nickshanagher

The answer to every strategic question is “it depends”. The trick is knowing what it depends on. If the answer to a question isn’t “it depends” then it’s not a strategic question. This is Mazzeo’s Law, a business school rule that its author and two fellow professors tested out on independent businesses across the USA in a series of road trips. Their book, The Roadside MBA , aims to provide real world lessons for entrepreneurs, start-ups and small businesses. Michael Mazzeo, Paul Oyer and Scott Schaeffer write up visits to 45 small businesses to provide lessons across 10 subject areas ranging from hiring staff to battling the big boys. The businesses range from a fitness centre for older women to a company that makes air socks and everything in between. The book’s strength is that it is a collection of the wisdom of people just like you, running a small business and making a profit. In Reno, Nevada, they visit Christine Kelly, owner of Sundance Books and Music. How do you comp...

The end of the independent bookstore (and a new golden age for books) is an unmissable Seth Godin comment piece that has resonance for any local shop. His analysis of how multiple retailers can take the profit opportunity from independent retailers who develop a market applies to more markets than just books. Think Easter eggs. Think back to school. His market positioning for the independent book shop of the future is great. How can you use what he says to apply to your business and to your customers. While the convenience business model appears to be robust enough to withstand the advance of the internet, you cannot afford to stand still. Think about how you can "own" the hearts and minds of your customers. For more, see www.betterretailing.com .

'We don't have it in stock but I can order it for you!' The words that are the death knell for small bookshops, according to Harry Mount, writing in the FT. He points out that thanks to Amazon he can order it himself and the book will be delivered straight to his door. Mr Mount's article is entitled: Shed no tears for the death of the old bookshop. He is confident that book shops may survive but only if they get the emotional pitch correct. They need to provide a quiet yet communal atmosphere in which shoppers can sift through ideas. It all sounds a bit fancy but the magazine retailer has something to learn. What Mr Mount describes is the commoditisation of buying books. In my local bookshop, when I ask for a book that they don't have, they suggest that they can order it for me. That means I must remember to come back. It also means if their wholesaler is out-of-stock then there will be more delays. I have never said yes. But what might make me say yes? This w...

News this week that the average price of a CD has fallen below £8 for the first time, compared to more than £11 in 2000, tell all retailers that prices do not have to just go up. While the recording industry may blame the internet and supermarkets, which are accused of below cost selling, the business of music may not be suffering in proportion. Radiohead guitarist Ed O'Brien told Time magazine that "the music industry isn't in crisis, the recording industry is; it is an unbelievably good time to be a fan of music and new bands." Whatever, most corner shops are not big into music. However, the implications for book, magazine and newspaper sales is more sobering. The Boston Consulting Group has just studied the attitude of shoppers towards buying digital content in the US, China and Germany. They will pay $100-$150; $70-$120; and $130-$160 respectively for an e-reader. For a book the price ranges are $5-$10; $1-$2; and $7-$12 respectively. For a magazine $2-$4; $1-$2; ...

It is a shock to read that Borders UK is on the brink of collapse. The book seller had seemed to revolutionise the UK book market and was widely praised by magazine publishers for the way it displayed their products. However impressive its 45 shops might look, they simply are not working at generating profits. On one side, lots of book sales have moved on line, on the other, the supermarkets have made inroads into the best sellers market. My last visit, only two weeks ago, was a disappointing experience. The two books I went in to find were not available. The bookstore assistant expressed surpise I would be looking for one of the books - Ulysses and Us - in a branch of Borders. I guess that speaks volumes about how a retailer can lose its way. The previous time I was there, with a senior news wholesale executive, he said to me that he did not know how Borders could compete with supermarkets. He said this looking while looking at a magazine category full of browsers. I was surp...

Last month I noted that Wal-mart was selling hardback best-selling books for $9, which is some $5 below cost price. Why are they doing this? To win customers of course. But which customers? Marketing expert Seth Godin suggests that the sort of people who buy hardback best sellers are the sort of people who have plenty of money to spend. "Every industry has people who are worth more", he says. "Don't treat people the same, find the ones that matter more to you, and hug them!" That is a pretty useful business rule for local shops. Use it to target the shoppers you need. Be aware of it in terms of winning supplier support from your competitors.

Local retailers may have some sympathy with independent operators of tied pubs, where the publican has to buy beer at prices set by the company from whom they have leased their business, after government regulators decided not to change their industry. CAMRA, a consumer group with more than 100,000 beer drinking members, had complained to the Office of Fair Trading that the market was rigged against their interests, pointing at the way that tied pubs were controlled. The OFT, in finding against CAMRA's complaint, in part used the Alan Greenspan defence that it thought pub-owning companies would not operate strategies that would compromise its commercial position. If it was not true for Wall Street banks, must it be true for pubcos? At the same time, in the USA, the American Booksellers Association has written to the government asking for it to investigate predatory pricing by Walmart, Target and Amazon. New hardback best sellers listed at $25 to $35 are being sold at $8.98 to $9...