Don't think this merits a different thread, so here goes:
In checking out the various reports out this week some numbers have popped up that suggest just how disfunctional consumer book retailing as a whole has become.
1- B&N and Borders combined are supposed to account for 49% of all books sold in the US. Amazon adds 28%. Number four Books-a-million is supposed to chip in with 9% or so. That means that four retailers account for 90% of the sales? Add in walmart and Target and that means regional and independent bookstores barely register.
2- Neither B&N nor Borders seems to be making money off the consumer book operations. Borders is bleeding to death and B&N is hanging on off the growing ebook and college bookstore business. Factor in Walmart and Target and it's clear that over half the books are sold at a loss. I'm not familiar enough with B-A-M to know how their sales and financials are structured or how they're sited (or how much they rely on BPH bestsellers) but it seems at first glance that they (and the niche bookstores like Powells) are the only ones making money in B&M consumer book sales.
3- Added up, it seems like nobody makes money retailing bestsellers (except, maybe, online); just the publishers and big-name authors.
Maybe Borders *is* right to ask the BPHs for relief.
Maybe Borders problems aren't all about bad management.
It's taken a lot of short-sighted decision making in a lot of places to get here.
4- I vaguely remember B&N sales being sized at 32% of the market, which leaves Borders at about 17%. Factoring in the quote about B&N capturing at most 19% of Borders' volume (3.2% of the total) in a Borders liquidation, the next question is what happens to the other 14%. Does it go away totally, as some analysts are saying? Does it go to the dept stores? Does it go online? To ebooks?
5- In their crowing press release B&N brags that they see the dept stores and "other" competitors leaving the book retailing business as the industry consolidates and that they intend to prosper as the consolidator. But a business where 90% of the volume is controlled by just 4 players is already consolidated more than common sense suggests is sensible. Cut it down to three and it's going to start looking like a dying business or a monopoly in the making. Neither is good.
5- Factor in ebooks. Factor in that the most prolific book buyers seem to be transition to ebooks and/or online retailing. Factor in that the most successful reader platforms, so far, are tied to walled-garden ebookstores. Factor in that Borders does *not* have one of those walled gardens as an escape hatch. Neither does B-A-M, btw; they've outsourced that to B&N.
I'm sorry but I don't see Chapter 11 working for Borders.
Unless the BPHs or some other samaritan throws a lifeline to Borders in the name of channel diversity, what I see ahead is Chapter 7.
Anything else will simply be preserving a zombie operation.
Things aren't as bad as they seem; they're worse.
Edit: BTW, if anybody has better numbers, please link the sources; I'd like to see a ray of hope somewhere.