Waterstones prepares for new chapter as bookshop chain returns to profitability

Resurgence in sales of physical books at heart of high street retailer’s revival as chief executive takes battle to Amazon

James Daunt, chief executive of Waterstones: ‘If a customer can tell me what was the last really good book they read, I know exactly what to sell them next.’ Photograph: Martin Godwin for the Guardian

Friday 20 November 2015 -  The Guardian - Graham Ruddick

Four years ago, Waterstones was facing oblivion. Declining sales of physical books, together with the relentless growth of Amazon and mismanagement by its former bosses, had led the famous book chain to the brink of bankruptcy.
But in an extraordinary turnaround, Waterstones is set to make its first annual profit since the financial crisis struck. “We have come along way,” says James Daunt, managing director of Waterstones, as he surveys the retailer’s megastore in Piccadilly, central London.

 

Waterstones is poised to make its first annual profit since the financial crisis struck. Photograph: Christopher Thomond for the Guardian

There are, he says, various degrees and qualities of profits, but Waterstones is “delivering a profit that is dealing with dilapidations and isn’t shoving anything under the carpet”.
“We are delivering a really robust and proper profit. This will be the best true and underlying performance for this business for seven to eight years. A genuine, little small piece of black at last.”

At the heart of the revival of Waterstones is a revival in sales of physical books. Industry figures show that sales of paperbacks and hardbacks rose 3% in the first half of 2015, the first increase since 2012.

At the same time, the digital revolution has stalled. Sales of ebooks to consumers are falling and demand for the Kindle e-reader has fallen so much that Daunt has removed them from most of Waterstones’ 280 stores.
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