B&N Says it is (Still) "Considering" Smaller Stores, But is Actually Closing Stores
The WSJ discovered yesterday that, much to no one’s surprise, Barnes & Noble is toying with developing a model for a bookstore with a smaller footprint.
Jeffrey Trachtenberg lead his article on yesterday’s earnings report with this tidbit:
Meanwhile, CEO Ronald Boire said in an interview that the struggling bookstore chain is mulling over a new store prototype.
“The industry is evolving, and we think there are opportunities ahead with a different format, ” said Mr. Boire, who started his job on Tuesday. “I’ve sat in on a couple of meetings about this and we’ll have more to discuss later.”
Mr. Boire declined to provide additional detail.
The average Barnes & Noble store measures 26,000 square-feet. A new prototype could be smaller and feature a broad assortment of merchandise.
I don’t know if this is a case of B&N not having a clue how to move forward or if this is an example of a reporter who didn’t follow up, but B&N gave almost that exact same response when Trachtenberg interviewed B&N Chairman Riggio 17 months ago.
It’s a shame that Trachtenberg didn’t follow up on the question he asked last April, because it’s worth noting that in the past 17 months B&N had announced the opening of a single store, and closed at least a dozen.
B&N said they are considering smaller stores, but what they’re actually doing is shuttering stores right and left. And that is the real story here, not that a "book retailer considers new store prototype".
Actions speak louder than words, which is why you should look at what someone is doing rather than what they are saying.
Never mind what B&N says in interviews; their real plan is to cut unprofitable stores. They accidentally revealed that plan in January 2013, and have been implementing it ever since.
And it does seem that trimming losses is working. B&N reported that
Comparable store sales increased 1.1% for the quarter, benefitting from growth in non-book categories. “Core” comparable bookstore sales, which exclude sales of NOOK products, increased 1.0% for the quarter.
In a time when more and more sales are moving online, that could almost be described as good news.
image by Genista
Comments
Liz September 10, 2015 um 10:40 am
I think Riggio needs to go. He was never fully on board with the digital side of the business and unfortunately, it shows. Until they make major changes in leadership and vision, one of them being Riggio out the door they will continue to tread water.
DaveMich September 10, 2015 um 11:35 am
As was written some years ago, it boils down to leases. B&N is closing stores as their leases come up for renewal. The latest closing in Queens is typical. The landlord had cut the rent a number of times, and when the lease came up in a good real estate market the landlord finally held out for market-rate terms. B&N couldn’t or wouldn’t do it. That’s pretty much the same thing with every closing you see, and what it says is that their current stores are barely profitable, if that, at their current lease rates. In most of these cases they pay lip service to the idea of finding another site for the store being closed, but they never do. The company is a car whose engine has stopped working, and they really don’t seem to know what to do.
Paul September 10, 2015 um 2:21 pm
Sadly I have to agree. And this really need to fix that god awful web site.
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