Venerable Xinhua bookstore struggles to stay open despite steeply rising rent
By Victoria Fei |
June 29, 2013, Saturday
|
Print Edition
Print Edition
XINHUA Bookstore located on 128 Xinjian Road in Minhang District will shut down after the summer vacation because the landlord wants to triple the rent when the current contract expires.
The shop's owners said they are looking for a new location.
Since it opened in 2003, the shop has been very popular with local residents, becoming somewhat of a cultural landmark in the Xinzhuang area.
"It's a pity if we lose it," said Li Shu, a local resident. "I buy books for my kid there because I live nearby and it's very convenient. Now I might go further to find books."
Since 2003, rent on the premises has been raised several times. It has been about 2 yuan (33 US cents) per squaremeter, far below surrounding commercial property. The rent will be raised to 7 yuan when the lease expires at the end of June.
The landlord has agreed to postpone the rent increase until the end of August so that children still can have easy access to books at least during the summer vacation.
"Even though the rent may not seem high, it's still impossible for a bookstore that doesn't have hefty profits," said Pan Yuping, a manager at the bookstore. "Our shop has 800 square meters. If we sign the new contract, the annual rent would increase to more than 2 million yuan."
Pan said the store's profit was barely above 200,000 yuan because of fierce competition. There was no alternative but to close and relocate.
Bookstores in general have been hurt by the rise of online book sales in China. According to Wang Zhenhua, office director of the bookstore on Xinjian Road, it has meant slower revenue growth.
"With so many challenges and obstacles, even if the bookstore could bear a higher rent, it would still barely survive the competition," he said.
Citywide, the chain of Xinhua bookstores needs to reorient its strategy to accommodate changing tastes and times. Huang Zefeng, sales director of the Shanghai Xinhua Store, said the success of his shop in Grand Gateway shopping mall in the Xujiahui area owes much due to support from the developer, Hang Lung Group.
"We get a rather lower rent, and meanwhile, we help to attract visitors to go to the shopping mall," Huang said. "Maybe the Xinjian Road shop should consider relocating to a shopping mall."
The shop's owners said they are looking for a new location.
Since it opened in 2003, the shop has been very popular with local residents, becoming somewhat of a cultural landmark in the Xinzhuang area.
"It's a pity if we lose it," said Li Shu, a local resident. "I buy books for my kid there because I live nearby and it's very convenient. Now I might go further to find books."
Since 2003, rent on the premises has been raised several times. It has been about 2 yuan (33 US cents) per squaremeter, far below surrounding commercial property. The rent will be raised to 7 yuan when the lease expires at the end of June.
The landlord has agreed to postpone the rent increase until the end of August so that children still can have easy access to books at least during the summer vacation.
"Even though the rent may not seem high, it's still impossible for a bookstore that doesn't have hefty profits," said Pan Yuping, a manager at the bookstore. "Our shop has 800 square meters. If we sign the new contract, the annual rent would increase to more than 2 million yuan."
Pan said the store's profit was barely above 200,000 yuan because of fierce competition. There was no alternative but to close and relocate.
Bookstores in general have been hurt by the rise of online book sales in China. According to Wang Zhenhua, office director of the bookstore on Xinjian Road, it has meant slower revenue growth.
"With so many challenges and obstacles, even if the bookstore could bear a higher rent, it would still barely survive the competition," he said.
Citywide, the chain of Xinhua bookstores needs to reorient its strategy to accommodate changing tastes and times. Huang Zefeng, sales director of the Shanghai Xinhua Store, said the success of his shop in Grand Gateway shopping mall in the Xujiahui area owes much due to support from the developer, Hang Lung Group.
"We get a rather lower rent, and meanwhile, we help to attract visitors to go to the shopping mall," Huang said. "Maybe the Xinjian Road shop should consider relocating to a shopping mall."
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