A couple of weeks ago I posted about the difficulties Borders was having staying solvent in the rapidly-changing book retailing environment. I made the point that the company seemed to be preoccupied more with restructuring its balance sheet than it was with reformulating its strategy.
I’m sorry to say things are getting worse for Borders, and now publishers—which are being asked to extend special terms to the struggling chain—are scratching their heads about the same thing. One publisher said it wouldn’t accept an I-O-U from Borders because, “In order to accept the note, you have to believe that their strategy will work, but their strategy is to continue doing what they’ve been doing.” Another complained, “They haven’t shared a plan that makes their long-term future look more sustainable than of late.”
Having been unable to figure out a relevant consumer proposition, Borders is now losing the confidence of its suppliers. That’s the last thing the struggling retailer can afford.
Steve McKee is a BusinessWeek.com columnist, marketing consultant, and author of “When Growth Stalls: How it Happens, Why You’re Stuck, and What To Do About It.” Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/stevemckee.