The Publishing Horizon

A conversational history of Landmark and book retailing in India

A couple of weeks ago, I interviewed Hemu Ramaiah, the founder of the Landmark Bookstore Chain, about her entrepreneurial journey with Landmark. This was part of the Entrevista series of Entrepreneur Podcasts by Venture Intelligence. The interview seemed almost like a history of the last 30 years of bookselling in India. Download / listen to the interview (77 minutes, 35 MB, mp3). 

During the conversation, Hemu Ramaiah talks at length about

• how the idea for Landmark came to her sometime in her 5th year of her eight a half year term as the manager of a chain of hotel bookstores in Chennai and was developed (all in her head) over a 2-3 year period before launch.
• her thinking in breaking away from a 250 square feet hotel bookstore format to the first Landmark store which was a 5,000 square feet sprawling store
• her belief in computerised inventory and billing from day one and how she went about the process of developing the software.
• dealing with a supplier (IBD, the book distribution house) who turned competitor by setting up Fountainhead, a bookstore in Chennai and began to short change Landmark by offering preferential pricing and supplies to Fountainhead compared to Landmark. This is was the spark for her to backward integrate into book distribution by setting up Westland.
• her struggles with foreign publishers who refused to deal with a small player like Westland, how she persuaded, one of them (Random House) to help her out. This required her to take one of the biggest decisions of her life overnight at New York - deciding to supply books to all her competitors, thereby growing the book market in India and her business as well, without worrying about the growth of her competitors.
• how she took a huge gamble during the foreign exchange crisis in 1991 and turned what was seen by everyone in the book retail trade as a showstopper into an opportunity and ended up building the Landmark brand across India and growing sales by leaps and bounds.
• the experience of expanding the Landmark brand through franchising (in Coimbatore) and a joint venture (in Calcutta) - which didn't work out well
• the thinking in setting up the second Landmark store at Spencer Plaza in Chennai and how she went about negotiating the lease, doing up the store and ended up buying the place.
• her bad experience with a private equity investor, why she became dead set against private equity investors and ended up looking only for a strategic investor
• her thinking on when to sell out - which was led by more by timing rather than how much she would make by selling her stake.
• how she got completely new readers into the store and turned them into regular customers. When she learns that her daughter’s schoolmate has never visited a bookshop in her life, she decides to turn the problem (of parents not exposing their children to books), by “taking the bookstore to the school”. Listen to this bit which is not part of the main podcast.
• her views on the future of online retailing versus physical retailing - physical book retailing has been taken over by accountants
• balancing home and work, and,
• opportunities for entrepreneurs today.

Download / listen to the podcast interview.

Market size of book retail in India

Technopak Advisors claim in the Business Standard that

The Indian book retail industry is estimated to be over Rs 3,000 crore, out of which organised retail accounts for only 7 per cent.

The industry is expected to grow by approximately 15 per cent a year.

Book retail contributes only about 1 per cent to the overall retail industry. Text and curriculum books account for about 50 per cent of the sales. Second-hand books are also a big chunk of the book retail market.

In the past few years, several large format book store chains have come up, such as Landmark, Crossword and Om Book Shop.

Book retailers are focusing on improved customer experience. Many book stores have also introduced coffee shops and provide a library-like atmosphere where customers can sit and read, while sipping coffee.

I expect better from Technopak Advisors. This kind of estimate is such a generic and meaningless estimate with no information on the basis for it, that I would discount this completely. It doesn't give me any data or insights that I can trust or use. They seem to be saying something for the sake of saying it and meeting a weekly deadline. It also does no good for their brand - I now wonder about all their other estimates of market size.

The sad part is that there is little or no other data on book retail out there and this is likely to be taken as correct and quoted over and over again by virtue of being the only data on the Indian book retail market out there. Use it as you please, but don't get taken in by it.

Reading Spa: A great bookselling idea

From The Penguin Blog: In praise of independent bookshops

But [Mr B’s Emporium in Bath, England] have also started what I think is a brilliant initiative. It’s called a Reading Spa: for £55 a person gets an hour of undivided attention from one of their extremely nice and knowledgeable booksellers. You sit and have tea and cake and talk about what you like, what you don’t like; they talk about what’s come out recently, what’s selling well. Based on this, they then go away and come back with a pile of books. £40 of that £55 goes towards these books, plus of course any extra you want to spend. So far they’re doing at least one a week and one chap spent an extra £400 a couple of weeks ago.

I wonder if bookshops in India would think of something like this. Maybe not since the floor staff are not very well informed these days.