Book Store Business Opportunity

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Book Store Business Opportunity

11/6/2007 - by: Acquireo Team - Director of Marketing, Acquireo.com

A retail store that buys and sells used books, rents books and sells new books is a profitable possibility for the right owner. If you can find one for sale or a great location with a rent that is affordable, then this business will have a chance for success. Like most retail businesses this type of store needs to have traffic to succeed. The problem with most of them is the chain store competition has forced them to sell without adequate margins in their selling price. A store does not have to beat the price of competitors; it just has to be competitive.

New book sales are going to be a tough one to crack as the chain stores can sell at very good prices. Used books on the other hand are merchandise that there may be no competition at all. Buying books and giving credit for them toward the purchase of other books is a good way to get inventory at little out of pocket cost.

Renting books for a week at a time with reasonable deposits is a way to keep the cash flow up without having to pay for more inventories. Keeping cash flow coming into the business is the key to any retail operation.

Finding an existing store for sale

The Internet is a good place to start looking for existing bookstores that are up for sale. There are not a huge number and they are all over the country. A person that is looking to find a store will probably have to be willing to move to buy an existing business. The price of the store will not only be prior year’s sales history, but also the current inventory and any computer assisted buying and selling information. A potential buyer would be wise to spend some time with the current owner to get a feel for the customer base and the daily sales volume. Also look at where the chain bookstores are in relation to the store that is for sale. Are the other businesses in nearby locations solid and likely to stay there in the near future? Are they the type of business that will generate traffic for the store?

Contact any business brokers that seem to have a few bookstores for sale. They may know more about the business and could be a great source of quality information that would help you in your search. A good question for any broker is how the stores are deciding on what their current inventory is worth. This business also would seem to cry out for some current owner financing. A bookstore owner is an unusual retail person and is usually attracted to the business due to a love of books and reading. This limits the potential buyers and the seller may be very willing to carry back some paper to make the sale happen.

Starting a store from scratch

The advantage of starting a new store is that you can slowly build up your inventory by trading and handing out credit for books a customer brings into the store. If you can find a decent location at reasonable rent this could be a way to get into the business. The startup will have to spend money to get customers into the store, as they will not have any built in clients to start. This means that cash flow will be slow and will build up over time. The owner better be able to live for a while without any money from the store for personal use.

Fixtures are going to be a healthy expense as books are heavy and will need to be displayed in order to sell them. Twenty dollars a square foot of display is a good ballpark to use to figure the cost of fixtures. Book information can be readily obtained on the Internet, but this means you will need a fast connection and a solid computer system.

Advertising the new business will be a high priority for the business. This is expensive, but it must be done. Think about giving each customer a card to give to a friend to invite him or her to the store. This will help a little on the business expense of bringing customers into the store. Check out the library and university sales that happen each year. They may be a good way to get some quality titles that would not come in via customers.

If you have friends who are writers, have them come in for a book signing and/or talk. You will be surprised at how people will come to hear a local author. Some advertising may be necessary to gain the audience.

Another way to get free publicity is to get a radio station to talk about books or a library to help with drawing a reading crowd.

Conclusions

Bookstores are a unique retail store. The chains have been tough on many of them, but there is still a niche market for those that are willing to work to find them and exploit them. People who love to read are a loyal group if they can be attracted to your store. Books and readers have a bond like men and cars. It is hard to understand, but it can be taken into account and used to develop a list of clients. Finding or starting a business is a decision that will have to be weighed very carefully by those that are interested in owning a bookstore. Bookstores do seem to have an energy that is not found in other retail stores. Using this to advantage is part of owning a successful bookstore.

Finding the right deal is part of the search and can make the difference between failure and success. People will not beat down your door to spend money and you are going to be forced to be proactive in getting customers in your store.

If you are looking for existing book store businesses we have them here at Book stores for sale- http://www.acquireo.com/tag/book-store.aspx


author: Acquireo Team

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