Are bookstores here to stay?

Books n Bobs founder Ang Yuen Tzai.

BEFORE the Covid-19 outbreak, bookstores throughout Malaysia were already beset by a constant plague of closures.

In 2018, it was recorded that there were twice as many shuttered bookstores as newly opened ones, with eight openings and 16 closures.

The Covid-19 pandemic was almost the final nail in the coffin for Malaysia’s book retail industry, as 2020 saw bookstore closures tripling the number of new openings.

After barely surviving the pandemic, the brick-and-mortar industry in the country also faces the threat posed by the digitisation of books, with electronic books (eBooks) and audiobooks increasingly gaining traction in Malaysia.

So, what is the future of the country’s book retail industry?

Malaysian Booksellers Association president Keith Thong Yuet Sheng.

Modest readership

Speaking with StarBizWeek, Malaysian Booksellers Association (MBA) president Keith Thong Yuet Sheng says eBook and audiobook readership in Malaysia is growing, but it remains small in the consumer market compared to physical books.

Sales of eBooks in the consumer market remain modest, he says, estimating it to be less than 10%.

Thong adds the low sales are due to public libraries providing free access to digital books for everyone.

Furthermore, the percentage of the consumers willing to pay for eBooks in this region remains low, he notes.

Hence, business-to-consumer digital book sales are insignificant, as the main activity for digital books is mainly business-to-business, he shares.

Thong points out that digital book sales are mainly driven and funded by the government for public and private tertiary institutes.

He expects to see big audiobook players investing in the market, as the rapid progress of voice artificial intelligence will help drive down production costs for mass market audiobooks.

Given the changing market dynamics, Thong says book retailers need to restrategise their business models in order to sustain profitability.

He points out: “The steep decline of bookstores in 2018 was mainly due to the revamping of some bookstores, particularly in the Malay-medium segment where readership is on the rise.”

According to Thong, bookstores witnessed a decline as there was decreased foot traffic due to the movement control order from 2020 to 2021.

“In 2021, the economy began to open, and new bookstores started to reopen and rebrand,” he adds.

To cater to consumers with a wider variety and selection of books, many bookstores modified their business models by consolidating smaller outlets into larger bookstores, he shares.

Among such companies were MPH Group Malaysia Sdn Bhd and several local brands, which opened mega-stores to be a one-stop centre for everything. By 2022 to 2023, more bookstores started growing exponentially as they expanded due to growing sales, he says.Thong notes the trend of bookstore decline post-Covid was mainly due to players not transitioning quickly enough to the digital market.

“These stores are likely trying to play the low-cost remnant (slow-moving clearance stocks) book game,” he shares, adding these stores are losing out to groups that are moving with the times, opening new branches in different locations in the country.

Despite the challenging operating environment, several local and foreign players are still looking to expand their footprint in Malaysia.

Japanese bookstore chain Tsutaya Books and Taiwanese bookstore chain Eslite, for instance, have established their presence in Malaysia since last year.

According to Thong, expansions are in the pipeline for local and foreign chain bookstores in the coming years. He notes that big players such as MPH, and Popular Book Co (M) Sdn Bhd are making a comeback, along with Tsutaya, by opening new outlets.

For instance, Tsutaya is opening new branches of mega bookstores next year, while MPH launched its mega bookstore in The Exchange TRX in May.

Thong adds that Popular recently changed hands to a bigger investment group with more capital for growth.

It is not just chain bookstores that are growing; independently-owned bookstores are also popping up.

Buukshop Sdn Bhd (Books n Bobs), which mainly focuses on online business, expanded with two physical stores due to robust demand from its customers.

Books n Bobs founder Ang Yuen Tzai shares that the company’s first store, which debuted in 2022, occupied 800 sq ft, and its second store, which opened in 2023, is nearly twice as large.

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Promising future

According to Thong, although there are still closures, the outlook for the Malaysian book retail industry remains strong, supported by resilient consumer demand.

He says: “Post-Covid, there is a recovery of new bookstores opening every year as they evolve and pivot their business models.”Thong adds that younger consumer demographics are also shaping demand for modern lifestyle-oriented bookstores.

According to Thong, there is plenty of room for growth for Malaysia’s book retail industry as it is still developing.

Meanwhile, Ang says despite the economic downturn and reduced expendable income, the industry will continue to grow.

She notes that certain sections within the book retail industry will perform better than others, while some will remain stagnant.

Ang points out book retailers sourcing books from overseas may encounter difficulties as shipping costs have increased exponentially due to geopolitical tensions.

“Most of our second-hand books are sourced locally so it does not affect us as much,” she adds.

Ang says the demand for physical books is increasing, as many readers still prefer to have a book in their hands rather than a digital tablet.

She says while eBooks have their advantages, such as being cost-effective and not taking up much space in luggage, physical books are still irreplaceable due to certain characteristics.

“Physical books provide a sensory experience where readers can engage with touch, sight and smell,” Ang explains.

“The act of turning pages and the scent of books contribute to a unique reading experience that is unparalleled with digital books,” she adds.

The founder of the independent second-hand book retailer says the experience of shopping for books is more than just a transaction.

“Most readers do not just go in and out of stores; they tend to linger around and explore the shelves for new genres and titles,” she says.

She highlights that a tranquil ambience and human interaction are also important elements in the book retail business.

To her, it sets the tone for an intimate shopping experience for consumers.

Hence, the book retail industry remains relevant as long as bookstores continue to offer unique, immersive experiences and foster a sense of community among readers.