Posted on 01/07/2012 6:22:34 AM PST by Kaslin
Retail sales are up but profits are down as noted in Profit Warnings at Target, Kohl’s, J. C. Penney, American Eagle
However, shrinking profits are one thing, huge losses another.
On Thursday, Barnes & Noble increased its projected loss per share for the current fiscal year to between $1.10 and $1.40, from the 30 cents to 70 cents it reaffirmed one month ago.
I have commented before that brick-and-mortar book stores are in serious trouble. It's time to move Barnes & Noble to the top of the list.
The Wall Street Journal reports Barnes & Noble Seeks Next Chapter
The nation's largest bookstore chain warned Thursday it would lose twice as much money this fiscal year as it previously expected, and said it is weighing splitting off its growing Nook digital-book business from its aging bookstores.
Ironically, Barnes & Noble had been one of the first to recognize the potential of digital books. In 1998, it invested in NuvoMedia Inc., maker of the Rocket eBook reader, and the bookseller actively supported digital-book sales. But in 2003, it exited the still-nascent business, saying there wasn't any profit in it.
It wasn't until 2009 that Barnes & Noble re-entered the business, introducing its Nook e-reader. By then, Amazon had been selling its Kindle device for about two years, and was offering best sellers for $9.99, a fraction of what hardcover best sellers are priced at.
Apple introduced its iPad tablet in January 2010. Amazon responded with its competing Kindle Fire tablet this past September, and in November, Barnes & Noble introduced its Nook Tablet.
To promote the Nook, the retailer returned to national TV advertising in 2010, after a 14-year hiatus, buying spots on popular programs such as "American Idol."
The heavy Nook investment has squeezed Barnes & Noble's bottom line.
Barnes & Noble said in a statement on Thursday it was "in discussions with strategic partners including publishers, retailers and technology companies in international markets." It said that could lead to expanding the Nook business overseas.
What's the "Next Chapter"?
The Journal reports Barnes & Noble is also considering a plan to spin off its Nook business. If it does, can it make a profit selling books the old-fashioned way? If it doesn't, does if have the resources to compete against Amazon and Apple?
Either way, the "Next Chapter" for Barnes & Noble just might be bankruptcy court. It took me a second to catch the play on words in the WSJ article because the first thought I had was "Chapter 7" and a word was missing.
Bear in mind, even if that happens, it can take years to play out. GM was terminally ill for a decade before it succumbed to the inevitable.
Find a technological way to turn their stores into e-versions of what they were up to this point.
Invent a technology where you can bring your e-reader into the physical store and electronically browse what’s there but as soon as you leave the store what you didn’t pay for goes up in smoke like in the old Mission Impossible TV shows.
Keep the cafes, the comfy chairs, and the prime locations.
Once people are hooked on a book they are “browsing” the chances are quite high they’ll actually go ahead and buy it - which is how their old model worked.
I'd LOVE to buy the books touted by many conservatives ... Levin, f'rinstance ... but the computer age has re-directed my love for reading and knowledge to occur in a sitting straight up position while becoming fat on whatever I damned well feel like gorging myself on.
Reading these days is more a Pac Man experience of bits and pieces until a whole hour or day has been eaten up and we move on to the next free game.
I HAVE attempted to read a book, but I find that as good a sleeping aid as Nembutol.
I think it all began in my childhood when I learned to peruse (a) magazine(s) while sitting on the terlet ...
Do girls have this sitting and reading thing ?
I recall reading last year where IHOP and Wendy’s were in trouble also. IMO, Should all three bite the dust in 2012 it would bring home the impact of the poor state of the economy to the average Jane and Joe than all the bank failures have so far.
Good. Maybe they’ll think twice about hiring snooty, more-intelligent-than-thou clerks to take your money when you check out.
I am a writer who gets most of his books (usually 50 years old at least) from abebooks.com and ebay. Occasionally I find I need to go to one of these “big-box” bookstores (hey, if they are going to insult Walmart and Target who are actually helping the middle class by providing affordable goods, we can use their nasty nickname against them) and 90% of the clerks who have taken my money have the attitude, “I work in a bookstore, ergo, I’m a brilliant writer/literary critic.”
Take the metal rod out of your nose, you’re just a cashier.
EDIT: I recall reading last year where IHOP and Wendy’s were in trouble also. IMO, Should all three bite the dust in 2012 it would bring home the impact of the poor state of the economy to the average Jane and Joe MORE than all the bank failures have so far.
Smaller stores inside more downtown areas with more emphasis on the cafe, free wi-fi, print-on-site books, and ebooks.
Huge mega stores in malls full of 40 dollar books is a sure loser.
Based on the iPad and Kindle, B&N has been REacting rather than being PROactive. And frankly, I liked the Kindle MUCH better than the Nook.
For the price of about 3-4 new hardbound books, One can buy an e-Reader that will hold hundreds, if not thousands, of books. Around $14.99 is the high typical price of eBook novels, with prices going as low as $0.99. And there are now gazillions of sites out there with free content for the download.
The only time now I’ll buy a physical book is if it’s something I want for my library. Something I feel is of value. Otherwise, my nose is in my Kindle “Keyboard” WiFi every day. Along with Calibri on my PC to maintain my collection, it’s a reader’s dream come true.
There is no reason at all a physical book store should exist. They are simply obsolete.
I agree there is an innovative new business model waiting to be discovered, and B&N ought to get busy or it’s going to become the next casualty. For example, rather than fighting Amazon, maybe there’s a way they could become the brick-and-mortar extension of Amazon, and merge the Kindle and Nook to better serve customers with a single unified e-book standard, but with multiple options for shopping.
My husband will be very sad if actual books go away. He was given a Kindle and he re gifted it to someone else. He likes a book in his hand, to turn pages and dog ear the page when he puts it down.
The superstore book store model is a money loser. Before Borders went belly up, its Waldenbooks stores were actually losing less than its superstores. And publishers are the ones making the most from ebooks. Last I knew, most, if not all publishers, were charging e- and retailers the same price for the electronic editions that they charge for the dead trees. Plus, the increase in transpo, warehousing, other costs are really doing a squeeze on margins for book retailers. Changes in publishing are also taking place. My bet is that, other than indie booksellers, the only big guys who’ll make a profit selling dead tree books will use a convenience book store model, kinda like what Waldenbooks and B. Dalton used to do.
I can think of at least one reason for a physical bookstore to exist—it’s a place to go, wander around, sample books, maybe have coffee and a snack, talk with your friends, take a date, etc. I hope the day doesn’t come when we lose all our interesting physical social gathering places.
I would disagree—MASS release bookstores are obsolete. But for those of us who deal in technical areas where they might not be readily available, even on a college campus, a brick-and-mortar bookstore still makes sense.
I've had my Kindle Keyboard for awhile and also tried the Nook Simple Touch. It went back to the retailer within two days. It took forever for the battery to get its full first charge, the USB connection into the unit was "iffy" and I wasn't sure the cord connector would last, and when I began reading, I'd swipe the screen to turn pages and I'd begin getting a ghost image of other pages (which became more visible as I continued on). That was it. Back in the box and back to the store.
My only complaint about the Kindle is their goofy idea of showing the percentage of the book read instead of what page your on. Sure, you can hit the [Menu] key to find out, but why should I have to do that?
My simple little e-Ink Kindle "Keyboard" WiFi will also let me browse the Internet, check my email, maintain a calendar and contacts list, play games, play music, and store photos (yes, in B/W). It's essentially a tablet without the color. And I've read the screen is easier to see in different light conditions than the Kindle Fire, also less taxing on the eyes.
Goodbye buggy whip.
My husband and I feel the same way. He reads at least 3 books a week and wants no part of a Kindle or Nook.
Because you can read that book on multiple devices, with various screen sizes.
I have Kindle for my laptop and smartphone. I can read on one, stop, and pick up reading on the other seamlessly.
One page on my laptop is much more than one page on my smartphone, so the percentage is more relevant in these cases.
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