Indigo Books and Music

Indigo Books & Music Inc.
Type	Public
Traded as	TSX: IDG
Industry	Books
Founded	1996
Founder	Heather Reisman
Headquarters	Toronto, Ontario, Canada
Key people	Heather Reisman (CEO); Hugues Simard (CFO)
Revenue	$1.079 billion CDN (2017)
Operating income	$25 million CDN (2017)
Net income	$21.8 million CDN (2017)
Total assets	$633.6 million CDN (2017)
Number of employees	7,000 (2017),
Divisions	Chapters; Coles
Website	indigo.ca

Indigo Kids, Indigo Eaton Centre in December 2010

Indigo Books, Music at the Yorkdale Shopping Centre in August 2013

Indigospirit, Royal Bank Plaza in November 2010

IndigoTech at the Eaton Centre Indigo Store in April 2014

Indigo Books & Music Inc., usually known as "Indigo" and stylized "!ndigo", is Canada's largest book, gift and specialty toy retailer, operating stores in all ten provinces and one territory, and through a website offering a selection of books, toys, home décor, stationery and gifts. Every Chapters and Indigo store includes a Starbucks cafe inside. This does not include Coles and IndigoSpirit stores.

At the end of its fiscal year in March 2018, the company reported annual revenues surpassing CAD $1 billion for the first time in its history. As of July 1, 2017, the company operated 86 superstores under the banners Chapters and Indigo and 123 small format stores, under the banners Coles, Indigospirit, and The Book Company.^[2] Indigo is headquartered in Toronto, Ontario and employed more than 7,000 people throughout Canada.^[3]

After a series of mergers and acquisitions in the Canadian bookstore industry, Indigo, founded by Heather Reisman, stands as Canada's last remaining national bookstore chain. In late 2017, announcements were made to expand to the United States, starting with a location in The Mall at Short Hills.^[4]^[5]

History[edit]

The company was founded in 1996 by CEO Heather Reisman, wife of Gerry Schwartz, majority owner and CEO of Onex Corporation.

The company's first big box bookstore, initially called "Indigo Books, Music & More", was opened in Burlington, Ontario on September 4, 1997. With financing from Onex Corporation, Indigo bought Chapters, their largest Canadian competitor, in 2001 and continues to operate many stores under the Chapters banner. Indigo also gained the ownership of the Coles chain of small-format bookstores, which was also owned by Chapters.

Indigo closed three high-profile stores in Toronto in the spring of 2014, including the World's Biggest Bookstore, which it acquired when it bought Chapters. In June 2014, Reisman said the company was headed into a new phase, selling a much higher percentage of non-book items.^[6]

In late 2017, it was announced that it would expand to the United States, with its first location opening in The Mall at Short Hills in fall 2018.

Operations[edit]

The company sells books, magazines, CDs, DVDs, gifts, and toys through its website and in its stores. Its banners currently include Indigo Books & Music, Chapters, Coles, SmithBooks, IndigoSpirit, and Prospero-The Book Company (small format).

Indigo began a partnership with Apple and iUniverse publishing in the 2010s. Indigo also manufactures its own brand of products, called IndigoLife. In addition, the chain's Indigo Trusted Advisor Program offers book recommendations from experts in health, finance, and the environment, such as David Bach and David Suzuki.

Charitable activities[edit]

In 2004, Indigo started the Indigo Love of Reading Foundation, a program which helps provide new books and learning materials to high-needs elementary schools. Indigo commits $1.5 million annually to schools across Canada.

The money is raised by Indigo itself, customers, staff, suppliers, and proceeds from Love of Reading fundraising products (i.e., gift card sleeves). 100% of customer donations have been granted to over 1800 schools since the Love of Reading Foundation's inception, with Indigo covering all of the operating costs of the foundation. The funding given to the schools is split across a 90% credit to spend at Indigo and 10% cash to be spent anywhere, as long as it contributes to advancement of literacy.^[7]

In addition to the regularly collected funds, the annual Adopt a School program has increased the Indigo Love of Reading Foundation's donations up to a total of $25 million given to over 3000 school libraries in Canada since 2004. During the month-long Adopt a School program, each retail store selects a local school to be the recipient of the donations the store collects during that time period.^[8]

In 2007, the Indigo Love of Reading Foundation produced a documentary chronicling the issue of funding for books in Canadian elementary schools. The documentary Writing on the Wall recounts the establishment of the foundation, while revealing the current conditions of school libraries and literacy in Canada.^[9]

Kobo Inc.[edit]

Kobo Inc., an e-reader platform and manufacturer, was founded and spun off of Indigo in November 2009.^[10] By August 2011, the Kobo e-reading platform had become the dominant player in Canada, with research firm Ipsos Reid estimating that it represented 36% of the Canadian market as of that date.^[11]

In November 2011, Japanese ecommerce company Rakuten purchased the company for US$315 million in cash.^[12] Around 58% of Kobo was owned by Indigo at the time of the purchase.^[13]

Employee programs[edit]

Indigo was listed in the 2006 and 2007 edition of Canada's Top 100 Employers, as well as Greater Toronto's Top 50 Employers (2007).^[14] This is due in part to a staff rewards program which includes benefits eligibility for both full-time and part-time employees. Indigo also offers a company matched RRSP program and yearly employee scholarships.

Criticism and controversies[edit]

Product removal[edit]

In 2001, Indigo removed Adolf Hitler's Mein Kampf from the shelves.^[15] In 2006, Indigo decided not to sell the June issue of Harper's Magazine, which reprinted the controversial cartoons of the Muslim prophet Muhammad that had led to violent demonstrations around the world.^[16] Indigo also did not distribute the issue of Western Standard which reprinted and discussed those same cartoons.^[17] The company has also reportedly refused to stock several titles by David Icke, and firearms magazines.^[18]

Support of Israel by owners[edit]

In the summer of 2006, the company was targeted by social activists from NION and the Coalition Against Israeli Apartheid. According to a report in This Magazine, CAIA advocated the boycott of Chapters/Indigo stores due to principals Reisman and Schwartz forming the Heseg Foundation for soldiers serving in the Israeli army that have no family living in the state of Israel. The article claimed Reisman and Schwartz donate $3 million a year to the Foundation.^{[citation needed]}

Competitive position[edit]

The Indigo/Chapters chain has been criticized over what some perceive as a virtual monopoly over retail-based book sales in Canada. In 2002, the company strongly opposed the entry of Amazon into the Canadian marketplace with accusations the U.S.-based company was skirting regulations about foreign ownership of Canadian booksellers.^[19]

Indigo's expansion has been blamed, among other factors, for the financial difficulties of some independent booksellers in Canada. In particular, its rise coincided with the bankruptcy of Lichtman's, once Canada's largest independent bookseller.^[20]