The UK bookseller has smaller sales but better profit. Since their deal to buy B&N fell through, the question remains: who has both the skills and the money to fix the troubled bookseller?
Ever since it was revealed in August that another bookseller was interested in purchasing Barnes & Noble—but the deal fell through—the industry has wondered who that buyer might have been. Now we know from reporting at The Wall Street Journal (subscription required): it was UK bookseller WHSmith.
Interestingly, WHSmith’s annual sales are less than half of Barnes & Noble’s. However, WHSmith is in a much better position profit-wise: it made $213 million during the last fiscal year, while B&N lost $125 million. WHSmith hasn’t been growing its sales—they are half of what they were roughly a decade ago—but has improved its profit nonetheless. The Financial Times noted (subscription required) that Barnes & Noble shares have dropped 75 percent since 2006, while WHSmith’s have risen more than fivefold.
WHSmith has instead acquired a different US retailer: InMotion. InMotion operates 114 stores across 43 airports and sells a range of travel and digital accessories, including headphones and earbuds, mobile power, and portable speakers—but not books. While it may seem a strange fit, WHSmith isn’t only in the book business; it also has a retail travel business.
So, Barnes & Noble still seeks a buyer. A Forbes commentator says that a new buyer needs three qualities: (1) the ability to manage retail stores, (2) experience competing against Amazon, and (3) the ability to create a retail environment that offers something different to bring consumers into the store. There is speculation that the Canadian bookseller Indigo might be a candidate. Some in fact thought they were the mystery buyer; the chain recently expanded into the US, and its profits are around $55 million a year. Would they take on debt to invest in a chain that’s been faltering for some time? Currently, B&N sells about one-fifth of all print books in the US (Amazon sells roughly half), and it’s in a legal battle with its ex-CEO, Demos Parneros. (Parneros, who is suing B&N, in turn stands accused of actively derailing the WHSmith deal and sexually harassing multiple women at the company.) Meanwhile, Amazon is busy operating its own chain of bookstores—the 18th store opened last month in Marina Del Rey, California.
Bottom line: Author and industry commentator Kristine Rusch thinks these latest developments for Barnes & Noble will eventually be a blow to traditionally published authors. Those who work with a Big Five house often do so because they want visibility and exposure throughout the bookstore ecosystem. But once that benefit has receded, an author may regret their long-term grant of rights if their publisher isn’t able to market and push sales through other channels or direct to consumer. An industry without Barnes & Noble will change an author’s calculations about what an attractive publishing offer and contract looks like.
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
