Brave fight

Many re­tail­ers of books rein­vent busi­ness mod­els to sur­vive and thrive in spite of com­pe­ti­tion on­line

China Daily (USA) - - FRONT PAGE - ByWUYIYAO in Shang­hai wuyiyao@chi­nadaily.com.cn

Re­tail­ers of books are rein­vent­ing busi­ness mod­els to sur­vive and thrive in the face of com­pe­ti­tion from on­line sell­ers by mak­ing their stores places to be.

Ev­ery Satur­day, ac­coun­tant Liu Xincheng, 28, makes spe­cial ef­forts to reach the SiSYPHE book­store in cen­tral Shang­hai’s Joy City, a com­mer­cial com­plex, ear­lier than other cus­tomers.

“You have to ar­rive there early in or­der to se­cure a (good) place to read or a seat in the cafe within the book­store. Af­ter 1 pm, the en­tire place is fully oc­cu­pied, and you have to line up for a seat, for brows­ing a shelf, and to pay at the counter,” said Liu.

The book­store is di­vided into three main sec­tions: books area, cul­tural area and cre­ative prod­ucts area. In ad­di­tion, there is a cof­fee area and a “pub­lic study” area for many young read­ers such as Liu.

“I even bring my date here. We don’t talk much be­cause ev­ery­one is read­ing, and each of us just reads the books we pick. But we don’t have to buy. It feels good when you can re­lax, have some qual­ity time, read some­thing and learn some­thing. It does not cost much,” he said.

SiSYPHE is one of the scores of branded book­store chains in China that has been try­ing to bal­ance the need to be prof­itable with the urge to pro­vide a book reader-/buyer-friendly en­vi­ron­ment.

Rents at prime com­mer­cial prop­er­tieshave­been­soar­ing so much in key cities that many book­stores had to close down. The sur­vivors are jug­gling costs and ben­e­fits, try­ing to of­fer more prod­ucts and ser­vices to sup­ple­ment the high cost of, and low prof­its from, sell­ing books.

Ac­cord­ing to a re­search note from China Galax­ies Se­cu­ri­ties, gross profit of­bookdis­trib­u­tors is about 10 per­cent, while that on cre­ative prod­ucts such as note­books, sta­tionery, T-shirts and can­vas bags could reach 50 per­cent, while book­store cafes could see 75 per­cent mar­gins.

Liu Gui, man­ag­ing di­rec­tor of JIC Books In­vest­ment Ltd, a cul­tural in­vest­ment arm of com­pre­hen­sive in­vest­ment group JIC Group, said book­stores have been un­der­go­ing an evo­lu­tion­ary tran­si­tion. The 1,500-square-me­ter book­store of JIC Books fo­cuses on bi­ogra­phies of busi­ness fig­ures, celebri­ties, states­men and cul­tural icons, and hosts a cafe, a func­tion room, a li­brary and a gallery.

“The book­store is­more­like a space that at­tracts peo­ple with shared in­ter­ests, and they can talk, ap­pre­ci­ate art, lis­ten to mu­sic, and hold meet­ings. It can serve as a gallery that dis­plays cre­ative works, and it can of­fer space for fo­rums and sa­lon. It is no longer just a pure-play book­store. It is ‘book­store plus’, of­fer­ing a com­pre­hen­sive space for guests,” said Liu.

In Hangzhou, JIC Books co­op­er­ates with a trust com­pany to func­tion as a “book plus fi­nan­cial” des­ti­na­tion, or a com­mu­nity tar­get­ing guests who need wealth management ser­vices.

In Wuxi, the book­store is lo­cated in a ho­tel, thus be­com­ing a meet­ing spot for the “book plus tourism” com­mu­nity mainly com­pris­ing tourists. In Beijing, the book­store opened in a life­style com­plex tar­get­ing re­tirees, adopt­ing a “book plus life­style” model, said Liu.

“I be­lieve if such mod­els work well, more cap­i­tal will en­ter the mar­ket to help book­stores grow,” said Liu.

Book­stores world­wide have had a dif­fi­cult time dur­ing the 2008 Global Fi­nan­cial Cri­sis, and have been re­cov­er­ing since the past two years, with some out­per­form­ing others. But all the mar­ket play­ers have been pon­der­inghowthey could bat­tle the elec­tronic books or e-books, on­line sales, and e-book read­ers... all these mean there are fewer read­ers and lower sales at brick-and­mor­tar book­stores.

Barnes & No­bel, the largest book re­tailer in the US, is go­ing to open restau­rants in book­stores. In the UK, book re­tailer chain Water­stones en­ables each of its stores to plan its spe­cific lec­tures and read­ing events to meet de­mands from read­ers in var­i­ous neigh­bor­hoods. In Ja­pan, Daikanyama T-site hosts not only book­stores but a DVD

WANG XIAOYING / CHI­NADAILY

XU CONGJUN / FOR CHINA DAILY

A girl tries her fin­gers at a chess-like board game de­signed to de­velop chil­dren's in­tel­li­gence, at an Es­lite book­store in Suzhou, Jiangsu prov­ince.

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