More store closings could be announced next week as Borders considers corporate office cuts
Ann Arbor-based Borders Group Inc. told publishers today that it is considering further reductions to its corporate office space, which raises the possibility that the company could make additional cuts to its corporate headquarters in Ann Arbor.
Meanwhile, the company also told publishers today that it plans to decide early next week whether to close an additional 75 superstores, a possibility the company has been weighing since it filed for Chapter 11 bankruptcy Feb. 16.
Borders revealed today that it is considering more corporate office cuts.
The company's chief financial officer, Scott Henry, told publishers today that Borders is examining "how much office space we really need," which could mean further reductions to the company's corporate headquarters in Ann Arbor. Borders employs about 550 workers at its Ann Arbor headquarters at 100 Phoenix Dr., a 460,000-square-foot building owned by Agree Realty Inc.
"We are going to ask all our business partners to work with us to review our current relationships and how they can be more cost-effective going forward," Henry said, according to an audio file provided by Borders.
The company told publishers this afternoon that it would reach a decision next week on whether to close more stores in addition to the 200 closings already underway as part of the bankruptcy filing.
Borders President Mike Edwards told publishers 75 additional superstore closings were possible, though not yet certain. That follows a revelation in the company's original bankruptcy filing that it was considering more store closings.
The company has about 485 superstores, down about 20 since the company's bankruptcy filing.
Borders spokeswoman Mary Davis declined to reveal whether the company's Ann Arbor stores on Liberty Street and Lohr Road are on the list of 136 stores Borders has flagged for closure consideration. The company is already liquidating its Arborland store.
"It is premature to comment on which stores may be impacted," Davis said in an e-mail.
Meanwhile, the company is also actively examining its existing contracts, supply chain and miscellaneous expenses in an effort to streamline its operations, Edwards said.
The U.S. Bankruptcy Court's Southern District of New York has scheduled a so-called omnibus hearing on Tuesday to address multiple elements of the company's bankruptcy case.
Under Chapter 11 bankruptcy law, the company has at least 120 days to deliver an exclusive plan for its reorganization. Borders has already requested that the bankruptcy court approve an extension allowing the company to take until January 2012 to renegotiate the rest of its leases.
Edwards said the company's reorganization plan would be presented to business partners in April and would include a "new commitment to e-books," improved store layout and a "refreshed merchandise strategy."
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
Comments
15crown00
Tue, Mar 15, 2011 : 10:28 p.m.
close everything an disappear
Jason Plowman
Mon, Mar 14, 2011 : 1:56 p.m.
Mr. Dearing, In your reply to ShadowManager's post about the "personell issues" at AnnAbor.com you mention that certain areas of coverage account for a majority of your readership and that "some areas of Entertainment coverage" account for very little; do your print edition readers count at all towards what gets covered? I ask this because a thought occured to me as I was at the Ann Arbor Symphony concert on Saturday. I was thinking that a good percentage of the seniors that find great value in such entertainment, probably also make up a good size percerntage of your print edition readership. I myself am not a senior, but continue to prefer the print edition (I look at a computer screen all day between work and school and do not need to spend anymore time in front of a screen) and would be very disappointed to find that my readership and that of other print edition readers doesn't count when decisions are made about coverage. Local entertainment coverage is something I find great value in and would hope that Ann Arbor.com sees the value in that as well.
Wolf's Bane
Mon, Mar 14, 2011 : 12:30 p.m.
I'm just glad the Government is NOT bailing Border's out!
Greggy_D
Sun, Mar 13, 2011 : 2:10 p.m.
Agreed. I find it rather ironic that AnnArbor.com has no problem announcing layoffs at others companies (Borders, etc) but will not comment on their own situation. Glass Houses and all that.
CynicA2
Sun, Mar 13, 2011 : 3 a.m.
Shhhhhhh! Huuuuushhh! Can't you see they don't want us talking about them?!? Lookie, lookie, at all the comments playing hookie! I wonder where they went?? Perhaps they were talking too much about about annarbor.com instead of boring old Border's. Touchy, touchy!
David Cahill
Sat, Mar 12, 2011 : 9:35 p.m.
If AnnArbor.com doesn't cover its own reorganization, then it will let this story be dominated by those who do not wish AnnArbor.com well. I just got a subscription renewal notice. I'm sending in my check. I hope my support is justified.
David Cahill
Sat, Mar 12, 2011 : 8:59 p.m.
Tony, I think your readers deserve a separate article about AnnArbor.com's staff cuts and its future. A reply to someone in an unrelated article simply is not adequate, IMNSHO.
CynicA2
Sat, Mar 12, 2011 : 8:17 p.m.
... Sounds like Borders isn't the only local organization missing the proverbial boat. Serves them right for censoring every pointed comment that comes uncomfortably close to the truth. Put a smiley-face on that! This just makes my day.
Andrew Jason Clock
Sat, Mar 12, 2011 : 2:30 p.m.
I'm with ShadowManager. Cutting 1/3 of your news room staff is going to have serious effects on aa.com's ability to cover local news. Why haven't we seen any coverage or acknowledgment of these lay-offs on your site?
MyOpinion
Sat, Mar 12, 2011 : 7:40 p.m.
Tony Dearing, Your explanation is good, except we aren't asking for "who got laid off" - the personal stuff. We just expect there to be a news story about it. After all, it was on NPR this morning. I also wouldn't claim that you all do local coverage. It is more like a Twitter*2 report: The school board had a meeting and decided xxxxx. They also talked about xxxx and decided to vote on this later. Ann Arbor Chronicle has much more comprehensive local coverage - except for sports.
Tony Dearing
Sat, Mar 12, 2011 : 5:32 p.m.
Please see my reply to ShadowManager.
MyOpinion
Sat, Mar 12, 2011 : 1:44 p.m.
This is Borders problem: Edwards said the company's reorganization plan would be presented to business partners in April and would include a "new commitment to e-books," improved store layout and a "refreshed merchandise strategy." What does a refreshed merchandise strategy mean? Each of the past 6 or so leaders of Borders has forgotten the basic business is books. Folks used to go to Borders because it had a wide selection compared to Walden Books or the airport gift shop. Borders is now all about best sellers and junk up near the cash registers. With the advent of electronic sales a dozen years or more ago, there was never any reason to build superstores. And, oddly enough all these MBAs sort of never saw the need to build an electronic distribution system.
schoolsmuse
Sat, Mar 12, 2011 : 12:39 p.m.
Why is it that annarbor.com reports on Borders laying off staff, but not on its own staff layoffs of reporters and "producers?" Did you think we wouldn't notice because you had so many reporters? Did you think we wouldn't notice that you currently have no higher education reporter, despite the fact that higher education--in the form of UM and EMU--is the county's biggest business?
Tony Dearing
Sat, Mar 12, 2011 : 5:32 p.m.
Please see my reply to ShadowManager.
robert
Sat, Mar 12, 2011 : 1:39 p.m.
Bravo!
robert
Sat, Mar 12, 2011 : 11:38 a.m.
When you miss the boat, and it is a big ship, there is no stopping or turning it around. I feel bad that Borders didn't see this coming and made better choices to advert it. Good-bye Borders and thanks for a great ride. Why get in your car, drive to a building, park, look around, not find what you are looking for and drive home at $3.75 a gallon and your time. One could order online, buy it cheaper and if grouped with a few more books get free shipping. It is over for all of the Border's book stores and we all know it. NOW CAN WE PLEASE MOVE ON?
ShadowManager
Sat, Mar 12, 2011 : 5:05 a.m.
Didn't Annarbor.com just make a bunch of drastic cuts to their workforce today and are in danger of also going bankrupt? Where's the articles on THAT?
tmo
Sat, Mar 12, 2011 : 7:09 p.m.
"While personnel issues are an internal matter and we don't discuss them publicly, I can confirm that we reorganized our newsroom this week " @Tony - like the way you avoided answering the down-sizing question and refer to it as 'reorganization'.
DBlaine
Sat, Mar 12, 2011 : 5:37 p.m.
This just in. Annarbor.com scooped by its own readers on a story about, ahem, annarbor.com.
Tony Dearing
Sat, Mar 12, 2011 : 5:31 p.m.
While personnel issues are an internal matter and we don't discuss them publicly, I can confirm that we reorganized our newsroom this week to put our focus more squarely on local news coverage. As a new organization, we have tried a lot of things. Now that we are well into our second year, the community has told us very resoundingly that what it wants most from us is hard news coverage, particularly in the areas of government, education, police, courts, health, the environment, University of Michigan sports, and business. These areas of coverage account for all but a tiny percentage of our readership and revenue. Meanwhile, we also have put a lot of effort toward other things -- including lifestyle topics like Passions and Pursuits, The Deuce, Homes and some areas of Entertainment coverage -- that our community has shown much less interest in, and we are scaling back in those areas. We have made tremendous progress since we launched, and we continue to be very happy with the growth we're seeing in audience and revenue. But from the beginning, we said that we would be shaped by what the community wants, and the community wants us to focus more sharply on local news reporting. We have repositioned ourselves to throw our energy and resources into our local news coverage and that is how we will operate moving forward as we continue to grow.
UofM_Fan
Sat, Mar 12, 2011 : 2:11 a.m.
More cuts at corporate? Who is left at the headquaters? 550 people? What, did they let all the staff go and only the managers and above are left? Face it, Borders is doing nothing but buying time. Less than a month into their filing and they've already asked for an extension? You can close stores, you can cut staff, but how will you continue to run the company? Borders continues its death spiral. Not to sound cynical but would the last one out turn off the lights? I can only hope that others will learn from Borders' mistakes. Few probably will though. Greed has a way of making people forgetful. Borders, I enjoyed most of the years that I spent working for you. Towards the end though I watched you throw away too many of my friends. I feel sorry for those that will lose their jobs, but I have no sympathy for the company as a whole.
Joseph
Sat, Mar 12, 2011 : 1:53 a.m.
I would be shocked if the Lohr Road location was not closed. It is a great store to shop because of it's vast size and little customer traffic to contend. The Lohr road store was opened back when Borders first announced it's financial problems. This location was supposed to offer customer's a new concept in bookstore shopping. Sadly, we never understood the concept nor it's target market and the lack of customer traffic was not surprising. You can't blame the location because the Best Buy next door is packed from open to close. Border's should have 'merged' with B&N when they had the chance. Now, B&N can pick through the bones.
Subroutine
Sat, Mar 12, 2011 : 1:19 a.m.
Sad but True, Borders is going down. I will miss them.