Rumors are that Borders will declare bankruptcy soon. The same link notes that 150 of 650 Borders stores are slated to close.
Borders receives de-listing warning from NYSE. Basically, the stock isn't worth enough to be listed on the exchange.
The loan from GE has a slew of conditions.
This 3rd link is the most important. Unless Borders can find lenders for another $300 million bucks, the GE load of $550 million isn't going to happen. Borders also has to find a way to make landlords allow Borders to walk away from the leases.
"Lukewarm" reception to junior debt is not something investors like to hear. I really doubt Borders can secure the GE loan without Bankruptcy court protection.
Borders needs to cut lease payment
Not all Borders locations are bad. The local two Borders are both ghost towns that unfortunately should be due for closure. :(
What really matters is that Borders closures will reduce the selection of print books. Yea... Borders isn't the store of 150k titles anymore (not after installed the larger coffee shop, toy section, etc. Yet it still carries more variety than B&N.
I have a few coworkers who are adapting to book store closings by buying either Kindles or the Nook Color. The 'Grand Dame' department secretary at work has become enamored of the Kindle. There is little point in yours truly trying to convince coworkers to buy Kindles, she is far more persuasive! ;) So for the overall book industry, the estimate 150 Borders closing will probably have little impact. I do wonder about the 'economies of scale' of print books.
In my opinion, this feels like film. As in film cameras. Once the top photographers went digital and Kodachrome (slides) went out of production, the downhill was quick from there. If you look at my prior post and extrapolate another year of 100%+ growth in ebooks (more likely 200%+), then I do not see how certain formats will thrive anymore.
Sometime in the next few months, the true fate of Borders and print books will be known.
Got Popcorn?
Neil
In my area, the closest bookstore was still about 30 minutes away. I used to bypass the B&N that was right off the highway and travel the extra couple miles down the road (through about 10 traffic lights) to hit up the Borders. I just liked it more.
ReplyDeleteBut truthfully, the B&N shopping experience was better. Borders was very stuffy and just felt old. When I was a teenager, I always felt more like I was in a library than shopping. (As much as I love libraries... it's just not where teenagers really want to be... ESPECIALLY if they are shopping.)
At B&N, everything was more open and bright. Categories of books were better marked for browsing. There was an escalator. (Escalator!!)
When the Borders closed, I was shocked. They were run out by a competitor with a more modern shopping experience, better selection and better location. It's not surprising, but still sad.
Now I shop at the B&N. Sorry Borders ghost, but I'm not driving over an hour to get to your nearest worse shopping experience. Can we still be friends?
J. E. Medrick
JE,
ReplyDeleteIt is funny how the Borders bookstore is always a few more lights off the main road...
As to selection (of books), the local Borders has always had more variety. But that doesn't matter if the rest of the shopping experience isn't up to snuff.
I stopped shopping at both except for children's books.
Neil