June 17, 2017

The Amazon/Whole Foods editiorial from Lacy you didn't even know you needed.

Hi everyone,
 

I’ll try to keep this as short as I can, and I solemnly swear it does link directly to happenings and changes at hello hello books! (If you want to get right to the bit super-specific to the store, head down to the paragraph beginning with a couple of asterisks.)

As most of you already know, Whole Foods announced today that they sold out to Amazon for nearly $14 billion. This sent immediate shockwaves through the retail community--and not just the large corporations. Amazon has been quite frank about their determination to put as many small and medium businesses out of business entirely, to dominate as much of the retail landscape as possible no matter the cost (both literal and figurative.) Many consumers see this as perfectly fine--their argument generally being that if small/local retailers can’t find a way to compete with Amazon, they weren’t fit to survive anyway, so too bad. Among the myriad things wrong with that argument, one sticks out the most: it fails to mention the uncomfortable, unbelievable fact that earlier this year it was reported that Amazon is “expected to vault past a record [of $1.2 billion] for state and local tax subsidies held for many years by Wal-Mart Stores Inc., the undisputed king of brick-and-mortar retail sales.”

Stacy Mitchell, co-director of the Institute for Local Self-Reliance (based in Portland!), is an expert in Amazon’s growth, and their impact. Late last year, she released a report entitled “How Amazon’s Tightening Grip on the Economy Is Stifling Competition, Eroding Jobs, and Threatening Communities”  In this report, she said “Amazon’s shift in strategy was accompanied by a decision to aggressively pursue tax subsidies as it erects warehouses and distribution facilities. She said the company came to state and local economic development officials with a sense of entitlement...When it became clear that Amazon’s strategy was going to entail a physical footprint in more locations in order to be able to do next-day and same-day delivery, they shifted to this approach of trying to win public handouts. They have been very calculating about how they do that, and they have been very successful.”

Read that again. “Amazon’s strategy was going to entail a physical footprint in more locations.”

The reason I’ve had a stomach ache all day isn’t just because of the incredible amount of damage Amazon has done to the book business; it’s because of the incredible amount of damage they’re now in an even better position to do to all small-to-medium businesses. The ones that don’t get subsidies. The ones that pay taxes where they operate, instead of actively avoiding paying taxes. This isn’t paranoid thinking; again, they’re quite open about their desire to be everywhere, all the time, and to cultivate an aura of fairness and convenience (just ignore the man behind the curtain.) The ILSR’s mighty work on Amazon (
ten pages full of links here) will give you far more information than you need to see the danger inherent in this Whole Foods purchase--in fact, they were quick to send out a press release urging regulators to block the purchase, saying it “raises significant anti-competitive issues that should be deeply concerning to federal antitrust regulators and the public. This deal would allow Amazon to leverage Whole Foods’ 444 U.S. stores in ways that would dramatically amplify Amazon’s online market power, by integrating these locations into its vast logistics and delivery network.” More succinctly, this tweet by the Financial Editor of the Wall Street Journal:


 

 

 

This acquisition invites Amazon into our states and our towns in an unprecedented way, and gives them access to a grid they’ve been salivating over for a long, long time. It’s ridiculous, given Amazon’s monopoly on so much, this deal was allowed to go through, and I do hope there’s an antitrust case against it. Just as significant, though, is the worry that as a nation, we’re just letting it happen, because it’s so easy.

I get it! Of course I get it! I shop online too; it’s nearly impossible not to these days, especially as a business owner and a parent to a toddler. But as my brilliant friend and fellow bookstore owner Christine recently wrote, “Making people feel guilty when they don’t shop local doesn’t work anymore. I want to stop trying to convince people that shopping at my store is not only a more pleasant experience, but also a more beneficial one to the process of book publishing. [And I would add, to the communities those stores are in.] So I’m going to focus on the people who have supported us throughout the years, who come to my stores to talk to other book lovers, talk to my wildly intelligent and knowledgeable staff, feel comfort that they are in a place where people like the same things they do.” I want to expand our customer base, and I want everyone to feel welcome and happy they have an indie bookstore in their community. But I’m never, never, never going to beat Amazon’s cutthroat pricing, so if that’s the only thing that matters to someone despite everything else my store has to offer, I have to bid them adieu.

**[Skimmers, here’s the store update part to read in full.]** So here’s the part that loops back around to Maine, to Rockland, to hello hello: The majority of the special orders of used books we do for our customers are through ABE (which was once the most reliable, reputable source for quality used books, and is now, of course, owned by Amazon) and Amazon itself  (which, no surprise, has about 95% of the online used book market cornered.) Though these books are purchased from individual sellers, money from these orders still flows into Amazon’s coffers through those seller’s monthly fees and the percentage of each sale Amazon helps itself to. This has always felt like a necessary evil--if we want to offer the service of ordering used books for people, we want to give them the widest possible array of choices. No matter the price of the book you’re ordering (which we get no discount on!) we’ve always charged $2.50 for the service, so after staff time it’s usually either a wash or a loss, but it’s a loss we’ve borne in order to preserve the service. If a book is in print, it benefits us much more to order a new one for you, and we try to suggest that option if you’re comfortable with it; it’s also a bit greener, since those orders bundle and ship with lots other new books we’ve ordered for the store, rather than being shipped in an individual mailer.

This Whole Foods thing has just been dogging me all day, and I just can’t shake it. Coupled with their long history of Amazon’s refusal to stop advertising on Breitbart (not to mention report after report on horrendous working conditions, all the ILSR studies, and their treatment of brick and mortar stores as “showcases” for stuff people should just buy on Amazon), the Whole Foods deal and the implied grid-infiltration has just busted down the damn. The loss of their percentage of sales from used book special orders won’t do much to Amazon’s bottom line, but we’re divesting. We’re done. We’re shutting down our ABE and Amazon accounts and limiting our used book special orders to much smaller companies, and we’re raising our special order fee to $5 in order to establish a more sustainable approach to this service. I’ll be frank: we might not be able to order as wide a variety of used books as we have before, and what we’re able to order might not come as cheap; some of you may choose to skip doing those orders with us and do it yourself, and that’s really okay. If you’re dedicated to us, as so many of you thankfully are, I hope you’ll understand why we’re making this shift. Please let me know if you have any questions, and thank you for reading!

 

See you in the shop,

Lacy