Waterstones boss voices concern over threat of Amazon stores launch in UK

James Daunt, chief executive of Waterstones since 2011, told Retail Week it was “interesting” that speculation around Amazon opening up to 400 stores in its domestic market had emerged. 

“It would be significantly difficult for us if they were to open that number of shops in the UK,” said Daunt.

Amazon opened its first physical store in Seattle last November.

However, Daunt flagged major differences between the US and UK market.

“In the US the differential between online book pricing and high street pricing is much lower [than the UK],” he said. “You can operate an Amazon retail outlet at respectable margins and expect to make a little bit of money from it. You couldn’t do the same in the UK.”

He added: “Property costs in the UK are dramatically higher and you have the burden of rates. It’s a completely different proposition.”

Daunt’s comments came as Waterstones reported a narrowing of losses in its last full year, off the back of a 1% lift in sales.

The Waterstones boss said it is on track to turn a profit in its current financial year after a “good solid performance”.

The book chain has been owned by Russian businessman Alexander Mamut since 2011, after he rescued it by acquiring it for £53m from the HMV Group.

Daunt said it had benefited from a revival in physical book sales as readers turned away from e-readers. “A digital bookshelf is a pale imitation of a real bookshelf,” he said.

Industry figures reveal that sales of paperbacks and hardbacks increased 3% in the first half of last year, the first rise since 2012.

Waterstones has also increased the number of cafes in stores to 40, out of its current estate of 276.