Mismanagement Killed Borders

After doing 4 interviews last week as a part of the Summer Blog Blast Tour, I had planned to get back to reviewing. I even have a few saved in draft and ready go, which is not the norm. Though I had to take moment and talk about Borders Books going out of business. I thought I would do such a post in May when the Borders I worked at in Atlanta for over 10 years closed. But when the doors shut for the last time, I just didn't feel the need. Maybe it was the last round of drinks with co-workers turned friends, or maybe I just needed the distance, and not to be reminded of how much I gave and how little I received in return.

When Borders filed Chapter 11, customers kept on asking why is Borders is trouble? For many the simplest answer would be ebooks. While increase in digital reading definitely played a part it's was mismanagement that killed Borders. If you really want to know what's going on with Borders I highly recommend Borders Live Journal Recently someone posted Borders CEO going all the way back to 1999. Out of the 5 CEO's none had any experience in the book industry. They all staffed Ann Arbor with people that had little to no experience with books. This inexperience showed in their buying habits, discount program, endless section reorganization. I could go on but I won't. Any former Borders employees feel free to add to the list in the comments. I will focus my attention on the three stated

1. No Regional buyers,cost Borders a lot of money. Certain authors and books sell better in different markets. And surprise surprise Southern authors are very popular in Atlanta. Unfortunately our first draw for many best selling Southern authors like Fannie Flagg and Pat Conroy was around 10. Same as the other markets and not nearly enough to get us through a weekend. It was embarrassing to have tell a customer on Friday that we are sold out of the new Flagg, that was released on Tuesday. Coming up with excuses to cover poor corporate buying habits didn't feel any better.

Not having regional buyers also meant losing summer reading sales. All summer reading list have universal authors, like Bronte, Morrison, Twain, and Wright. Beyond the classic authors all lists are regionally inclined and that's were the money is. A customer can stop at any bookstore to buy Bronte. Parents are more then willing to return to bookstore if the store stocked hard to find summer reading titles.

I handled the summer reading list for the last five years. I was lucky enough to have managers who allowed me to get as much as I could in. Our selection was very good, not as good as I would've liked to be but it was the best in the Atlanta area.

There was a time when a store had three chances to get the product in the customers hand. With the Internet and ebooks, its down to one for bookstores. If the item a customers wants is not in stock the first time, they may try back. If its not in the second time the sale is lost. Customers simply have too many options. Not having regional buyers to capitalize on the wants and needs of customers in every market hurt.

2. Coupons - Borders discount program with the coupons was atrocious from the very beginning. Initially there was only one Borders rewards card. It was free and customers were enticed to come back with coupons. Which sounds like a great plan, customers save and store makes money. Its a win/win. Wrong. 25% 30%, and 33% discounts were being sent out every three days. Every so often there was a 40% coupon. Books have a very small mark up. So Borders was barely breaking even with the 33% discount and losing money with the 40% discount

The logic beyond the coupons was that customer who saved would buy more. There were a handful that did. Though in real world beyond the corporate data analysis and sales projections there was more coupon abuse then additional sales. On the store level everyone knew that coupon saturation was a very serious and costly issue but upper management refused to listen.

The abuse could've been maintained or even eliminated if the coupons were place on the Borders Reward cards rather then requiring customers to print them. Many customers would print out stacks of single use only coupons to use on all of their purchases. If it was a 40% coupons many were willing to drive to other Borders to use the coupon more then once.

I really can't fault customers for second infraction. A company that doesn't manage their discounts in a correct manner should expect to be taken advantage of. But the customers printing out stacks of coupons made me sick because based on the rules for usage, they were very much in the wrong. These needless, never pretty run ins with coupon abusers could've been avoided if the coupons were simply tracked on the Borders Rewards Card.

3.Reorganization, The company spent a lot of money on "experts" who would figure out the best way to lay out the store that would result in more sales. The children's department had some of the most changes. Though one thing stayed the same customers found it confusing. Librarians and teachers were always baffled by it, all I could do was shake my head and walk away. I really want to know which expert was responsible for superface outs.

I don't have a picture *, so I will do my best to describe a superface out. At any bookstore you'll usually see 5 or more copies of a single title faced out, drawing attention to the book and the section. A superface out came together with a large quantity, at least 10. 3 copies would be placed down flat on the shelf spine out, 5 would be placed top of the three, and the remaining copies would be put to the left of the faced out copies. Yes someone was paid to come up with that bright idea and yes it looked as silly as it sounds. It was supposed to give the illusion of more books. Though it didn't work and thankfully didn't stay around for too long. Corporate invested so much time and money into various relays to the point of no financial gain.

I never could figure out what was up with Ron Marshall and all those training videos that he insisted on starring in. They were just awful and what a waste of money.

I can't end this without saying free Wi-Fi, is an awful, non money making idea. People would come in seven days a week to use the Wi- Fi and not buy anything. There was very very very small percentage of customers that didn't take advantage. Overall Borders was a study hall/ conference room/office for many thanks to the free Wi Fi

There's a huge misconception that booksellers who work at chains are in it for the money. That is so far from true. We did it or do it because we love books. Everyone at the Borders I worked at was very knowledgeable. We could've held our own against any Indie.

The way Borders handled being in Chapter 11 (no recovery changes were implemented, still gave out 40% coupons) this closing was inevitable and I am glad to see it finally come to an end.

Though I am very sad that a lot of hard working people on the store level will be unemployed including many of my friends that transferred to another store. The only upside is no bonuses will be paid out to upper management.

Come back tomorrow for How to Work/How to Shop at a Liquidated Borders.

* if any Borders employees have a pic of a superface out please place the link in the comments. Thanks