Powell’s Books was selling books online before Amazon.com existed. Over the years, its flagship store grew to occupy a full city block in Portland, Ore. And the company, which until recently employed some 500 people, is still family owned.
But when the coronavirus hit, Powell’s — like many businesses around the world — suddenly faced an existential crisis. Its chief executive, Emily Powell, closed the company’s stores in mid March. Without customers browsing the aisles, revenues dried up immediately, and the company’s head count was slashed by some 90 percent in a matter of days.
As word of the layoffs spread, online orders spiked, allowing Powell’s to rehire many workers. Yet with its stores still closed and the virus still spreading, Ms. Powell — who took over the business from her father and grandfather — says it remains unclear how a sprawling used bookstore will be able to safely reopen to the public.
How was Powell’s able to succeed in the era of Amazon?
Most of the credit goes to my father and grandfather. My grandfather never limited his vision of what the bookstore could be. He was one of the first to put used books and new books together on the shelf, so you could afford to take a chance on a book you might not feel like splurging on a hardcover copy of. That synergy has been everything for our business. And my father brought to the table a willingness to say, “If customers are buying this many books and there are more books out there, why not make it bigger? Could we take over the next part of this block?” Those two pieces I think were really the foundation of what has made us what we are.
Amazon came along relatively late into our story. We went online ourselves in 1994, which was just slightly before Amazon, but we were already very well established as a very large independent bookseller with very large inventory and selection.
When did the virus first start to disrupt the business?
I remember a Friday, the 13th of March, coming around and feeling a very clear sense at that point we were going to have to close. We are just too big of a space and we did not feel like we could stay open and potentially participate in a spread of a virus. And our employees were feeling increasingly uncomfortable about coming to work. We are a big public space, lots of people in and out, lots of travelers visiting. It was feeling increasingly uncomfortable to them and we could not stay open and potentially risk infecting them as well. So on Sunday the 15th, we just decided we have to shut right now.
After you closed and had to lay off so many staff, how did the community respond?
We suddenly had this huge outpouring of support in the form of online orders. So we pivoted as quickly as we could to hire folks back to be able to fulfill those orders. That was honestly the most challenging time in many ways because there were just so many unknowns and, rightly, a lot of folks did not want to come back to work. It’s a scary time. They didn’t feel safe or comfortable getting on a bus. They didn’t have child care. They have folks with health issues at home. And so it was a very difficult time for employees to make a choice about what is the right thing for me and for my family. And I respect all of those choices that they were wrestling with. But at the same time it meant our orders were sitting for quite some time.
How many people were you able to bring back?
Initially we brought back another 50 folks, which brought us to about a hundred. We’re now around 200, and we’re hoping to maintain that as long as we possibly can, until we can open again. Unfortunately that’s really an unknown. I don’t think any of us knows what will happen with our economy and how comfortable people will feel spending any extra money they have on something like a book. So it really depends on what happens in the coming months.
Some of your employees were unionized, and you faced some criticism for having to let them go.
Very few of the folks we kept were union members. That was not intentional in any way, shape or form. It was simply a reflection of when you’re shutting down business, you need the folks who have the security codes, and know where the contracts are for the utility company, and can both direct folks on how to shut down a business while also doing the work themselves. We’ve been unionized for 20 years now and I call it a marriage. You know, we’re, well, married, and we’re going to be married for a lot longer. Marriages have good days and bad days and days of misunderstanding where there could have been better communication. We’re doing our best on both sides at the moment to repair the communication process and that relationship.
What is the outlook for the next few months?
The real honest answer is, I don’t know. I think of ourselves right now as having been very fortunate. If you use a surfing metaphor, we were on our board and a huge wave was coming for us and we paddled as hard as we could. We didn’t know if it was going to crash on our head or not. We caught the wave and now we’re on it. And the problem is we don’t know if it’s going to crash us on a rocky beach without any food, if there’s a shark hiding in the wave or if we’re going to ride this thing out and land on a nice soft beach down the road. A lot depends on what happens in the next six to 18 months. It depends on both our ability to rise to the current challenge and find ways to be creative, but also on the support of our customers being willing to keep coming back and stay with us through the duration. So it’s really an unknown at the moment.
It doesn’t sound like the stores are opening anytime soon. You recently wrote that “like so many other Portland businesses, we struggle to see a business model where we can enact the social distancing and safety measures we feel are necessary while sustaining the work of our operations.” That’s a pretty grim assessment.
In many ways the book business hasn’t changed in a very long time and that’s certainly no different for Powell’s. When we opened, all we needed were wooden bookshelves, a rotary phone, a cash register and cash. Now we, like many other retailers, need social media. We need dev ops engineers to build an automated website. We need a database that lives in the cloud that’s searchable in a very nuanced way. There are far more costs to doing business. So we have these expenses that have been going up for a very long time, and now we have very few of the sales, and we anticipate when we open the sales will be quite low even as folks come back.
So how do you make that work? Especially as we add the additional expense of creating a very safe environment for our employees and for our customers. You have to be comfortable touching a book, pulling it off a shelf and putting it back and lingering in an aisle. And that’s going to take quite a bit of work on our part, which we’re happy to do, but we have to be able to pay our bills at the same time. So that’s the essential struggle: How do you exist in this modern business retail environment at a time when your sales have returned to a level you maybe haven’t seen in 20 or 30 years? We will figure it out, but it will be a very different business and it’s going to take us some time.
What are you going to have to do to keep competing against Amazon?
I think the threat of Amazon in some ways has only really arrived at our doorsteps. We are all becoming more and more accustomed over time to placing just one more order on Amazon. “Oh, I just ran out of this thing. It’s too much trouble to go to that store or to find it somewhere else.” Little by little, that’s eroded all of our shopping behavior. That impact was really being felt in an increasingly outsize manner in our business.
Do you have any advice you for someone considering opening an independent bookstore of their own right now?
Don’t do it. Um, that’s not good advice. I don’t mean that. It is really a lovely line of work. My only advice is that it will always be challenging. You know, don’t get into the business thinking that if you sort of get a few things right in the beginning that then it will just work and I don’t have to think about it again. The work of book selling is always challenging. There’s always something new, whether it was the big box stores in the ’90s, and then Amazon and now this. There’s always something.
Have the habits of book buyers changed? Are people purchasing different books now?
Yeah, they really are. It’s fascinating. Folks are buying much more classic literature. Not modern literature, but things from a different era, things that are tried and tested and shown to stand the test of time. They’re buying a lot more science fiction and mystery, and of course lots of kids books and lots of workbooks to help with the schooling at home right now and keeping kids busy. It’s definitely a different pattern than we would historically see.
What are you reading right now?
Well, I’m just a nerd at heart. I’m reading some Italian short stories from the ’20s and ’30s in Italian because, just like a lot of us, I’m looking for a way to escape to a different place in time, where I might be able to glean a little wisdom, but also lose myself in the language. That’s been a real treat, even if I can just get a few pages.