Borders Group
From Wikipedia, the free encyclopedia
| Borders Group, Inc. | |
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| Type | Public (NYSE: BGP) |
| Founded | 1971 (Ann Arbor, Michigan) |
| Headquarters | Ann Arbor, Michigan |
| Key people | George L. Jones, CEO & Chairman Edward Wilhelm, CFO |
| Industry | Retail (Specialty) |
| Products | Books, Maps, CDs, DVDs, Calendars, Zunes, Gift Packs, Magazines, Board Games, Encyclopedias |
| Revenue | ▲$3.903 billion USD (2004) |
| Employees | 35,000 |
| Subsidiaries | Borders UK Ltd(17% Stake) Paperchase |
| Website | www.bordersgroupinc.com |
Borders Group (NYSE: BGP) is an international bookseller based in Ann Arbor, Michigan. Borders is (as of 2005) the second-largest bookstore chain in the United States (after Barnes & Noble), selling a wide variety of books, CDs, DVDs, periodicals, as well as gifts and stationery.
Borders owns a majority stake in Paperchase Products Limited, a leading gifts and stationery retailer in the United Kingdom, and showcases their products in their stores, as well as Books etc., Borders' other, mostly London-based bookshop chain. In 2004, Borders reached an agreement with Starbucks subsidiary Seattle's Best Coffee to operate the cafes in its domestic superstores under the Seattle's Best brand name.
As of 2007, there are more than 500 Borders stores in the United States, and around 500 Waldenbooks and Borders Express stores, mainly in U.S. malls and airports.
Contents |
[edit] History
[edit] Beginnings
The original Borders bookstore was located in Ann Arbor, Michigan, where it was founded in 1971[1] by brothers, Tom and Louis Borders during their undergraduate and graduate years at the University of Michigan. The Borders brothers' inventory system tailored each store's offerings to its community. A sister company, Book Inventory Systems (1976-1994), was founded to serve as a wholesaler for, and provide the brothers' custom inventory system to, regional independent bookstores such as John Rollins, Thackeray's, Schuler Books, and Joseph-Beth Booksellers. Until Borders Superstore expansion occurred in the early 1990s, BIS serviced more independent stores than Borders stores. Former Hickory Farms president Robert F. DiRomualdo was hired in 1989 to expand the company.
The first Borders bookshop, with a meager stock of used books, was located in two rooms above 209 State Street, north of the State Theater. From there the brothers soon moved, briefly, to a tiny ground floor + mezzanine operation in the Maynard House apartment building, on the SW corner of William and Maynard streets. In 1971 they bought out the stock of Wahr's, an 80-year-old bookstore which was ending business at 316 South State, and moved into that location. Wahr's had been mainly a textbook and school supplies vendor, but the brothers did not deal in textbooks. Soon after the move back to State Street, they switched entirely from selling used books to new ones, and then leapt at the chance to occupy much larger quarters that had become available across State Street, in the former location of the Wagner & Son men's clothing store. This site, 303 S. State, is now part of the Steve & Barry's sportswear chain.
[edit] Kmart and Waldenbooks
Borders was acquired in 1992 by Kmart, which had acquired mall-based book chain Waldenbooks eight years earlier in 1984. Kmart had struggled with the book division, having first tinkered with the assortment, and later with discounting. In the Borders acquisition, Kmart merged the two companies in hopes the experienced Borders senior management could bail out floundering Waldenbooks [citation needed]. Instead, much of the Borders senior management team fled the company, leaving an even larger and more unwieldy division for Kmart executives to handle, on the heels of aggressive expansions by rivals Barnes & Noble and Crown Books. Giving up on the division entirely in 1995, at the beginnings of its own fiscal problems and under intense pressure from stockholders, Kmart allowed Borders to buy itself out through a highly-structured stock-purchase plan. The newly liberated company was initially called "Borders-Walden Group", but had changed its name to the "Borders Group" by the end of the year.
[edit] International expansion
In 1997, the company established its first international store in Singapore, occupying 32,000 square feet (3,000 m²) in Wheelock Place, Orchard Road, which was then the largest bookstore there. It has since opened another 41 stores in the United Kingdom, Ireland, Australia, and New Zealand, and bought 35 Books etc. stores throughout Britain from Philip and Richard Joseph.
In 1998, Borders (UK) Ltd. was established as a Borders Group subsidiary and is now one of the country's leading booksellers over its Borders and Books etc. brands. However, due to the fierce competition in the UK marketplace, a number of these Books etc. stores will be closed and will be replaced by larger Borders stores in retail parks on the edge of town. In Q3 2006, the Singapore store emerged as the best performing amongst the entire group's 559 outlets, with the highest revenue generated per Square feet[2]. The highest grossing store in US territory is located in Puerto Rico which was recently remodeled and expanded.[citation needed]
[edit] Franchise stores
In April 2005, Borders Group opened its first franchise store with Malaysia's Berjaya Books Sdn. Bhd. in Kuala Lumpur. It is located in Berjaya Times Square, which is the world's biggest mall built in a single phase, with 7,500,000 square feet (700,000 m²). The store in Berjaya Times Square was advertised as being the world's biggest Borders at 60,000 square feet (5,600 m²). After Berjaya Times Square, Borders opened their second store in Malaysia. It was located in The Curve, Mutiara Damansara. The 3rd Borders store opened in Queensbay Mall, Penang on 7 December 2006. Borders opened a franchise store in Mall of the Emirates in Dubai, UAE in October 2006.
[edit] Changes and controversies
[edit] Muhammad cartoon controversy
On March 29, 2006, in response to the controversy over cartoons depicting the prophet Muhammad, Borders Group announced that Waldenbooks and Borders bookstores would not carry the April-May issue of Free Inquiry magazine that contained the controversial cartoons.[3] Borders Group did carry an issue of Harper's the next month which also featured the cartoons.
[edit] Changes in business plan
In March 2007, Borders Group announced it would scale down the number of Waldenbooks outlets it had by half, to about 300, in the next year.
The company also announced that its marketing alliance with Amazon.com would end. (Amazon had been essentially acting as Borders' online component.) Borders will launch its own web sales site in 2008. [4]
In March 2007 Borders Group also announced the disposal of its UK and Ireland businesses including its Books Etc. Business in the UK, with the aim of revitalizing the core U.S. business, however it was also announced that Borders Group would retain the Paperchase Stationery Business. However international expansion would be likely to continue via franchising. [5]
In September 2007 it was announced the UK and Ireland business of 42 Borders Stores and 28 Books etc stores had been sold to private equity group Risk Capital Partners for an initial £10m. [6]
Throughout 2007, Borders silently launched a limited test-run of a new concept program. Currently named the Digital Center, this program offers select electronic devices such as MP3 players, digital photo frames, and the Sony Reader. It also offers services such as in-store kiosks for partner websites Ancestry.com and Shutterfly.com, as well as customer CD-burn and download system provided by the Mix & burn company. The Borders Digital Center is currently operating in limited capacity at select locations in Ann Arbor, Michigan, Denver, Colorado, Las Vegas, Nevada, and Noblesville, Indiana. The lastest Borders Digital Center opened in Alameda, California in May 2008.[7]
In late 2007, Borders installed digital video monitors in select stores. The monitors display special programs, as well as news, sports, and financial information provided through Ripple Networks, Inc., a California-based marketing service.[8]
[edit] See also
[edit] References
- ^ By the Book
- ^ "S'pore store is Borders' No. 1", The Straits Times (Life!), 15 November 2006, p. 10
- ^ Borders, Waldenbooks Won't Carry Magazine
- ^ http://www.chicagotribune.com/business/la-fi-earns23.2mar23,0,2794946.story?coll=chi-bizfront-hed
- ^ Borders Media Relations
- ^ BBC NEWS | Business | Borders sells its UK book stores
- ^ Borders Media
- ^ Ripple's high-definition screens heading for borders: company can fine-tune videos to chain's different locations | Los Angeles Business Journal | Find Articles at BNET.com
