Twenty years ago, if someone had told Pete Mulvihill, Kevin Ryan, and Kevin Hunsanger that they would one day own Green Apple Books, the store where they then worked, all three of them would have been “gob-smacked”—much like their reaction last month when they were told that their San Francisco indie had been selected as PW’s 2014 Bookstore of the Year.

The store was founded by Richard Savoy in 1967 as a 750 sq. ft. used bookstore, but by 1996, when Savoy asked Mulvihill and Ryan if they would like to buy Green Apple, it had grown to occupy three floors, selling new and used books. The store also had a loyal customer base that was expanding beyond the Richmond District, where Green Apple is located. “We don’t know who the other candidates might have been, or even if there were any, but Rich settled on Kevin R. and myself to take over the store,” says Mulvihill, adding, “We told him we needed a used book person—Kevin H.—to be our partner, too.” I spoke to Mulvihill in Green Apple’s office, which has a fully stocked bar within arm’s length of the book-buying desk. It took some time and a pile of legal fees before a formal contract was drawn up, but the three partners made their last payment to Savoy in 2009, and today the store, which has grown to 8,000 sq. ft., is all theirs.

The century-old building that houses Green Apple contains a maze-like series of alcoves, stairs, bookcases, and nooks, with artfully handwritten signs and staff recommendation cards wherever one looks. An incongruous but beautiful collection of vintage ethnic masks line the upper walls of the store’s first floor, seeming to gaze upon Green Apple’s vast inventory of books below. The mezzanine level holds Green Apple’s large children’s section.

The partners divide their roles at Green Apple in a way that suits their personalities: Hunsanger is an enthusiastic hand-seller and expert on used books, the store’s “life blood,” which make up 50% of the store’s sales and 60% of its inventory; Ryan, the new book buyer, is an affable and engaged people person; and Mulvihill is analytical and precise about the store’s finances and marketing. They share a camaraderie and trust that’s largely responsible for Green Apple’s longevity. “We’re more than married,” says Ryan, laughing. “We can divorce our wives, but we can’t divorce each other.” Green Apple has a staff of 28, and offers a solid benefits package to both full- and part-time employees. “Our booksellers are passionate about their jobs,” Ryan notes. The partners agree that their staff deserves the Bookstore of the Year award as much as they themselves do.

Children’s is the dominant book category, and its sales have grown exponentially over the last five years. Cooking, fiction, and art are the next largest, among both new and used books, with graphic novels also selling well in used. Green Apple stocks a variety of sidelines and stationery, along with branded T-shirts, mugs, and clothing, as well as used CDs and DVDs. But what outsells all of those incidentals are new and used vinyl LPs. “We’ve doubled the size of our LP inventory,” says Hunsanger. The store also stocks vintage-style Crosley turntables in the LP section.

Green Apple is doing well. “Sales have been steady or up for the last several years, and we always take great pains to manage expenses like credit card processing, supplies, phone and Internet providers, etc.” Mulvihill says. “There have been growth areas—new LPs, new kids, and YA—and areas of weakness—new CDs and DVDs—so we continually adjust our offerings to best serve our customers. Rich taught us about supply and demand. The scale has gone back and forth over the years, but 85% of our sales are still books.”

Green Apple is a destination bookstore, unlike the many neighborhood bookstores in San Francisco. “We get people from other parts of the city, from Marin County and the East Bay, and tourists from New York,” Mulvihill notes. The store has an international following; its tote bags are shipped to a distributor in Japan and sold in Tokyo shops, and they’ve been spotted in Ireland as well. The partners have succeeded in turning Green Apple into a brand of sorts; its social networking is clever and carefully targeted. The website gets 30,000 hits per month, its newsletter goes out to 7,000 customers, and, between Twitter and Facebook, the store garners about 12,000 followers and “likes.” It also has a Kobo display, but sales of e-books are modest.

Six months ago, the business launched its Cafe Green Apple program, in which the store partners with several coffee shops in San Francisco and provides bookcases that it fills with a selection of used trade paperbacks; the books are mostly fiction and are all priced at $5. “We send the truck out once a week and refill the bookcases,” Mulvihill says. “There are signs that say, ‘This is a partnership between Green Apple Books and so-and-so.’ ” The store splits the proceeds with the coffee shops, “and we get free publicity,” Mulvihill notes.

Of all the authors who shop at the store, Daniel Handler is probably Green Apple’s most enduring. “When I was 10 years old, the bus I took home from school stopped right in front of the store,” says Lemony Snickett’s spokesperson. “I’d get off, go inside, and buy a book.” Now Handler brings his son to the store every Saturday to buy a book. “The staff treats him like a grown-up, with the utmost respect—the way they treat all their customers. Green Apple is the first place I left Otto by himself when I had errands to run—it’s just that kind of place. The store balances quality with quantity, and they think a lot about their readers. It’s what I’d like every bookstore to be.”

A second Green Apple store is opening this summer, which longtime staffer and new book manager Stephen Sparks will run. Located at the entrance to Golden Gate Park, Green Apple Books on the Park will provide the event space lacking in the original store, and the opportunity to curate the inventory in a more precise way. The new store will have more of a showroom atmosphere, and a cafe as well. Because of its location, the owners believe the store will attract tourists. “We’re joking that it won’t be a matter of foot traffic, but a matter of crowd control,” Ryan says.

Green Apple is located in a diverse neighborhood that includes Chinese-American residents and Irish bars. “We don’t have a ‘typical’ customer,” says Mulvihill. “They range from families who drop their kids off, to Asians, to little old ladies buying $4 mysteries, and the chef who spends $700 on a boxed set of elBulli.” Green Apple sells books to about 200 customers a day. “They all know that they can get it cheaper elsewhere, or they can wait to download it, but they don’t. It’s a mystery to us, except that we seem to create a sense of community here. The shop local movement is very strong, and our customers know that if they don’t buy their next book at Green Apple, the store might go away. They like the sense of discovery and serendipity at the store, too, and some people find Green Apple a beautiful place,” Mulvihill explained. The store has survived competition from the chains and Amazon, as well as the 1998 Loma Prieta earthquake. Green Apple Books’ contributions to the literary culture of San Francisco over the last 47 years have made it an essential and beloved part of the city.

PW wants to thank this year’s juries and Donna Paz Kaufman of the Bookstore Training Group of Paz & Associates. Bookstore of the Year judges: Margaret Coffee, Egmont; Chris Cooke, University of California Press; Ruth Liebmann, Penguin Random House; Josh Marwell, HarperCollins; Craig Popelars, Algonquin/Workman; and Bruce J. Miller, Miller Trade. Rep of the Year judges: Sarah Bagby, Watermark Books; Glenda Childs, Shilough Hopwood, and Jennifer Brenninger, Doylestown Bookshop; Tim Hunter and Rene Kirkpatrick, Eagle Harbor Books; Nicole Magistro, Book Worm of Edwards; Lyn Roberts, Square Books.