Dive Brief:

• Following Elliott Management's acquisition of both stores, Paper Source is launching shop-in-shops within two Barnes & Noble locations this month — one in Hingham, Massachusetts, on Nov. 19, and another in Charlotte, North Carolina, on Nov. 22 — according to a press release shared with Retail Dive. 
• The shop-in-shop will sell more than 1,200 products from Paper Source, ranging from greeting cards and stationery to crafts and wrapping paper, including a holiday assortment and over 500 Paper Source exclusives. The companies in the release said Paper Source's assortment will "enhance" Barnes & Noble's merchandise of books, toys, games and other items.
• Outside of the holiday shop-in-shops, Paper Source's seasonal items are featured in more than 100 Barnes & Noble stores across the country and on the bookstore's website.

Dive Insight:

Paper Source's shop-in-shops in Barnes & Noble could be just the beginning of a larger partnership between the two companies. In a press release announcing the joint experience, the companies said it was "the first experiment to bring the best of both brands to stores across the United States."

In 2019, U.K.-based financial firm Elliott completed its acquisition of Barnes & Noble, and in May of this year, Elliott bought Paper Source out of Ch. 11, placing Barnes & Noble and Paper Source under the same parent company.

"With our shared heritage in paper and a commitment to nurturing creativity, it is a natural fit to partner with Barnes & Noble to explore new retail experiences," Jenica Myszkowski, CEO of Paper Source, said in a statement. "Our customers will love being able to find their favorite Paper Source products at Barnes & Noble, and we can't wait to bring this experience to more stores."

The decision to launch Paper Source shop-in-shops within Barnes & Noble stores follows a transitional period for both retailers over the past two years. In early March 2020, just before the coronavirus upended brick-and-mortar shopping and international supply chains, Paper Source announced plans to buy 30 of bankrupt rival Papyrus' locations and rebrand them within three months. About a year later, the company announced plans to file for Chapter 11 bankruptcy itself, with plans to close 11 stores.

Barnes & Noble, too, has struggled to compete in a changing retail world. The bookseller, prior to being acquired by Elliott, hadn't grown its revenue for seven years, and is now in the midst of a turnaround aimed at reintroducing a more local feel to its stores.