Losing another local institution to the malls: Charlesbank Books in Belmont

I’ve heard from many of you who have expressed concern for the loss of our Charlesbank bookstore in Belmont Centre, which has been owned for many years by Barnes and Nobles who acquired it as part of the acquisition of B.Dalton. I share the concern, recognizing the value that the store provides to many readers in our community and its contributions to our local economy.

I had a long conversation today with Mitchell Clipper, the Chief Operating Officer of Barnes and Noble.

In summary, he explained that their decision was final, that he could not be influenced and that the community had, in his mind, voted against the store by not patronizing it adequately over the past five years. He expressed regret, and understanding for the concerns that people had, but explained the decision as a necessary business decision.

Here are some additional specific points that he made:

  1. The store has been losing more and more money as sales have been declining for the past five years. Local managers do not see the whole P&L for the store and may not understand the true economics of the store. They see gross margin and payroll, but not rent and a number of other costs directly attributable to the store.
  2. The losses are not small. He would not disclose the specifics, although I pressed, but stated that the annual losses for this specific store are at the six figure level.
  3. He stated that they do not make decisions to close stores lightly and that they review each specific store to look for ways to keep it open and had done so in this case. He was specific that there was no concession for rent that could remotely be adequate to make the store profitable.
  4. While I pressed repeatedly, and he emphasized repeatedly, that this specific store is losing money, he did say that the losses in this store are consistent with losses in similar “small format” stores nationwide. They are keeping a few unique “small format” stores open but have been closing 30 a year for the past few years. If I heard him right, he said that this year they are closing 47 and they are down to their last 50.
  5. The large format bookstores are profitable — the one “down the street” in Burlington is profitable.
  6. He explained that the competition includes “a thing called the internet” as well as the big box retailers like Walmart and Target.
  7. He said he had heard from people offering to try to help the store by building business, but was adamant that the community had already voted by patronizing the store inadequately over the past few years.
  8. He also said he had heard boycott threats, but indicated that B&N couldn’t build its business by keeping unprofitable stores open — he and the committee of people that he works with to make these decisions have concluded that they need to redeploy the capital elsewhere.

In summary, he said “it’s over” and said specifically that there is nothing that the community can say to him that will affect his decision. It seems that if we are to have a local bookstore in Belmont, someone else is going to have to come forward to run it.

Published by Will Brownsberger

Will Brownsberger is State Senator from the Second Suffolk and Middlesex District.

5 replies on “Losing another local institution to the malls: Charlesbank Books in Belmont”

  1. I am sorry that the store is closing, but he is right about Barnes and Noble business model not working so well.

    It is not the Mall that is killing the local book store but the Internet. Amazon is the 800lb gorilla. They carry every book in print. They are available for browsing 24/7. They normally have it available in a couple of days. and lately they offer free delivery. and for the willing same day delivery.

    One thing the state can do is to work harder at creating a level playing field between brick and mortar and internet companies. I think it is time to figure out a way to extend sales tax to internet and mail order sales. It is a small advantage internet companies have that they work very hard to exploit over local competition. They also use it to do business in places where they can pay little for help, pay no taxes and transfer the wealth to themselves. Lately I have heard about an internet company that is dispensing eyeglasses in Massachusetts from China. It is a completely artificial advantage created by the government. And it is time for the state work to fix it.

    I can imagine the state requiring Fedex, UPS and the Post office to collect Massachusetts sales tax from commercial shippers for deliveries to Massachusetts except for those who register as tax exempt with the delivery carriers. The State could even compensate the carriers by offering them a million dollars to fix their computer systems to handle the accounting, and 5 cents a delivery to collect the tax. It would solve the problem for the internet companies not wanting to have to deal with 50 or 1000’s of sales tax schemes. they would get the tax passed on to them through their shipping bill which they already deal with.

    My own business is being increasingly impacted by internet sales, and I have lost business to out of state suppliers because the 6.25 sales tax even when I match the internet prices. Granted these were not my regular customers, but potential new customers.

    If everyone had to pay the sales tax, more business and jobs would stay local. the state would be collecting more taxes on what our citizens are buying. And the fiscal health of our local businesses, local government and the state would improve. Such a policy would not shield local businesses from competition, just end a system that rewards people for buying over the internet and avoiding the taxes their local representatives believe need to be collected. Given the current economy, it is time to take a hard look at this expansion of the sales tax.

    1. My name is Kevin Phillips an I am an intern in Rep. Brownsberger’s Office. We have done some research regarding the internet sales tax and here is what we have found. Some websites are subject to the MA state sales tax while others are not. Barnes and Noble is subject because they have buildings in Massachusetts but businesses like Amazon, for example, are not.

      However, there is an act H4115, An Act to promote sales tax fairness for main street retailers, that will help to fix this. The Act changes what it means to be engaged in business in the Commonwealth. “‘Engaged in business in the commonwealth’ means having a business location in the commonwealth; regularly or systematically soliciting orders for the sale of services to be
      performed within the commonwealth or for the sale of tangible personal property for delivery to destinations in the commonwealth; otherwise exploiting the retail sales market
      in the commonwealth through any means whatsoever…”

      The Act covers a wide range of areas such as laying out direct mail sourcing rules, telecommunications and related services sourcing rules, amending laws regarding sales of tickets to places of amusement and sports and clarifying language from previous acts, among other things.

      H4115 received a favorable report from the Committee on Revenue but it is not clear what the next step is, as there is no timetable for it to be heard in the House.

      1. Thanks, Kevin. Good work.

        Just a couple of other points that I picked up in speaking to the chair of the Revenue Committee. The federal constitution limits our ability to tax remote internet sales. The legislation in question will only take effect when enough states have adopted it. Currently 23 states have.

  2. How does this help the workers since they’re losing their jobs?

    I do agree that this should remind us all of the importance of supporting local businesses. In the case of Charlesbank, it’s not a local business, but does (or did) provide service to the community that the big box B&N does not.

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