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Originally Posted by DMcCunney
I'd like to think they've been at least doing decent sales tracking, but whether they pay attention to the numbers is another matter.
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The issue really is, are they tracking the sales
by store? And do they know the expenses for each individual store? From what I've seen in businesses of this size and age, they may know the overall bottom line, but they may not know which individual stores are the most profitable. So the shut down decisions end up not being made on the best criteria.
Target is a great example, but I suspect B&N and Borders have nothing close to that level of tracking. Target had money to spend on those systems; B&N and Borders didn't.
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They certainly need to slim down. Book sales are down, and I don't see a dramatic recovery happening.
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They need to slim down
and come up with a radical new way of making money. Something clever and profitable. That's the only way they can survive IMO. The profit margin on print books was always razor thin, and it isn't getting any bigger.
If they simply merge, then artificially inflate the stock price in time for the hedge fund to turn a quick profit, it's all over. (And of course that's the hedge fund's motivation in getting involved). But they've been on the verge of collapse for a long time, so the hedge fund may just be speeding up the process.