Home Archives April 2009 The good book

The good book

| Print |  Email
Wednesday, April 22, 2009

President and owner of Powell’s Books

POWELL’S BOOKS, powells.com
FOUNDED: 1971, Portland


Even before stock markets plunged and banks went bust, independent bookstores were closing their doors for good. But not Powell’s Books. “When people talk about the book business, there’s everyone else and then there’s us,” says 68-year-old Michael Powell, president and owner of the largest independent bookstore in the world. “We’re in our own category.”

Powell’s Books stands out not only for the size of its flagship store — the 68,000-square-foot building in Portland’s Pearl District attracts somewhere between 3,000 and 6,000 visitors a day — but its age. Powell’s father, Walter, opened the Portland store in 1971. Michael bought the store from him 10 years later.

Powell’s has survived the rise of bookstore behemoths Barnes & Noble and Borders as well as the emergence of online bookselling. Today the company consists of six Oregon stores and the website Powells.com, which sells the entire stock of books and accounts for 30% of annual sales.

As the economy withers and the publishing industry struggles to push the printed word, the bookstore has been forced to re-examine operations. Poised in “a good, competitive, strategic position,” according to Powell, the company hasn’t made any drastic changes, but did cancel plans to remodel the main store and asked employees to voluntarily cut down on hours or take sabbaticals to avoid making layoffs.

To help generate revenue, the company has revived a formative focus on buying and selling used books. In the early days, Walter Powell made the unorthodox decision to shelve new and used books side by side. The strategy propelled the sale of used books, which have a higher profit margin than new books.

The Pearl District store alone bought an average of 4,000 used books a day last year, but new has outsold used by 60% to 40%, a shift Powell attributes to online competition. The company hopes to return to selling 50% new and 50% used books in 2009, using the tool that’s shifted the balance. It recently launched an online system that rewards individual sellers with instant cash for their books using online banking systems such as PayPal. The system tracks needed titles using algorithms, preventing surplus, and has already increased the stock of profitable recent titles, Powell says.

Even though creating and using new technologies can cost more upfront, Powell recognizes the need to remain current. “We want to keep our hands in new technologies so we’re prepared for new opportunities,” he says. “It’s important to stay relevant.”

For example, Powell’s now sells eBooks for four electronic devices, the antithesis of shelves of dog-eared used books. Even though eBooks accounted for just 3% of sales last year, the offering represents the president’s drive to keep the company nimble and fluid, ready to respond to new demands.

The same sense of adaptability prompted the bookstore to start selling through Amazon.com, the web’s largest bookseller. “My ego isn’t so big that I can’t see the benefit of partnering with a competitor,” says Powell.

Next July, Powell will turn over company operations to his 30-year-old-daughter, Emily, the current VP, who recently received a degree from the Berkley-Columbia Executive MBA program and has held positions in marketing, online sales and used books. In terms of the economy, timing may not be ideal, but father, daughter and company have been preparing for the transition for years.

While Powell expresses some worry about the future, during the current economy and beyond, 30 years of experience, which includes starting a retail business in a dilapidated warehouse district, has created confidence.

“If we’re surrounded by vacant storefronts it’s going to affect us,” he says. “But we started out surrounded by vacant storefronts, and we survived that.”


Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it


More Articles

Closing the gap: Community colleges and workforce training

Thursday, March 27, 2014
03.27.14 thumb collegeBY MARY SPILDE | OP-ED CONTRIBUTOR

Community college career, technical and workforce programs present an opportunity to bring business and education together as never before.


How to handle the unexpected

Contributed Blogs
Friday, March 28, 2014
03.28.14 thumb disasterBY TOM COX | OB BLOGGER

The next mysterious (or disastrous) event could be one that you or your team might suddenly need to respond to, probably under intense scrutiny.


Eking out a living

Tuesday, April 08, 2014
04.08.14 thumb ourtable-coopfarmsBY HANNAH WALLACE | OB BLOGGER

It may be obvious, but most farmers don’t make a lot of money. According to preliminary data from the 2012 Agriculture Census, 52% of America’s 2.1 million principal farm-operators don’t call farming their primary occupation. Farm cooperatives may offer a solution.


Branching out

March 2014
Tuesday, February 25, 2014

A blueberry bush is a blueberry bush — except when it’s a blueberry tree.


Car ignition recalls and lean product design

Contributed Blogs
Friday, April 11, 2014
04.11.14 thumb gm-gettyTOM COX | OB BLOGGER

The auto industry is starting to share more costs across manufacturers for complex and challenging design work, like new transmission design, and certain new engine technologies. What we’re not yet seeing is wholesale outsourcing of “unavoidable waste” components to specialist companies.


Small business sales go big

March 2014
Tuesday, February 25, 2014


Sales of small businesses surged in 2013 according to the biggest Internet marketplace of such transactions, BizBuySell, increasing to 7,056 reported sales, a 24% increase over 2012, when they dropped 7%. Portland Metro sales tracked by the site grew 9% to 73, capping three years of solid growth. On top of that, Portland’s median sale price jumped 67% to $250K, versus just 13% to $180K nationally. Portland was one of just six metros tracked where the median sale price matched the median asking price, with sellers getting, on average, 92% of what they asked.

BTNMarch14 tableBTNMarch14 line

BTNMarch14 piePDXBTNMarch14 pieUSA


The 2014 100 Best Companies to Work for in Oregon

Friday, February 28, 2014

100best14logo ThumbnailThe 21st annual 100 Best Companies to Work For in Oregon list was announced Thursday night at an awards dinner at the Oregon Convention Center.

Oregon Business magazinetitle-sponsored-links-02