A Bay Area bookseller whose roots stretch back to the mid-19th Century has filed for bankruptcy, saying its in-store sales have yet to recover from their coronavirus-induced maladies.
Books Inc. has filed to reorganize its finances under Chapter 11 of the U.S. Bankruptcy Code, according to court records.
The retailer will shut its Berkeley store next month. Other stores might close depending on the outcome of the company’s plan for reorganization.
The book retail chain‘s chief executive officer Andrew Perham blamed the aftereffects of the economic maladies unleashed by the coronavirus outbreak for much of the company’s woes, documents on file with the U.S. Bankruptcy Court show.
“Dramatic changes to consumer buying patterns in the aftermath of the COVID-19 pandemic” are among the primary factors behind the company’s struggles, Perham stated in the filing. “Sales dropped precipitously during the pandemic due to shelter-in-place orders and a general decrease for in-person retail shopping.”
In 2019, the final full year before the onset of government-ordered business shutdowns to combat the spread of the deadly bug, Books Inc. generated revenue of $20.9 million, a Bankruptcy Court filing showed.
The retail chain’s revenue totaled $18.9 million in 2023, marking at that time three consecutive years of rising sales after revenue collapsed in 2020 to just $11.3 million, according to the court documents.
Revenue, however, slumped in 2024, falling to $17.1 million, court records show. That was down 18.2% from revenue totals in 2019. More importantly, the 2024 revenue total was down 9.5% from the 2023 revenue total.
“Consumer spending has not fully recovered to pre-pandemic levels,” Perham said.
San Leandro-based Books Inc., however, said other problems have begun to hound the retailer that have nothing to do with the coronavirus.
“During the past few years, Books Inc. has seen significant increases in operating costs, including higher payroll and rental expenses,” Perham stated in his declaration to the bankruptcy court. “At the same time, increased interest rates have made it more expensive to service the company’s debts.”
Books Inc.’s 11 retail sites — at present — are all in the Bay Area. The retailer’s sites include three stores in San Francisco, and two stores at San Francisco Airport. The company also has one store each in Alameda, Berkeley, San Leandro, Campbell, Mountain View and Palo Alto, the Books Inc. website states.
“The company intends to use the procedures afforded by the Bankruptcy Code to work with its landlords to adjust lease costs to align with the current levels of foot traffic and sales in the neighborhoods where it operates,” the Books Inc. CEO stated in court records.
More stores besides the Berkeley location might close if the retailer can’t strike fresh rental deals with property owners.
“If favorable lease arrangements cannot be reached for underperforming stores, then the debtor anticipates closing those locations to meet its profitability goals,” Perham stated.
The company describes itself as a collection of independently owned and operated bookstores. The company’s stores have served the Bay Area since 1851, making Books Inc. the oldest independent bookseller in the western United States.
“The debtor has historically been profitable and expects to return to profitability in the near future,” the company CEO stated in the court filing.
The company is determined to keep operating, even if some stores close, Perham stated in a prepared release. Perham took the reins in 2019 as the retailer’s top boss.
“Books Inc. is not going away,” Perham said.