With book wars hitting Chicago in a big way, no one is feeling the pinch more than Kroch’s & Brentano’s, the city’s oldest and largest full-service bookstore chain.
Since 1907, when Adolph Kroch opened his first store in downtown Chicago, the store has been the city’s dominant book retailer, providing everything from best-selling novels to obscure texts on arcane technical subjects for hundreds of thousands of casual readers and bookworms.
But in recent years, and especially in the last 12 months, Kroch’s status has been challenged by several book chains.
And though it remains the leader in book sales, the company concedes its revenues are eroding-and at a time when industrywide sales are on the rise.
Kroch’s, which is 80 percent owned by its employees and 20 percent by the Kroch family, saw its sales in 1991 dip 8.1 percent, to $35.2 million, company officials say. A decline of “5 percent to 10 percent” was recorded last year.
As a result, Kroch’s is now taking defensive measures that only a decade ago the normally patrician book retailer would not even have considered. To begin with, it will offer the same discount promotions used by its slick and feisty new competitors.
Beginning next Sunday, Kroch’s will discount bestseller hardcover and paperback books 40 percent, the steepest discount available from any major bookstore in the area. It promises to meet or beat the price of any book title that a competitor advertises at a discount.
And it will introduce a frequent-buyer discount-card program that will reward customers with certificates for every $100 worth of purchases they accrue.
Going toe-to-toe and slugging it out price-wise with competitors isn’t something Kroch’s relishes. After all, the 20-store book chain has prided itself since its founding on being the ultimate “full-service bookstore.”
But in today’s increasingly competitive retail environment, Kroch’s says it has no choice but to get into the discounting fray.
“With at least a dozen new bookstore chains having come to town in the last year, we realize we can no longer rest on our laurels,” William Rickman, Kroch’s president and chief executive, said in announcing the discount policy.
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Among the newcomers are such chains as Waterstone’s Booksellers, Barnes & Noble, Crown and Borders Book Shop, the latter a division of Kmart Corp., the Michigan-based retailing giant.
Even before the recent advent of the superstores, Kroch’s came under assault, first from B. Dalton and Waldenbooks, then from discounter Crown Books in the early 1980s.
Nevertheless, with the exception of a 25 percent reduction on best sellers initiated in late 1991, Kroch’s scrupulously avoided discounting.
What Kroch’s has learned, retail analysts say, is what merchants in just about every retail and service business have learned: Among consumers in today’s economy, “price is king.”
In the hearts and minds of many Chicagoans, Kroch’s is as much a part of Chicago as the Water Tower, the Chicago Theater and Wrigley’s Spearmint chewing gum. But when it comes to buying books, such sentiment apparently plays little role in where they shop.
That point was underscored by customers at Crown’s bustling new store at 55 S. Wasbash Ave. in the Loop. The bookstore is about half a block from Kroch’s & Brentano’s long-standing flagship at 29 S. Wasbash.
“I feel kind of guilty because I used to go to Kroch’s where they were always so nice,” said Margaret Liston, of southwest suburban Worth. “But this is cheaper. Sometimes when I can’t find something, like a health book, I’ll go there.”
Morty Rosenkranz, executive vice president of Stone Container Corp., walked an extra half-block past the Kroch’s & Brentano’s to Crown’s. It was worth the walk because the book he wanted to buy for his wife was cheaper at Crown’s, he said.
“I still shop there,” he said of Kroch’s. “But $9 (in savings on the book he bought) is worth walking an extra half block.”
When informed that Kroch’s soon will join the discount wars, several of those interviewed at the Crown Super Store said they likely would make Kroch’s the first stop on their next book-buying sojourn because they felt the established bookseller had a better selection.
But while Kroch’s Rickman insists his chain will do whatever needs to be done to remain competitive, some analysts question whether Kroch’s can survive, at least in its present form, for the long term.
For one thing, they point out, the Chicago chain doesn’t have the capital to sustain a long-term discount shootout with the national chains or to expand the size of its stores to compete with its competitors.
Kroch’s, they say, has one of two choices: either continue to operate as it does now and risk joining the list of Chicago business icons, such as Polk Bros., that were forced to close shop when they tried to compete against the national giants, or take a cue from Sears, Roebuck and Co., another Chicago business institution, and downsize the scope of its operation.
Specifically, they argue, Kroch’s would do best by becoming a niche player in the market, serving consumers needing special types of books.
Kroch’s already has a reputation of having books other stores don’t.
“Whenever I’m looking for a specialized publication, I always go to Kroch’s,” said a shopper at Kroch’s Wabash Avenue store.
“The Crown’s and the other discounters are going for the mass market, not specialized publications.”