Books Inc. is closing its Berkeley store as company files for bankruptcy

When Books Inc. moved its Berkeley store from Fourth Street to Shattuck Avenue in 2015, the bookstore – and customers – had high hopes this would be a formula for commercial success.

The site, in the former much-loved Black Oak bookstore, as well as its surrounding North Berkeley commercial neighborhood were considered lively and popular, drawing visitors night and day by foot, car and bus. 

But this wasn’t enough to save the store. 

Books Inc. announced Tuesday the Berkeley store will be shuttered as part of a reorganization under Chapter 11 bankruptcy. 

The Berkeley store is the only one of the company’s 11 locations closing in the bankruptcy deal, according to the announcement. 

It will close on Feb. 9, “with some staff expected to be transferred to positions at the company’s remaining ten locations,” the company’s press release said.

The Berkeley store’s lease expired on Dec. 31, and attempts to negotiate reduced rent failed, CEO Andy Perham said in a legal filing with the bankruptcy court. “These efforts were unsuccessful, necessitating the closure of the store,” 

“The Berkeley store has been steadily underperforming in sales revenues since the pandemic,” added Steve Silvers, a company spokesperson, calling the closing unfortunate. 

Books Inc.’s other stores include three in San Francisco, two at the San Francisco Airport, and in Alameda, San Leandro, Cambell, Mountain View and Palo Alto. 

Books Inc. is 174 years old and calls itself “the oldest independently owned and operated bookstore in the western United States.” 

This isn’t Books Inc.’s first bankruptcy

This isn’t the first bankruptcy for the company. As independent bookstores nationwide lost ground to large chains, and then to the internet in recent decades, Books Inc. declared bankruptcy in 1995, shutting 10 of its then 12 stores, then building back up again. 

The aim of this bankruptcy is to keep the business alive for “long term sustainability” if on a smaller scale, the company said. 

“Books Inc. is not going away,” Perham, the company’s leader since 2019, said in a statement. “Our board, investors, senior managers and key partners agree that reorganizing with the tools afforded us by Chapter 11 is the fastest path toward putting our company on a smaller, financially stronger platform from which we can continue our long legacy of serving California readers.”

The statement said:

“Utilizing the protections of Chapter 11 reorganization will allow the popular, privately held 174-year-old collection of neighborhood bookstores to continue operating while it establishes a sustainably solid financial footing in response to annual revenue losses resulting from steadily rising operating costs and dramatically changing consumer buying habits exacerbated by the COVID pandemic.”

In the bankruptcy court legal filing, Perham attributed the company’s declining revenues to “several factors,”, including the pandemic, and less neighborhood shopping as more people worked from home. 

“Sales dropped precipitously during the pandemic due to shelter-in- place orders and a general decrease in in-person retail shopping. Even as the pandemic subsided, the widespread adoption of remote and hybrid work models hindered the recovery of foot traffic at many of the Debtor’s physical locations,” the filing said. 

Revenues haven’t returned to pre- pandemic levels, and operating costs have jumped, the filing said. 

Gift cards from the Berkeley store will be honored at any other Books Inc. location, including online.  The company’s website isn’t shutting down, nor is the Frequent Reader program.

The bankruptcy motion was filed in the Northern District of California Bankruptcy Court. 

This is a developing story and will be updated.