In an effort to pivot the book publishing business back to its glory days, before streaming platforms had lured away customers, bookstore chain Crossword has set itself ambitious targets. These include a renewed focus on children’s books, cementing an omni-channel play, increasing its store count, and launching private labels across categories.
According to industry estimates, the bookstore business had been growing at 9-10% annually before the pandemic, but in 2020, the degrowth was about 5%. “A large portion of the business also went online,” said Aakash Gupta, CEO and MD, Crossword Bookstores. But in 2021, the business almost returned to normal. World over, independent booksellers and bookstore chains are clocking in growth numbers. For example, Waterstones, Barnes & Noble and Dymocks are all back to profitability in the last one year, owing to physical books being “back in fashion”, and e-books and Kindle sales reaching a plateau. In India, e-books don’t find many takers, except for upmarket readers/ travellers.
The bigger threat has always been online book shopping, particularly on Amazon. “We are a bit behind everybody else when it comes to omni-channel and e-commerce, being a physical retailer traditionally,” Gupta said. Crossword is now upping its omni-channel play, with plans to launch a new app and revamp its website in the next six to nine months. The company hopes to differentiate itself by making its website more curated, like a community for book lovers. “We want to be a bit of Goodreads, a bit of Amazon and a bit of our physical store,” Gupta said.
Late last year, Shoppers Stop sold Crossword Bookstores to its largest franchisee, Pune-based Agarwal Business House (ABH), for `41.6 crore. Under Shoppers Stop, Crossword had prioritised high-margin, non-book categories like toys, electronics and accessories, with the contribution of books to overall revenue shrinking over the years to about 55%. Under ABH, this figure is already at 65%, with the remainder split equally between toys and stationery.
Going ahead, the contribution of books to overall revenue could even touch 70%, in Gupta’s estimate. The aim, clearly, is to hero books as the primary product once again.
Within the book universe, the lion’s share of attention will be on children’s books. “A majority of these are discovered at the store itself,” Gupta said. “While not necessarily a higher margin business, children’s books are our biggest category, forming almost 38% of all books.”
Moving beyond books, Crossword plans on launching its own private labels in categories like toys and stationery over the next nine months. “Families still want puzzles, board games, edutainment toys or premium, exclusive stationery and gifting items,” Gupta said. The company also plans on growing its publishing line, The Write Place, which helps first-time authors get published.
For FY23, the chain, which has a store count of 80, plans to launch 19 new stores. It recently opened two stores in Lucknow, with a third one on the anvil. It is present in cities such as Nagpur, Nashik, Udaipur, Bhopal and Siliguri, in addition to major metros. “Our vision is to have 300 stores in different formats. Our network will help in last-mile online deliveries too,” Gupta said.
In addition to forays into tier-II cities like Patna, more stores are being planned within metros, too. “There are so many cities we have not fully penetrated yet,” Gupta admits. For instance, in Delhi, the company has only one store at present. Crossword claims to currently have a run rate of 150 crore, with estimates of taking it up to170 crore by the end of this fiscal. “The turnover projection for Brand Crossword is `400 crore in the next two years,” Gupta said.
In terms of formats, the company currently has seven flagship stores, all on high streets, with plans to launch five or six more in the next two years. It also has a few stores in hybrid office complexes, for example in Gurugram and Noida. “We plan to grow in this space as we are a good gifting destination for these offices, and this is a highly involved customer base.”
Travel retail is another avenue for growth. Crossword has three stores at Mumbai airport, with two more in the offing. Talks are on to bid for Bengaluru airport. It may soon open stores in Metro stations as well. “Unlike other airport bookstores offering many categories of items, we are proper booksellers with 50-60% space exclusively for books,” Gupta said.
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