By Nolan Feeney
Mike Oelrich is strolling through the aisles of City Newsstand, cleaning up the racks and putting stray magazines back in their places when something catches his eye.
“Oh, look at that!” he says, reaching into the shelves to run his fingers over five thick holographic “The Hobbit”-themed issues of Empire, a monthly British film magazine that City Newsstand imports. “This is what we need more of.”
Between the faded brick walls of City Newsstand, four aisles of shelves carry more than 5,000 magazine titles. “Newsstand” is really a misnomer—at 2,000 square feet, City Newsstand is a bona fide magazine store. Dozens of food and cooking magazines are in one corner, business and fitness magazines are in another, and subculture titles for tattoo artists and pot smokers are in the middle. There are magazines about scrapbooks, and there are magazines about motorcycles, both for home mechanics and for fans of the scantily clad women sitting atop them. There are political journals in multiple languages, British celebrity tabloids, and GQs from every corner of the world. There are magazines for Civil War-history nerds and for beauty-pageant veterans. There is a $179.95 fashion magazine, Gap Collections, and there is Horse Illustrated.
In the forty-eight hours after Newsweek magazine announced in October that it was going strictly digital, City Newsstand added seven new magazine titles. The week the New York Times announced its paywall in March of 2011, City Newsstand added eleven magazines. It added a new magazine the day Los Angeles Times Magazine announced its end this past May, and it added another when SmartMoney did the same in June. Just one month later, Oelrich helped City Newsstand owner Joe Angelastri unveil hundreds of thousands of dollars in renovations, including the store’s first-ever café.
The world of magazine publishing may be facing an uncertain future, but City Newsstand is here to stay. Times are certainly tougher than they used to be: In the past few years, Angelastri says the store has started to lose more titles than it can add. But as City Newsstand weathers the highs and lows of magazine publishing, it has not only become a local fixture, it has also become one of the last newsstands of its kind.
“There’s not very many left,” Angelastri says of stores like his.
Joe Angelastri knew he wanted to be a businessman ever since he organized backyard carnivals as a child growing up in Chicago’s Logan Square neighborhood. He got his first newsstand job in eighth grade before his father, a factory foreman, moved the family to the Wisconsin suburb of Wilmot, which Angelastri describes as a real-life “That ‘70s Show.” In high school, he picked up routes as a newspaper-delivery boy. “That was the only job you could do,” says the soft-spoken Angelastri, fifty-three, in his spacious and well-lit basement office of City Newsstand. “You could cut grass and deliver newspapers.”
After he graduated high school in 1978, he moved back to Chicago to Portage Park, the same neighborhood where City Newsstand now operates. He took a job working as a vendor at an outdoor corner newsstand, and he quickly had his eye on buying the place. “Back then, old timers would come by and say, ‘During the Depression, the only people who had money were the guys that had these little newsstands,’” Angelastri says. “It looked like you could make a lot of money in the newsstands in the 1970s.”
Within six months, Angelastri was running the place. As it turns out, the newsstand’s owner, Philip Barasch, had been looking to sell the stand, one of several he owned across the city. As it also turns out, Barasch was a corrupt business broker who helped businesses cheat on their taxes and coordinated bribes between city officials and his clients. Angelastri remembers unpacking the papers one morning and finding his former employer’s face all over the front page of a Chicago Sun-Times investigation. But Barasch gave Angelastri his big break, selling the stand at a generously discounted price to let the then-eighteen-year-old become his own boss. “He wasn’t some evil person they made him out to be in the media,” Angelastri says.
Angelastri returned that generosity to his employees, hiring down-on-their-luck men more than twice his age—often alcoholics or homeless men—to keep the newsstand open all night. He let them keep whatever they made in their de facto nighttime shelter, and Angelastri still has the ashes of a homeless man who worked for him for five years and died on the job. The nightshift is also how Oelrich came to work for City Newsstand in 1993. Angelastri needed someone to cover for one troubled employee’s annual weeks-long bender, so he hired Oelrich and later moved him inside to work as a buyer.
By the time Angelastri hit the ten-year mark in 1988, things were looking good. The neighboring bookstore housed where City Newsstand now operates announced it was closing, so Angelastri made the second big move of his career by snatching up the space and its leftover inventory. Because the bookstore had failed, and because megastores such as Barnes & Noble and Borders were growing, Angelastri decided his best hope was to shrink the store’s book orders and expand his corner newsstand into an indoor magazine specialty shop. He continued to run his corner newsstand until 2000, when lack of reliable staffing led him to close it down for good. “We realized it was either going to be a tiny bookstore or a really large newsstand,” Angelastri says. “Because we started as a paper stand, we knew if we kept putting magazines in, we could be known.”
Angelastri’s intuition paid off. It took a few years for he and Oelrich to build up City Newsstand’s selection to several thousand titles, but by the mid-nineties, the store’s reputation for its “magazines and nothing but” approach spread well beyond Chicago and into the Midwest. Customers have journeyed from as far as Missouri, and Oelrich says he has regulars from Wisconsin and Indiana that make routine pilgrimages. Angelastri, who in 2001 also reopened the Chicago-Main Newsstand in Evanston that had shut down under a different owner in 1993, once conducted a survey and found that eighty percent of his customers came from more than five miles away.
One of Angelastri’s loyal customers is Mike Rossobillo, a diehard car enthusiast who says automobiles are in his blood. Rossobillo has read the same handful of car magazines for most of his life, and he has been coming to City Newsstand regularly for the past thirty years to get them.
He lives in the Sauganash neighborhood of Chicago, but says he skips the local Barnes & Noble near his house to visit City Newsstand instead.
“He’s got all of them that I know,” Rossobillo says. “I don’t have to shop around.”
Oelrich is a big guy, who dresses in a self-imposed all-black uniform with black suspenders. A bushy goatee and glasses—which he says he needs after years of squinting over order spreadsheets—decorate his face. He likes to joke that he doesn’t know why anybody buys magazines anymore, but listen to him explain the organization of the store and it’s clear he has an encyclopedic knowledge of publishing trends, a firm belief that print is alive and well, and a detective’s intuition about why the magazines on the shelves are the ones left standing.
Oelrich’s twenty-year tenure at City Newsstand has put him face-to-face with the difficulties of running a business whose primary product is journalism. In the past two decades, there has been a trifecta of challenges: First, a pair of recessions crippled retail and magazine sales, though the store experienced a 4.5 percent increase in year-to-date sales in the past year and a half, the first positive trend in nearly a decade.
Second, the Internet transformed the value of certain print products. Take Computer Shopper, for instance. It was a magazine for DIY computer junkies who bought and sold parts through its classified ads, but it shut down after almost thirty years of publishing as free Internet classified services made its niche obsolete. Oelrich points out, however, that Hemmings Motor News, a classifieds-heavy automobile magazine on the opposite shelf, has fared much better, likely because the people who spend their free time working on cars in their garages aren’t as Craigslist-savvy as the folks who work on computers. “You would think it had gone out of business a long time ago,” Oelrich says.
The third factor is total esoterica: radical changes in magazine distribution. How a magazine gets from the desk of Anna Wintour to a retailer like City Newsstand is a multi-step process. The magazine publisher creates the magazine and sells ads; the national distributor connects publishers to wholesalers; and wholesalers—with their algorithms, trucks and warehouses—tell retailers what titles they get and how many they get. Wholesalers run the show.
In the 1980s and the early nineties, magazine wholesalers had fixed the system, colluding and divvying up the national market so they didn’t have to compete—and so they could rake in the dough. But as with many schemes that spit in the face of antitrust laws, the wholesalers couldn’t get away with it forever, and things came to a halt in 1995. Up until that point, TV Guide had published different editions of its magazine for different regions of the country, and it had obeyed the artificial boundaries set up by wholesalers. But under increasing pressure from mega-chains like Safeway, which didn’t like being told which magazines it would get and from where, TV Guide broke rank and began selling all editions to all markets, and the system started to fall apart. Lawsuits were filed. The Justice Department got involved. And for the very first time, wholesalers had to compete with one another.
“That was the sea change,” says Gil Brechtel, the president and CEO of the Magazine Information Network, a research firm that tracks magazine sales. Wholesalers kept lowering their prices to beat out the competition, but they couldn’t pull in enough profit to keep the industry from collapsing. In just one year, the number of magazine wholesalers in the U.S. plummeted from several hundred to just a couple dozen, and now only a handful of them control more than ninety percent of the market. “Wholesalers started losing money in 1996, and have continued to lose money ever since,” Brechtel says.
There are a number of ways this sea change trickled down to newsstands, but Oelrich says one of the consequences of a hemorrhaging network of wholesalers has been a loss of control of shipments. The business of newsstands has always been notoriously inefficient: For every three copies of a magazine on a newsstand, usually only one sells. But in the mid-2000s, Oelrich noticed wholesalers, looking to cut costs, were providing less than what City Newsstand could sell. If the store could sell twenty copies of a particular title, wholesalers might only send fifteen copies instead, meaning City Newsstand was losing sales before issues even hit the shelves. “We’re all losing sales,” Oelrich says. “We’re losing sales, wholesalers are losing sales, publishers are losing sales. And the customers, they’re the ones that are not getting the magazine they want.”
Some magazines have left wholesalers altogether, opting for exclusive deals with Barnes & Noble that take them away from retailers like City Newsstand. Couple this with publishers’ aggressive pursuit of subscriptions—Hearst, which publishes Esquire and ELLE, ran a promotion offering their entire magazine portfolio for eighteen cents an issue—and effectively managing supply becomes a major obstacle. “It’s tough to keep the stock we need, but we do our best. That’s our biggest challenge now, getting the number of copies we need,” Oelrich says. “It’s like, why can’t we get it?”
How City Newsstand still profits off its evolving magazine selection is best explained by the theory of the long tail. Former Wired magazine editor-in-chief Chris Anderson coined the term in a 2004 story and subsequent 2006 book to explain the success of Internet retail giants like Amazon.com, but oddly enough, it also explains why a small-business magazine store in Chicago has lasted more than three decades.
The theory is essentially a distribution curve. The y-axis is popularity, and the x-axis is number of products. On the left end is “the head,” the handful of mega-popular mass-market products. As you move down along the curve—the long tail—there are more products with decreasingly small but equally viable niche markets. In the world of magazines, the head would include The Economist. The long tail would include RubberStampMadness, a thirty-year-old quarterly magazine based out of western Oregon for people who like decorative stamps.
The fate of a magazine store like City Newsstand isn’t tied to whether or not the big names are flying off the shelves. What matters most are these unexpected titles: the ethnic hair magazines, the log-cabin-living magazines, the magazines for goat owners, the magazines you would think few people actually buy. “What we’re selling are the ones nobody else has,” Oelrich says. “We’re only selling five, but we’ve got 1,000 titles like that. So that’s where we’re making our money. We’re not making any higher percentage than anybody else. That’s our niche. It’s everything.”
In other words, City Newsstand continues to find success with the same asset it has relied on since the 1980s: a selection. “Our strategy has always been the same: Get everything we can,” Oelrich says.
At the front of the store is a request sheet for missing titles that Angelastri says fills up every one or two weeks. New magazines come on the market every month, but smaller publications aren’t any more immune to print-business blues than other titles, so the market is sink or swim: In a given year, Oelrich says City Newsstand gains around 500 titles but loses close to 700.
Oelrich and Angelastri can’t do much about disappearing titles, so they’ve added their own: books. The two aren’t setting out to turn City Newsstand back into the bookstore it used to be, but diversifying their offerings has brought some success in sales. Arcadia Books, a series of text-light, picture-heavy books about the history of different Chicago neighborhoods, line a wall of the store. And even though the City Newsstand’s customers skew male by a 2:1 ratio, last year’s popular “mommy porn” erotic novel (and unlikely boon for the publishing world) “Fifty Shades of Grey” was a hit. “We were surprised,” Angelastri says. “We don’t sell a whole case of anything, and we sold a whole case of those.”
Also popular are the bookazines, special-edition magazines that Oelrich says might just be the future of magazine publishing. The category is broad: Bookazines can range from one-off issues about a certain celebrity or franchise, like an issue devoted to the “Twilight” series, to brand-focused lists or compilations, such as Rolling Stone’s “500 Greatest Albums of All Time” book. The bookazines run at a higher price, usually starting at around ten dollars, but they’re often collectors’ items with enough added value—more pages, better binding or page stock, multiple covers, high-quality photography—that readers will happily fork over the extra dollars. “Nobody’s collecting e-zine files and selling them at swap meets,” Oelrich says. “I think that’s a good model for the future. I figured about two years ago that’s the way print could survive.”
There’s one other major addition that Oelrich and Angelastri hope will boost business: a café.
City Newsstand has always been a destination newsstand, but since Angelastri renovated the store this past year, it has become a friendlier locale for the magazine lovers who like to linger with the addition of a small coffee shop in the front of the store. Thanks to a local small business grant, which the city of Chicago consulted Angelastri on during its development, Angelastri roughly split the $250,000 bill with the city to, among other improvements, build out the storefront space that now makes up City Newsstand café.
Since the café opened in July, it hasn’t made any money. Oelrich, who wears a second hat as the café’s barista during his Saturday shift, says it was actually a financial drain. But now that the café serves close to forty customers a day, he expects business to turn around soon.
“We want to be a magazine store,” Oelrich says. “If circumstances don’t allow us to be a magazine store, we at least want to be a store. There are fewer and fewer magazines. At some point in the future, there will probably be even fewer magazines. I hope it doesn’t get to the point that we’re not a magazine store anymore, and we sell God knows what. If it happens, it happens. But I don’t see that happening.”
Exactly how long the store can be a mostly magazines establishment may be a bit of a questionmark, but the two are optimistic that won’t happen anytime soon. Both Oelrich and Angelastri consider City Newsstand a survivor, and there are certain perks that come with lasting as long as it has. Because Angelastri owns the building, paying rent isn’t an issue. With close to thirty-five years under his belt as a member of the Six Corners community, Angelastri has also been able to rally local businesses to set up a special tax district to put money back into improving the area and attracting shoppers. And because it inherited their small, two-location operation from a former bookstore and historic newsstand, City Newsstand has never had to build up business in the way other, now-defunct magazine stores struggled to do.
In other words, the fact that they’ve survived for so many years is, in some ways, exactly what keeps them around.
So even if retail hits its stride again, even if magazine publishers cease their frenzied pursuit of subscribers, and even if survival rates for new titles improve—will the newsstand ever make a comeback?
“I hope not,” Oelrich says with a smile. “We don’t need the competition.”
City Newsstand is open 7am to 11pm seven days a week at 4018 North Cicero, citynewsstand.com