What All Businesses Should Learn from Borders' Bankruptcy
This is something I never wanted to write. Borders, the national bookseller, is going out of business. It could begin liquidating as early as Friday, but it is the final chapter in a long (and more recently, sad legacy) stretching back to 1992 when Borders was purchased by Kmart and transformed into a national book chain.
Borders has always been special to me.
Its original flagship store in Ann Arbor, as Mitch Albom best-selling author noted in his recent column for the Detroit Free Press, was a marvelous collection of book titles, some one million or so in all. For readers it was heaven. And for authors is was a nice place to do a book signing. It still gives me a thrill to see my books on their shelves. For authors who toil in solitude seeing your book on the shelf is a validation that your words matter.
Sad to say, Borders affinity for readers and authors never really resonated in its management corridors. As part of the Kmart family of companies Borders seemed a stepchild, just another property to merchandise. Combining it with Walden Books made sense on the books (pun intended) but not in stores. Borders was for book lovers; Walden was for customers looking for best prices on best sellers.
I think it is fair to call Borders' demise a failure of leadership. Its executive team never seemed to get the essence of booking selling and book buying in the 21st century. As such the Borders brand, for those who knew it, withered and eventually died.
Businesses that wish to avoid Borders' fate would do well to heed these lessons.
Respect the culture. People who worked in Borders stores were once bibliophiles â€" they enjoyed reading and talking about books. As the chain expanded that sense of bibliophilia went by the wayside. Clerks who could make knowledgeable recommendations about authors and their catalogues seemed fewer in number.
Invigorate the brand. Borders brand is ill defined. Yes, it means books but other than a place for book shelves what is it? Well, it has a coffee shop and it sells music and movies but so too does Barnes & Noble. Borders became just another retailer.
Manage the bottom line. Again and again Borders got itself into financial difficulties. It would upsize and downsize and finally downsized into oblivion. Its management team never took care of balancing the books and as a result the retailer seemed in danger of going under. That sense of doom hung like a cloud over the stores and affected morale.
Look ahead. Borders missed the e-revolution in retailing. I remember attending a guest lecture by two Borders senior executives at the University of Michigan business school. One executive spoke about how Borders was trying to become an e-retailer. First it had it had its own site, then it partnered with Amazon, then it launched another attempt at reaching e-consumers. Had Borders been more attuned to how customers bought books online it could have staked out its own e-territory before Amazon did.
The biggest losers in the Borders demise are customers and employees. Border's personal service in the stores was always first rate. People who worked in the stores liked books and were happy to make suggestions. They would also walk you to the shelf where the book you wanted would be there. I will miss their personal touch.
Borders employees will miss their paycheck. Thousands have been laid off already and thousands more will be let go now. Terminating anyone in these troubled economic times is painful.
The question arises: What could have saved Borders? Maybe nothing. Barnes & Noble, its chief competitor, is in financial straits, too. But as shopping habits have changed from the physical to the cyber, Borders lack of a genuine e-presence (other than as an electronic book catalog) doomed it.
Sad to say, but maybe Borders is an example of a business that outlived its usefulness and like all things useless must go by the wayside. Too bad. I will miss it.
Related:
- Another Navy SEAL Lesson: Instill Pride without Chest Beating
- Trying to Fill "Big Shoes"?
- Do You Have an Open Door Policy that Works?
