Debabrot Roy was in a quandary. owner of a popular medium-sized bookstore named World of Books (WoB) near Dalhousie in Kolkata, he was facing stiff competition from a recently opened bookstore, Book Lovers' Den (BLD).

WoB had been in business for over 17 years now. Debabrot's family was in the printing business, but he wanted to do something more than just that. A keen book lover, he started WoB after spending about three to four years with the family business. When the store opened on Bijoya of 1985, it was by far the best bookstore in Kolkata. Spread over an area of 1,100 sq feet (the largest floor space in Kolkata dedicated exclusively to books at the time), the store had almost all the popular titles on its shelves. It distinguished itself by arranging books by subject in a manner that was rather intuitive of customer behaviour. This made navigation a breeze, even for arcane titles. It became the talk of the town, and people flocked to the store. It took just six-to-eight months for WoB to develop a loyal customer base. Since Debabrot was actively involved in the day-to-day activities of the store, including customer interaction, a large number of customers became personal friends of his. They would call him to check the availability of titles and so on, even asking for recommendations. WoB had two other sales people who interacted with customers and two more employees in the back office. They had been trained by Debabrot, and for almost three years, this five-man team was enough to run the store. In January 1989, Debabrot's younger brother Siddhartha, who had just finished his post-graduation, joined the store as a salesperson in order to take some load off Debabrot, who would get more time to identify new titles and add to his already good collection of books at the store. By March 1990, Debabrot handed over most of his sales and supervision activities to Siddhartha. The store would run smoothly even when Debabrot would go on his longish trips to visit book exhibitions within India and abroad. The store's reputation was strong, and it was one of the key attractions in Dalhousie. All was well, until...

In 2001, Debabrot came to know from his circle of friends that BLD, a leading chain of large-format bookstores with presence in Delhi and Chennai, was testing the feasibility of opening a bookstore in Kolkata. BLD typically sprawled its books over at least 2,000 sq. feet of space, and was extremely browser-friendly, with modern amenities for shopper comfort and smart merchandising tools. It had a special reputation of providing the customer a completely new book-buying experience. "Let's wait and see," Debabrot told himself.

It had now been a month since BLD opened its first store in Kolkata. It was located in a bylane off Ballygunge Circular Road, in close proximity to lots of schools and colleges. Debabrot visited the store on its opening day, and was both surprised and dismayed by the huge crowds. BLD had wide aisles and a wide range of titles across subjects-it was particularly strong on management, popular fiction and self-help. Of these, management was a hot section within Debabrot's store. The selection of new books at BLD, Debabrot was forced to acknowledge, was superior to that at WoB. What's more, the books at BLD were well laid out, easy to find, and amenable to extended hours of browsing (special tools were provided for this). BLD even had a store loyalty programme for anybody buying more than Rs 1,000 worth of books on a single day, with attractive benefits for members. Debabrot was disheartened to see a long queue at the enrolment counter to sign up for it.

WoB was in for trouble, and sure enough, the impact was felt immediately. For a month now, Debabrot has been a worried man. Sales for the last month were down by 15 per cent compared to the corresponding period last year. While the business was still profitable, Debabrot felt that it was imperative to turn the tide quickly. Many of his regular customers had started complaining-a new phenomenon-about issues that they didn't seem to notice earlier. They complained about lack of space and specific titles not being available, and some even advised him to quickly do something to save his store.

Specifically, sales of business books had dipped. The impact on sales had been less felt in literature (both Bengali and Western), where WoB's traditional reputation still remained unhurt. WoB had a distinct advantage in this field, in terms of access through the family's traditional publishing business.

There was another issue. Over time, Debabrot had built excellent relationships with his customers, who tended to seek him out when they visited, and valued his book recommendations. However, as Debabrot got into other areas, he spent only a couple of days per week at the store. His younger brother, Siddhartha, seemed to take a much more task-oriented approach to the business, and did not really cultivate relationships to the same extent. After sales started declining, Siddhartha had been very harsh with the staff, and two of them had left to join BLD at significantly higher salaries.

Debabrot could not afford to let the business slide further. Even his older, loyal staff looked demoralised at work, and there was a fear that if this trend continued, he would lose a lot of competent staff to whom many customers were personally attached.

In terms of customer profile, there were two main clusters of customers who used to frequent WoB-one, the literati, who came to the store for its selection in classical literature and its up-to-date inventory in new Western authors, and two, the businessmen and young professionals who frequented WoB because of its proximity to their workplace and because of the selection of business books. This second category had begun to defect to BLD. Debabrot knew he had to act soon. He, however, had no idea where to start.

The question: What should Debabrot do?

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