Better World Books: What other dealers can learn from the new model
By Susan Halas
The editor tells me that what AE readers, especially AE readers who are booksellers, want to know is about ways to make more money. So while there are many different ways to examine Better World Books, one of the most controversial companies in the bookselling pantheon, this article will stick to what it is, what it does, and what others in the book trade can learn from them.
Better World Books - What It Is & What It Does
Better World Books is a seven-year-old multi-faceted for-profit B corporation with its front end acquisitions department based in Georgia and back end warehouse facilities in Indiana. It has gross revenues somewhere north of $40 million a year and a double digit annual growth rate. Last year they paid off more than $2 million in debt out of cash flow. At the time I visited their Mishawaka operation in early October 2010 the company had over 300 employees of whom about 45 were in Georgia and the rest were in Indiana. The company has recently opened a UK affiliate in Scotland.
A barebones synopsis of their history reads like a fairy tale from the world of capitalism:
Less than a decade ago three Notre Dame undergrads stumbled quite by accident onto a money making opportunity in the book trade. Their first venture - on-line textbook sales - was profitable from the onset. An outgrowth of that experience was a "business plan" (a phrase that will reappear again in this article). Their idea won the "Business Plan" contest at Notre Dame.
Winning the contest got them in the door. Once inside some savvy venture money appeared. Along the way, one of the business plan judges became their CEO. The young founders were quick studies and they came already equipped with strong math and IT skills (if not exactly flush with knowledge of the ancient and honorable trade of book selling).
They rapidly learned how to extract money from diverse segments of what soon became a huge flow of inventory. From textbooks, they went on to systematize popular post- ISBN titles, sift through thrift store rejects, cultivate library de-accessions, and expand into the antiquarian field. Waiting in the wings are a variety of ways to "monetize" used books while simultaneously acquiring enormous quantities of inventory with little or no up-front expenses.
BWB receives many of the books it sells as donations. The company teams with literacy oriented non-profit organizations. These partners receive a portion of revenues generated by donated books. The partners also receive many actual books as well. Those who want to donate can deposit unwanted books at large bins in high traffic locations around the nation. The company also hosts book drives seeking donations of unwanted volumes in many communities.