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Finding bright spots in a dark place

When I signed the deal to sell my bookstore & tea shop to a new cooperative, I was really excited. I’ve spent a lot of time on nonprofit boards, and now I was becoming the General Manager of a co-op. It ended badly.

The dark place

I took the assets and inventory of my 1,800 square foot shop and built a 4,000 square foot shop in a historic building in downtown Billings. I talked about the new co-op on TV, on the radio, in podcasts, at conferences, and in print. I loaned them money for the construction, let them use my personal credit card for inventory purchases, and invested in the business. They, in turn, only raise about a third of the money they’d budgeted. So what did they do? Fire me.

Just last month (January 2018), I finally got a judgment from the Department of Labor ordering them to pay my unpaid salary and accumulated vacation from February & March of 2017. The co-op still owes me $45,000 of the original purchase, plus over $15,000 in unpaid loans and credit card debt. They haven’t even paid for my daughter’s books that they sold at her book signing in 2016.

To shoppers and shareholders, this means that the co-op hasn’t actually paid for most of the inventory, furniture, fixtures, databases, software, intellectual property (e.g., tea blends), and even the floor they’re walking on. It all came out of my pocket.

And the financial statements they handed out at last year’s annual meeting did not show almost $50,000 of their debt to me.

This was all done by three board members that I trusted. One of them (a college professor, no less) even made horrible accusations about me to the Department of Labor, which she had to withdraw when it was proven that she was lying.

I got angry. Massively pissed off. Then I got depressed. How could “friends” do this to me?
Phoenix Pearl Tea Logo 400x600

The bright spots

In the meantime, I poured my energy into something positive. The debacle with the co-op hadn’t just left me without a job, it left my daughter, who’d been managing the tea side of the business, out of work as well. So we built a new tea shop.

As the family built the Phoenix Pearl Tea Tavern, I enjoyed spending my days back home in Red Lodge, Montana, free of the toxic environment at the co-op in Billings. Setting up the new shop let us restructure everything and go in a different direction. And it gave Gwen a chance to take the lead in managing the day-to-day operations of the business.

The community welcomed us back with open arms, and the new tea shop has been drawing a new crowd. Giving me something else to focus on has been a sanity-saver, and Gwen has really had an opportunity to blossom professionally.

The dark spot is brightening up. I felt thoroughly vindicated getting the Department of Labor judgment (especially since it included penalties), and the co-op’s lawyer is finally talking with us about mediation.

Now, it’s time for me to move on and start putting the whole co-op experience behind me, and take on a whole new challenge. Tune in tomorrow for details…

Merchandising for Libraries


One of the best things about teaching and giving seminars is that it makes you think about subjects you might not otherwise have thought about. I was approached by Edmaker about giving a keynote address for Library Journal‘s New Ideas in Collection Development & Merchandising workshop. They suggested calling it “How to Merchandise Like a Bookstore.”

I’d never thought about merchandising from the point of view of an organization that’s not really selling anything, and it really led me into a new way of thinking about the work librarians do. The traditional definition of merchandising involves convincing people to buy something. Change that word “buy” to “borrow,” and it’s precisely the job of the librarians that are working to develop and expand their collections. Bookstores don’t carry a book unless people buy it; libraries don’t carry a book unless people borrow it.

Last week, I presented the keynote to a group of librarians. There were some great questions and discussion topics, and it really underscored how much a library has the same goals and objectives as an independent bookstore and how easy it is for us to work together.

The slides from the presentation are available here for download (it’s a 5.1MB PDF file). As always, I welcome comments and questions on the presentation!

This House of Books: By and for readers and writers

As much as it saddens me to say this, I would discourage anyone from investing in This House of Books until they have either replaced the Board leadership or taken positive steps to correct the horrible situation they’ve created for the co-op—and me. See details in my post of October 20.

Rollout of new name

As I discussed in my last post, there’s a new bookstore coming to Billings, and I will be at the helm. The store now has a name: This House of Books, an homage to Ivan Doig’s masterpiece This House of Sky. There’s a lot to be excited about, but there’s one thing in particular that makes this store new and different: it’s a cooperative.

A cooperative is an organization that is owned and democratically controlled by the people who use its products, supplies or services.
Montana Cooperative Development Center

There are farm co-ops, food co-ops, and insurance co-ops, but book co-ops are not so common. A few of them thrive around the country, like People’s Books Cooperative in Milwaukee and Buffalo Street Books in Ithaca. They are, as the MCDC quote above says, owned by their community. That’s what we are doing with This House of Books, but we’re taking it a step farther: we’re not just working within our physical community (Billings, Montana), but reaching out into our virtual community, the people who write the books we love to read.

Two-thirds of our board of directors are published authors, including Carrie La Seur, who is shown helping me to announce the store’s name in the picture above. Over a dozen have invested, and more have made their commitment to be member/owners. The outpouring of support from the community has been amazing. One of our novel (pun intended) fundraisers is an anthology that we hope to release this August. All of the authors have agreed to donate their royalties back to the co-op, and my publishing company (Proseyr Publishing) is doing the same with a portion of the profits.

What does it mean to be a member/owner of This House of Books? We’ve prepared some fact sheets that explain everything in detail (download the PDFs here), but this is it in a nutshell:

  • If you buy a $100 voting share, you may participate in all open meetings, help to select the board of directors, and vote on changes to the bylaws.
  • If you buy any number of $500 preferred shares, you become eligible to receive dividends if the store is profitable.
  • All member/owners, regardless of the number or type of shares, are eligible to receive patronage refunds if there are more profits after dividends are paid.
  • We are offering additional benefits spelled out on the investor page of the store website, which include store discounts, early registration for classes and tea tastings, access to advance copies of books, VIP events, and more.

Let me be clear about something: we’re not just building a store here. We’re building a cultural hub in downtown Billings. We’re working with the public library, Montana State University, Rocky Mountain College, Writer’s Voice, Montana/Wyoming authors, and other literary groups. We’re building a place for book clubs and writers’ groups to meet, a place for authors to give talks and sign books, a place for poets to read their work, a place for creative people to share their art, a place for the community to gather to play games or listen to music.

The bookstore co-op has come this far thanks to endless hours of volunteer work by the board and the early advisors (including owners of three other Montana bookstores). Bringing it the rest of the way and getting the doors open depends on the community buy in, and I mean that literally. Close to a hundred people have put their money where their mouths are, pledging over $35,000 in total, but this doesn’t put us anywhere near the $250,000 it will take to open the store. It doesn’t matter whether you buy a single $100 voting share or a big stack of $500 preferred shares—every single share sold moves This House of Books closer to reality.

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