I’ve only been in Australia for about 3 and a half years, thats right I’m a FOB, but I remember back when I was in first year, even in 2nd year, no wait, even until recently, Borders was like a hang out place for a few of my friends and myself. It was like a library, we got a book, sat at the cafe or at one of the lounges and spend a few hours there before deciding if we should buy a book.
I recently went back to Borders again and the experience was very very very very different this time. Everything was on sale, everything from their books, to their furniture. Yes they went bankrupt, which is maybe inevitable but very unfortunate.
Sure you can buy all the books for maybe half the price on Amazon but Amazon can never give you the experience Borders can. The feeling of walking into a bookstore with their chilled lounge music, browsing for a book, reading a bit of it to see if its worth your money and then purchasing it. Before Borders went bankrupt, that was the concept that they were going for in order to differentiate from their competition Amazon. They realised that online shopping will never give you the experience that a proper physical bookstore offers. They found out that shoppers on average spend about a hour in their stores before making a purchase. Hence, they added the couches, the cafe, the lounge music, the friendly staff, etc. Unfortunately it was not enough.
That is the thing with business though, whats hot and whats not changes with time. Energizer used to do very well, until lithium ion batteries took over. Kodak did very well, until SD memory cards took over. Cassettes did very well until CDs took over and that did very well until iPod took over. Steam engines did well until petrol/diesel engines took over. and the list goes on.
As investors it is probably important that we are wary of these changes even thought they can be very subtle at times. We don’t wanna be putting too much money into a sector or company that is not doing so well.
So although sad that Borders is closing down, oh well, what can we do about it. Be happy that we can buy cheap books from Amazon. And one day, Amazon will meet its demise when something else takes over.
So what do you think about Border’s bankrupt. Could they have done something sooner to prevent this? If you were the CEO of Borders what would you have done to avoid this? What is the next big sector that will be displaced? Do drop me comments or emails, I’m more than happy to read them. Thanks for reading! If you like the blog, click on the little like button on the right hand side of the screen to like the page on facebook, or follow me on twitter!
ps, thanks Frostie, if you're reading this, for talking to me about Borders. I had a massive writer's block.