21st February 2011: Borders’ Bankruptcy

The bankruptcy of US booksellers Borders has shaken the Australian publishing industry.

Ebooks and online retailers are blamed.

Borders failed due to other reasons. Large floor space meant sales pressure and diversification away from core business. High retail prices, foreign currency exposures and sluggish turnover meant large store inventories. Private equity debt compounded the situation.

Borders was a victim of poor management and high cost structures.