What went wrong with Borders? The story so far is that a mouse is eating an elephant. According to my own back-of-the-envelope calculations as well as a more serious report from Frost & Sullivan, online shopping accounts for about five per cent of the Australian consumer’s retail dollar. That’s enough to cause private equity …
This is related to UK chains of these two stores but the model they followed was probably the same in abroad, so anyway its worth pointing out that the strategy of Woolworths was seriously flawed, in that yes they could drive down prices (because they owned the biggest distributor EUK) but they didnt make any money, Borders had massive sellection, they had very good stores, but they were very heavy on staff costs and full of dead stock, it was inivitable, both were poorly managed
Australian Book Stores
Have noone but themselves to blame. I went to buy a non-fiction paperback here and the price was $27. I got it shipped from the book depository in the UK for $11. Delivered. Therein layeth the problem.
I Would Agree
but I think we also have to accept that Australian publishers need to take a large portion of the blame here. They have been gouging Australian readers for decades with ridiculously over inflated retail pricing. Book stores don't set prices, publishers do. The book is printed with a price on it and the book store is given 40% of the sale price. Sure, some book stores can trim that margin down a bit but they have to make money to pay the rent too.
Publishers have been making hay for decades because consumers have had no alternative but to pay the cover price.
Now that the Internet is here consumers do have an alternative and it's high time Australian publishers moderated their demands on the consumer or suffer the consequences.
Blaming the Internet for their woes is just puerile and will amount to nothing in the long run.
You're not wrong
Aussie book publishing/retailing has had an easy ride over the years thanks to government protection.
I love the sound of capitalists whining about capitalism and how unfair it is. So, Australian publishing mafia, you joined the club and you agreed to play by the club's rules. Don't cry hard-done-by when the rules come back to bite you on the arse.
"Because of absurd territorial copyright laws, Amazon in America is able to get books to Australia before local publication, and because of publishers’ price-fixing powers (which in most industries would be illegal), Amazon ships books from America cheaper than the local store can get them."
What's most impressive is that's despite the *huge* distance that book has had to come.
sellin' coal t' Nyucassle
when gettin' t'coal from t'pit t' t'power station were more expensive than shippin' t'coal from Australia t' t'power station that's what closed our pits! now we're doin' t' same t' Australian book shops.
Thy Emperor, he hath no clothes.
Why does it take a UK (tech) publication to speak truth in the Australian Retail Market?
(and what is it with the recent rash of Oz stories - Going for a .com.au edition?)
Maybe the this journalist is an Aussie who keeps in touch with down under?
Maybe just a Kylie fixation?
Inquiring minds need to know...
If I recall correctly, the "absurd territorial copyright laws" mentioned in the article makes it illegal for businesses to import any book into Australia that hasn't been published by local publishers for two years. (This two-year period can be fudged and extended with reprints and new editions.) All in the name of saving the jobs of Australian publishers.
Hence the steep price of books.
I recall this law was called into question some years ago but the powers that be decided it should stay.
Ironic that this protectionist law will now contribute to the loss of jobs of store-front staff. Perhaps even more than the number of publisher jobs than were "saved" in the first place?
Australia is popular this year.
Am I the only person who has noticed the number of australian articles on the Reg has been quite high recently?
I for one welcome our new Australian [overlords] readership... One of which I intend to be after July this year:)
Borders has failed to learn anything from Amazon
I went in to one recently looking for a number of books. I couldn't find anything on my list.
Was there a nice terminal I could bang the title into to see what was in stock? No (my small Uni [Poly] library had a couple of these 15 years ago). So I had to hunt down an actual expensive, busy, can-only-serve-one-customer-at-a-time human.
After I'd asked the guy to look them up and he confirmed they didn't have any of them, that was it. Why didn't he offer to order one? Get it delivered to my house tomorrow morning? Get it delivered to the shop so I could pick it up during lunch (better than missing a packet)? "Is it a present? We can have it gift wrapped and on their doorstep tomorrow morning." "Should have some in soon, can I call / email you?"
All of these could be automated.
Hell, they could just use Amazon. The shop would still get a cut and I'd be a damn site more likely to visit it again.
How are they supposed to compete with the wonder of Amazon when they take no advantage of having a high street presence beyond that of any other shop?
Bicycle shops are in the same boat. They were part of the recent whinge brigade along with Gerry Harvey et al. Yet the typical local bike shop experience remains one of surly service, terrible advice, and ridiculously high prices.
Go online instead and receive instant, high-quality advice from a friendly website selling top-notch goods at rock-bottom prices.
These guys, it's as though they *want* to go bust through lack of imagination.
i have to disagree (UK)
I do not agree with this. In the UK and certainly in my local area, the bike shops are very friendly and know their regular customers by name. Even when they did not know me, they gave great support on sizing cycle helmets for my children.
What you will also find is that quite a few of the bike brands require you to collect from a shop so even when bikes are advertised on the web, they cannot be delivered. This is part of the contract the shop has with the supplier along with not discounting 2011 model year bikes for the first six months.
Yes some brands can be delivered but Trek and Specialized are (when I last checked) a collect only product.
@Borders Customer Service
I've had much better service then that at the Boarders I usually go to to buy my books.
I'm just glad that so far I haven't had any Borders employees come to my house to take back the books they sold me. I used to like Amazon too.
And how much did they spank on internal IT infrastructure?
One of the SAP "Basis Barbies" here used to work for the NZ arm of this empire (called Whit-something) and they run SAP on Windows, which probably means after paying all the SAP license and support costs, they couldn't afford to hire Unix support staff.
While the locals in Australia deserve a fair bit of criticism,
the Border collapse is entirely the fault of American management. And I say that as a US citizen.
If it was only the Australians that were causing the problem, only Australian stores would be closing. I think the root of the problem is that Borders forgot what Borders was supposed to be. They've done essentially the same thing here in The States that the author notes they did in Australia: didn't maintain their specialty niche, and didn't go full Big Box for discounting. Then they further muddied their market with DVD sales (music and telly), coffee shops, and pay internet services, while not engaging in internet book sales. Oh and throw in a bit of Kindle or Kindle-clone to boot. And all of their services were mediocre. That sort of thing may not cause problems in times of plenty, but when things get tight, those are the places that will get hit the hardest.