The metamorphosis

By Sun Shuangjie Source:Global Times Published: 2016/8/22 18:23:39 Last Updated: 2016/8/23 8:11:02

Transformation of China’s largest State-owned bookstore chain is painful but promising

The year of 2017 will mark the 80th anniversary of Xinhua Bookstore, the country's largest State-owned, nationwide bookstore chain, which was founded in Yan'an under leadership of the Communist Party of China.

Driven by booming online book sales and popular privately owned bookstores across the country, Xinhua Bookstore is also going through an unprecedented reform now.

Only five or six years ago, Shanghai citizens were accustomed to frequent news that one after another, the city's bookstores, no matter State-owned or privately owned, were closing because of a lack of customers. This was mainly attributed to the rise of reading on electronic devices.

However, just in the past few years, a number of new types of bookstores, mostly privately owned, have appeared in Shanghai and many other large cities across the country, and they're altering people's perspectives on bookshops through striking interior design, warm and comprehensive food and beverage services, and innovative shopping choices, as well as diverse cultural programs.

Taking a quick peek into the Shanghai Book Fair (SBF), which ends this week, people may see a number of popular bookstores from Shanghai, Jiangsu and Zhejiang provinces showcasing their features.

For instance, Xiaofeng Book House from Hangzhou has furnished its booth into a traditional Chinese-style household with carved wooden frames, and besides books, the store offers a variety of products such as bookmarks and refrigerator magnets, as well as bags bearing images from paintings by Chinese essayist and cartoonist Feng Zikai.

Since 2012, the Shanghai Book Fair has been setting up specific areas for these bookstores, alongside booths for publishing houses.

And together with Shanghai Municipal Press and Publication Bureau, it has held three annual meetings for bookstore owners hailing from around the country since 2014.

Last Thursday, 31 managers of major publishing groups and 51 directors of major bookstores in the country gathered at the third annual meeting, titled China Physical Bookstore Innovation & Development Conference.

Apart from a small number of privately owned bookstores, most of the attendees came from State-owned companies.

A man passes by a Xinhua Bookstore in Shanghai. Driven by booming online book sales and popular privately owned bookstores across the country, Xinhua Bookstore is also going through an unprecedented reform now. Photos: Yang Hui/GT

Largest State-owned bookstore

Xinhua Bookstore is the country's largest State-owned bookstore chain. The history of the company dates back to 1937, and today its branches can be seen in every province on the Chinese mainland. Moreover, its brand is now shared among different State-owned media and publishing groups.

In Shanghai, Xinhua Media Co., Ltd. is the only owner of Xinhua bookstores and has roughly 150 bookstores under its wing, including both large-scale Shanghai Bookstores and also small- and medium-sized Xinhua bookstores.

Xinhua Bookstore is also currently going through reforms so that it can survive during the transformation of the brick-and-mortar bookstore industry nationwide.

The latest stimulus comes from a guideline co-released on June 16 by the Publicity Department of the CPC Central Committee with the Ministry of Culture, Ministry of Finance and eight other State departments, which will support physical bookstores with preferential taxation and policies.

"As a time-honored bookstore brand, Xinhua Bookstore has a glorious history, now faced with new changing conditions in the book market, it's become a new subject for us to maintain the prestige of our brand and to achieve further sustainable development through innovation," said Wang Yanbin, head of the Department of Printing and Distribution from the State Administration of Press, Publication, Radio, Film and Television, which initiated the annual meeting.

Last year, Xinhua bookstores across the country earned revenue of 113.4 billion yuan ($17.06 billion), accounting for 34.6 percent of all the bookstores in China and achieving an 8 percent increase from 2014.

A reader at a Xinhua Bookstore in Shanghai

Super bookstores

It's been a consensus in the bookstore business that a good bookstore will not only sell books but also offer other services that can attract people to physically go and spend time there.

Right now in Shanghai, citizens have a handful of choices. There are The Mix Place on Hengshan Road, Upper Bookstore on Harbin Road, Yan Ji You bookstore on Tianshan Road, Old China Handing Reading Room on Shaoxing Road, as well as the newly opened Zhongshu Bookstore near Jing'an Temple.

All of them are run by private owners, but the owners of Xinhua Bookstore have seen the possibility of learning from their rival competition.

In 2014, the Heilongjiang Book Audio and Video Publishing Group, formed by 88 Xinhua bookstores in 1996, set up a new shop, the Gogol Bookstore in Harbin, capital of Heilongjiang Province.

It innovatively combines theater into its shop and regularly holds concerts and dance shows adapted from classic literature. It has become a cultural landmark. In the first half of the year, the revenue of the bookstore surged 100.88 percent year-on-year.

"In the past two years, we have been learning from the success of Gogol Bookstore and how to apply its method to Xinhua bookstores in our province," said Zhang Shengchen, deputy manager of Heilongjiang Book Audio and Video Publishing Group.

Currently, major Xinhua bookstores in nine cities have improved and expanded their services, which has proved rewarding, as some of them have doubled and even tripled their revenue.

A Xinhua Bookstore on Changning Road

Blue sea in suburbs, small towns

The success of bookstores in cities in Heilongjiang Province also has led more and more booksellers to smell the opportunities in medium or small cities, or even in towns and villages.

Last year, the revenue of bookstores in top-tier cities increased 5.8 percent, far outnumbering the nationwide average growth of 0.3 percent.

But Peng Weiguo, the deputy director of the Shanghai Municipal Press and Publication Bureau, told the Global Times that beyond the downtown areas of big cities, there are huge potentials for readership.

Peng cited what he has seen in small towns of Zhejiang Province as an example.

Zhejiang Xinhua Bookstore Group Co., Ltd. started to cooperate with individuals in the township in 2009 to set up stations where the owners could buy books from Xinhua bookstores in big cities for their own customers; then, they could deliver the books to individual customers' homes.

According to Peng, he encountered a couple who owns such a book station in a town of Shaoxing, and the couple can easily make hundreds of thousands of yuan per year.

By the end of last year, Zhejiang had 405 such stations, which garnered 105 million yuan in total for one year.

"The critical problem for Xinhua Bookstore is how to reform its system. Currently, in downtown Shanghai, we have a good number of comprehensive bookstores, but in the newly built communities and in some suburbs, we still can do a lot," Peng said.

"There is great potential to open bookstores with its own features on campus, residential compounds and community of white-collar workers," Peng added.

Posted in: Metro Shanghai, City Panorama

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