The company handling the liquidation sales at some 200 Borders Books stores announced today the sales will begin Saturday. Hilco Merchant Resources of Chicago issued a press release saying the liquidation will begin with 20 to 40% on all merchandize with some exceptions. Over $350 million of inventory including books, magazines, music and movie media, calendars, posters and more will be liquidated.
Borders Books’ successful trip through bankruptcy is contingent on deals with publishers. Borders filed for bankruptcy protection Wednesday.
Court documents show the Ann Arbor-based bookseller owes more than $150 million to 7 publishers, including Simon & Shuster, Random House and Penguin. Borders has also been delaying payments to publishers since December.
Independent bookstore owners are not sure whether Borders Books expected bankruptcy filing this week will be good news for their businesses.
Analysts expect Borders will close 200 or more stores as part of any bankruptcy plan.
When Borders Books and other mega-bookstore chains started opening 40 years ago, it seemed like the end for many small local bookstores. They found it difficult to compete with the big stores with their wider selections, coffee bars and other amenities. But the obituary for the corner bookstore was a bit premature.
Now that online book sales and e-book readers are shrinking the market for big-box bookstores, the smaller footprint booksellers suddenly have a brighter future. Deb Leonard is the executive director of the Great Lakes Independent Bookseller Association.
“Those independent stores in those neighborhoods will benefit because people need a place to go.”
Leonard says, in some cases, local bookstores might consider taking over former Borders locations.
Borders Books is expected to begin its next chapter this week. The Ann Arbor based bookseller is expected to file for bankruptcy protection Monday or Tuesday.
On Friday, the Wall Street Journal reported Borders will likely file for bankruptcy protection this week. Borders stock fell by a third on the news.
It’s not like the news was unexpected. Borders has been struggling financially for years. Less than a year ago, investors were paying more than $3 for a share of Borders stock. When the market closed Friday, you could have bought a share of Borders Books for 25 cents.
Borders is still the nation’s number 2 traditional bookstore with more than 600 stores. But as book buyers have spent more online, Borders’ share of the total book market has shrunk.
It’s been delaying payments to publishers and others since December, as the company has tried to hang on to some cash. Borders’ bankruptcy plan reportedly includes closing more than 200 stores.
No word on what the plan is to convince book buyers to return to Borders.
The Wall Street Journal is reporting that Borders Group may file for bankruptcy protection on Monday or Tuesday next week. The Ann Arbor-based bookseller has struggled in recent years as book buyers have migrated from big box stores to the web.
This could be a pivotal week for the future of Borders Books with some sources saying the company could seek bankruptcy protection.
The Ann Arbor-based bookseller delayed payments to publishers and others the past two months. The company has been trying to negotiate with its vendors and come up with a plan to move forward. Borders has a half billion dollar financing deal in place, if it can come to terms with its vendors.
Jeff Manning is a managing director with BDO Capitol Advisors. Manning’s company closely follows the retail market.
"The challenge, if you look at the statistics, majority of companies that enter bankruptcy do not emerge. If you look at recent statistics with retailers, an awful lot of retailers have gone straight into liquidation."
Manning expects Borders’ vendors will decide it’s more in their interest to keep Borders viable. He says, if Borders does file for bankruptcy, the company will probably exit bankruptcy before Christmas. But Manning says Borders execs must be careful, since the bookseller is in a precarious position:
"One foot in the grave and one foot on a banana peel," says Manning.
Members of the Cleveland Orchestra (TCO), trapped in Ann Arbor because of the recent snowfall, ended up putting on an impromptu performance on Wednesday with members of Classical Revolution Ann Arbor (CRAA), a local chamber music collective.
Because of the snowstorm, TCO was unable to leave Ann Arbor in time for a concert Wednesday at Chicago's Orchestra Hall. The musicians chose to pass the time playing with University of Michigan students and amateur musicians at Sylvio's Organic Pizza in Ann Arbor, where CRAA meets every Wednesday for jam sessions.
The first quartet of the evening consisted of Bill Preucil, TCO's concertmaster, TCO violist Joanna Patterson, cellist Ed Baskerville, and University of Michigan student violinist Dan Winnick. Other TCO musicians showed up to play throughout the evening, including principal oboe Frank Rosenwein and principal flutist Joshua Smith.
Ann Arbor-based Borders Books may be able to stave off bankruptcy, thanks to a new financing deal announced this week . Professional writers are waiting to see what the company’s next chapter will bring.
A new type of incubator is open for business at the University of Michigan. It’s called a “venture accelerator,” and it’s located in the sprawling research complex Pfizer built before it left Michigan a few years ago.
Toyota Motor Corporation has launched a new $50-million dollar safety research center in Ann Arbor, as the company seeks to recover from last year’s massive recalls of millions of cars.
The money will pay for research on ways to reduce driver distraction, and better protect the most vulnerable passengers including children. Chuck Gulash is senior executive engineer at Toyota Technical Center in Ann Arbor.
Borders Books reported the company lost $74 million dollars in the 3rd quarter. That's about twice as much as Borders lost in the 3rd quarter of 2009. The Ann Arbor based book seller continues to struggle in a competitive market.
In a written statement, Borders Group CEO Mike Edwards conceded his company's struggles:
Since we posted this story we found this analysis piece by Sarah Weinman of Daily Finance News. She also calls the notion that Borders Books could buy Barnes & Noble a story that has "entertainment value" not much more. Weinman says of Borders Books:
"If a merger was its plan for saving itself, expect B&N's rejection of the deal to accelerate its downward spiral -- an end that, sadly for the publishing industry, is likely to come sooner rather than later."
If you're a habitual reader of The New Yorker magazine or you just browse the latest issue's cartoons then you may have noticed a recent cartoon that made you think of home... home that is, if you live in the Ann Arbor or metro-Detroit areas.
Without spoiling the joke, we'll just say the cartoon — by Ann Arbor's Dave Coverly — makes reference to shopping malls — and specifically, several we're very familiar with, including Briarwood Mall, Westgate Plaza and Jackson Plaza. Troy's Somerset Mall and Oakland Mall also get a shout-out.
You can see the cartoon at The New Yorker's website.