Borders Has A Long History Of Missteps And Poor Management

Borders just can’t get a break. The latest misfortune to hit the bookseller came last Thursday, when the New York Stock Exchange threatened to delist Borders if they can’t get their stock price above $1 per share.

But don’t start feeling bad for Borders quite yet. A long series of missteps, poor management and lagging behind the rest of the industry is the cause of their current troubles. In fact, the roots of Borders’ problems can be traced as far back as the 1990s.

An article on Crain’s Detroit Business website chronicles the bad decisions Borders has made throughout the years. One of their earliest mistakes, according to the article, was concentrating on mall ’boutique’ stores when Barnes & Noble was moving to standalone superstores.

However, it’s the digital realm where Borders really messed up:

In 1998, Borders launched an e-commerce site — three years after Amazon.com launched and one year after Barnes & Noble.com.

But after just three years of trying to make a go of online sales, Borders gave up. In 2001, it entered a joint venture with Amazon.com to develop a website to be operated by Amazon with a portion of revenue to be shared with Borders.

One industry analyst called the partnership with Amazon a “Jackass move.” Then once Borders got their website running, the competition was moving forward with ebooks:

And while Borders was busy building up its own e-commerce site, its competitors were busy working on e-reader strategies.

At a time when Borders should have been working on its e-reader program, the economy slowed and the company lacked the cash to develop the program, said Souers.

“Borders was running out of money and lacked the financial flexibility to embark on an e-reader program,” he said.

Borders’ troubles are not new and are not the result of ebooks cannibalizing print sales. They were in trouble long before ebooks came along. Rather, a long series of bad decisions by inept management dug Borders into a deep hole.

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