I discovered today that one of my favourite independent bookshops, The Little Bookroom, did NOT close many years ago. They were just hiding in Carlton. What's more, they're just about to open another shop.
Compare and contrast with the Borders/A&R/Whitcoulls implosion in Australasia, and the Borders one in the US.
Clearly, there's still money to be made in bricks-and-mortar book retailing if you've got a niche, and being a kids book specialist is a great one.