide paid services, and your local Chamber of Commerce should have people among their members who are lawyers/accountants who you can reach out to as well about their paid services. So you can always start with the free advice and then move on to more specific paid professionals if you need more assistance. In a different episode, I’m going to go over the different types of bookstore businesses that I first asked you about, like pop-up, brick-and-mortar, bookstore/cafe/yarn shop, etc., but right now, I’m going to give you really basic information about legal business structures, and then you can find out more about them on your own by going to irs.gov, sba.gov, or that can be your first question that you ask your new business advisor when you make your free appointment at your nearest SBDC. Let’s begin! * What is a Sole Proprietorship? (I feel like I’m on Jeapordy) * Basically this is just you, owning your own business. There’s no separation between your personal assets and the business assets. This is probably the riskiest option for owning your own business,, as you could be sued as your business or the business could go under and you could lose all personal assets, like your home or car or all your money, if that happens. That said, you can still use a trade business name for your business with a sole proprietorship; it doesn’t have to be your actual name. * What is a Partnership? * This is the same as a sole proprietorship in terms of the liability, only it involves two or more people. Still pretty risky on the personal liability front. There are two types of partnerships – limited partnerships (LP), where one person has all the liability and the other people have limited liability, and limited liability partnerships (LLP), where everyone involved has limited liability. The pro here is that it’s a very simple thing to create and it has what’s called flow-through taxation, which means while it’s very easy to file taxes for this through your personal income taxes, you DO have to be careful to keep the business finances operating separately from your personal finances in order to do this. If you are planning on going into business with anyone, please make sure your business partner(s) have the patience, understanding of your vision, and supportive nature of my parents encouraging their daughter’s origami stand instead of the more traditional American lemonade stand I opened as a 9-year-old (SO ahead of its time, I know. I’m sure people would flock to my origami stand today unlike how they did NOT in the early 90s…I digress). If they don’t have that, they better be bringing some other VERY good assets, connections, and knowledge to the table to make that risk worthwhile. Because while it might seem incredibly daunting to open a bookstore all on your own, it’s even worse trying to open a bookstore with the wrong business partner. And in this scenario, the wrong business partner includes predatory lending practices from banks and other financial institutions or potential funders. There is absolutely no shame in starting off small, doing pop-up events, renting a micro space (300 square feet or less, roughly), or coming up with a different creative way to dip your toe into independent bookselling. Other options for avoiding partnership structures include being rich, romantically partnering with/marrying a rich person and gaining access to their money to start your business, winning the lottery, drawing up individual contracts for personal loans from friends and family members (sort of like unofficial crowdfunding), actual crowdfunding through websites like Kickstarter, GoFundMe, Kiva, and IFundWomen, and applying for grants if your store is a nonprofit or if you find a grant applicable to your business structure. We can also sneak in buying an existing store in an owner-financed circumstance, where the original owner essentially turns over the keys to you for the running of the business as the new owner and then the original owner takes a salary or percentage of profits from the store until receiving the agreed-upon amount to cover the purchase/sale of the store by you. (While there are many ways that scenario can be constructed, in this case, the original owner would not be a partner in the running of the business, but would simply receive payments. There are, of course, ways to construct this type of business sale where the original owner is still involved in the running of the business with the new owner, and this type of long term handover can occasionally prove to be very beneficial for new-to-independent bookselling bookstore owners.) Don’t get me wrong – business partnerships can be lucrative, supportive, energizing, and affirming. Owning a bookstore can be a multigenerational family enterprise like Oblong Books in upstate New York, or can bring a couple closer together like Cavalier House Books in Louisiana. It can be a cooperative structure with many partners (like Raven Bookstore in Kansas) or a friendly financial and legal arrangement between friends/co-workers/colleagues, like Loyalty Bookstores in Washington DC and Maryland). Nonprofit bookstores have entire communities as partners (Bookmarks in North Carolina or R.E.A.D. in Virginia). Some bookstores have silently lurking partners, occasionally in the form of a single person or group of private investors – I would name some but that would give away the whole silent, which often means secret, investor part. Some bookstores are set up within other existing spaces, and the partnership structure looks even more different there, with rent and profit sharing coming into the mix (La Revo Books in Wisconsin has boutique locations within another business and they share spaces with other businesses, in addition to doing pop-ups). And then, of course, many many bookstores have financial partners in the form of traditional or specialty bank loans; those lending institutions are partners in the business, too. But those last two examples (setting up shop within an existing business and bank loans) don’t really impact the legal business structure of your bookstore, and that’s really the first thing you need to decide, so let’s dive back into that:  * What is a Limited Liability Company also known as an LLC? * This can be one person or it can be more than one person as part of this business structure, but it removes personal liability, meaning if this business fails, you hopefully won’t lose personal property, unless you’ve used that personal property as collateral for a bank loan, for instance. This type of business structure can be converted into a corporation structure later on. This is a very easy type of business structure to set up and many many independent bookstores begin and remain as this type of legal business structure. Now, let’s move on to corporation structures. A corporation, in general, offers stronger protection for the owners from personal liability, BUT it costs more to form one and is slightly more complicated to maintain. There are also different tax implications for making a profit as a corporation than as an LLC; basically corporations pay income tax and sometimes the profits are even taxed twice – once when the profit is made (called an entity tax) and once when profits are paid to shareholders (so this would be on their personal taxes, so called owner tax). That said, a corporation is the best business structure when trying to raise capital for a business, as it also allows for different classifications of stock amongst shareholders, Board of Directors, officers, etc. Also, there are legal ways around double taxation if you work with a good accountant. Here are those corporation types: * A C Corp (corp is short for corporation) is the most basic kind of corporation.  * An S corp is, yes, another type of corporation structure, but it’s a special corporation (hence, S corp) in that it can avoid some of the double taxation of C corps. THAT SAID, not all states treat S corps the same and this is the one you have to register separately at the federal level than at the state level, etc. More hoops to jump through for this one; this may also be what makes it so “special.” Also, for this one, you can’t have non-US citizen shareholders or partners, and you can have only one class of stock, but you can make it voting or non-voting. If that’s all too in the weeds for you, again I really can’t recommend enough doing your own research on what all this means! * B Corp (you’re getting the picture here about what corp stands for, I hope) * The “B” in B corp stands for benefit. This is a for-profit entity that acts as a social enterprise or mission-based organization. As the Small Business Administration (SBA) puts it, “B corps are driven by both mission and profit.” Not all states recognize this business structure, and it’s taxed in the same way that a C corp is, not an S corp. * Just to make it more confusing, there are third party entities that provide an assessment for B Corp Certification. That is NOT a legal business structure but it recognizes the social and environmental impact of an organization (and which must be recertified every three years, to ensure the company is staying true to B Corp Certification principles). For instance, the independent bookstore-supporting online bookstore Bookshop.org is B Corp Certified. This B Corp Certification is not required for a business to be legally considered a B corp business designation in states where that type of business is recognized. You can find out more about the B Corp Certification at bcorporation.net. * Close Corporation * A close corporation is kind of like a B corp but with a less traditional corporate business structure (whatever that means in practice…). It’s not one that you hear a lot about, so definitely do more research into this if you’re considering going the B corp route. * Moving on to Nonprofit Corporations: * The mission of a nonprofit organization must benefit the general public community in some way. Usually nonprofits are focused on work in these areas: charity, education, literary, political, religious, scientific. Because the work benefits the public, nonprofits can receive tax exemption from paying state and federal taxes on profit made; a separate filing with the IRS is required to receive this tax exemption. That also means setting up the business as a nonprofit business entity is separate from setting up the business as a nonprofit for tax purposes. The Seminary Co-op Bookstores, for instance, changed from a worker-owned cooperative to become the first not-for-profit bookstore in the country whose mission is strictly bookselling, BUT the stores’ tax status did not change; being owned by the public as a business structure is separate from the IRS and paying taxes. Also, historically, each new presidential administration has changed laws around small businesses, business legal structures, taxation of businesses, and that includes nonprofits, so it’s really important to do your research into any new changes into the type of business structure you’d like to be to make sure it still allows you to do what you want to do. * According to a December 2022 Forbes article, there are 32 different types of nonprofits. The most common is a 501(c)(3), which refers to the part of the Internal Revenue Code that grants the tax-exempt status and are mostly applied to charities, but there are also 501(c)(6) organizations, like the American Booksellers Association (ABA), which falls under the “business leagues” nonprofit status designation. It’s important to do your research here and, depending on the mission of your business, choose the correct tax exempt status to apply for, for your nonprofit business structure. * Last but not least Cooperative * While you may associate the word “co-op” with a local grocery store selling organic produce, at its core, a cooperative business, or co-op, is simply a business that is owned and operated by its community. This community can be made up entirely of the people working in the business, or it can also include general members of the public who don’t work in the store, but who have purchased shares as an investment in the business and are now cooperative members. I still get the member newsletter for the grocery co-op I joined in 2008 in Massachusetts, where I haven’t lived since 2013, so you may want to carefully consider some things before opening your co-op up to the public or else you may end up with a rolodex of absentee members after a few years (learn from me…). If your head isn’t already spinning, here’s some more information that may make it start: the C Corp, S Corp, and nonprofit legal business structures can also be tax structures, separately from the business structure. So an LLC can file taxes as someone self-employed OR as an S Corp, if the business is arranged to do so. See what I mean about talking to a professional to get some advice on what would work best for you? Take a deep breath in. Let it out. Do it again a few times.  Now here’s the shortcut (and again, I’m not telling you to do this because I’m not a licensed business or financial person, I’m just sharing common practices): most independent bookstores start out as LLCs and pay their federal business taxes through a Schedule C form when they file their personal taxes around April 15 (or before, if you’re an early bird, or after, if you’ve gotten an extension, but really, the first three months of the year are usually the slowest in indie bookselling, so I’d recommend doing it when you’re supposed to, if you’re at all able). Though it can get a little messy, if you decide to change your business structure later, you can do so. You can turn your for profit business into a non-profit business, for instance. You can also run multiple businesses under one public-facing heading – for instance, Bethany Beach Books in Delaware runs a bookstore under that name and also a very successful subscription box service under the name The Book Drop (that’s a separate business, but is publicly linked to Bethany Beach Books), and many bookstores have both a for profit side and a non-profit side for events and programs, such as Dragonfly Books in Iowa. I cannot stress this enough – getting some professional business advice for how to make that work is most definitely advised! BUT if all you want to do is start selling books tomorrow and the rest will figure itself out, save up about $300 for various filing fees, and here are the first five steps you need to take: 1. Decide on your business entity (LLC is the easiest legal structure that offers you the individual the most protections) 2. Register your business through your state’s office for doing so – Wisconsin literally has a one-stop business portal through their Department of Revenue where you can do all the paperwork needed to register your new business. It cost me about $50 and 10 minutes. In Oregon, I did this through the Secretary of State’s website and it also cost about $50. You could pay a lawyer to do this for you, or you could literally open your favorite web browser and type into your favorite search engine, “How to register a business in [your state’s name]” and one of the top non-sponsored search responses will be your state’s department for doing this. If you have an intermediate English reading and comprehension level, the questions asked are relatively straight-forward, and there are official state department phone numbers to call and reach a live person who can assist. Quick note here: this does mean you have to decide on a name for your business… While we all want to choose the most perfect name on the face of the planet for our very special and unique bookselling business, there’s something very important you need to know: if you do, for whatever reason, decide to change your mind about the business name, you can do so without registering as a new business entirely. This phenomenon is called a DBA or doing business as. It’s also known as a fictitious business name, an assumed name, or a trade name. So legally your business would be called one thing, while publicly, you would be doing business as a different entity name. What this looks like in practice is that you can register your business as Aunt Mary’s Curiosity Shoppe LLC, and years later decide to call it Uncle Jim’s Book Barn, and all you need to do is file the DBA update with your state (sometimes also with your county; AGAIN, check with your SBDC or your favorite search engine for the specifics required for where your business is registered). All of this is to say that if you haven’t come up with the most perfect special name for your bookstore business but you still want to get started, it’s okay! Pick one, register it, and you can always do a DBA later. (Also again, I’m not a business lawyer, but common practice does have people dropping parts of their legal name, such as the LLC after the business name, on websites, business cards, social media, etc., and a DBA generally isn’t filed for that. For instance, a bookstore might be called The Book Shoppe LLC on legal paperwork, but go by simply The Book Shoppe publicly, without the LLC part.) So what do you want to call your store? It can be traditional, like Your Name Booksellers. It can be place-based, such as any number of Main Street Books locations or Montana Book Co. in, of all places, Montana. It can be whimsical, such as The Wandering Jellyfish Bookshop in Colorado, or it can mean something special to you, such as Green Feather Book Company in Oklahoma. In this age of social media, however, one big thing to consider is whether your social media handles are available. But even this isn’t a deal breaker – if your chosen name is taken on social media, try adding location initials or something else to stand out; for instance The Haunted Bookshop in Mobile, AL and in Iowa City, IA both include their city names in their Instagram handles for ease of recognition. Whatever you choose, I always recommend trying to get the same handle across all social media channels, even if you don’t plan on using all the social media channels, for ease of customer recognition and future tagging purposes. Okay, back to what’s now no longer the super quick version of how to open an independent bookstore. The third thing to do is to apply for your federal and state tax ID numbers. Your federal tax ID number is also called your Employer Identification Number (aka EIN or FEIN) and you will be asked for this number roughly seven trillion times over the course of your business lifetime, so I highly recommend when you get this number that you have at least a PDF copy of the paperwork saved on your computer and a printed copy of it in an easily-accessible file somewhere near your desk. For your federal tax ID number, IRS.gov has an EIN assistance tool for applying for this number AND a helpful phone number to call if assistance is needed. For your state tax ID number, again use your favorite search engine to look up “How to get a state tax ID number in [state]” or read through the website you’ve already found for what your state requires in this department when you registered your LLC. Keep in mind that each state is different! In the state of Wisconsin, I had to complete a Business Tax Registration with the Department of Revenue AND I had to register with the Wisconsin Department of Financial Institutions; I pay taxes to the Department of Revenue on a quarterly basis AND I have to file an annual report with the Department of Financial Institutions every year to let them know my business is still operating. That’s all in addition to filing my personal and business federal tax returns. 1. #4 – Apply for any state licensing and permits that you need. Because bookselling is a retail business, many states have some kind of seller’s permit that’s required. Again, search “seller’s permit, your state” in a search engine for how to get this for your state. When opening accounts with publishers (and other vendors), you’ll also be required to submit a Sales and Use Tax Exemption Certificate (sometimes called a Resale & Tax Exempt Certificate, or something similar), which allows you, a retailer, to purchase from the publisher at a wholesale cost without paying tax on the original items (so you are technically in this scenario only tax exempt as a for-profit business – most nonprofits are tax exempt as well) so that you can resell them in your shop and collect sales tax from your customers at that time. Again, the search engine is your friend; if you haven’t already been pointed to this by whatever websites you’ve already been on, type in “Sales and Use Tax Exemption Certificate [your state]” and one will come up; you’ll want to fill out the “Purchaser” part of the document, and send that in to every publisher for them to fill out the “Seller” part of the document and keep it on file for you when you open your publisher account. If you plan to have a bookstore/cafe or other type of hybrid business, other local, state, and federal permits may be required. Also, even if you don’t offer regular food or beverage, you can also get one-off permits for serving drinks at a special event. Some municipalities may also require permits for large events, say if you’re having an outdoor courtyard event with a local author reading and live music. At some point, it would probably behoove you to explore the wild and wonderful world of municipal permitting for your area to make sure you’re in compliance with everything. But you can do that later. 2. Lastly, open a business bank account I recommend banking locally, if at all possible – what a shock, I know, to recommend local – but the most important thing is to avoid fees. When looking for a business bank account, I double-check if there’s a minimum balance I need to keep in the account without a fee, if there’s a deposit limit (either daily or monthly dollar amount, and also how many total deposits can be made in a month), if there are any transaction fees, and if there are any fees for using the debit card at a non-local bank ATM location (in case I travel for bookselling work), AND if there’s a no-fee credit card I’m able to apply for via the bank that can help me with my business (for instance, earning cash back or airline miles that can be spent on work travel to conferences, etc. – make that system work for you, my friends!). Opening a business bank account is the single most important thing you can do to avoid co-mingling your personal and business assets and causing yourself ALL KINDS OF HEADACHES when doing taxes or, heaven forbid, if you’re ever audited. 5. Now you’ve decided on your legal entity type, registered your business (and in doing so, chose a name, which is kind of a sneaky extra thing I slid in there), applied for federal and state tax ID numbers and any state licensing and permits you needed, and finally, opened a new business bank account – Congratulations! You’re now in the bookselling business! Website: https://businessofbookselling.com/ [https://businessofbookselling.com/] Instagram: https://www.instagram.com/bizofbkselling [https://www.instagram.com/bizofbkselling] Links + resources mentioned in the episode: * Small Business Development Centers (SBDCs): https://www.sba.gov/local-assistance/resource-partners/small-business-development-centers-sbdc [https://www.sba.gov/local-assistance/resource-partners/small-business-development-centers-sbdc] * https://www.sba.gov/ [https://www.sba.gov/] * https://www.irs.gov/ [https://www.irs.gov/] * https://www.ifundwomen.com/ [https://www.ifundwomen.com/] * https://www.kickstarter.com/ [https://www.kickstarter.com/] * https://www.gofundme.com/ [https://www.gofundme.com/] * https://www.kiva.org/ [https://www.kiva.org/]

The First Five Things

It is a truth universally acknowledged that all cities, towns, and even neighborhoods are in need of an independent bookstore. And yet, there is no one single way to accomplish this. But, there are some universal truths about opening an independent bookstore, in America at least, that each new bookstore owner should acknowledge. And that is where this podcast episode comes in. Welcome to The Business of Bookselling: The First Five Things to do when starting to consider opening an independent bookstore.  1. Create an email address specifically for your bookstore dream. This may sound like an odd one to start with, but here’s why: you’re about to embark on one of the most exciting journeys of your life. Perhaps this is something that’s been percolating in the back of your mind for years, or maybe you’re exploring an opportunity that recently fell into your lap – if that’s the case, I would totally read that book and watch the movie about this happening – but either way, you’re about to dive deep into a research and logistics process that will, at one point or another, become completely overwhelming to you. Don’t be scared, this is a natural part of life. Have you ever started a hobby or been interested in taking a vacation somewhere, and suddenly you find yourself with 300 skeins of yarn and 500 knitting needles, or more long-distance road biking equipment and gear than you’ll ever use in a season, or receiving notifications and emails from the 50 travel-to-Italy Facebook groups, gap year abroad blogs, and budget travel websites you’ve joined for that trip to Iceland or Italy? This is like that. At some point, you’re going to want to step away for a minute. And it’s much MUCH easier to not check one email account for a little while than to avoid the email you use for everything else, from emailing recipes with your sister to paying your bills. By the way, on a personal note, I highly recommend getting a different email account that you use just for your bills. Anyway, in addition to one email address being easier to step away from, it’s also the easiest way to find something you thought you remembered from that one piece of research you did – or in other words, it’s MUCH easier to organize. So do yourself this favor and create a new IHeartMyBookstoreDream-at-freeemailwebsite-dot-com [IHeartMyBookstoreDream@freeemailwebsite.com] email address to go down this path of exploration. 2. Now that you’ve opened a new email address, start your research. First and foremost, research bookstores in your area. Do you have one or more? If one doesn’t exist within an hour drive radius of you, can you find out why not? If one does exist nearby, what else can you find out about it? Is it a corporate store or an independently-owned one? Does it have a café or additional business as part of the store model? Does the store sell new or used books or both? What else does it sell – cards, gifts, toys? Does it have a niche focus in some way? Collecting all of this information will help you identify gaps in the market where your book business could thrive. This is an incredible opportunity to start narrowing in on your exact business model and product – or multiple products – you want to focus on for your own store. 3. As part of that research you’re doing – and this is item #3 on the list – sign up for industry newsletters and bookselling Facebook groups – if you’re a Facebook user – to start learning more about the book industry and what books you’d like to bring in for store stock. Some recommendations for Facebook groups to join as someone new to the industry include Indie Booksellers; Diversity, Equity, and Inclusion in Bookselling; the Pop-Up, Bookmobiles, and Other Nontraditional Bookstores group that I moderate, BXsellers run by Publishers Weekly; The Romance of Bookselling, for booksellers specifically interested in romance; and a lot of others that are niche specific, like Children’s Booksellers, Mysterious Indie Bookselling, Indie Bookseller Sidelines for learning about non-book products to sell, etc. I’m part of the mod team for several of these, so don’t be surprised if you join and see me popping in to post. Industry newsletters you should sign up for include but are not limited to Shelf Awareness – they have two, one that’s industry-focused and one for readers; I recommend signing up for both; Publishers Weekly – if you join that BXsellers Facebook group, you can receive free newsletters by clicking the pinned links with that offer in the group; a newsletter called The Independent Bookseller, which provides a round-up of indie-specific reminders and opportunities; and the We Need Diverse Books newsletter, which highlights titles by diverse creators and featuring diverse characters, but which also includes different industry opportunities to be a part of. Another type of industry newsletter are those that other independent bookstores put out. You just did all that research on bookstores in your area – sign up for their newsletters! Find other bookstores in the industry that inspire you with what they’re doing; sign up for those as well, and then keep a folder in your email of great ideas you’d love to replicate in your own way some day. If you’re really into organization like me, you may also want to start some spreadsheets of titles, perhaps organized by genre or section or age of reader, listed out with title, ISBN, author, illustrator, and publisher name. If you’re wondering where you find all of that information, I want to introduce you to an industry website called Edelweiss plus. Literally, the website is E-D-E-L-W-E-I-S-S.plus. It’s free to create an account, and it is a wealth of industry information. You can join communities as a reader, becoming involved in conversations and giving and receiving book recommendations, but perhaps more importantly as a bookstore, you can look through season after season of publisher catalogs. They often offer catalogs or collections of titles for specific identity holidays, seasonal titles, groupings along a particular theme, etc. Edelweiss offers a lot of tutorials, as it can appear a little overwhelming at first, but it also provides so much wonderful information 4. The fourth thing I would recommend doing is spending a little bit of money to join your regional bookseller association and the American Booksellers Association (ABA) as a provisional member. These are trade associations geared towards independent booksellers who sell primarily new books. There are other associations, like the Antiquarian Booksellers Association or ASTRA, the American Specialty Toy Retailing Association, that booksellers selling other types of products may also want to join, but as this podcast is primarily focused on independent bookselling, the regionals and the ABA are the ones that offer education, services, information, and networking opportunities that will help you at every step along your journey. The ABA website – bookweb.org – does have the other regional associations listed at the bottom of their page, but here’s some love for them by name – CALIBA recently united the entire state of California into one regional association, whereas PNBA serves the rest of the west coast and a few other western states and even includes some Canadian booksellers; GLIBA is for the Great Lakes region, while MIBA is for the Midwest-based stores – some stores belong to both regional associations, and these two have historically come together to offer the Heartland Fall Forum which unites the booksellers in both associations for one week long conference; MPIBA serves the Mountains & Plains region north to south, and NEIBA (New England), NAIBA (New Atlantic), and SIBA (Southern) serve the entire east coast with various individual and overlapping programs throughout the course of the year. 5. The fifth and final recommendation I have for anyone looking to start an independent bookstore is to pick your store name–and once you have that, purchase the domain name and grab your store’s social media handles. Domain name is the URL for the online home of your business. RiverDogBookCo as an example. Social media – Facebook, Instagram, Twitter, TikTok, Pinterest, Snapchat (if that’s still a thing when you’re listening to this). Storygraph. Discord account. LinkedIn page for your business. Basically any online medium you think you’ll use when you open your business. Don’t have to use them all; put up a placeholder post for now and possibly even in the future, directing people to the one channel you choose to use the most. But grab all the handles now so that if you want to use them later, you can. Also, if you know what you want your store to be called before doing the rest of this, then combine number one and number five – make your bookstore research email your store’s email. It can be StoreName-at-freeEmailAccount-dot-com – by the way, that’s a placeholder website so it doesn’t sound like I’m sponsored by any particular free email account organization, just FYI – or you can go ahead and purchase your domain name and then hook that up to something like a paid Gmail account that will use your domain name for your email address, so you can create something generic like hello-at-riverdogbookco-dot-com. Whether you choose to do that or not, use the email address you created for all of your bookstore research to sign up for all of these social media channels so you can, once again, have everything organized in one place. So now that you know the first five things to do once you’ve had the idea to open an independent bookstore, can you guess the most frequently asked question I get asked from people with this idea? “What books should I carry?”  My answer is going to give you a little bit of bonus information for things to explore and start doing.  Start with the books you yourself love to read, because that is what you know the best and you can use those books to practice what’s called handselling – placing a book in someone’s hand, excitedly telling them about it, so that they want to purchase this book that they didn’t know about before you told them about it. That’s essentially what being a bookseller is – putting the right book in the right hands for the right reader. Over and over and over again until the end of time. If that doesn’t sound exciting to you, you might want to start thinking about exactly why you want to open an independent bookstore. I’ll dive into that a little deeper in another episode, but in the meantime, if you begin with the books you love to read – in my case, much of my first season of pop-ups had inventory that I pulled off my own shelves at home, and I know I’m not alone in that – and then read through these industry newsletters and pay attention to things like the independent bookselling and national bestseller lists (each regional association does send out their own weekly bestseller list, and you can Google things like the New York Times, USA Today, etc. bestseller lists), national book awards, like the American Library Association (ALA) awards, the actual National Book Award, the Pulitzer Prize, and others, and then keep an eye out for other books that are being talked about in the general zeitgeist – various celebrity book clubs, for instance, or movies and TV shows that are based on books, things like that – you’ll be able to pick and choose the titles that you want to carry that best fit your bookstores’s niche and the needs of your community. Now, all of that said, here’s a very important piece of advice I want to leave you with: don’t let anyone – myself or any of the other wonderful, knowledgeable, and experienced booksellers you may talk to or who are featured on this podcast, or anyone else you go to for advice, or people you didn’t go to for advice but will still give it to you – tell you how to run your store. That’s what makes this industry so beautiful. Whatever distinctive ideas, partnerships, book clubs, decor, events, etc. you have or want to do in the future to make your store unique? That’s the whole point of independent bookselling. It’s YOUR bookstore, and you can do with it what you want to. Welcome to the community. Website: https://businessofbookselling.com/ [https://businessofbookselling.com/] Instagram: https://www.instagram.com/bizofbkselling [https://www.instagram.com/bizofbkselling] Links mentioned in the episode: * https://www.edelweiss.plus/ [https://www.edelweiss.plus/] * http://bookweb.org [http://bookweb.org] Bookselling Facebook Groups to Join (search by the group name in Facebook, if the link isn’t working): * Pop-Ups, Bookmobiles, &  Other Non-Traditional Bookstores – this is the group I started and admin for; at last count, we had almost 2,500 members * https://www.facebook.com/groups/272475283556676 [https://www.facebook.com/groups/272475283556676] * Indie Booksellers – this is the most popular independent bookselling group on Facebook and definitely the OG of the bunch, along with being one of the most active; has about 3,200 members * https://www.facebook.com/groups/indiebooksellers/ [https://www.facebook.com/groups/indiebooksellers/]  * Bookseller Mentors – a group run by other independent booksellers and geared toward helping newbies; about 2,800 members * https://www.facebook.com/groups/2774656642655715 [https://www.facebook.com/groups/2774656642655715] * BXsellers – this group was created by the industry publication Publishers Weekly; I am currently one of the moderators; it’s a place where you may get quoted in an article if you answer a question by a Publishers Weekly staff member (they openly state this about their questions); has about 1,500 members * https://www.facebook.com/groups/1702657459794029/ [https://www.facebook.com/groups/1702657459794029/] * Booksellers- 1 Person Indies – a group for indie bookstores run by one person; I’m also an admin for this group; it’s less active but is a good place to ask questions specific to one-person stores; has about 330 members * https://www.facebook.com/groups/808900192984386/ [https://www.facebook.com/groups/808900192984386/] * Children’s Booksellers – a group for…children’s booksellers….; about 180 members * https://www.facebook.com/groups/553413184774826/ [https://www.facebook.com/groups/553413184774826/] * Diversity, Equity, & Inclusion in Bookselling – this group used to be run by the American Booksellers Association’s Diversity, Equity, and Inclusion Committee, but then everyone on that committee decided to leave Facebook, and so in order to not lose the historic record, I became one of the admins; a few other folks admin as well; I wish this group was more active but it’s a good place to go for specific resources such as creating a land acknowledgement (resources are pinned to the top of the group); currently about 460 members * https://www.facebook.com/groups/deiinbookselling/ [https://www.facebook.com/groups/deiinbookselling/] * The Romance of Bookselling – a group for booksellers who love romance; some publishers are also in this group; it’s run by Billie Bloebaum, the bookseller who started Bookstore Romance Day in 2018; has about 530 members * https://www.facebook.com/groups/1772632959493048/ [https://www.facebook.com/groups/1772632959493048/] * Mysterious Indie Bookselling – a group for booksellers who love, you guessed it, mysterious! Not very active, but still a fun place to go for recommendations; about 110 members * https://www.facebook.com/groups/729448614597881/ [https://www.facebook.com/groups/729448614597881/] * Indie Bookseller Sidelines – a group run by other independent booksellers who all offer more than books in their stores; specifically talking about what gift items make great merchandise to also sell at indie bookstores; about 2,200 members * https://www.facebook.com/groups/indiebooksellersidelines [https://www.facebook.com/groups/indiebooksellersidelines] * Indie Bookstore School Book Fairs – a group for bookstores with questions about how to run school bookfairs; about 430 members * https://www.facebook.com/groups/718744463013290/ [https://www.facebook.com/groups/718744463013290/]  * Used Bookstores/Booksellers – I think you get the point of this group; about 515 members * https://www.facebook.com/groups/1026309424997462/ [https://www.facebook.com/groups/1026309424997462/] Bookselling Facebook Groups to Join that are Region-Specific: * California Independent Booksellers Alliance – CALIBA Bookseller Group: https://www.facebook.com/groups/592082324677450 [https://www.facebook.com/groups/592082324677450]  * Midwest Independent Booksellers: https://www.facebook.com/groups/midwestbooksellers/ [https://www.facebook.com/groups/midwestbooksellers/] * MPIBA Booksellers: https://www.facebook.com/groups/680019409173304/ [https://www.facebook.com/groups/680019409173304/] * NW Indie Bookselling: https://www.facebook.com/groups/889418684443009/ [https://www.facebook.com/groups/889418684443009/]  * Southern Independent Booksellers Alliance Group: https://www.facebook.com/groups/205172186875708 [https://www.facebook.com/groups/205172186875708] Bookselling Facebook Groups to Join That Are Point-of-Sale System-Specific: * Booksellers on Bookshop.org US (managed by Bookshop.org team): https://www.facebook.com/groups/1550729631964952/ [https://www.facebook.com/groups/1550729631964952/] * Basil Bookseller Software Group: https://www.facebook.com/groups/BasilBooksellerSoftware/ [https://www.facebook.com/groups/BasilBooksellerSoftware/] * Bookmanager North American Bookstores: https://www.facebook.com/groups/1282053901967553/ [https://www.facebook.com/groups/1282053901967553/] * Bookstores Using Square: https://www.facebook.com/groups/1097407303731307/ [https://www.facebook.com/groups/1097407303731307/]  * Booksellers Using IndieCommerce: https://www.facebook.com/groups/2531600896999738/ [https://www.facebook.com/groups/2531600896999738/]

The Business of Bookselling Trailer

Welcome to The Business of Bookselling with BrocheAroe, a live-workshop and interview-style podcast about business and book culture. This podcast uses a diversity, equity, and inclusion lens, combined with triple-bottom line sustainability business principles, to offer actionable advice, bookselling basics, and deep dives into the book ecosystem. Transcript: My name is BrocheAroe Fabian, and I am a bookseller. For over 15 years, I have turned my love of reading into a book industry career, working at one museum library, three publishing companies, and five bookstores, teaching English and Creative Writing, becoming a freelance editor, writer, bookstore consultant, and sensitivity reader, all while earning two degrees and a certificate, and finally opening my own independent bookstore, River Dog Book Co., in 2018. With all of that experience, I thought I knew what I was doing, but since then, I have learned so much more about business in general, the bookselling industry specifically, and I still have a lot of bookstore goals I’m working toward reaching in my future. At some point during my bookselling journey, my commitment to cultivating community met my desire to share knowledge, and the idea for creating accessible and inclusive content about the world of bookselling was born. I want to help other people make their independent bookstore dreams come true in a way that recognizes that we all begin this journey at different places, with different resources, serving different communities, and with different goals in mind. There is no one right way of opening an independent bookstore, so I am here to facilitate the transfer of bookselling knowledge from people in the industry to people who want to become part of the industry, in a way that is accessible for everyone. Join me and my equally book-obsessed and industry savvy friends as we explore the vast and varied ecosystem of the book industry, from the nuts and bolts of opening an independent bookstore to the creation of a book as a product worthy of selling in the first place! My guests will be experts in their field and newbies learning along the way, fellow booksellers and publishing executives, writers and illustrators, and other industry stakeholders and thought leaders you may never have heard of. What’s the one thing we all have in common? We’re all dedicated, in one way or another, to the sales pipeline of one very specific product: the book. Welcome to The Business of Bookselling. Website: https://businessofbookselling.com/ [https://businessofbookselling.com/] Instagram: https://www.instagram.com/bizofbkselling [https://www.instagram.com/bizofbkselling]