Nicole Magistro never planned to own a bookstore. When she moved to Vail, Colorado in 2002, she had planned to earn her living the same way she had in Chicago—as a freelance writer.
But, when things weren’t quite panning out the way she had hoped, she decided to apply for a job at a local bookstore, thinking it would be a natural fit with her love for the written word. Ironically enough, she didn’t land the gig the first time around. But, when the other hire didn’t work out, she got the job and began working for the Bookworm, a local bookstore in the charming community of Edwards.
She enjoyed the work, but she still felt her self-described “entrepreneurial style” nagging at her. “I was looking to do my own thing, and I was looking at a few different options,” she explains. While Magistro was mainly looking to open up a business in the dining industry, she couldn’t ignore fate when, in 2005, one of the bookstore’s co-owners asked if she’d be interested in buying her share of the bookstore.
Magistro took the leap and said yes. Since then, the Bookworm of Edwards has gone through numerous changes—including a move to a new location, ownership restructuring (Magistro is now the sole owner), and even the addition of a coffee shop and cafe.
While exciting, owning the store hasn’t been without its challenges. With huge sellers like Amazon impacting the way that all goods—including books—are sold, Magistro has had to continue to find ways to reach her audience and keep her doors open. “Amazon had a really negative effect on the existence of independent booksellers,” she says, “Those that were operating with passion principles or more hobby-style ownership were the first stores to go.”
That level of competition and those unexpected challenges are frustrating and sometimes disheartening, of course, but they’re also incredibly enlightening. In fact, it’s roadblocks just like those that have taught Magistro a few valuable business lessons.
Find Your Focus
With a giant like Amazon breathing down the necks of so many independent booksellers across the nation, Magistro knows it would’ve been easy for her to scramble to keep up with the changing trends in a likely fruitless effort to stay in the race.
But, she didn’t cave or panic. Instead, she leveraged this competitive matchup as an opportunity to find her niche and zone in on the things that kept customers coming back to the Bookworm—an important lesson for any business owner.
“Whether that’s in the bookstore or in the cafe, we’re constantly evaluating what we do, what we carry, what we believe in, and what we choose to get behind.”
“At the end of the day, what I have found to the most sustainable—from both a profit perspective and from a culture perspective—is to just say, ‘We will focus on what we do best,’” Magistro explains.
For the Bookworm, she says without hesitation that it’s the curation of selection and quality of product that the store’s customers have come to expect.
“Whether that’s in the bookstore or in the cafe, we’re constantly evaluating what we do, what we carry, what we believe in, and what we choose to get behind based on a very curated selection of quality stuff,” she adds.
The bottom line? You’d rather serve your niche exceptionally well than provide watered-down service to a wider base of customers. That’s what will ultimately keep you relevant and competitive.
Understand Your Cash Flow
Understanding cash flow is crucial for any business owner. Magistro knows this—and she also recognizes that this can get particularly complicated as a bookstore owner in a location that’s as seasonally driven as the Vail Valley.
“I’m not ashamed to admit it—I use my line of credit every off season,” she explains, “I always pay it off, it’s not free, and it’s not huge, but I do use it.”
Magistro has spoken on the topic of cash flow at numerous seminars for independent booksellers—a subject she says that’s particularly important, as cash flow in the book industry can get tricky.
“A lot of traditional business mindset around it doesn’t apply in the same ways,” she says, which is only made more complicated by the fact that the Bookworm is both a cafe and a bookstore, and thus works with over 600 different active vendors.
And, while the book industry comes with tons of strange caveats in terms of cash flow—such as a returnable option for unsold product—Magistro says it’s important for her to view her cash flow outside of that bookseller lens as well.
“It’s critical to understand cash flow and inventory management like a normal retailer when you’re a bookseller, because that’s how the bank looks at it and that’s how your landlord looks at it,” she explains, “So, you kind of have to play both sides in order to have a truly healthy handle on cash flow.”
However, Magistro also knows when it’s time to buck traditional business advice and do what she knows is best for her business. For example, this year the Bookworm renovated their dining room. It was about a $20,000 investment, but Magistro didn’t want to have to take out a loan in order to get it done.
She knew she couldn’t wait until the off season if she wanted to pay cash, because she simply wouldn’t have it. So, while many business advisors would likely scratch their heads at her decision to undergo a renovation smack dab in the middle of a busy time for her business, she did it in the middle of season anyway. “And it worked out great!” she says, “I would never have made that move five or ten years ago for sure. I think I’ve learned from that.”
Work on Your Business—Not In It
Much like it’s important for a business to find its place in the market, Magistro knows firsthand that it’s equally crucial for an owner to find his or her place within the business.
For a number of years, Magistro found herself working 60 or 70 hours each week just to get everything done. But, she eventually reached a point when she knew she couldn’t keep heading down that road.
“I really had to restructure the whole organization, and so I kind of consider these last four years to be a new phase in the business and much more where I run the business and I don’t necessarily work in the business,” she says.
“It won’t get easier unless you plan or figure out how it’s going to be easier.”
Like so many business owners, Magistro recognizes how tough it can be to release some control. But, by bringing on numerous different managers—from an office manager to a marketing manager to an inventory manager—she’s been able to remove plenty from her plate. Today, her role mainly focuses on human resources, finance, and the inventory.
“It builds a lot into the payroll, but it also allows the business to be sustainable without me,” she says.
Being an entrepreneur is no easy gig, and Magistro thinks it’s important that fellow business owners understand that the investment is more than worth it.
“It won’t get easier unless you plan or figure out how it’s going to be easier,” she concludes, “You have to be able to step out of the business enough to develop a plan and then execute it. You have to be willing to change.”