As expected, Borders Books has filed for bankruptcy and is taking drastic action, closing 200 of its remaining 642 stores (the chain once had more than 1,300 locations) as part of its "restructuring" and "repositioning" effort. Earlier this week, customers received a carefully worded email from president and CEO Mike Edwards that tried to remain as optimistic as possible.
"However," explained Edwards, "because of the ongoing impact of the difficult U.S. economy, coupled with the rapidly changing bookselling environment, we must restructure Borders and reposition our business for long-term success." He goes on to reassure customers that, among other things, "Borders stores are open for business" ("Families can still enjoy enriching events, including author readings and signings, book clubs, and kids' storytimes and parties"), the rewards programs "remain in effect," "Borders.com is operating as usual," and "Borders will continue to maintain its strong national presence."
Except that it might be a little more difficult to get to those storytimes and book clubs when 200 of 642 locations will shut their doors, including every store in the District of Columbia (even the enormously popular location at 18th and L Street, NW). So much for the "strongh national presence."
The reasons for all this have by now been well explained. "The company ... is struggling under more than $1 billion in debt amid rapid changes in how Americans buy and read books. In: e-books, downloaded whenever, wherever. Out: People shopping at chain bookstores," reports the Washington Post. According to the Wall Street Journal, "As competition for consumers intensified amid the growth of the book superstore in the 1990s, Borders made a number of crucial gaffes including transferring its Internet operations to Amazon in 2001 and embarking on an overseas expansion that swelled its debt."
Perhaps most shocking is the amount of money Borders owes to the major book publishers—$41.1 million to Penguin Putnam, $33.8 million to Simon & Schuster, $33.5 million to Random House, $25.8 million to HarperCollins. (The list was compiled in the print edition of last Thursday's Journal.)
If the Borders nearest you is closing, be on the lookout for possible liquidation sales. As noted in the Post, "Borders has asked a bankruptcy judge in New York to let it begin liquidating inventory at stores this weekend. The company says in court filings that the Presidents' Day holiday would bring in high foot traffic. In liquidations of the 45 stores it closed last year amid mounting financial problems, Borders sold everything it could, even bookshelves and cleaning supplies."
Maybe now I can afford Nathan Myhrvold's Modernist Cuisine?