It was never meant to be this way. Profitable bookstore chains? In the age of Amazon? That’s not how the bookstore apocalypse narrative goes.

But as The Guardian reported back in 2015,

Four years ago (2011), Waterstones was facing oblivion. Declining sales of physical books, together with the relentless growth of Amazon and mismanagement by its former bosses, had led the famous book chain to the brink of bankruptcy … But in an extraordinary turnaround, Waterstones is set to make its first annual profit since the financial crisis struck.

It was no one-off.
Waterstone’s has just announced another profitable year.
Yes, the headline news is only part of the story and there are underlying cautions noted by Publishers Lunch, but let’s not let that detract from the fact that this is happening at all in the UK, the second-most Amazon-dominated publishing country on the planet for print, and the most Amazon-dominated country on the planet for digital.
Let’s run that 2015 quote from The Guardian once more.

Four years ago, Waterstones was facing oblivion.

Waterstones was on its knees. This was not some flush-with-cash company with endless resources to withstand the Amazon onslaught. This was a company no sane observer was saying could survive.
We can turn to the Independent in March 2011 to get a flavor of just how bad things were.

The UK arm of Borders went bankrupt 14 months ago; now its US parent is heading the same way.
Waterstone’s is still owned by the HMV group, which has issued three profit warnings since September, and next month expects to announce a year-end net debt of more than £130m.

This just a month after Waterstone’s (it still had an apostrophe back then) had closed eleven stores in one slash of the axe.
And let’s put this in even more context.
In March 2011 the Kindle UK store was barely eight months old and digital reading was still a nerdy novelty in Britain, so the mess Waterstones was in at that time had absolutely nothing to do with ebooks.
As we all know, the Kindle UK store went on, quickly, to become Amazon’s second biggest ebook store, and with approaching 90% of the market Amazon has a much stronger stranglehold on UK ebooks than it does in the US.
The Kindle store should have been the final nail in a Waterstones coffin lid already nailed firmly down. The phemonenal rise of the Kindle UK store and of other competing ebook players in the UK ought, by any interpretation of the bookstore apocalypse narrative, to have been the death blow to Waterstone’s. Waterstone’s was, to use the favoured bookstore apocalypse phrase of the day usually reserved for the then Big Six publishers, re-arranging deckchairs on the Titanic.
Amazon was and  is far and away the biggest online retailer in the UK, and also the biggest in the entertainment sector, including physical retail, despite Amazon having no bricks & mortar outlets in the UK.
Put simply, Waterstones hadn’t a snowball’s chance in hell of surviving, and for most observers the only question was whether Borders in the US would beat Waterstones in the liquidation race.
Yet here we are in 2018 declaring an 80% increase in pre-tax profits for 2017, despite having to close several profitable stores.
Wait. What?
Yep, Waterstone’s boss James Daunt closed the profitable Oxford Street West and Wimbledon branches of Waterstone’s last year, otherwise the profits reported might have been even higher.
And that’s something to bear in mind when we read about bookstores closing and see the kneejerk assumptions that Amazon and ebooks are to blame.
It’s simply not that black and white. If a landlord decides not to renew a lease, or chooses to bring in unacceptable hikes in rents or changes in terms & conditions then, as with the two aforementioned stores, perfectly profitable bookshops may have to close.
Not here to defend Barnes & Noble’s store closure record, but we should bear in mind that many Barnes & Noble closures have been due to lease expiry or other factors not directly related to the competition from Amazon.
And it is with Barnes & Noble I’ll end this post, with a  reminder that, in 2011, Waterstone’s (with apostrophe) was far closer to oblivion that Barnes & Noble is today in 2018.
James Daunt has accomplished what many in 2011 thought impossible. Waterstones has not just survived (not the apostrophe, sadly – that went in 2012.) but is profitable, strong, and moving forward.
Lessons to be learned for America’s clearly struggling biggest bookstore chain. The collapse of Barnes & Noble is not carved in stone. Proof-positive of that lies just across the Atlantic.
But thus far it seems Len Riggio prefers to look the other way.