Desperate times call for desperate measures and the latest to find themselves on the wrong side is Borders Groups Inc. So much that the famed Ann Arbor, Mich., bookseller is left with no other option but to file for bankruptcy, which is a clear indication of their financial woes having only worsened in recent times. Final preparations are currently on so that we might get to hear the ultimate news as early as Monday or Tuesday itself. On the firing line will be close to 200 of the Borders’ 674 stores. Job losses are also in the cards which is likely to run into thousands. The company currently has 19,500 people on its payroll.
“Borders is not prepared at this time to report on the course of action it will pursue,” the company revealed in a statement.
Failure to register a strong presence in rapidly changing book reading landscape has led the bookseller to its decline which otherwise used to be the preferred destination for the American book loving crowd. Times have changed so that its the digital version of books that are more in demand than anytime before in the history of hardcover books. The quick absorption of e-reader devices has only led e-books to be sought more than their printed counterparts. E-reader manufacturers too have been acting out of their skin to promote the new age e-book reading devices by including more and more features on one end while reducing the price on the other. All of these rang the death knell for the printed books.
Also, while all other booksellers have resorted to have an e-reader of their own along with their own e-book library promising anytime, anywhere and any book reading experience as a survival strategy, Borders fell out of the race by not having a device of its own. It had tied up with Kobo though the deal did not pay off in a manner that could have led Borders to survive. That the Kobo e-reader isn’t as great a product as the Amazon’s Kindle or the Barnes & Nook’s Nook e-reader did not help things either. It tried to diversify into offering interactive kiosks that would allow users to select and make their own CDc, or download their books and music but it did not pay off. Borders had also started to offer the Libre e-reader as well but all of their efforts came to a naught. Last October, Borders had also entered the self publishing genre by setting up Borders Publishing in conjunction with Book Brewer which was in line with Amazon’s Digital Text Publishing Platform or the B&N’s PubIT program.
So while Amazon stayed afloat with the brilliant Kindle and the B&N with the Nook e-reader, its was only a matter of time for the Borders to suffer the same fate as it happened to music stores a decade ago. The company has earlier put itself up for sale unsuccessfully in 2008. Interestingly, Borders has sold off its loss making internet operations to Amazon in 2001. Seven years later, when Borders once again decided to have an online presence, it found itself up against Amazon that was already an established player by that time and was on the verge of making a killing at a time when consumer preference was shifting to e-books and online buying.
As of now, it remains unclear if Borders will be able to restructure and emerge out of the red though experts believe avoiding liquidation might be too tall a task.