Amazon May Experiment with Physical Bookstores

There were two announcements this weekend that may freak people out over the future of books. The first was a prominent and innovative independent bookseller announcing that she had put her store up for sale with a broker who might look for someone to take over. As with the sale of the popular store in Washington, DC, Politics and Prose, there’s a good chance this move will be seen as a bellwether for independent bookstores.

After all, Roxanne Coady of Madison, Connecticut’s R.J. Julia is a financially sophisticated owner capable of making a going concern work. If she’s getting out of the business—arguably a few years too late—then there cannot be much hope for physical bookselling.

And, yet, there’s news today that Amazon is planning physical bookstores or, at least, a pilot store to sell Kindles and the physical books that they publish themselves. This comes from Good E Reader:

Amazon sources close to the situation have told us that the company is planning on rolling out a retail store in Seattle within the next few months. This project is a test to gauge the market and see if a chain of stores would be profitable. They intend on going with the small boutique route with the main emphasis on books from their growing line of Amazon Exclusives and selling their e-readers and tablets.

Seattle is where Amazon’s main headquarters is based and is known as a fairly tech savvy market. It is a perfect launch location to get some hands on experience in the retail sphere. A source has told us that they are not looking to launch a huge store with thousands of square feet. Instead they are going the boutique route and stocking the shelves with only high margin and high-end items. Their intention is to mainly hustle their entire line of Kindle e-Readers and the Kindle Fire. They also will be stocking a ton of accessories such as cases, screen protectors, and USB adapters.

The company has already contracted the design through a shell company, which is not unusual for Amazon.

Not even contemplated here is an even bigger opportunity whereby Amazon could open small to medium size bookshops that capitalize on the desire for a third-space complete with coffee bar. In that retail environment, Amazon could easily sell the high-volume, high-margin items taking advantage of its superior logistics and distribution skills. (And, if it wanted, could also install a print-on-demand capacity that would make it easy to walk in and purchase any one of millions of titles.


Amazon in the Process of Launching a Retail Store
By Michael Kozlowski
Good E Reader; February 4, 2012

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