The news out of the UK for Borders is not good. The Telegraph and others are reporting that the whole business is for sale and not just selected parts.
A week back we learned that the A&R Whitcoulls bid had been withdrawn for the Australian and New Zealand operations of Borders.
While it would never get up, newsagents should consider making the leap and buying Borders’ Australian business. It’s think kind of bold completely out of left field move which will provide channel wide focus. It would unlock better commercial terms for books for newsagents as well as give newsagents a stake in a major national chain. Totally crazy! Doomed to fail! But, what if…
Am I serious? No, well, sort of. many newsagents need to leap (be pushed or dragged) out of a small business victim mindset. They a bold mission, a new mission which makes them part of something much bigger. This is why the Borders opportunity is interesting. It’s something we would never do and cold never pull off. It’s exactly the kind of mission newsagents need to actively consider.
Of course, for this to even be considered, newsagents need to act as a cohesive channel of entrepreneurs who will pursue business opportunities with missionary zeal. They need to want a profitable future.
Lets see, Borders must be worth a bob or two to buy, lets say 80 million just for something to say (stores plus debt). There are 4500 of us, thats $17,777 each. Sales last year were worth $US3.8 Billion, we should know how to run this business, we do it everyday on a smaller scale, put me down for a few shares.
It looks like your $80 might be a little low. Just had a look around and found a new story (http://business.smh.com.au/sale-of-borders-falls-through/20080312-1z09.html) in the SMH that suggests it could be worth $480 million ($106,666 each). If Borders Inc want to keep the 25% mentioned in the article, it would then be $360m ($80k). Unfortunately, although this would be an excellent opportunity for our industry, I’d estimate that maybe 20% of newsagents would support something like this, meaning they’d need to put in something like $400k each. That’s likely a bit of a stretch.
Mark, what an excellent idea!! You could count us in for a couple of shares at least!!
Mark
I think that the $480 might be ambitious too, given the losses they made last year – however, still put me down for a share or two.
New chapter for Borders’ Australian stores
TOP News
Australia’s $1.8 billion book industry is set for a shake-up, with the competition watchdog clearing the private equity owner of Angus & Robertson to buy Borders’ Australian stores, The Age reports.
According to the paper, the deal allows A&R Whitcoulls, controlled by buy-out company Pacific Equity Partners, to buy the 22 stores for an estimated $130 million.
Angus & Robertson is Australia’s biggest bookshop chain, and the deal will give it more than 200 shops, making it twice as big as competitor Dymcocks.
According to The Age, the Australian Competition and Consumer Commission indicated that Borders’ “buy two, get one” promotion may be phased out with the merger, saying: “Inquiries suggested a likelihood of some reduction in discounts currently offered by Borders.”
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Borders sale price was around the $130 million for its Aust and NZ operations , not to be confused with Borders International
I think bitting for Borders cannot change the status of our newsagent channel.
As a regular reader of Mark’s blog, I am interested in his stories in Iphones, Internet, Newsagency delivery, and Newsagecny challenges.
“Apple is a platform company”, we watched Apple evolute into a platform for communication, personal computering, music and entertainment. Learning from iPhone SDK conference 2008, we understand how Apple attract software developers into the platform and using Apple’s online store for profit sharing with developers.
For last 6 years, Mark try to make a platform for newsagents by enhancing a powerful and integrated POS systems, by introducing a internet FindIT website, by running Yahoo newsagents discussion group and the blogs.
Most of his effect works well as the platform is profit/idea sharing, a good example is EziPass.
So can we create a better platform on Internet for all newsagents? so that all newsagents can share profit by acting as a delivery agent and pick up point?
So can we create a better platform for all neighborhood stores, so that every newsagent can delivery milk, bread, and beer (from local liquid store), meat (from local butcher) into local communities?
Newsagency channel should be a platform, sharing profit with suppliers, distributors, neighborhood stores.
Cheers,
Sunny