Helping Maintain Austin's Independence: BTW Talks with BookPeople's Steve Bercu

Steve Bercu, owner of BookPeople in Austin, Texas

Last summer, Steve Bercu, the owner of the independent bookstore BookPeople, joined with Waterloo Records, the Austin Independent Business Alliance, and Liveable City, a local, nonprofit community organization, in a campaign to keep a Borders Books & Music from moving into a proposed development at Sixth and Lamar in downtown Austin, Texas. As part of their grassroots effort to dissuade the developer from anchoring the development with a chain, the groups commissioned a study, "Economic Impact Analysis: A Case Study, Local Merchants v. Chain Retailers," which documented how local businesses contribute significantly more to the economy than do chains. (To read the study, click here.)

In late April 2003, Borders decided to pull out of the proposed development. (For a related article, click here.)

BookPeople's Bercu recently spoke to BTW regarding Austin's independents' battle to keep chains from anchoring the Sixth and Lamar development, their subsequent victory, and the overall importance of local, independent retailers to their community.

Bercu will be part of a panel, moderated by ABA COO Oren Teicher, at BookExpo America that will look at related issues. The panel, "Economic Impact of Locally Owned Businesses," will be held on Saturday, May 31, from 10:30 a.m. - noon in Room 303A/B.

BTW: Do you think that Borders Books & Music's decision to pull out of the Sixth and Lamar development was due, in part, to the actions of the local, independent retailers in Austin?

Steve Bercu: This was, at least in part, a basis for their decision -- certainly the economy played a part. It is clear that the uproar created by the possibility Borders might locate across the street from two local independent businesses with large followings influenced the developer of the project, and, over time, changed his mind as to the desirability of Borders as tenant.

Which independent business alliances does BookPeople belong to, and how important do you think independent business alliances are to the businesses themselves and their communities?

BookPeople is a member of the Austin Independent Business Alliance [AIBA]. I believe that local, independent business alliances are very important to [us] and the community. The importance to BookPeople is indirect because, of course, we are an indie and benefit from whatever support they receive in general. The community is a clear winner … for all the reasons set out in the AIBA, Liveable City, BookPeople, Waterloo Records "Economic Impact Analysis" [study].

As communities face increasing budget deficits, they will be tempted to follow the simplistic approach of sales tax revenue creation at any cost. They need to be educated about the true economic impact of the existing locally owned businesses before they make the wrong decision for their constituents.

When people think of local businesses, politics might not be the first thing that jumps to mind. How important is it for independents to be politically active in their communities?

As Orrin Hatch, the U.S. senator from Utah, said (not an exact quote), "If you have a small business and are not involved in politics, you won't be in business for long." He's right. The only businesses that don't need to be involved in politics are those that are unaffected by any change in zoning laws, tax decisions, street closures, parking regulations, incentives for competitors, regulations concerning employee safety or health, insurance rules, etcetera.

Do you consider yourself to be political savvy -- were you involved in local politics prior to the Sixth and Lamar development?

I had only a minimal interest in local politics before I discovered that there might be incentives granted to help develop a space for Borders across the street. I discovered that news about three years ago. I developed my interest [in politics] quickly after that. I am far from an expert now, but I do know our mayor and all the city council members, and many of their staff personally now. I participate in several city task forces and committees. I am on several boards that are all involved in city decisions concerning either my part of town or the whole city.

The Sixth and Lamar development received widespread attention -- how soon was it before you and your fellow independents were actively involved in trying to change things?

I first heard about Borders' possible arrival about three years ago, and I helped found the AIBA a few months after that. I began the direct campaign in July 2002.

How did your ultimate strategy come about, the centerpiece of which was the commissioning of the economic study?

This began with my sending an e-mail to BookPeople's e-mail list in July 2002 asking for their support in opposing incentives that the developer might get to build the space that Borders was to occupy. I enlisted the support of Waterloo Records soon after that, and they sent out a request to their e-mail list. We asked AIBA to join in a little later. The initial response was very big, with the city council receiving thousands of e-mails and with the original e-mails we had sent out being forwarded all over town. LiveableCity got one of our e-mails, as did CivicEconomics [an economic analysis and strategic planning consulting firm].

We received lots of media coverage. In fall 2002, CivicEconomics came to me to ask if I might be interested in doing an economic impact analysis to quantify the value of local business. I met with Waterloo to decide whether we should fund the analysis, and, in the meantime, CivicEconomics met with Liveable City and secured their participation. BookPeople and Waterloo brought in AIBA, and we all commissioned the study. The study received more media coverage and led to recommendations to the city from Liveable City. Meanwhile, we were all meeting with council members all the time in an effort to secure their support in opposing incentives. It all came together.

What were the challenges in your fight to keep Borders from anchoring the Lamar development?

We had to overcome the city's simplistic analysis of sales tax revenue as a panacea for its economic problems; the developer's interest in keeping a nationally credited tenant; the lease itself; community lack of awareness of the issues; community inertia; the city's concerns about the Smart Growth Initiative pursuant to which the incentives were being sought; the city's desires to be developer friendly; and probably something else.

Do you believe the "Economic Impact Analysis" study is applicable to any other town in America?

I believe that the exact numbers found in our study ... would not come up everywhere, but that something very close would be found. I believe that it is safe to say that almost any local business will economically impact its community about three times as much as a competing chain.

Did the significant economic implications of the study change the perceptions of the community at large regarding chain stores? Was it surprising to people that locals contributed so much more to the economy?

Definitely. I'm not certain how surprised everyone was, but I believe that quantifying it confirmed some people's suspicions, and that others were actually surprised. There is no doubt that many people who may not have paid much attention to their shopping choices, but who were disposed to support local business, began making an effort to change their habits and to seek out independents.

Do you think the work that BookPeople, Waterloo, AIBA, and Liveable City did will continue to have an impact, or is this something that will require continuing diligence?

Continued diligence is absolutely necessary. Consumers need to be reminded continually about the impact of locally owned business, and the business needs to continually give them a reason to return once they go in.

On Saturday, May 31, from 10:30 a.m. to noon, at BookExpo America in Los Angeles, you will be a panelist at the "Economic Impact of Locally Owned Businesses" session. What message do you hope to get across to other independent booksellers?

Booksellers must be a part of their larger business community as well as their community as a whole. They cannot do it alone. Working together with other independent businesses to continually educate consumers will benefit both them and their communities. Almost everything we do in concert with others is more beneficial than going it alone.

[For more about the BEA panel, click here.]

Finally, are there any upcoming challenges for independents in your community?

Keeping the momentum. This is a never-ending struggle. Just because we are popular this year doesn't mean a thing next year. All any of this does is get people to seek out an indie instead of a chain store. Once they do so, they better have a superior experience or that consumer will be right back at the chains tomorrow. Unless we provide that superior experience all this effort is a waste of time. --Interviewed by David Grogan