BilmBlog500

I should be reading a manuscript but it's late and I'm tired and it's not the right conditions for work reading. So instead, let's reflect on one year of life after Borders. Technically I could do in September, but this week marks the real end, the week when the liquidation became official, when the theory of the Borders bookstore gave way to the going out of business sale. And it still sucks. To tackle some good news first, the end of Borders wasn't the end of publishing as we know it. I don't know of any publishing company that went under because they were left holding a bag with a hole in the bottom of it. At least not yet. I'm also not aware of any publisher with cash flow issues where our receivables get kind of long in the tooth that's had its circumstances improve over the past year. But that's about the extent of the good news, that the Borders bankruptcy wasn't the start of some fancy game of dominoes where we could watch them all m...

Publishers Lunch Daily has a list of Barnes & Noble locations that have quietly closed at the end of 2011. The demise of their big and busy store in the University Village mall just down the hill from the University of Washington and its University Bookstore had been known to me earlier. But also of interest is that their store in Washington DC's Georgetown neighborhood has also shuttered. Going back fifteen years ago in the earliest days of B&N's nationwide superstore expansion, they would take out ads in places like The New Republic to ballyhoo their wonderful selection, including of academic, scholarly U Press type books. Those two stores, University Village and Georgetown, were two of the half dozen or so locations that would be specifically included in those posts. So to see those two stores closing at pretty much the same time kind of brings down the curtain on a small part of the book superstore era. The University Village store is one that I'll certainly ...

Wrote this email to someone I know who worked at a Florida Borders... Sorry didn't return your call, at a weekend long wedding with two days in office and to catch up on sleep before heading to St. Louis for Bouchercon where I am now. Very sad. My last Borders visit last Sunday to Middletown NY between the wedding and the town I grew up in. I really wanted to be the last customer St a Borders as I was at 1003, but no way for it to happen,  Four of the StL stores already closed, two were going to close on Thursday but one shut a day early and the other as I kind of expected said "we may close in 15 minutes, we may close in 45," and i couldn't hire a car to take me ten miles into Illinois, wait around for who knows how long and in the process blow off the stuff I and to do at the convention. Even though there was nothing to be done about it, I will feel like a loved one passed away without me getting to the bedside. Then I go to the downtown Left Bank Books, it has one ...

The Borders at the World Trade Center opened in 1995. I'm told it might not have been very profitable on account of the size of the rent, but it was the company's first store in Manhattan, an important presence for a publicly traded company just a few blocks from Wall Street, and Borders made money in those days. There are worse things than if your face to the world is a store with huge throngs of shoppers selling tons and tons of books. Lower Manhattan wasn't in the beaten path for me, but because Borders World Trade was such a bustling and prosperous store that sold so many copies of so many books by so many JABberwocky clients it was a store that I liked to visit at least every several weeks. Even if it meant making a special trip, it was a pleasant destination. And on a beautiful day, what better really than take the occasional walk through Greenpoint and Williamsburg, over the Williamsburg Bridge, down East Broadway through Chinatown, down Park Row beneath the Bro...

There's a custom in Jewish prayer to recite something called the "Mourner's Kaddish" at the end of every worship service. When I'm leading a service, there's an introductory reading I do to this. It's the last paragraph of John Crowley's Little, Big; my favorite non-client fantasy and in part because it leads up to this wonderful passage of loss, of feeling for better days and different times. And there aren't better words to provide as I begin what will perhaps be my final post about the Borders business, for today all of us who love books have to be in mourning: From LITTLE BIG by John Crowley One by one the bulbs burned out, like long lives come to their expected ends. Then there was a dark house, made once of time, made now of weather, and harder to find; impossible to find and not even as easy to dream of as when it was alight. Stories last longer; but only by becoming only stories. It was anyway all a long time ago; the world, we know ...

So as Borders makes its way through the bankruptcy process, they've gotten the OK to terminate their relationship with Starbucks to have Seattle's Best Cafes. The filings to get out from under say how the royalty rates are too high and make it difficult for Borders to make money on the cafe operations, so it would be better for Borders to take back the operation. Hmmm. If you substituted the Borders website and Amazon for cafes and Seattle's Best, you'd be getting a strong sense of deja vu. Borders went with Seattle's Best because they had, over time, a very big problem that they just weren't running their cafes very well. B&N had that relationship selling Starbucks coffee and desserts from Cheesecake Factory from cafes with attractive menus and bright fixtures with everyone in their very nice and consistent uniforms. Borders kind of slowly scraped over time toward having some vague degree of consistency in their wares, but overall the cafes just never ...

So I think it's safe to say that the main beneficiary of the ongoing disappearing act at Borders has been Amazon or other internet outlets for buying books (and probably not borders.com as one of those!). Nielsen Bookscan gives breakdowns on sales in retail/brick and mortar channels as against sales in discount & other which includes primarily Amazon and bn.com. (Target and K-Mart are also in that line but for the typical new release sf/f hardcover these outlets aren't a factor.) So we can look at the breakdown on launch week for those two lines and see where books are being sold. This also separates out e-book sales. Whatever people are doing there, wherever they're buying e-books, we are able from this to look solely at market share for new books in print format. January 2010, launch week for Simon Green's Good, Bad & The Uncanny Retail market share 54% March 2010, launch week for Elizabeth Moon's Oath of Fealty: Retail market share 44% April 2010, laun...

The Wall St. Journal had an article this week about the slow return of guns to the shelves at Wal-Mart. (no link, since hides behind their pay wall.) Ordinarily an article like this would meet with my scorn and approbation. I am not a gun person. But there was a sentence in the article that I enjoyed very much reading. It said that Wal-Mart -- and for all its power Wal-Mart has struggled a bit in the US in recent years, trying to broaden its appear without particular success and then struggling along with its customers during the economic difficulties of the last two years -- was starting to return things like guns and sewing cloth to its stores because it came to realize that these slow-moving items were more important to generating customer traffic with its core customers than they had appreciated. And this made me feel better about one of my passionately held beliefs about Borders, that the major blow to the chain came in spring 2008 when the company reduced title counts at its st...

Publishers Lunch links to the updated Borders closing list , with another 28 stores scheduled to close by the end of May, 12 of those stores that I have visited. As with the original list it includes stores of all shapes and sizes. Hollywood & Vine that did business but I doubt ever enough for the rent at that location. Milpitas CA which I will miss, because it was one of the nicest stores in the country for selling sf/fantasy on the day I visited. Fairfield CT, which I was surprised to see wasn't on the original list and which I'd visited on opening day and occasionally since as a quick on/off Metro North. Stamford CT is a somewhat historic site, as it had been put up by Waldenbooks prior to its purchase by Borders as part of their budding "Bassett Books" chain of superstores, the original location in Towson of Borders #44 that is now in Lutherville MD had been another. Braintree MA and Tacoma WA had both once been extremely prosperous, and I don't kn...

Borders CEO Michael Edwards gave an interview to the Wall Street Journal and the company also had a conference call with creditors, which was covered by Publishers Weekly and Publishers Marketplace. The company will soon decide, based on discussions with landlords, on the fate of an additional 25 to 75 stores that may close. Publishers Marketplace does a good job of putting this into perspective. The 200 stores liquidating now were all drawn from the not quite 500 superstores so it was a full 40% in the initial round, and as few as 145 of those 500 stores were solidly profitable. That is a scary statistic. These articles differ on whether it not there will be a round of closings for the smaller format mall and airport stores. The company is getting supplied by major suppliers on a cash basis. It is begging for the major publishers to resume shipping on regular terms. Good thing to hope for. Costco will brag in its annual reports that it churns inventory so fast it is often getting paid...

All told I have visited around 80 of the Borders that are closing, adding two in Burlington and Peabody MA this past weekend.  Around 25,000 square feet, e average store that's closing.  Leave aside the drain represented by entire stores, each of those could have done it's business in 5000 fewer square feet, 5K x 200, and that's one million extra square feet floating around, and the troubling thing is that the 450 stores that remain open probably carry around another 2M spare tire around the belly, and the bankruptcy filing doesn't help that.  Start at the top, alphabetically by state, and the Anchorage store is as typical an example as any.  When I visited Anchorage in 2006, the Borders was disappointing. I had been to the amazing Waldenbooks in Wasilla, which had an amazing selection in an amazingly small space, kind of a captive audience, and then the BN in Anchorage which was selling books in jaw-dropping quantity. And then the Borders?  Well, it was just OK. It had...

For general impressions of the closing Borders see my last post here  This will start some store specifics.  I believe that Borders #10 at the White Flint Mall in Kensington/Rockville MD and Borders #50 on 18th and L St in downtown Washington DC were in their prime two of the best bookstores in the entire country.  Store #10 was one of the first stores opened by the brothers Borders as they expanded across the US. It was the second Borders I ever visited, my late uncle Matthew dropping me off at the Bethesda Metro station with instructions on how to find my way there as I was heading home after from something or other. I loved it. It was exactly like the experience of visiting the original Borders, and I no longer had to go to Ann Arbor for it. I was upset they were not carrying Simon Green's Blue Moon Rising in it's original Roc edition. That store was in a small standalone retail building on Rockville Pike, subsequently filled with an Anthropologie and now vacant; the Border...

As you can imagine, I spent a good chunk of time looking at the list of Borders that will be closing in the next six to ten weeks following the chain's bankruptcy filing this morning. I'll have more to say about some individual locations or other specifics, but a thing or two worth noting: First and most important, a store's fate didn't depend on sales alone. Which might be my biggest sadness about the list. My hope had been the Borders would close a third of its stores doing 20% of its business, but it just ain't so. The rent and square footage ended up saying as much about a store's profitability as the quantity of books it is selling. So here in New York City, there's a store in Glendale, Queens that is still remaining open, in a failed attempt at an upscale shopping mall. So failed that the shopping center itself was just sold at a bankruptcy auction. Hence, the Borders survives. Why? Well, along with the movie theatre the Borders is one of the f...

One of my clients was wondering what effect a Borders bankruptcy might have on major publishers. At least there, the answer is "not as big as you might think." Let us say Borders was 12% of the company's business, and that Borders was not paying for two of the biggest holiday months, so that this would be more like 1/3 of their annual billing with Borders than 1/6 of it. So that ends up being around 4% of your expected income where you've actually paid for and printed and shipped books and incurred all of those costs and you're stuck with the bill. Now, that's a big hit. A very big hit. It could take your expected profit and narrow or shrink it, maybe even put you into a loss situation for the year. But it's an absorbable hit, especially when you realize that most of the major publishers are part of huge international conglomerates with publishing operations in lots and lots of different countries. And this isn't the first time a major player in...

So sneaking out the news on a Sunday night, Borders put out an official press release to say it's not paying publishers for January, and now starting to skip rent payments as well. This follows a press release last week to say that they had a contingency-riddled commitment to new financing. It's going from sad to worse. Borders is so poorly managed right now that it can't even go bankrupt right. As I mentioned on New Year's Eve day, you have to pay your landlord before you pay anyone else, because your landlord is the one person who can change the locks and keep you from accessing your inventory. And if things are so bad you aren't paying your landlord, then you should have just gone into Chapter 11 long before, but as I suggest here that poses ego issues and money issues to some very rich people who've made some bad bets on Borders. Because of those rich person egos, Borders has engaged in a long drawn-out process that has pissed off employees, publish...

Even though Barnes & Noble likes to brag about how wonderfully they're doing, the cost-cutting bug hasn't skipped over. Here Publishers Weekly discusses the impact on small presses of B&N's recent layoff of some four dozen staffers, including several long-time buyers and merchandisers which include the company's director of small press and vendor relationships. Holding to the truism that companies don't like to mayke announcements of bad news, there is no B&N release on the layoffs, their latest is to wax enthusiastic about periodical sales for the Nook. The news from Borders is that publishers are supposed to indicate next week if they will trade their accounts receivable for a promissory note. And there were more layoffs at HQ. They raised some cash by selling their Day by Day calendar kiosk business to Calendar Club. Can't be much, though, because the kiosks are a seasonal business, and the business can't be much more than selling the r...

I found my way to an Atlantic blog post by Peter Osnos, the person who founded Public Affairs Books, which is now part of Perseus, with his take on why Borders has declined so. It overlaps with but is somewhat different from my own . You can read his here . According to Jim Milliot in this week's Publishers Weekly, Borders accounted for 8.5% of dollars spent on books in the third quarter, which was just under half the dollar share for B&N, and still for most people their third largest account. So you can understand the dilemma, that everyone wants Borders to keep going but at the same time it's hard to know what the good path forward is. A quick update on the JABberwocky e-book efforts. We love Amazon more and more with each passing day because they made it so easy for us to go up with titles for Kindle. We will soon be up at Kobo, waiting to get a countersigned contract back. They were very nice, because we were actually able to negotiate a couple of points in the c...