Sadbook1.jpgAs part of its bankruptcy proceedings filed this morning, Borders has announced that it will close some 200 stores nationwide — you can see if yours will be hit in this interactive map. Chicago has been particularly stripped, with half of their 30 stores set to close. According to documents, Borders has $1.29 billion in debt and $1.27 billion in assets; it hopes to boost the bottom line by closing these 200 stores which were losing $2 million a week for the company.

While facing the inevitable, the big question is whether the chain will be able to avoid complete liquidation; observers are skeptical. And past fatal flaws are being reexamined:

Nonetheless, Borders must boost its online sales and figure out a way to capitalize on e-books as soon as possible. The company is still haunted by a deal in which it outsourced its online sales to Amazon from 2001 to 2008 – a relationship now viewed as a potentially fatal mistake. By the time Borders launched its own website in 2008, Amazon was the market king. Cutting into Amazon’s sales will be extremely difficult. In the third quarter of 2010, online sales made up about 2.7 percent of Borders’ revenue. In other words, the impact of Borders’ online business on its sales performance is negligible.

While nearly 40 court documents are readily readable, here’s the main filing for those of you who want to play along at home.

Chapter 11 Affidavit of Borders’ C.F.O.

This is a story that has struck close to home, a.k.a. Stately Beat Manor, as the Borders up the street from us will be among those closing. We certainly didn’t buy that many books — no need to — but it was a frequent browsing ground, and every Christmas we bought gifts there and on occasion had a cuppa joe while using free Wi-Fi for out of the house work. In other words, it was a part of our life. With the Borders closing, the odd strip mall it resides in — one of a scant handful of its kind in Manhattan — will soon house two giant empty stores. An Office Depot also closed about three years ago and has stood empty since, although a temporary Halloween shop opens every fall. The Borders store is huge…maybe a Barnes & Noble or (WE WISH) Trader Joe’s will move in or at least something to add to the neighborhood. Amazon is great but it doesn’t get you out of the house and talking to your neighbors.

[Illustration by Maggie Siegel-Berele]


  1. My first thought was “430 stores in Chicago alone? No WONDER they’re in bankruptcy.”

    (It’s actually 30 stores in Chicago.)

    Still, what you described is probably a big source of the problem they had; lots of people browsing, buying the occasional coffee or gift, but very little regular buying. I”m not being accusatory–we do the same thing at our local B&N.

  2. Barnes and Noble closed in Hoboken. Opens as a Halloween store once a year.

    I see a pattern.

    We have a non-chain bookstore in our town, and I am trying to figure out a business model for them that would work. With Amazon paying no sales tax, on top of its huge volume discounts, they don’t have a chance.

  3. The Borders in Medina, Ohio is closing, which doesn’t come as a surprise to me. Their selection and service has been poor for several years. But, sadly, it leaves my town without any actual book stores, save for a used book store run by a local charity.

  4. It is posible for a local, non-chain bookstore with local ownership not just to scrape along but to thrive. We have three splendid local bookstores in the Portland, Maibe area and all of them are doing well — Longfellow Books (my fav), Nonesuch Books, and The Book Review.

    The silly and groundless argument that Amazon automatically destroys all local bookstores is just plain flawed logic.

  5. Buying and reading printed material is fast becoming a hobby. As with any other hobby, a local shop can flourish where a faceless chain might fail.

  6. Brian above hit the nail on the head. Borders is going to send back everything they can via returns in order to lower their indebtedness.

    Some people who can ill afford it (and I am talking small publishers now) are going to take a pretty severe hit when they find themselves in the red with Diamond and stuck in a cycle where we are going to go out and have to liquidate our own product in order to cover the costs of the returns.

    Which will, in turn, inhibit sales of key backlist.

    My hope is that some of the publishers who are owed millions will sue and force them to liquidate rather than return books.

  7. I work in a NJ Borders that is on the to-be-closed list, and have been told that the store is being taken over by a liquidator. So I assume that means that we will have a weeks-long “Going Out Of Business” sale, rather than just boxing up and returning the stock. We won’t fully close until April. (Though the info has been a little sketchy, to say the least.)

    I concur with the commenter above who mentioned that not ehough people actually BOUGHT books. A LOT of people just use (used the store) as a glorified library, albeit it one with a cafe! It takes us a good two hours each night after closing time to clean up the mess.

    And a good portion of the folks who DID buy a book only did so if they had one of the numerous 30 or 40% off coupons…

  8. Dang, both of the stores in Columbus, Ohio are getting the axe. We do have quite a few B&N stores, and several thriving independent book stores, so it’s not a catastrophic hit. Still, one of those stores was a mere 5 minutes from my house, and my family did a lot of browsing and impulse purchases there.

  9. There is one Canadian big box store in my area. It killed off a few good small book shops, and now has okay-to-mediocre stock, with as many candles and aprons as books.
    And plenty of people sitting around drinking Starbucks, while their kids lie on the bookstore floor reading manga. Seems like a universal story about a universal store concept.