Owner, Powells Books
“Who could feel bad about being in the book business? ”
Powell’s City of Books in Portland, Oregon, is a destination for many travelers. It houses some 1.5 million books, most of them used. It is the largest independent new- and used- book store in the world.
Michael Powell opened his first store on Chicago’s south side, then moved to Portland and bought the store his father opened there.
He talks here about what led to his owning a bookstore and the lifelong principles that guide his business decisions.
I’m the son of a Depression-era father and mother, and that was formative. My dad was born in 1911, grew up during the Depression, did what he had to do in order to make a living. He told stories of being very close to the edge poverty. He had very difficult jobs before the war which gave him a stake and work experience. He worked hard all his life and tried different things, then tried to get into book business later in his life. My mother also worked; she was a teacher all her life, so I grew up in a working family. Not unusual. Work; very strong work ethic. Graduated from grade school when I was about 14. My mother suggested I go work with my grandfather on a [commercial] fishing boat. I think mostly to baby sit him.
But for me, it was a very serious job, and I took to it, enjoyed it. Learned some life lessons from it that I didn’t know I was absorbing, but on reflection, I see that I was. When you’re a commercial fisherman, you’re learning three basic rules, which are: keep your gear in reasonably good condition; have some sense of where the fish are, which you learn either generationally or from experience, and keep your net in the water, that’s in the boat or on the docks. [In the book business] you always have to be getting to know your technology, you have to know where your customer’s at, and you got to keep working. That, to me, became the metaphor of my life or touchstone of my life. I certainly wasn’t sitting there taking notes when I was doing this. But once you know, it’s pretty obvious.
I did that for seven years; after that, went to school at University of Chicago, but by then, those lessons had been learned. The opportunity came along to dabble in the book business and then dive in. The only career I had after college was the book business. I have never looked back.
What was it that made your father want to open his store?
He actually opened the store in Portland after he helped me out in Chicago where I had a store, and he liked it. He always wanted a retail store. He was a college graduate, but because of the Depression, personal need, he got some shipyard experience. Then he became a painter and paper hanger, and he spent much of his life doing that, and some photography. He always drifted back to painting and paper hanging, then he retired. But he had always had the dream of opening a store. He thought it would be a wallpaper store or something like that. But he never did anything about it. Then I opened the bookstore in Chicago, I think that touched a button. He loved it. He didn’t know books but he was smart enough to come back and hire people who did, who could help him. He took to it pretty readily, and he loved the sociability of it, he loved talking to the customers. He just enjoyed that whole aspect of it.
This is an interesting time to be talking to you. [The book business] seems to be changing so dramatically.
It does, on the surface. The question is, is that just surface change or is there a paradigm?
What do you think?
I’m a great one to look ahead and try to figure out inevitable consequences of something happening, and I’ve also been here long enough to realize that you can chart out a change, and if you graph it long enough, it just goes straight up. But life intervenes. I saw the advent of electronic books, and they took off briskly. Amazon, of course, has a lot of money to support them. So we’re beginning to see a little bit of a question mark about the future. I think they will be a permanent part of the industry, but they’re not going to be the whole story.
Right now, our sales are stable. Borders went down, but Borders went down for a lot of reasons. I don’t think it had to do primarily with electronic books. Mismanagement was a huge piece of it. Barnes & Noble has stuck with the Nook, which is losing them hundreds of millions of dollars. But at the moment, I watch to see how many people are using them. People are using them, right? But it’s not an overwhelming response. It is a niche; a large niche, but so far it’s still a niche market. The Nook is an interesting tool. It’s like, yeah, you can buy an electronic hammer, but that doesn’t mean the hammer’s going out of existence, you know? For a lot of people, the conventional hammer is just fine. Same with books. For a lot of people, the printed book is kind of where their DNA is. I’m not one to be Pollyanna-ish about the future of the book. I watch the numbers, you know, we’re selling more books than we did a couple years ago.
But we do sell electronic books. Kobo, which was the old electronic book, has been imported over to independent bookstores. We’re probably the largest seller of Kobos in the country, but financially, it’s meaningless; you do it because you want to show that you’re engaged in that piece of the business.
I find it such a pleasure to walk into Powell’s Bookstore. It always feels like there are lots of people. I am wondering how much [of the appeal] is social.
Oh yeah, it’s community, it’s sociability, it’s serendipity. You know, it’s hard to browse electronically. You can look at lists and one thing or another, but it’s hard to browse. We’re pretty active in the community in terms of being seen supporting cultural events, certain political things, not too many, but a few. I’ve served on dozens of committees and boards and panels of one kind or another. The community responds to that. They know that we’re not a national company, we’re a local company, we’re engaged in the world, making decisions which are not driven by self-interest but are driven by community interest. I have respect for that, I think. People obviously feel good about the store, and I take great pride in it. We’re just custodians; the city really owns it. You know, if I were to sell to Barnes & Noble or something, I’d have to leave the country.
People will travel here and say, “We came to Portland because you are here.” So all of that kind of gives a pretty genuine sense of responsibility. I have had people say, “You must love books,” and I say, “No, no. I love selling books.” I have a passion for selling books. Who could feel bad about being in the book business? But at the same time, who can feel bad about being successful? I get a double benefit.
Was being very successful a significant goal for you?
Staying alive was, eating. Paying the rent. Absolutely. I never had a vision to have a large store; that was never a vision of mine, no, never. I started out with probably about 1,000 square feet in Chicago, maybe not even that much. I ultimately occupied a building that was about 4,000 square feet. Then we just grew it over the years incrementally as the customers indicated by their buying that they would support a bigger store. We didn’t say how big, we just said, Well yeah, it could be a bit bigger. I don’t think we’ll do it again. I think we’re as big as we’re going to be, but it was never a vision to be a big store. It was a vision to be a store that was successful on all levels. All levels being customer expectations primarily, but also financially successful. Without it, the bills don’t get paid and people don’t get hired. Papa goes hungry. You know, it is first a business, always.
When I look at a Borders or a Barnes & Noble, it’s like they’ve set out to be wildly successful, and that can lead you astray, I would think. But you’ve focused on staying very attuned to your audience.
That’s right. I’ve been asked, are you opening stores in other cities? I’ve been asked that thousands of times. “Would you open a store in our city, look at some properties?” And I did kick a few tires in places like Seattle and San Francisco, but part of it was my own lack of self-confidence that I could run a business that had that level of complexity. And at the same time, I just loved that it was an Oregon institution. Because I knew it was our institution.
People say, “There’s one thing I want to do when I’m in Portland.” Or when you’re in some other city and you say, “Well I’m from Portland, Oregon.” “Oh, that’s where that bookstore is.” That’s a very powerful place to be. And it didn’t start out to be that way. It just happened, you know? I think that’s what happens if you’re really true to the mission that you espouse, and to me, the mission was selling the broadest possible selection of books, always about selling.
I’ve seen other Oregon businesses go national, and suddenly they were a big national company and they weren’t perceived as being anything uniquely Portland. Growing out and doing more, first of all, is kind of boring. It wasn’t necessary. Just doing the same thing over and over again, I mean, the fact that you can open 400 stores doesn’t mean you’ve got to, it just means that you can. There’s no inherent need to do that. Somebody sees a big financial future in that, I suppose. But the truth is, you can make enough money to live on and what are you going to do with the surplus? You might end up giving it away. It is, for me, not necessary. An unnecessary and not very interesting exercise. But also, it takes me out of my comfort zone.
Do you consider yourself “well off”?
Well, you know, I’m very comfortable. I don’t know what constitutes well off, but when you read about other people’s travails, the economy – Yes, we’re comfortable. But we lead a quiet Portland-style life. Trying not to be in any way flashy about it. Is money important? Money to a business is important because it makes the business real secure. You have to have the money to pay the wages, to buy the technology, buy the inventory, to pay the rent and all the rest of it. So money is very, very important to the sustainability of business. I think a lot of people who don’t recognize its centrality wind up suffering.
Yes, you want some sort of plus for yourself and your family, but how much does it take to live, travel once a year, you know, have an enjoyable life? It doesn’t take hundreds of millions, doesn’t even take millions. If you’re the guys that own Barnes & Noble — I have no idea what their take-home is, but it’s probably pretty substantial. And yes, they own a business which arguably is worth hundreds of millions and more, but does that make their life any better or does that make their day any better? When you got those kinds of numbers, then you start worrying about losing it, and that becomes more of a problem. It doesn’t seem to me that it adds value to a person’s life. What adds value to a person’s life is doing. Yes, being successful is a good feeling. But it’s not the endgame.
Our model was to have a successful business in Portland, Oregon, and we achieved that. We work to improve it, because if we don’t work to improve it, it could degrade. But we don’t need to be ten times bigger in order to satisfy some black hole in our soul or some financial need in the company. We just need to be financially healthy. Just build in as many safety devices as you can, and at the same time, explore and keep exploring.
Had a conversation with Jeff Besos [founder and CEO of Amazon.com] way back when it had 500 employees. Now, I think, they’ve hit the 100,000 mark. We drove out to Seattle to see him. He said, “I’d like you to be the guy at the company that would do our used book business for us. But you have to do it under the Amazon name.” And I said, “So what are you thinking in terms of volume?” I don’t remember what he said, one or two hundred million dollars.
And we’re driving back [to Portland]. There were three, four of us in the car. We were senior CEOs; we always do things by consensus, you know? And I said, you know, I can’t even imagine where I’d find one or two hundred million dollars’ worth of used books. But the truth is, I don’t want to do it under somebody else’s name. We’re nothing but a jobber at that point, a wholesaler. And you have no impact on the world, and all you’re doing is supporting Amazon.
Was this a difficult decision?
No. We were 20 miles out of Seattle. I said, “Okay, what are we going to do here?” Somebody said, “Well, doesn’t feel very good. What do you think, Mike?” I said, “You know, I don’t like this, it doesn’t seem like that’s who we are.” And within five minutes, we had put it to rest. It was a no-brainer. I said, “We’re done with this conversation.” And we enjoyed the rest of the trip.
It turned out to be a good decision for other reasons. It turned out Amazon was born without a soul. If they decided that there was a more expedient way to approach the problem, I would have woke up in the morning and there wouldn’t even be a phone call. The computers would be turned off, and I know that because I’ve experienced it. It was a good decision, but it was a pragmatic decision based on non-pragmatic matters. It was about who we were and what we were, and we just didn’t need to do that. It may be that a more ambitious person would have done something greater or more meaningful or different, I don’t know, but I am who I am.
See also my interview with Anne Kingsbury who, for over thirty years, has owned and operated a small book store devoted exclusively to small press books.