Borders prepares to liquidate

Bor­ders, the sec­ond largest book­store chain in the Unit­ed States, will soon be going out of busi­ness. The com­pa­ny announced today that it had run out of time to reor­ga­nize itself and would wind down its operations.

Bor­ders said in a news release that it will pro­ceed with a pro­pos­al by Hilco and the Gor­don Broth­ers Group. That liq­ui­da­tion plan will be pre­sent­ed to the fed­er­al judge over­see­ing the company’s bank­rupt­cy case on Thursday.

What is left to unwind are Bor­ders’ 399 stores, about two-thirds of the loca­tions it oper­at­ed when it filed for bank­rupt­cy in Feb­ru­ary. It cur­rent­ly has 10,700 employees.

Bor­ders will begin clos­ing  its remain­ing stores as soon as Fri­day, and the liq­ui­da­tion is expect­ed to run through September.

The com­pa­ny has ten stores around Puget Sound, includ­ing one in down­town Red­mond, NPI’s home­town, and anoth­er half-dozen stores in Ore­gon’s Willamette Val­ley. Two (in Fed­er­al Way and Taco­ma) were already in the process of clos­ing, and now it looks all the oth­ers will be gone in a mat­ter of weeks.

Bor­ders’ demise will result in the loss of more than ten thou­sand jobs.

Although the Inter­net will undoubt­ed­ly be cit­ed in many Bor­ders obit­u­ar­ies as the cause of its demise, the real­i­ty is that the chain was doomed by poor man­age­ment and ques­tion­able deci­sions. It did­n’t col­lapse overnight; it’s been ail­ing for years. Half a decade has now gone by since Bor­ders had a prof­itable quarter.

Bor­ders could have sur­vived, if it had closed under­per­form­ing stores ear­li­er, not out­sourced its online oper­a­tions to Ama­zon, and done a bet­ter job of antic­i­pat­ing and con­trol­ling costs. But, like Cir­cuit City and Block­buster, it did­n’t make the moves that it need­ed to in order to remain a going concern.

To put it more suc­cinct­ly, the rise of ecom­merce is not what killed Bor­ders. Missed oppor­tu­ni­ties are what killed Borders.