From a single bookstore in Ann Arbor, Mich., in 1971, Borders grew into a bookselling behemoth by pioneering on a large scale* the concept of the superstore - a supermarket of books stocking hundreds of thousands of titles in each location.
Now, it appears, Borders is about to write the last chapter in its history.
The company isn't prepared to do this quite yet, as it filed for bankruptcy Feb. 16 under Chapter 11 of the Federal bankruptcy code, which allows a business to continue operating while it reorganizes and works with creditors to repay or otherwise discharge debts. But the chain's decline has been so steep, so painful, and so long that some observers see few ways the company can avoid a Chapter 7 conclusion, in which the business is closed and liquidated to settle debts.
As it is, under Chapter 11, Borders has announced that it will close one-third of its 642 stores in the United States, with thousands of employees laid off as a result.
The announcement caps three straight years of losses and store closings for Borders as it fought competition from e-books and online distribution. Some say the company's woes can be traced to what in hindsight turned out to be a major misstep: exiting the online business just as it was taking off when it sold its online operation to rival Amazon.com in 2001.
Those former Borders customers are probably now downloading titles electronically to their Kindles. The e-book reader developed by Amazon remains the market leader in its category, and newer, cheaper models enable more readers to switch from buying stacks of books to carrying them around in a slim, highly portable tablet.
Borders got back into online bookselling in 2008, after a disastrous attempt to expand its brick-and-mortar operation overseas fizzled and left the company swimming in debt. But by then the damage had been done. Not only was Amazon.com eating into its core business, but so was its superstore rival, Barnes & Noble, which had not only hung onto its online store but also had developed its own e-reader, the Nook.
While Barnes & Noble is also struggling financially, its prospects are not as grim as Borders', thanks in part to the Nook and in part to its college bookstore division, which includes *the real first book superstore - the company's flagship location at 18th Street and Fifth Avenue in New York, which opened in 1937.
Still, just as the superstores decimated the ranks of independent bookstores, it appears that digital books and online bookselling is about to do the same to the superstores.
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Sandy Smith has been blogging for RetailGigs.com since 2010. In addition to launching award-winning newspapers and newsletters at the University of Pennsylvania and Widener University, Sandy is a veteran writer whose articles and essays have appeared in several local and regional media outlets, including The Philadelphia Inquirer, the Philadelphia CityPaper, and PGN, and on several Web sites. He is also an active participant on several discussion boards, including PhiladelphiaSpeaks.com, where he posts as “MarketStEl.” He has been supporting himself through a combination of freelance and part-time work and unemployment compensation since early 2009 and is himself an active job-seeker. Read more of his posts on RetailGigsBlog.com and follow him to Nexxt for more job opportunities.
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