New broom, difficult backdrop
31.03.10 | Neill Denny
Since he took the top job at Waterstone's in January, Dominic Myers has been mastering the detail of the business and has now unveiled the broad strokes of how he intends to reinvigorate Waterstone's.
By sheer coincidence Blackwell, a business Myers ran for three years up to 2005, has unveiled its latest figures, showing a loss of £9m on turnover of £74m, a grim statistic that underlines the acute pressures all high street booksellers are under.
The gloomy backdrop was further accentuated by Tim Hely Hutchison, head of the largest publisher in Britain, who, in his regular letter to authors, noted the collapse of Borders and Hughes & Hughes, and pointed out that "chain booksellers and independents will remain under pressure and we must all wonder where it will all end. In short, we think a proportion [only] of the existing traditional booksellers can and will survive."
Myers has given Waterstone's a decent route map for the road ahead in which local booksellers have more autonomy and the deafening volume of promotional noise the stores were emitting is turned down. Waterstone's had become over-centralised and guilty of imposing one-size-fits-all bookselling on branches despite very different catchments.
Staff will now be able to source up to 10% of stock themselves and be responsible for some local promotional activity. The intranet will be used in an Ottakar's-style way to enable branches to swap tips. Equally, more effort will be made around author events and children's while the proportion of non-book stock will creep up to 10%.
The brand will be freshened up as early as this May. The hub is now performing as it should; savings of £5m by 2010/11 are being forecast, while the chain's net profit margin is predicted to hit 3%–4% in the medium term.
Much of what Myers' is proposing seems an obvious and welcome change from the ancien régime, which seemed at times almost determined to stifle the creativity and book sense of the frontline staff. There is much work still to be done—the store estate needs trimming and money needs to be spent smartening up the many tired shop interiors—but Myers is making all the right noises and the staff like the cut of his jib. Unlike Blackwell,
Waterstone's has no rich benefactor to fall back on. There is much riding on Myers' broad shoulders and the market is not about to get any easier.