ABA Urges Mayors to Include Indies in Discussions on Minimum Wage

As a growing number of cities tackle the question of raising the minimum wage, the American Booksellers Association called on mayors across the country to include indie retailers, such as booksellers, in any discussions on increasing the minimum wage in their cities.  

In a letter to the U.S. Conference of Mayors dated June 25, ABA CEO Oren Teicher wrote: “When cities raise the minimum wage without including small business owners in important policy discussions, they risk harming the people they are seeking to help, by forcing independent businesses, which work on very small margins, to cut benefits or staff hours — or worse, to go out of business.”

Teicher stressed that indies do not oppose increasing the minimum wage, but ABA member bookstores “want to work with cities to help craft solutions that raise wages based upon sound economic principles,” he wrote.

An increase in the minimum wage is more likely to succeed as long as cities support indie businesses, Teicher noted. “The importance of independent retailers to the fiscal health of their communities cannot be overstated,” he said. “Since 2002, a number of studies have documented the positive economic impact of locally owned businesses, and their significantly greater economic return to the local economy than that of retail chains, big box stores, and remote online retailers. Supporting independents strengthens communities — and their workers.”

Teicher pointed out that there are many ways government can support independent retailers to ensure that they can provide their employees a minimum wage increase. They can organize and sponsor events highlighting the importance of shopping locally or provide tax incentives for landlords to rent space to local retailers, among other ideas.

Booksellers are also encouraged to take an active role in minimum wage discussions in their town. ABA has created a Minimum Wage Legislative Action Page that provides indie bookstores with tools and tips to help them become an active participant in any wage-increase discussions that occur in their areas.

Read Teicher’s letter in full below.

 [ABA LETTER TO U.S. CONFERENCE OF MAYORS]

June 25, 2015

Tom Cochran, CEO and Executive Director
The U.S. Conference of Mayors
1620 Eye Street, Northwest
Washington, DC 20006

Dear Mr. Cochran:

I am writing on behalf of the American Booksellers Association, the national not-for-profit trade association of independent bookstores, in regards to the minimum wage issue. I’m sure you are aware that the question of raising the minimum wage is a prominent issue in many cities, and we believe that more and more cities across the nation will soon be addressing it. It is our hope that ABA can work with the U.S. Conference of Mayors to encourage mayors nationwide to include indie retailers, such as booksellers, in any discussions on increasing the minimum wage in their municipalities.

Currently, most of our members pay their employees more than the minimum wage. But when cities raise the minimum wage without including small business owners in important policy discussions, they risk harming the people they are seeking to help, by forcing independent businesses, which work on very small margins, to cut benefits or staff hours — or worse, to go out of business.

Without question, this is an important and complex issue. Independent booksellers fully understand this, but they also have little price flexibility, and they are competing against online retailers that heavily discount and often fail to collect sales tax. And, in our business, the manufacturer (the publisher) prints a suggested retail price on the product — making it virtually impossible to add a surcharge to cover an increase in wages. 

Many successful indie bookstores will generally see a net profit of approximately two percent or less. With margins this tight, it is important to understand that a small change can have a very big effect on profitability. If the minimum wage is raised, it inevitably means indies will have to increase the wages of senior and full-time staff in addition to increasing the wages of any minimum wage workers. A seemingly “insignificant” wage increase can have a dramatic effect on the bottom line, sending a profitable store into the red.

To be clear, we do not oppose increasing the minimum wage. Our members want to work with cities to help craft solutions that raise wages based upon sound economic principles. An independent bookstore has a much better chance of accommodating a gradual wage increase that occurs over a few years than a drastic wage increase that occurs in one.

Moreover, we believe a carefully executed minimum wage increase is more successful if planned in conjunction with concrete steps to support independent Main Street businesses. The importance of independent retailers to the fiscal health of their communities cannot be overstated. Since 2002, a number of studies have documented the positive economic impact of locally owned businesses, and their significantly greater economic return to the local economy than that of retail chains, big box stores, and remote online retailers. Supporting independents strengthens communities — and their workers.

There are many ways government can support independent retailers to ensure that they can provide their employees a minimum wage increase. Cities can organize and sponsor events highlighting the importance of shopping locally (for example, a Shop Local Day). They can provide tax or other incentives for landlords to rent space to local retailers, and they can reduce fees and/or taxes for indie retailers to help them pay a higher wage to their employees.

I’d be happy to discuss this important issue with you, at your convenience, either in person or via phone.

Thank you for your consideration.

Sincerely,

Oren Teicher, CEO
American Booksellers Association