One year at a time

Happy birthday to us.

We bought the store a year ago on 1 August. It seems like both a long time ago and no time at all.

So how are we going on saving the bookstore, you might ask.

Well, we track our commercial progress week to week. Our goal is to cover costs with seven days of staffing. This requires revenue of $2,020 a week, or just under $300 a day. Our intermediate target is $1,610, or $230 a day.

Here is a view of revenue by week for all the weeks up to the last one. The orange lines are weeks where we hit the intermediate target of $1,610. You can see that we haven't done this very often (a total of 12 weeks), but we have done so more often recently. Things are looking up! We have crossed the $2,020 mark in just five weeks - two last year and three in the past few weeks.

Break it down

Weekly revenues are made up of a number of sales and an average value per sale (we call this basket value). When both of these numbers are high, then we have a good week. When we have high sales but a low basket value (or vice versa) then the week is middling. And when both of them are bad, things don't look so good.

Ignoring some outliers that make the numbers harder to interpret:

  • Value per sale has varied between $13 and $29, and averages $20.

  • Sales per week have varied from 34 to 94, and averages 61.

The chart below shows basket value from left to right, and the number of sales from bottom to top for each week. So the top right of the chart are weeks with lots of sales and a high basket value. And the bottom left is the weeks with poor sales numbers.

The dots are the size of total revenue for the week, with the orange ones the weeks where we have gone over $1,610 in revenue.

You can imagine a hypothetical line that runs across the top right corner of the chart and separates the weeks we break even from those that we don't.

Some lessons on this line:

  • We have never broken even with a basket value under $18.

  • We have nearly always broken even with a basket value above $23.

  • We have almost never broken even with fewer than 75 sales in a week.

The average sales value hides quite a lot of variation. For example, we have a very different day if fifteen customers each buy one $10 novel compared with if one of those fifteen customers spends $100. Next time, I will talk about some of this variation in sales values and what we can do about it.

Straight from the horse's mouth

We post a book of the day on Facebook and on our website every day. We recently switched from posting to Facebook via the website to posting directly to Facebook. This means a little extra work: we have to create each post twice. But it turns out that content that we post directly gets nearly three times as much visibility on Facebook.

Spot the difference

This is a chart of how many people have seen our content in their timeline (what Facebook now calls "post_impressions_unique:lifetime") for 110 content posts to Facebook in the last three months. I have excluded from this any posts that we put money behind, and posts with links to stories on this blog.

I have colour-coded the bars so that the via-the-website posts (called "links") are blue and the direct-to-Face posts are orange. You can see clearly the effect of the switch to posting direct to Facebook in early June. There are also a couple of direct posts to Facebook earlier on that stand out.

The numbers confirm what the eye can see. The table below shows some basic stats on the number of impressions. In rough numbers, posting the same content directly to Facebook means that it will get on average nearly three times as many views.

Direct to Facebook Indirect via website
Total impressions 12,459 6,661
Minimum 10553
Maximum 883443
Median 254 82
Average 265106

Why would this be

The two posts appear in the same place on the page. The difference is just how much information is available without clicking.

This is the direct one.

And this is the indirect one.

A fraction of the whole

In the last post I presented some info on what books we have and what books we sell. In this post I want to talk about what we can learn from those numbers for our stock strategy.

The summary is this one bubble chart. Towards the top of the chart are books we sell more of. Towards the right hand side chart are books we have more of. And the bubble size is the total revenue we have made from that type of book since we started nearly a year ago.

The five coloured circles make up about 50 per cent of total revenue, so these are the ones I am most focused on.

  • In the top right the green and orange circles. These are literature (green) and genre fiction (orange). We have lots of them. They sell pretty well. Let's keep doing that.

  • Against the left-hand side, the two red-coloured dots are new arrivals (books that we sell from the front room before we get around to entering them in the computer) and books we put on display in the front room. We do not have many books in these categories, but they sell super well.

  • Interestingly, new arrivals is the larger dot, suggesting people like something about the new arrivals bookcases (which might be that customers can look at them without being visible from the counter, or that they like to fossick).

  • The grey dot down the bottom is our collectible stock. They sell slowly but they make up almost 10 per cent of our revenue because they have such high prices.

Above the line

You will see on the chart a blue line. Books above this line sell relatively well. Books below it sell relatively poorly.

Of course, there are lots of relevant factors apart from the book genre itself, like the quality of the book, its presentation and price, and broader factors like awareness of the store in general. But just focusing on sales and genres, I think we can say some useful things:

  • Genre fiction is a better seller than literature (it is further above the blue line). We could aim to reduce our literature stock or put books that sell better on the shelf, like classics (War and Peace FTW!).

  • The small blue dot towards the top middle of the chart is bargain books. They sell really well. We have quite a lot of them. But they generate little revenue. One strategy would be to put up our prices (the average bargain book is only a dollar). We have introduced clearance books to try to do this. They are $5 each or five for $10.

  • The two larger blue dots in the middle at the bottom of the chart are New Zealand books and Art books. We have a lot of both but they do not sell very quickly. We know that they attract higher prices than other books though. Thinking about ways to get them more attention would be worthwhile.

  • As noted above, our collectible books don't sell well at all. They are in the front room too (right beside the fast-selling red dots). Looks like there is work to do here as well.

Don't mind if I do

Like Julie one of my earliest memories is of books. I used to spend hours poring over a set of illustrated New Zealand encyclopaedias making up my own stories to fit the pictures. Each time being transported to another time and place.

I am also a collector of words. I love the way they sound, the images they invoke or just the surprise I feel when I look up a word and it isn't what I expected. Vellichor is one of my favourites.

I have long been a supporter of the bookstore, and of Hayden and Julie's vision. I have avidly followed its progress and over the months books have been slowly migrating south and finding a home in my already overflowing bookshelves.

One day I was explaining to my daughter why I loved books and reading. How it is as necessary to me as breathing. She looked at me, as children do, and said "why don't you work in a bookstore?". And I thought to myself yes, why don't I? 

The rest, as they say, is history. 

What sells and what endures

Is our shelf of Minette Walters going to follow me to my grave? Should we get in more literature or more self-help books? Or are books about dreams or crystals or gardening more likely to be the thing?

By the book

In the 46 weeks we have owned the store up (yes, nearly a year already) we have sold 6,133 books (about 130 a week or 580 a month). This is the break down for the top fifteen genres. These account for nearly 5,000 of the total 6,133 books sold.

Some clarifications:

  • "Literature" is literary fiction, including contemporary novels and classics (but not New Zealand fiction).

  • "Fiction" is genre fiction, the biggest category is crime/thrillers.

  • "Admin" is largely new arrivals. It includes books that we have not yet priced, that live in two big bookcases in the front room.

  • "Display" is books from the front room (other than new arrivals).

  • "New Zealand" is the top level category for all New Zealand fiction and non-fiction.

  • "Bargain", "General interest" and "General" are all bargain books.

From that what we can say is that just on a count of books, about a quarter of the books we sell are fiction (not counting New Zealand). The front room ("Display") plus bargains stock add another quarter.

Weighty volumes

Some books are worth more than others. This chart shows genres ordered by the revenue per book. The 15 most popular genres in the chart above are shaded green. The orange line shows the average revenue per book, which is $8.80 (all revenue figures exclude GST).

You can see that far and away our most valuable books are "ABE", which is our collectible stock. We have sold just 88 of these books so far (less than two per cent of total items sold) but at $54 per book, they have made up nine per cent of our revenue.

Down at the other end of the scale, the bargain categories generate about $1 per book. Literature and fiction, our big sellers, are a bit below average, at $6 to $7 per book. Art books and New Zealand books are both reasonably big sellers at relatively higher prices.

Shelf life

The last step is to bring in a view of what books we have.

We have 19,558 books in our list. The top 15 genres that make up 81 per cent of stock are shown in the next graph.

You can see that about a third of our stock is literature or genre fiction. About 10 per cent is by New Zealand authors, and we have big Art and Bargain sections as well as quite a lot of History, Biography and collectible (ABE) books.

We know we have sold 6,133 books out of 19,558, which means we should expect to sell around 30 per cent of our stock in a year (we need to exclude new arrivals, since they aren't in our stock list yet).

This last chart shows the proportion of books sold against the proportion of stock. The categories to the left are those that are relatively bigger sellers, given how many of them we have. Those on the right are relatively poorer performers.

You can see that Display books (those in the front room) are big sellers (which might also help explain why Curiosities sell relatively well). Children's books, Self-help and New Age books do pretty well too (and they are harder to find in the store). Genre fiction is about average. Literature is slower moving. And we sell relatively fewer New Zealand, Art and ABE books, despite their being relatively higher value. Sad.

All together now

In the next post I will see about putting together a single view of stock, sales and revenue, and seeing if we can draw some conclusions about what our strategy should be.

Payments update

I updated the numbers on the point in a previous post on whether removing Paywave has meant a higher proportion of payments by EFTPOS instead of credit card. And it definitely seems like it has.

On the chart below the squiggly line shows the proportion of card payments by EFTPOS as a 14 day rolling average. It is 69 per cent of all card payments across the 279 days we have data for (the grey line), but you can see what looks like a change between the orange days (when we had Paywave) and the blue (when we did not).

This is good news for us because it reduces our costs. For credit cards we have to pay a proportion of the total transaction in fees, where EFTPOS is a flat charge regardless of spend. 

Out of this world

Our brand promise is Out of this World. One of the ways we deliver on that promise is through our instore environment. Right on Ponsonby Road, but a million miles away in hustle and bustle. A place where you might want to spend some time, even if you aren't looking for a book.

We are at last getting to the end of the physical changes we will make to the store. We have owned it nine months this month. This post is about the before and after, and what turns out to be a long documentation of all of the things. Holy. So many things. I guess even the longest list happens one item at a time.

Here is the original wonky walkthrough video I sent to Julie a year ago. And another version I shot just now (I walked a bit quicker the second time soz).

Does not seem like much from the video but the short story of the long list that follows is that we have kept what was good about it (peace and quiet, gentle pace, many books) and:

  • Made the place more welcoming, lighter and more open, making it easier to see the books and easier to navigate the nooks, crannies and corridors.

  • Created a lot more places to sit about, started serving coffee and set up free wifi.

  • Transformed the large backyard into a delightful sunny space (except on days like today) with tables and chairs and grass and a hammock.

  • Spent about $10,000 in total. Thirty per cent of that was the front window. Another forty per cent is for assets that we get to keep (furniture and signs, coffee machines). The rest was for our backyard labourers and for hiring skips and other equipment.

Now that we can better deliver on the physical promise of the brand, we just need to be telling the story more, enticing a few peeps to take a climb up the steps and come out of the world for a bit.


Stick with me now, while I list the changes and put in some pics. Thankfully it is easier to write about them than it was to do them.

Street appeal

  • We replaced the dark-tinted front window with clear bi-folds, which means people on the footpath can see in. We open them whenever the weather allows. We split the enormous cost (about $8k) with the landlord because we thought this was an essential change.

  • We made new signs with our new name and identity, and later added some more details underneath the lawn sign so people walking past get a better sense of what this place even is.

  • We add bean bags to the front lawn on sunny days to invite people up, and we have festive lanterns in the trees from time to time.

The front room

  • The new window also transforms the front room, making it lighter, more open and more connected to the street.

  • We removed the enormous salmon counter of doom (a four foot high, three metre long barrier to interaction) and replaced it with a narrow folding desk that can be readily moved.

  • This took a long time: we had to get the new point of sale system working first so we could replace the three store computers with just one to give us space, plus move the telephone and power (which were plumbed into the counter).

  • Then the counter itself cottoned on to what was up and resisted the inevitable: we sold it twice, only to have people show up and say that it was too big for them, we disassembled the thing (omg so many screws) only to discover that some parts were too big to put in the skip we hired, so we ended up sawing up the last pieces with a sabre saw.

  • Just last week we at last replaced the last piece of the counter (three horrible pink drawers) with a more appealing kauri cabinet.

  • We removed the staff nook that was to the side of the counter, and a bookcase that was filled with books that were yet to be sorted.

  • We removed a large round table and some ugly bookcases that drove me crazy every day (because the shelf spacing was too small and inconsistent) and replaced them with a more appealing setup.

  • We put in a piano. We put some delightful plates on the wall. We also improved the Internet connection and put in free wifi for visitors.

The back yard

  • Courtesy of some helpful contractors and the generosity of the attendees at two working bees, we took up the old and ugly weed matting, threw out a huge pile of concrete and junk and leaf litter, levelled the ground and planted some grass (at which time I got very good at watering the seeds twice a day).

  • We dug up two shallow pits and put in some beautiful white gravel. On top of these we put tables, umbrellas and chairs. We water-blasted the courtyard paving stones. A grate for the fire is coming (so we can tell scary stories around the fire).

  • The plant guy eventually came and picked up his plants and, later, some metal frames and other things that had been there for years. (We are still waiting for him to get the last of his things from the shed: Dave, if you are reading this, we are here every day ten until five :-)

The kitchen and bathroom

  • Turns out the store had an original brown-tiled bench behind a couple of bookcases. Who knew? We repurposed the bookshelf beside it to store cups and glassware and plates. We got a coffee machine and some tea pots (a precursor to actually selling these things, imagine: you can get them for free most days at present).

  • We transformed the bathroom, from a dark storage pit (old doors and dirty cardboard in the bath yo) to a light and open space.

The big room

  • This is the most recent change. We combined together all the literature in one room, replaced the bookcases that used to crowd the middle of the room with a beautiful table, and moved out the bookcases that have spent the last ten years in front of the bay windows.

  • We bought some beautiful red stools. Now I just need to find a powerpoint (which is reportedly behind one of the towering shelves of books) to plug in a heater. Brrr.

  • Oh, and we emptied out two random chests of old books in the art room and the little room and replaced them with tables and chairs.

The books

  • To make all this possible, we have had to move a lot of books. Every change is like a logic puzzle (or a yak shave). Travel has been moved twice. Biographies now live by the front window and combine together literary and other into one section. Māori and Pasifika has more space and more visibility in its new room. We have moved kids books into the last room at the back of the store (which was previously all the one dollar books). We moved sport and essays and journalism out of the corridor. So much better.

  • We have gone from about 24,000 books when we started to about 20,000 now. A banana box fits about 40 books, so that 4,000 is 100 banana boxes. We have tried to lift quality and improve visibility of the books, and along the way get to know them better.

  • We reordered the collectible books by genre (previously they were stored by shelf, which made it easy for us if they were ordered online but meant nothing to customers). Now people in store can look through them.

  • And we changed the incoming books system so that books are on shelves as soon as they arrive (rather than being in boxes for a while until we get around to pricing them). Books in the front room that have not yet been priced are, surprisingly, one of our biggest sellers.

Going Places

When you tell people that you've bought a second hand bookstore with someone you wrote a book with, many of them will then ask, "so, do you sell your book, then."

And until now, the answer to that question has been, "Well, no." And for those who like elaboration, "because we sell second-hand books, not new ones."

But after the umpteenth person has asked, you find yourself thinking, "well, actually there's no reason why we couldn't."

So I asked our publisher, Tom Rennie at Bridget Williams Books, he sent us a box and Bob's your uncle.

So you know what to look for, this is the cover:










and they now have a shelf to themselves in store. You can find out more about it here

If you happen to buy your copy on a day that Hayden or I are there, an autograph is free with purchase.



We have a clear goal for the bookstore: to increase revenues to the point where we can cover our costs with staffing for seven days a week. Roughly that means doubling revenue from when we took it over.

One thing that makes it hard to know how we are going is the volatility in the numbers. These are the revenues per day for all 34 Mondays we have owned the store (this excludes Boxing Day and January 2nd when we were closed). Jumps around rather a lot.

Looking at things over longer time frames helps. Just eyeballing this chart it looks like things have improved recently. It looks like we have had fewer Mondays with less than $100 revenue this side of New Year. And more Mondays that have been at or above the average Monday (shown as the orange line).

The numbers confirm this. The average Monday revenue for the 20 weeks before Christmas (excluding the week of) was $106. The average Monday revenue for the last 13 weeks is $162.

This is the same data for Mondays ordered by revenue.

Our best Monday ever was the week before Christmas with revenues of $394 (closely seconded by Monday this week at $393). The worst Monday was 12 September with revenues of only $23. On average on a Monday we have taken in $136, the orange line (all these revenue figures exclude GST).

Typically the worst day of the week is Thursday (although it is pretty much the same as Monday, Tuesday and Wednesday) and the best is Saturday. It is hard for us to have a good week if we have a bad Saturday. The distribution of daily revenue for the last 35 weeks looks like this:


We try to limit the impact of daily volatility on reporting by looking at revenue over longer time frames. Our usual frame is by week. To cover costs with full staffing, we need to take in about $300 a day. Our intermediate target is $210 a day or $1,470 a week.

Here is what revenue looks like by week over time, expressed as the difference from the intermediate target. You can see that we have made our target in only five of the 35 weeks so far (these are shaded orange). Three of those weeks are the two weeks before Christmas and a week in October when one big sale came through.

But maybe there are also the glimmerings of something hopeful, since you can also see that we have been doing better against our target in recent times. As we know from the Monday numbers above, we have done better on this side of New Year. On this chart we have done notably better in the last few weeks.

One culprit might be the new window (which went in in the excellent-for-revenue week of Pride Parade at the end of February). Long may it continue. But time will tell.

One of these lifetimes I will get around to adding weather and staff and collectible book sales to the numbers and compare them with the historical figures for the store that we have. That way we can see if we can start to explain some of the volatility other than just by the season or the day of the week.


It was hard to get data on the options for taking card payments because the banks do not seem to publish their rates online in ways that are easy to understand or compare. And there is a clunky process of needing to contract for the terminal, the network and the payments processing with two separate firms, and these things do not seem to be well-coordinated.

These are the rates that we pay to ANZ on different forms of payment (not counting the network fee or the EFTPOS terminal rental, and note also that these fees are calculated on the retail price, i.e., the price including GST).

Type Rate
Visa or Mastercard credit 3.85%
Visa or Mastercard debit 1.22%
Paywave 4.30%
Card not present 3.90%

There is a minimum monthly charge of $20.

We could get cheaper rates by being a member of the Retailers Association or Booksellers NZ but we would have to switch to bank with Westpac (we bank with ANZ)


I turned off PayWave in early January because it cost too much. I wondered if doing this might increase EFTPOS, since if the customer had to insert or swipe their card anyway, a major convenience of using a credit card would be lost. The data supports this hypothesis because we have seen a shift to EFTPOS and away from credit cards since the change, but we would need more time to be surer because we have seen these shifts in previous months before.

The grey line on the chart is the average EFTPOS revenue per day since 1 August as a proportion of total card revenue. The orange line is the 14 day average. You can see that since I switched off PayWave we have had a higher proportion than average in EFTPOS revenue (which means less money from Credit Cards). It is too soon to be sure that this move to EFTPOS we can see is a sustained thing. I will keep an eye out and update you.

I am thinking about getting a store mobile phone and switching to mobile EFTPOS because it is cheaper at 3 per cent for credit cards (although debit cards go up) and more flexible. My preferred solution would be to do payments online with Stripe or similar and cut out the bank and the EFTPOS payments entirely. But I can't (yet?) take EFTPOS payments other than with an EFTPOS machine.

Stacking up

One of the major changes we have made in store is to the backend systems. When we bought it, the store ran on ancient point of sale software and two even more ancient PCs (two because neither PC was capable of running both the point of sale software and a web browser at the same time). The software was stored on the PCs, meaning that work on the stock and reporting could only be done in store. We didn't have a functioning inventory system (although we did have a full stock list).

Processes otherwise were somewhat haphazard too. Lots of notes written on small pieces of paper. Some notebooks with receipts and notes stapled in, hand-written comments and updates, and many crossings-out. A credit system stored in a ringbound folder.

We wanted to reduce the effort required to run the store day to day, systematise our processes so everyone could do the same thing consistently, and enable more people to be involved (including people who are not physically in store). Since the previous systems had the virtue of being very cheap, we expected to spend a bit more on overheads as part of the change.

This is the technology we now use in our marvellous bookstore.


  • At the heart of it is the point of sale system. We use Vend, a great system made by a New Zealand company. We pay $150 a month for unlimited products (one peril of secondhand bookstore is a lot of unique products: we have 22,000). The system runs in the cloud, so I can look at sales or products or reporting in real time when I am not in store, and Julie can do the same from New York.

  • We use Google Sheets (free) for adding, moving, changing and deleting stock in Vend.

  • For task management and collaboration, we use Trello (also free). We have divided the things to do up into ten boards (like Customer requests, Communications, Instore, Stock, Strategy, and Admin). On each board we put cards for tasks to do on the lefthand side in an inbox, and as tasks are progressed the cards are moved to the right towards completion. Each week I move cards from the Inbox to Todo to reflect what I want to do next, remove cards that are done, and tidy up the boards. Anyone working in store can easily figure out what to do next by just looking at the cards, and we can all leave notes on them to show progress.

  • Our website is built using Squarespace. It was super easy to set up and links directly with Facebook (the only social media that we use). This means that updates from the store go to the site and to Facebook at the same time, with traffic coming back to the site. For conversations with customers and advertising, we use Facebook, email, text messaging and the telephone.

On smaller things:

  • We use Dropbox for file storage (free for a modest level of storage). Our files are arranged in folders with the same names as our Trello Boards to keep things easily organised.

  • We use Xero for accounting ($50 a month). We can easily see where we are at at any time from anywhere, and it makes it simple to collaborate with our helpful accountant.

  • We use Zoho Creator ($100 a year) to track our 800 collectible books. Zoho is easy to use to make a form-based system from a single spreadsheet. We put the collectible book listings on ABE, a second-hand book search engine.

  • Our domain names are managed with Discount Domains. Our email comes through Google ($5 a month).

  • I use Typora (free) for writing in markdown, a delightful way to compose, shorn of the complexity of Word or Google Docs.


  • We retired the two ancient PCs and now run the store on a single Google Chromebook (which gives us a lot more deskspace as well as all the other benefits). I have my computer in store when I am there too, since it is faster and it is easier to use for some things.

  • We have unlimited VDSL from Vodafone plus a couple of excellent WiFi access points that make it simple to offer decent WiFi for customers and for our own use.

  • We have a landline phone so people can call us. I call people back on my mobile because it is already paid for (and of course mobile is the only way to text).

  • I got rid of the fax machine :-)

  • We have an EFTPOS terminal. It is ugly (why must these things be so badly designed?) and it has two cables (one for power, one for Internet) that get in the way. A few more words on payments in the next blog post.

Adding up

This table compares what the store used to pay a month in technology overheads with what we pay now.

Item Then Now
Point of sale $0 $150
Internet $160 $160
Collectible books$0$10

You can see that we are spending nearly $3,000 a year more than we used to on technology. There are some upsides. It is easier to manage the store now than it was (especially adding, editing, changing and deleting books). Vend is far superior to the software we used to use for reporting too. We can check on progress remotely and share information in ways that were impossible with the previous system. Our website is functional where the old one was not.

There is no shortage of options for the future. We have our collectible books online through ABE. One thing that is often suggested to me is to make all our books (not just the collectible ones) searchable online. To do this we need pictures of the covers and we would need to format the information we have on each book consistently because otherwise search is going to be a bad time. But computers and free online book databases make this at least possible to think about. Chatbots are cool.

The temptation for someone who works in tech is always to sprinkle some more technology on things. With the well-functioning processes and systems we have now, our main problem remains foot traffic. So in my view, we are better to focus on solving that next.


Kia ora koutou katoa. I’m Julie Fry, co-owner of the open book.

I spend most of my time in Brooklyn, New York, or on a family farm in Brooklyn, Motueka. I’m usually in Auckland for less than a week a year.

So why buy a share of a bookstore in Ponsonby?

Last year, I wrote a book, Going Places, with the open book’s other owner, Hayden Glass.  We wanted to create space for a constructive conversation about migration to and from New Zealand. Writing the book was hard work, and hugely rewarding, and I learned a lot.

As we were finalising plans for our book tour, which took us from Auckland to London via the Motueka Sprig and Fern and a few other places, this conversation happened: 

Demonstrating the perils of clarifying questions

And a few minutes later:

Oh the joy of saying yes to things

Beyond the gut reaction, I decided to invest for several reasons.

I love books. I particularly love old books: the way they smell, the way they look, how they feel in your hands.

As a child, I used to camp out in a bedroom in my grandmother’s house that had a built-in book cupboard. I would sit and read heavy green-bound encyclopedias that taught me all the plants that grew in and around English hedgerows, and Gay from China at the Chalet School, and Little Women.

About ten years ago one of my aunts visited and decided to throw out all the books in the cupboard. Something to do with silverfish, apparently.

I can still picture the gold embossed titles on the spines of the encyclopedias, and see the line drawings of pussy willows and elderflowers and old man’s beard.

But still … buying a bookstore? Isn’t that a bit of an over-reaction?

Well, the physical space at 201 Ponsonby Road is glorious. Seven rooms of books, and a huge sunny garden out back.

The first time I saw it – via a slightly wonky 3 minute video walk through filmed on a phone – I made an involuntary happy noise and my daughter stuck her head around the door and asked me if I was okay.

In real life, it feels like a giant version of Grandma’s book cupboard. Without the hideous mustard-coloured shag carpet and the silverfish. Especially now the enormous salmon counter of doom has gone.

Still, as a well-meaning friend with knowledge of the economics of physical bookstores commented, “Seriously? You could just visit.”

Yes. I could. And clearly the financial rewards from this investment will be modest at best. But as an owner, I get to enjoy all the things about the open book that make my heart sing, and I also get to play a part in the transformation of the business.

In reality, because geography matters more for selling books than it does for writing them, Hayden has done most of the work so far with help from a cast of fabulous people who are closer to Ponsonby than I am. But the technology is pretty awesome so I can tell what is going on from afar, and I get to spend a couple of days in-store next month (February 6-8).

Come by and say hello if you’re in the neighbourhood.  

Far to go

Start from what you know

Before we bought the bookstore, we had sales figures and expenses for the last couple of years, some monthly sales figures from 2008 from the previous proprietor, and an inventory of all the books on the shelves.

From that we knew that the store lost a small amount of money most months, and did best in the summer. We knew that sales had been pretty consistent in the past couple of years, but were about three times higher ten years ago. We also knew how much the store spent and on what. And we had a good idea of what books were in stock.

We also knew some things about the broader business environment from Statistics NZ Business Demography statistics and the ever helpful Business Figures from Figure.NZ (where I work).

From that we knew that overall retail spending was pretty buoyant and Auckland had been adding retail outlets in recent years. The number of shops in Ponsonby is growing slowly (and employment there is growing more quickly: a sign of growth for existing shops), and the number of book and magazine retailers has fallen by nearly half since 2000.

A simple business model

The fundamentals of the business model in this second-hand bookstore are pretty straightforward.

On the revenue side:

  • Visitors: People come in store in person or online

  • Customers: Some proportion of visitors buy a certain number of

  • Books: and each book has a

  • Price: which together give us

  • Revenue

An average day in 2014 and 2015 had 17 visitors, 10 customers and revenue of $215 (including GST). Weekends are the best. Tuesdays are the worst. Revenue is also peaky, i.e., a small number of transactions account for a large proportion of the total.

On the costs side, the main costs are rent, staff, and book buying, with all the other stuff (including Internet, electricity, accounting, insurance) adding up to only 12 per cent of the total.

Typically we pay 25 per cent of the retail price (including GST) to buy a book. We get a lot of good books in from donations, and we have been getting in more than we have been selling in recent times.

What to do

To restore the bookstore to financial sustainability means increasing revenues.

To figure out how much, I made three scenarios for how our operating costs might look and then solved back to how much we would have to grow revenues to cover those costs.

The owner before us worked here six days a week. We couldn't do that, so we would have to spend more on staff. I committed to spend 4 or 5 days a week here for the first few months, working the rest of my life around it. We also knew that our rent was going up. We thought we could save some money on some things (I live right nearby so we don't need a carpark), but overall we would be spending more on other overheads too.

We also knew that we would need to spend some money on the books and other assets, but also on capital projects, like transforming the garden, replacing the signs, and (soon!) changing out the front window.

Overall not a great picture on the costs side of things. We decided to stop buying books for cash for a while to try to husband our resources.

The scenarios look like this.

Scenario Description Annual cashflow Revenue increase for breakeven
Now Status quo -$1k 2 per cent
Baseline Higher rent, four days staff, higher overheads -$11k 25 per cent
Steady state Higher rent, seven days staff, higher overheads, some book purchasing -$33k 50 per cent

The main difference between the scenarios is how many days a staff member is here. So one way to think about what we are doing first is growing revenues in order to pay staff. If we can boost revenues 50 per cent, we can fund one staff member for seven days a week as well as do other things we want to do, which would be a huge success.

If we can do better than 50 per cent, we will start generating a return on the money we have invested. We aim in the long run to generate positive cashflow of $10,000 a year, so no one is going to get rich from this project. But a return on capital will make it sustainable in the long-term, which is our ultimate goal.

How are we going

Four months in, here are some lessons and progress:

  • Revenue has overall been in line with history (but it is very volatile from week to week). There is no sign of an uplift yet, but that isn't especially surprising because

  • it has taken longer than expected to make major changes. We took over on 1 August, but it took until late November to get into position to do some marketing with the new name, brand, signs and website all in place.

  • Costs have been a bit higher than expected too. It has been hard for me to carve out enough time from the other parts of my life to devote to this delightful but rather needy side project. This has meant we have spent more money on staff (which is good for them of course but not so good for our forecasts :-).

  • We have so far spent a bit over half of the 15k in working capital that we initially tipped in (mostly on paying for the costs of projects, but also on paying for the ongoing operations).

One other thought by way of postscript.

It is amazing to have a physical project (since almost all of my other things are in the world of data and ideas). With 23,000 physical books, there is always something to be done.

Ordering the shelves doesn't seem likely on its own to get more people in the door so one does not want to get too stuck in the delights of doing that. But still, late in the afternoon when the sun is shining in just so, what could be better for the soul than writing prices in pencil on the inside of some slightly worn tome, wondering who will be the next person to take it home. At moments like that, it is fair to say that the business case for this bookstore dream isn't exactly top of mind.

What's in a name

We put up new signs this week and will make this website visible shortly (and this blog soon after that: hello world!). These will be some of the first customer-side signs that anything is changing, other than some physical adjustments instore. (I will talk about our systems and process changes in a later post)

a new dawn

a new dawn

The bookstore is now called The Open Book. Of the options we came up with (Mine, Pono, Spine, True Story, Subjunct, Subtext and Varsha was the shortlist), it was the best fit with what we want to do here.

More specifically:

  • It says books in the title (duh)

  • It suggests openness, i.e., authenticity, plain dealing, and transparency

  • We want to be a place that is open to the community and available for new projects and collaborations, a place where other things can happen, built on the foundation of books

  • We want to say practically that we are open (because we are up off the street and we get feedback that passers-by aren't sure if they can come in)

  • And, less obviously, it suggests technology (i.e., open source).

We started by thinking about what we wanted to do here, and how books relate to our lives and to those of our customers. We did this early, after the numbers side of things, but before anything else. We used three different approaches:

  • Be/say/do - This is a framework from brand genius and bookstore friend Tracey Lee. She explained it in a conversation at Spark Lab recently. The practical takeout is to think about why we exist, about what we offer, and about how we deliver those things. This picture sums it up.

  • Narrative - We wrote a little story of what was important to us. It was born from some ideas from the talented folks at String Theory combined with some thoughts of mine, iterated a few times back and forth, written down and read out. It reads like a toast, which gives it ceremony (and reminds me of a friend who likes such things).

  • Narrative extension - Building on the narrative we thought broadly about our purpose, about what the world would be like with us and without us, and some practical matters like our beliefs, behaviours, products, mission and values. You can see the results here. This does not feel like the final form for me yet, but it was useful for progress.

The virtue of doing it this way for us is that we can build everything from the narrative and any time we come across a question we are not sure on (what tone do we use in this blog? what colours do we want for the website? how will we market ourselves?) we can use our brand thinking to guide how we do it (and revise our brand thinking if that makes sense from what we learn as we go along).

Together these processes led us to a few different elements of the brand that seemed to be consistently important:

  • A steward of stories - No one wants to throw away books. If books can't be discarded, then we aren't in control of their destiny. We just look after them for the time that they spend with us before they go on somewhere else. So it is a book store not a book shop.

  • Human connection - Books are personal. It takes a while to arrange a match. Plus they are all unique. The joy of the search is part of what we offer. Curation is another part, since not everyone wants to go on 23,000 first dates.

  • Physical not digital - We wanted to say something about the varied, beautiful, storied reality of books, in contrast with the efficient, consistent, digital environment for reading. We are keen on technology, we just want to use it in service of the books.

  • A place out of the world - Physically the store is quiet and up off busy Ponsonby Road. The backyard will soon be a peaceful place to sit in the sun. We have nooks and chairs to encourage you to take your time. There are no price tags (prices are in pencil on the inside front-cover). And the books are cheap. Like mostly less than ten bucks. We have a thousand books for a dollar each.

This led us to a simple stack of things:

  • Practically, we are a switched-on second-hand bookstore.

  • Our promise is genuine human connection between you and your books, and in the way that we help with the match.

  • And our vision is to make a place out of this world (which is what we ended up having as our strap line).

This last piece also links with something else about openness that we like, i.e., we want to provide a platform to work with others and a connection with the community. We are just getting started on this: repurposing old books into notebooks with Lovenotes is an early example.

As for the name itself, The Open Book showed up early on in the process as a favourite, and from there we just tested all the alternatives against it. (It is also the name of a bookstore in Scotland that you can rent on AirBnB: guests get to run the store as well as sleep in an apartment above it, which seems like a cool thing to be associated with. Only for planners though; it is booked until November 2019)

Chapter One

Kia ora. Welcome. I am Hayden Glass, and with a friend I have just bought a second-hand bookstore in Ponsonby.

One delight among 23,000

One delight among 23,000

The Open Book, we are calling it. Seven rooms, twenty three thousand books. Sci-fi/fantasy, literary fiction, poetry, biography, history, New Zealand books, new age, travel, one dollar bargain room, a lot of collectibles and curiosities. All kinds of delights.

Come say hello. We are at number 201 Ponsonby Road. Open every day from 10 until 5.

Why bother

As you might suspect, second-hand books are not exactly crazy money-spinners. In the last nine months of 2015 this store lost a total of about a thousand dollars. So, not a disaster, but not an amazing situation either.

Not obviously winning

Not obviously winning

This chart shows the number of book and newspaper retailers in Auckland over the past 15 years from Stats NZ business demography data. Not obviously a winning retail category.

Our goal in buying this is to turn it around, to restore it to financial sustainability and to go from being just a second-hand bookstore to being more of a community hub and providing a platform for other things. We will transform the big backyard into a place where folks can sit in the sun and we can hold events and shows. Maybe we will get a community garden. We will put in some more tables and chairs and start serving coffee. That kind of thing.

We have the news feed and social media for the customer side of things. This channel is for the business side. This is where we are documenting the story of the turnaround of this micro-business. Our goal is basically to double revenues. It will be interesting and perhaps instructive to see how we go.

So stick around. I plan to do an update once a month or so. We have lots of ideas but not much revenue, so we need to make relatively few changes and see what we can achieve.

All encouragement and reasoned feedback is welcomed. If you have ideas on what we should do or should not do, drop us a line. And if you have arms or legs or anything else that you want to lend to the effort, we'd love to hear from you.

Thanks. It is great to have you on the journey.