Reading the Future of Locally Owned Bookstores

Can independent booksellers keep their places in the community as readers go digital?

As Dr. Joe Peeden will readily confess, he is a book nut.

The affable Knoxville pediatrician with the graying mustache and wire-rimmed glasses chooses no sides in the ongoing battle for eyeballs between fiction and non-fiction; he reads both, voraciously. A former Air Force major, he describes himself as a constant reader, consuming all sorts of books in all sorts of genres. He loves each and every one. Well, all except one particular type of book: "I'm a non-Kindle kinda guy. I like to have the feel of a book in my hand, and I like to be around people who like books."

Consequently, Peeden spends a lot of time amid the aisles of Carpe Librum Booksellers, the decidedly analog new-books haven in Bearden. It is the sort of place where other book nuts are unashamed to reveal their true natures.

Walking in, shoppers are immediately embraced by the scent of fresh books: that distinct fragrance of new ideas set on paper with ink—catnip to the book lover. Arrayed on handsome wood shelves and low tables are personally selected titles that bravely venture beyond the New York Times Bestseller lists to feature other authors awaiting discovery. Regional histories, new contemporary fiction, ravishing art and photography coffee-table tomes, and in the back, a treasure trove of children's books—all of them lovingly tended by fellow book worshippers. Even the store's lighting seems to flatter, making each browser appear especially thoughtful and well read. For Knoxville's truly hardcore book buyers, it's a cozy second home.

But a few weeks ago, things went horribly awry for Peeden on one of his visits "to look for a book." Relaxing on the shop's couch while thumbing through Philip Roth's latest novel, Nemesis, he was approached by co-owners Flossie McNabb and Shiela Wood-Navarro.

"Shiela goes, ‘Joe, I have something to tell you,'" he recalls with an almost audible wince. "And they said, ‘We're going to close the bookstore.' Well, I was speechless. I feel like I'm losing a dear friend. Maybe I'm being overly dramatic, but I don't think I'm the only person in Knoxville who feels this way."

And he isn't. Since last Wednesday—when McNabb, Wood-Navarro and fellow co-owners Martha Arnett and Claire Pool made the store's closing official with an e-mail to their newsletter subscribers—the store has been awash in tears and condolences and hopeful entreaties that maybe they can still make it work.

But the answer has been a polite no; faced with fewer customers due to the bad economy, competition from chain stores, the relentless growth of Amazon, and an impending lease renewal, McNabb and Wood-Navarro say now is the right time to call it quits.

"It's like bombshells every day," McNabb says. "We're just torn. We haven't made any money. We pay our bills. We pay our staff. We can buy books. But it's no profit, no extra, no break-even. It's purely intrinsic rewards. We love it. But there's no money. So when do you start becoming stupid?"

That's a question many independent bookstore owners may be asking themselves these days, particularly when faced with predictions of a stark future without physical books. While e-book sales currently compose just 9 percent of the consumer book market, they've just started taking off, with a 193 percent increase this year through August, according to the Association of American Publishers. Forrester Research estimates that there are currently 4 million U.S. homes with an e-book reader like Amazon's Kindle or Barnes & Noble's Nook—but it also predicts that their sales will reach over 29 million in the next four years. Even Stephen King, America's foremost slaughterer of trees for door-stop-size books, foresees e-books ruling 50 percent of the market in a year or two.

Does this mean the brick-and-mortar method of selling books is doomed?

Not altogether. The livelihood of local bookstores might just rely on the cultural connections they make with their own communities. That is, if their communities, like Knoxville, respond.

Tempus Fugit

For a veteran industry watcher like Wanda Jewell, executive director of the Southern Independent Booksellers Alliance in Charleston, S.C., this electronic upheaval is another cycle of change that will leave some stores by the wayside—but it may also inspire new ones to start up. Last time around, in the mid-'90s, big retailers like Borders and Barnes & Noble swarmed new regions of the country in a race to become number one, leaving independent sellers in their wake. Before then, deep discounts on books were an alien concept.

"Books sold for the whole price and that was how business was done," says Jewell, who's headed up SIBA for the past 20 years. "Books weren't sold everywhere, so if you wanted to buy a book, you pretty much had to go to a bookstore. When the chains came in and the discounting was pretty aggressive, pretty predatory, there were a lot of independent stores that just weren't prepared. So we lost a lot of stores in the late '90s. But a lot of great stores came out of that time, some of the best stores in the country: Malaprops in Asheville, N.C., Books & Books in Coral Gables, Fla., Eagle Eye Bookshop in Atlanta."

This time, even though the odds may seem stacked against independent booksellers, Jewell instead sees even bigger problems ahead for the chain stores. With Borders and Barnes & Noble mired in their own respective financial problems and management mayhem, it's an opportunity for locally owned stores to reclaim their turf. Jewell says the excitement over mega-bookstores is fading, and she sees renewed consumer interest in supporting locally owned retailers.

"[Independent stores] are the ones that are trying to bring to their community a literary richness, and certainly isn't doing that," Jewell says. "It's not putting money into your community, it's not supporting your community, it's not exploring your community, it's not doing anything for your community."

That's another reason Carpe Librum's demise is troubling—the store embodies community-oriented service, bringing writers to town to discuss their works, providing a hatching ground for book groups, and supporting local authors by stocking and recommending their works. But Knoxvillians, it appears, did not choose literary uniqueness.

"We're losing a cultural beacon," says Peeden, who holds an annual summer reading contest among his young patients, sending them to the store. "In the past, before we had Carpe Librum, I'd go to Borders and Barnes & Noble, and I felt like I was going to Walmart. There's nothing wrong with Walmart, but nobody knows who you are, they don't know your reading interests. I used to tell Shiela that it always felt like it was going over to my friend's house who happened to own a bookstore, to pick out books.

"To me, if a place like Carpe Librum can't survive the brave new world of bookselling, I don't know who could because they just did everything right."

From its opening in 2005, Carpe Librum's owners have sought to differentiate their shop's selections from the chain-store competition: "No Dummy books, no Idiot books, no romance. We didn't want anything with that," McNabb says. "But we wanted special things you wouldn't see everywhere." And part of that is featuring local authors like Michael Knight; the store has sold about 100 copies of his new novel, The Typist. "He may end up on a bestseller list," she says, "but I don't think the Barnes & Nobles of the United States are going to discover him. I think it's the independents who are going to make him big."

McNabb has been a book lover all her life; her parents had a large library, and as a child she would imagine she owned a bookstore. Likewise, Wood-Navarro—who worked with McNabb at Davis-Kidd Booksellers before it closed here in 2000—grew up visiting Gateway Books downtown, the first stop on her family's weekly drive into Knoxville from Newport. She later worked at Malaprops, then returned to Knoxville when McNabb was able to get the financial wheels rolling for Carpe Librum. Together, they could be the two hip sixtysomething grandmas of a TV sit-com: McNabb the folksy dreamer, Wood-Navarro the sharper-tongued realist.

Each woman brings a devout passion to their work that you don't typically find in chain store employees—and it has made their decision to end the store that much more painful.

"Oh, we cried. And then we had the thought, ‘What if we just go on for one more year?' ‘Just do it one more year!' ‘Okay! We'll do it!'" McNabb recalls. "And we got so happy for a little while, but then we were going, ‘That's not going to work.' And then we were just deflated again. We were trying to make ourselves feel better by thinking we could keep it going. But you just can't do it that way."

"Three more years in a lease—we like where we are, but we just didn't see the ability to be able to do that," Wood-Navarro says. "The choice possibly would be made for us; it's not made for us now. We're going to go out still loving what we've done, continuing to love books, and loving the customers who've become friends."

While the store's fans have likewise been lamenting the decision, it's been with a rueful understanding of the economics involved. Local attorney Melinda Meador is one of their biggest customers, and a lifelong book lover. Her mother was a high school librarian, and as a girl Meador would pretend to be one as well; she eventually became an English major in college. Meador buys books everywhere, both in stores and online—she confesses to using a Kindle "for certain purposes"—but she quickly fell in love with Carpe Librum when it opened. And she, too, voices a disappointment with Knoxville's readers.

"The owners of that store have performed a tremendous service for this community, and I'm sorry that more people have not been willing to support it the way they have supported the community," she says. "I understand the drive to buy books at reduced prices. I have friends who are as avid readers as I am, who would not consider buying a hardback book or even buying a bestseller unless it had been deeply discounted like you can get from any number of sources.

"But there is a reason to pay full price. When you go into a store like Carpe Librum, you're getting more than the book. You're getting a sense of the culture that supports the book."

The Forward-Thinking Antiquarian

Down south on Chapman Highway at the Book Eddy, owner John Coleman is packing up his books, dismantling the labyrinth of exotic bibliophilia that he and his staff have built up over the past dozen years. He's not one to get overly nostalgic about the business, or his place in it, but his creation of the Book Eddy was marvelous: a warren of some 150,000 items—and nearly all of them unusual in some form or fashion.

Although he's just picking up stakes for a move to a new, smaller location in "Downtown North," any diviner of the oddball will nevertheless miss the old store with its endless hodgepodge of bizarre bric-a-brac and one-of-a-kind finds. But the good news is that Coleman is readying a new concept that he hopes to open by Dec. 1: Central Street Books at 842 N. Central St., and it promises to be a more concentrated version of Coleman's passions.

Located in the former Corner Lounge (complete with original bar), one part of the newly refurbished store will be devoted to literature, arts, history; the other side will have those amazing objects: one of the 500 Meatloaf Live at the Bottom Line LPs pressed on red vinyl, a unique diary from a Civil War participant who may or may not have run off to hide in his mother's barn, a unique photo album of Cumberland Plateau photographs, an ornate box with around 500 vintage buttons. In other words, no more competing with the Internet by trying to sell purely informational books or former bestsellers that have already flooded the market.

"After a book's been out five years, then it just has become a vicious race to the bottom on price for anything that has the slightest supply and demand imbalance," Coleman explains. "There aren't many people walking in wanting them. We're not going to put them on the Internet for a dollar, and we're not going to wait anymore for a person to come along and pay us $6 for it. So we're getting rid of that, and that's probably the best news. We're turning the store upside down and shaking it and getting rid of everything we don't want. We're going to be better, much more focused buyers. And do what we enjoy doing."

While he may not often appear happy in his role as Knoxville's last remaining antiquarian bookseller, it's obviously his calling. Coleman has been avidly buying and selling old books here for almost 19 years, first with the Kingston Pike Book Shop, and then with two stores downtown, and later with the Book Eddy. (His vision for having such a large store with low-demand books was that "someone's got to hold these books until the next person comes along and wants to read them.") Coleman grew up in Nashville, then attended the University of Tennessee with the idea of starting an agricultural career—but instead became an ag commodities broker. And that didn't last very long.

"I was a trader in Chicago, got done with that, then decided to move on to learning the book trade," he says simply. "Owning a book store was one of my two longer-term goals anyway. Trading is a young person's job that usually only lasts a little while. The theme of both of these jobs, I guess, is their independence and being local, with a small footprint. Plus, they are both good jobs for a curmudgeon."

Coleman likes books, and likes hunting for books. So he fashioned a career out of it. He became a book scout for a vintage dealer in Michigan, and also worked for a spell at Book Inventory Systems, a sister company to the original Borders in Ann Arbor, Mich. that served as its wholesaler, giving him an inside view of chain stores. ("Working for them made me realize how much I did not want to deal with them. I also intuited at that time that system might be broken.") He returned to Knoxville in the early '90s, and has been dealing in used books ever since.

Coleman's a pessimistic sort by nature when it comes to contemporary culture, but is surprisingly confident his business will weather the storm of digital media. He often sounds more concerned about the health of our culture itself: "I don't fear these changes too much for myself, though. I'll adapt, but I worry that people's ability to think critically is being eroded and their attention to detail is being overwhelmed by the temporary whiz-bang of the titillating. I know I feel that way myself sometimes."

A query about what role a locally owned bookstore serves in its community becomes a challenge to examine the responsibilities of a city's shoppers.

"A question for your readers: What function does a citizen-consumer, who understands the money flows in a local economy, serve to its community that might differentiate them from the über shopper whose sole interest is price points and quantity over quality," he asks, "even if to get quantity at a certain price one has to buy from huge corporations that squeeze tax concessions from the local government to sell unneeded crap made in sweat shops 4,000 miles away?"

It's that kind of passion—shared by co-workers Molly Johnson, Beci Bolding, and Sean Dietz—that has made Coleman's stores so individualistic in an era of retail homogenization. And not to worry, treasure hunters: Around the block on Jennings Avenue, Coleman is stocking a book warehouse that he's considering opening to the public a few days a month. But will that be enough, still, to lure in shoppers being enticed by digital downloads and whose desire for physical books may be on the wane?

"Look at McKay's success," Coleman says. "They understand the culture almost perfectly. I fight it incessantly. The Kindle might start to affect them a little in time, but not for a while. But the removing of the physical from the equation is going to affect them more than us as we are trying to avoid that type of product already. This might be the golden age for McKay as houses are still filled to the gills with analog stuff even as many under a certain age are starting to grow more minimalist in their gathering and reading habits.

"The changing of the ‘collector's mindset' might affect us more—although I still have some faith that if I like something, there is someone else out there who will, too."

Welcome to the Media Machine

At McKay Used Books, CDs, Movies, and More, liking (or disliking) the items they stock is of little concern—mostly, the store offers mass quantities of stuff at reasonable prices, brought in with a liberal trade policy. And it's been a wildly successful formula.

On any given Saturday, McKay's three levels of parking lots off Papermill Drive are jammed with cars. Inside the warehouse-style building, hundreds of people jostle for position as they seek gold amid the countless shelves and tables. For the most part, the shoppers know what they want—and odds are McKay has it; in a busy week, 80,000 individual items will come in through the doors, borne by sellers and traders. But the trick for shoppers is to find that particular game or movie or book before someone else does. Titles turn over fast, and the race can become heated as lines form amid the stacks.

Don't these fervent book and disc shoppers realize they're supposed to be at home downloading this stuff?

Apparently not. McKay has been steadily growing since owner Anne Jacobson and her then-husband opened the first store across from Bearden Elementary School on Kingston Pike in 1985. That one had 4,000 square feet. Six months later, they moved the store into Knox Plaza for a space with about 7,000 square feet. In the mid-'90s (and after a divorce), Jacobson moved McKay into a former Pero's Steakhouse on Kingston Pike with 11,000 square feet. Finally, in 2005, McKay's new 24,000-square-foot edifice opened, built to Jacobson's specifications—including two floors and a glass elevator. Meanwhile, she also opened a McKay in Chattanooga in 1990 (now housed in a similarly built-from-scratch building), and a Nashville McKay (currently leasing an old Circuit City location) in 2007.

The McKay empire is a great Knoxville success story. But it can be a difficult one to tell. Jacobson politely declines interviews. The local store's managers meet and decide not to speak to the media. Current employees don't want to cause any waves, and even former employees aver that if the owner doesn't want to talk, then they respect her too much to break the code of silence themselves.

But: McKay does employ its own spokesperson, Dan Bockert, the non-fiction director at McKay's Chattanooga location, and he's an amiable, helpful guy.

"In the beginning, the idea was to have a free-enterprise library," says Bockert, who's been with McKay for over five years. "It was really more of a resource for people, to serve like a library, where people could come and self-educate as well as to get fiction and so forth. The emphasis has always been on used, and that the store itself would not be a collectors' store but a readers' store.

"The idea being that by offering a generous trade policy, that you could get materials, trade them in, get your trade credit, then come back and trade them again and again. The more that you use the trade policy, the more value you actually get out of the original you turned in, because you keep turning that value around by getting more things."

And there's the crux of it: the McKay system. Using its own custom tracking software and its local staff of 65 employees, McKay has trading and selling used media down to a very precise science. It's a systematic understanding of supply and demand that's drawn would-be competitors who'd like to imitate it, and would-be financiers who'd like to buy it. But McKay resolutely guards its process.

"The prices are determined not by what we think they should be, but by what the customer is willing to pay for an item as well," Bockert says. "I can't get into the details of the pricing structure, because that's part of McKay's trade secret, so to speak. Pricing is set so that we can make a profit, and also make it appealing to the person who wants to trade. Now, trading is more attractive to most people than the cash, because you can get a higher percentage back of what we would charge in trade credit vs. cash."

Bockert says what they give out for items may vary, but trade credit is approximately 50 percent of what they would charge for an item, and cash is about 30 percent of what they would charge.

Old-school booksellers like Coleman admit to yielding to McKay's allure themselves; he not only sells his back-stock there, but he also shops at McKay. Coleman describes their system with a combination of awe and a personal disinclination to attempt it himself.

"Because of her data management and her investment in understanding the flow of her books, [Jacobson] knows very quickly when to start marking things down when they need to go to 45 cents or 25 cents," Coleman says. "It's brilliant. She's recycling media: games, DVDs, books on tape, iPods, drum kits, Wiis. There's stuff in there that turns over constantly, every day, that I'm not even interested in. We're like analog, and she's like digital. She's got a good process, and she leverages it. But that's not what I want to do."

As far as its online and e-book competitors go, Bockert says Jacobson and her staff are mindful yet undaunted—and consider to actually be a booster of their business by exposing consumers to the option of buying used books rather than new. They feel that e-books are too new of a phenomenon to gauge their threat level yet.

"When you get an e-book, you basically buy it, download it, and then you can't do anything with it—you can't legally sell it or trade it in, or anything like that," Bockert says. "So whatever you spent on it, that's your cost to do that. Whereas with a system like McKay's, you can get an item and when you're done with it, allow somebody else to use it. That's not possible in the e-book market."

And, again, there's the distinguishing factor of service to the local community: "One thing that McKay has done from the beginning is be very supportive of the educational community," Bockert says. "Anne is reluctant to toot her own horn about the work that she has done, so I'm not even free to say a whole lot about it because she likes to keep it quiet, but I can say that McKay has been incredibly supportive of the public school systems in each of the communities where they're located."


Last February, Robert Loest, the popular financial guru and downtown Knoxville booster, suddenly experienced a heart attack while working on his car. He slid into a coma, and was hospitalized for several days before he died. During that time, his many friends and acquaintances instinctively knew where to turn for news and solace: his favorite local bookstore, Carpe Librum.

"Although I wasn't in the bookstore during that time, it was a comfort to me, knowing that dear friends were gathering in concern and holding him in their thoughts," recalls his widow, Judy Loest. "I think of Carpe Librum as being like the combination post office/grocery store/filling station in Snowflake, Va., the farm community where I was born. It was the place you went to buy things, but it was also the place you went to see friends, to get local news or gossip, and, in that brief social exchange, to be reaffirmed and buttressed in the face of life's many grievances. Carpe Librum will be missed deeply, root-deep."

But, perhaps, the old Carpe Librum may live on in spirit at a new store. "We could do it again," says McNabb. "In another lifetime. We'd have all this knowledge. But I'm not closing the door—well, I am on this one."

When bookseller advocate Wanda Jewell joined SIBA 20 years ago, there were about 5,000 independent bookstores around the country, she says; today, there are about 1,500. She thinks this holiday season will be a make-or-break time for small bookstores, and their fates lie in the hands of consumers; their buying choices may also determine the kinds of communities they live in, she says.

"I feel like there's an issue of community at heart, and people are going have to make decisions about their own communities—if they want their community to be Walmart town, or if they want their community to be unique to them," Jewell says. "This is certainly a telling time, for all independent retail. People have to spend money [there] or you don't have those places. That's just the bottom line."