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If you are planning to write the Bookstore business plan on your own, then this sample Bookstore business plan can be great for guidance. However, if you are looking for a professional business plan writer for a business loan, SBA loan or to find out the possibility of success for your new business then let’s talk!

Executive Summary

Overview: The Hockessin BookShelf was founded in 2002 and is a new and used bookshop in Hockessin, Delaware. With 826 square feet of inventory space, The BookShelf is a little marvel, much like our state. We have a wide variety of books, with fiction, mystery, romance, and children’s books being our most popular categories. We love books, and our reading habits are broad, spanning everything from genres to classics, biographies, and children’s books at the Hockessin BookShelf. Summer reading, book clubs, and fun in-store promotions have all been popular at our shop.

Mission: We give many books and continuing literacy assistance to families and their children beginning at birth. We serve as a model for communities to ensure that children become lifelong readers and learners.

Vision: Our aim is for a future where reading, learning, and access to information are valued as rights rather than privileges, allowing all children to flourish.

Industry Overview: Bookstore sales in the United States increased to $9.03 billion in 2021, up from 6.5 billion. The number for 2021 was a preliminary estimate that might be revised later. Still, it was a significant improvement over the figure for 2020, when store closures had a negative impact on sales. This industry’s businesses sell books both in physical stores and online. Barnes & Noble, Books-A-Million, and Follett (all located in the United States), as well as Fnac Darty (France), Indigo Books & Music (Canada), Kinokuniya (Japan), Thalia (Germany), and Waterstones and WHSmith (both based in the United Kingdom), are among the major retailers (both based in the UK).

Financial Overview:

Bookstore business plan financial overview

Financials is one of the most important sections of a Bookstore business plan. You can get an idea of your projected revenue, required investment amount, is the business sustainable without additional funding, etc.

Financial Highlights:

Liquidity2020A2021A2022F2023F2024F
Current ratio612233242
Quick ratio611223140
DSO88888
Solvency
Interest coverage ratio8.211.114.2
Debt to asset ratio0.010.010.20.180.16
Profitability
Gross profit margin51%51%53%53%53%
EBITDA margin12%14%21%22%22%
Return on asset5%6%13%14%14%
Return on equity5%6%16%17%17%

FUND USAGE

Bookstore investment Capex

Industry Analysis

The industry analysis section of the Bookstore  business plan will help you get better insights into competitors, market growth, and overall industry prospects. You can order a custom market research report for your Bookstore business.

In this digital era, consumer books are referred to be “analog.” Although the printing press was established centuries ago, books are still widely available, affordable, and serve as a source of pleasure and knowledge for people all over the globe.

Most adults, it’s reasonable to say, don’t think much about the market: they either think about books one at a time or don’t think about them at all. Even if a print book today appears remarkably similar to one acquired decades ago, the market and all players in it have been impacted by a perfect storm of changes: Everyone in the industry, from Random House to the lone one-person publisher, is under pressure from rising printing and distribution costs, an image problem of appearing “old fashioned” in an increasingly wired world, and a public that appears increasingly scatterbrained and distracted even to consider picking up a book.

The book business in the United States has encountered several issues, ranging from the rising popularity of digital media to the difficulties faced by traditional bookshops. Despite this, books continue to play an important role in customers’ lives. The number of books sold in print has increased, and annual unit sales now exceed 650 million. Print is also the most popular book format among Americans, with over 60% of people have read a print book in the previous year.

Net revenue of the book publishing industry in the United States
from 2008 to 2020(in billion U.S. dollars)

Bookstore business plan industry analysis

While working on the industry analysis section of the Bookstore business plan make sure that you add significant number of stats to support your claims and use proper referencing so that your lender can validate the data.

The book publishing sector in the United States is expected to bring in $25.71 billion in net revenue in 2020. Although this is a modest decline from the previous year, income stays consistent and is an improvement over the number for 2018.

After more than a decade of losing sales, the Book Stores business has consistently battled to enter a new chapter. Industry revenue is falling even as consumer expenditures and disposable income per capita rise. The sector has been harmed by increased competition from internet shops and big-box retailers. Traditional retail locations have also been pressured as e-books have become a widely recognized medium. Industry income is predicted to drop by 6.3 percent annually to $9.3 billion in the five years leading to 2021. Industrial revenue fell by 10% in 2020 due to the temporary closure of industry operators.

Trade books, magazines, paperbacks, and religious literature are all sold by companies in this business. Domestic and, in certain situations, foreign producers and distributors are used to get these items. The operators subsequently sell these commodities to the general public at industrial shops. This business does not include retailers specializing in derivative products, electronic shopping, or mail-order houses.

Book store sales in the United States
from 1992 to 2021(in billion U.S. dollars)

According to PR Newswire, the worldwide book industry is predicted to rebound and increase at a CAGR of 2% from 2021 to reach $91.4 billion in 2023. The biggest region, Asia-Pacific, accounts for 34% of the worldwide book publishers market in 2019, followed by North America, which accounts for 34% of the global book publishers market in 2019.

Roughly 6,500 businesses (single-location enterprises and units of multi-location corporations) make up the US bookshop sector, which generates about $10 billion in yearly sales.

There has been a lot of conjecture about the collapse of the American bookshop over the last several decades, and some of it isn’t wholly unjustified. How can tiny local shops expect to thrive while large brands like Borders succumb to internet sellers, e-books, and other types of electronic entertainment? While the situation for booksellers in the United States is not ideal, it is not as terrible as it seems. Despite the print media’s catastrophic forecasts, Americans continue to read many books and spend billions of dollars on them each year. Even though a significant portion of book sales now take place online, many small and big bookshops continue to make good money. There’s a lot of opportunity for improvement, but it’s not all doom and gloom for booksellers in the United States.

The coronavirus pandemic might have devastating long-term consequences for booksellers. Sales will be lost to online bookstores, notably Amazon, due to consumer shop closures and social alienation, which the sector has been combating for decades. COVID-19 will almost certainly hasten bookstore sales decreases. In March 2020, bookshop sales decreased by more than 33% and were down more than 11% this year compared to the first quarter of 2019. Major bookstore chains, in particular, have been targeted.

Marketing Plan

A key part of the marketing plan in a Bookstore business plan is the marketing budget. The growth in the number of customers is proportional to the budget and dependent on the CAC.

Bookstore business plan promotional budget

Website: A website that has an order button to inform clients about the items offered by The Hockessin BookShelf.

Content Marketing: Create a blog about new arrival books and books that are on sale at your The Hockessin BookShelf website with material for prospective customers.

Discounts: Provide reward points or incentives to The Hockessin BookShelf customers frequently visit the store.

Social Media: promote The Hockessin BookShelf products and services using Facebook, Instagram, Linkedin, and other social media platforms.

SEO (Search Engine Optimization) helps The Hockessin BookShelf rank higher in searches on Google and other search engines.

Email Marketing: The Hockessin BookShelf will be sending commercial messages to a group of people.

Organogram:

Bookstore business plan organogram

Financial Plan

This section of the Bookstore business plan helps your lender figure out whether you will be able to pay off the loan, whether the business is sustainable, what are the growth prospects, etc.

Earnings:

Break-Even Analysis:

Bookstore business plan break-even analysis

Income Statement:

2020A2021A2022F2023F2024F
ANNUAL REVENUE
Item 19,21759,117175,410415,277781,357
Item 234,701222,558660,3681,563,3942,941,580
Item 34,06719,56146,43278,519114,905
Total annual revenue47,985301,236882,2112,057,1893,837,842
% increase528%193%133%87%
COST of REVENUE
Item 13602,2596,61715,42928,784
Item 24803,0128,82220,57238,378
Item 352,00065,00078,00091,000104,000
Item 47203,6158,82216,45823,027
Item 5140,000336,000560,000840,0001,120,000
Item 660,000144,000240,000360,000480,000
Item 732,00061,33385,533112,153141,435
Total Cost of Revenue285,560615,220987,7941,455,6121,935,625
as % of revenue595%204%112%71%50%
Gross Profit-237,575-313,984-105,583601,5781,902,218
SELLING & ADMIN EXPENSES
Item 128,00096,800154,880175,692193,261
Item 275,000105,000120,000120,000120,000
Item 336,00096,000108,000120,000120,000
Item 48,00012,00012,00012,00012,000
Item 53,83918,07444,11161,716115,135
Item 63,35912,04926,46641,14476,757
Item 75,60010,00012,90415,03417,376
Item 86,66714,00022,06730,94040,701
Total selling & admin expenses166,464363,924500,428576,525695,230
as % of revenue347%121%57%28%18%
Net profit-404,039-677,907-606,01125,0521,206,987
Accumulated net profit-404,039-1,081,947-1,687,957-1,662,905-455,918

Cash Flow Statement:

2020A2021A2022F2023F2024F
CASH FLOW from OPERATING ACTIVITIES
Net profit before tax-$404,039-$677,907-$606,011$25,052$1,206,987
Depreciation$44,267$85,333$120,504$158,127$199,512
Payables
Item 1$4,333$5,417$6,500$7,583$8,667
Item 2$11,667$28,000$46,667$70,000$93,333
Item 3$6,250$8,750$10,000$10,000$10,000
Item 4$3,000$8,000$9,000$10,000$10,000
Item 5$667$1,000$1,000$1,000$1,000
Total payables$25,917$51,167$73,167$98,583$123,000
change in payables$25,917$25,250$22,000$25,417$24,417
Receivables
Item 1$320$1,506$3,676$5,143$9,595
Item 2$360$1,807$4,411$8,229$11,514
Total receivables$680$3,314$8,087$13,372$21,108
change in receivables-$680-$2,634-$4,773-$5,285-$7,736
Net cash flow from operating activities-$334,536-$569,958-$468,280$203,311$1,423,180
CASH FLOW from INVESTING ACTIVITIES
Item 1$16,000$13,200$14,520$15,972$17,569
Item 2$20,000$22,000$24,200$26,620$29,282
Item 3$28,000$22,000$14,520$10,648$11,713
Item 4$96,000$88,000$72,600$79,860$87,846
Item 5$20,000$22,000$24,200$26,620$29,282
Net cash flow/ (outflow) from investing activities-$180,000-$167,200-$150,040-$159,720-$175,692
CASH FLOW from FINANCING ACTIVITIES
Equity$400,000$440,000$484,000$532,400$585,640
Net cash flow from financing activities$400,000$440,000$484,000$532,400$585,640
Net (decrease)/ increase in cash/ cash equivalents-$114,536-$297,158-$134,320$575,991$1,833,128
Cash and cash equivalents at the beginning of the year-$114,536-$411,693-$546,014$29,978
Cash & cash equivalents at the end of the year-$114,536-$411,693-$546,014$29,978$1,863,105

Balance Sheet: 

2020A2021A2022F2023F2024F
NON-CURRENT ASSETS
Item 1$16,000$29,200$43,720$59,692$77,261
Item 2$20,000$42,000$66,200$92,820$122,102
Item 3$28,000$50,000$64,520$75,168$86,881
Item 4$96,000$184,000$256,600$336,460$424,306
Item 5$20,000$42,000$66,200$92,820$122,102
Total$180,000$347,200$497,240$656,960$832,652
Accumulated depreciation$44,267$129,600$250,104$408,231$607,743
Net non-current assets$135,733$217,600$247,136$248,729$224,909
CURRENT ASSETS
Cash-$114,536-$411,693-$546,014$29,978$1,863,105
Accounts receivables$680$3,314$8,087$13,372$21,108
Total current assets-$113,856-$408,380-$537,927$43,349$1,884,214
Total Assets$21,878-$190,780-$290,791$292,078$2,109,122
LIABILITIES
Account payables$25,917$51,167$73,167$98,583$123,000
Total liabilities$25,917$51,167$73,167$98,583$123,000
EQUITIES
Owner’s equity$400,000$840,000$1,324,000$1,856,400$2,442,040
Accumulated net profit-$404,039-$1,081,947-$1,687,957-$1,662,905-$455,918
Total equities-$4,039-$241,947-$363,957$193,495$1,986,122
Total liabilities & equities$21,878-$190,780-$290,791$292,078$2,109,122