Last week we saw the filing of Chapter 11 bankruptcy protection for Borders Bookstores. Shortly after the filing, Borders CEO Mike Edwards sent a mass email out to all of the faithful.
In it, he talks about Borders stores being “beacons of enlightenment and education, where readers young and old explore their passions and find those special books that speak to them personally.” He also goes on to say the problems with “the difficult U.S. economy, coupled with the rapidly changing bookselling environment” are the primary reasons for Borders filing for Chapter 11.
Uhmm…, the difficult U.S. economy. Yes, that is something we are all dealing with, some better than others. Edwards goes on to talk about Borders Bookstores “providing customers with a vast assortment of books in a warm, relaxing environment—and we intend to build on this.” This is commendable and I am one of those who took advantage of that warm and relaxed environment on as many occasions possible. I am a bibliophile and there is no other place more inviting than a bookstore or library. The sad truth is, someone has to pay for that environment and unfortunately, not enough patrons are stopping in to buy from the bookstore.
Many owners, CEOs, managers, and companies are discovering the advantages of the virtual store. What if you could have same volume of sales, without having to pay mortgage or rent, or utilities? Would it be nice not worry about air conditioning or heating? It is definitely advantageous not having a storefront which may be susceptible to armed robbery.
As we move more into the 21st Century, more business owners are discovering the advantages to running their businesses strictly online. In fact, Circuit City was one of the first icons to shut down all of their brick and mortar stores throughout the nation on March 9, 2010. They continue to sell their electronic wares over the Internet; prices are pretty much the same and for the customer, this is a double-edged sword.
While the Circuit City customers no longer have to drive to the location to make their purchases, they are also unable to “test drive” a particular product in the normal sense. In other words, they have to know what they are buying because they can no longer pick it up, look at it, turn it over, or check it out. In the end, this tends to make the customer a much more perceptive buyer.
The other concern Edwards pointed out in his e-mail, is the “rapidly changing bookselling environment.” This portends changes in the publishing industry overall. Every day more publishers are making the move into the digital world in a couple of ways.
First, print-on-demand technology is eliminating the need for initial large print runs. This also changes the rules for distribution. Since the publisher no longer needs to buy books in bulk, he or she no longer needs to worry about storage of the excess product, along with the associated costs of environmental storage and insurance. Additionally, publishers can sell directly to the public, eliminating the middleman altogether.
Secondly, one more nail in the coffin of the brick and mortar bookstore is the e-book. Kindles, the Nook, Digital Readers, iPads, and other comparable e-readers are in the process of changing all of the rules—permanently.
Books will be around for a while, but if you have not started shopping for your iPad, Nook, or Kindle, it might be time to start.
© 2011 J. Clark