Powell’s maps its strategy

PORTLAND, Ore. – Powell’s Books’ flagship store is so large, visitors get a map at the door. Not that some people would ever want to find their way back out.

Visitors wander through the warehouse-sized store, which sprawls across an entire city block. They loll in a room dedicated to the arts, wander a few aisles on metaphysics and browse shelves of nautical fiction.

Powell’s is one of the nation’s largest independent booksellers, offering 4.5 million new, used, rare and out-of-print books. It competes with the likes of Barnes &Noble, Borders and Amazon.com. But unlike many of its independent bookstore brethren, Powell’s survives and thrives.

“Powell’s is viewed as one of the pre-eminent bookshops in the world,” said Mitchell Kaplan, president of the American Booksellers Association. “No one has done it the way Powell’s has done it.”

And no one but a Powell will continue to do it. Founder Michael Powell, 65, recently announced he is handing the business over to his 27-year-old daughter Emily – renewing the commitment to keep Powell’s an independent, family-run endeavor.

The challenge for the bookstore’s second generation, industry experts say, is to continue the innovation that made it a quirky leader among corporate competitors.

“I’m not sure what the next big thing is,” said Daniel Raff, associate professor of management at Wharton School of the University of Pennsylvania. “But he (Powell) has been involved in several very major big things so far and has made out … with really striking efficacy.”

Michael Powell was a graduate student in Chicago when he started his first bookstore in 1970, with the encouragement of friends and professors, including novelist Saul Bellow.

His father started the Portland store after visiting his son for the summer. When Michael joined his father in 1979, he moved the business to a larger location – a former car dealership where it still stands. And he decided to sell new and used books on the same shelf – an unheard of move that paid off.

Powell’s grew from one store to six, expanded its main store and launched an online business in 1994, just before Amazon.com. Online sales now make up about one-third of the company’s revenue.

“It’s not enough to love books,” Michael Powell said. “You have to love the business of it.”

Powell was onto something early. Used books and online sales have revolutionized the bookselling industry in the past few years, industry groups say.

Powell’s has staff who scour the globe for the best used books and even go on road tours to hold weekend used book buying events around the country. The result is a inventory that could provide a book to each of the Portland area’s 2 million or so residents and still have 60 percent of its stock.

Michael Powell said he sees technology, overseas and non-English books as areas to grow. Daughter Emily agrees but said it’s too early to talk about where she might take the company. She’ll transition in over the next six years, with the help of family business consultants.

She’s already worked in the online division and then moved to used books, two areas crucial to the store’s success and also areas where the other current senior management did not have prior experience.

Emily Powell said she recognizes what she is stepping into. The company has become more than a company – it is a bibliomecca of sorts.

The store is internationally known. Powell’s sent one of the first shipments of commercial goods to Vietnam following the end of the war, $50,000 worth of books. It is currently working with a Saudi prince to develop a library there.

About 10 years ago, the company shipped an entire cargo freight container of one title – the Sears and Roebuck “Wish Book” catalog – to China. The buyer was interested in promoting the concept of capitalism by showing people the images of what variety it could offer.

“My goal is not to be visible. My goal is to be successful in getting books to readers,” Michael Powell said. “Every book has a potential reader, so the challenge is to find that linkage. Sometimes it takes more effort; … sometimes there is only one reader.”

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