About Me

A blog wherein a literary agent will sometimes discuss his business, sometimes discuss the movies he sees, the tennis he watches, or the world around him. In which he will often wish he could say more, but will be obliged by business necessity and basic politeness and simple civility to hold his tongue. Rankings are done on a scale of one to five Slithy Toads, where a 0 is a complete waste of time, a 2 is a completely innocuous way to spend your time, and a 4 is intended as a geas compelling you to make the time.

Tuesday, June 9, 2009

The Comeback Kid?

It's time for a progress report on Ron Marshall, who took over as CEO of Borders in early January, and who has been trying very very hard since the start of the year to dig out from under the hole dug by his predecessor, George L. Jones.  I had a very ambivalent relationship with Jones, whom I felt made some good decisions and some bad decisions and some interesting decisions but at the end of the day wasn't running a tight ship, wasn't solving the biggest problems quickly enough, and was rearranging the concept store deck chairs while the company's cash position was sinking like the Titanic.  I urged his firing in March 2008, and the only sad thing about the announcement of Ron Marshall's arrival was how long it took to make the change.

I am happy to say that I like pretty much everything Ron Marshall has had to say since he came on board.  He seems to be executing on what he's saying in his interviews and conference calls.  He's solving problems that need to be solved.  And I can only hope he's doing things quickly enough in these difficult economic times to put a real turnaround into effect.

To give credit where due, he is building on some initiatives left in place by George Jones.  It looks like Borders is trying to leverage the new employee computer system that was introduced in 2008.  And I felt in 2008 and continue to feel today that Borders was placing some good and right bets on the JABberwocky list, with Charlaine Harris and Brandon Sanderson both enjoying more consistent support from Borders.  Part of the credit for that goes as well to sf buyer Morgan Burns, who will now be tending a new sf/fantasy blog called Babel Clash at the Borders web site.

So let's look over some of the things Ron Marshall has done:

He's chopped middle management at the store level.  This is something the liberal in me doesn't like to like, because there are hundreds of people who've lost jobs as a result of this.  But it's the kind of hard decision that has to be made.  Every Borders had a variety of management positions, like a sales manager or an inventory manager, because that was the way it had been done at Borders.  And that wasn't a problem in the 1980s when Borders started to march across the country and generally had little competition and state-of-the-art inventory and was opening good, high quality, well-trafficked stores in good neighborhoods.  But over time, Borders had hundreds of stores, and some of them were still big and well-trafficked but others were not.  Yet all of them still had the full assortment of middle management positions that Borders always had, and to be quite honest I was sometimes surprised to go to a mid-level or lower Borders and meet a bookseller who had one of these titles because I could look around the store and see there wasn't a lot of inventory for an inventory manager to manage.  He also dropped some middle management positions at HQ.  I'm pained by this, but I have to give this a thumbs-up.

He's made it very clear that Borders cannot shrink its way to success and that his ultimate goal is to get the Borders customer re-engaged with Borders and buying merchandise at Borders.  This might be a difficult thing to accomplish when most retailers are seeing drops in same store sales, but at least he knows that he has to get an upward sales trend going.  Thumbs up.

He's increased the frequency of reordering.  Big big big thumbs up for this.  He is addressing a core problem Borders has had in the past ten or fifteen years.  It had been the custom at Borders that each publisher would see a backlist order from Borders once every month or so, with some frontlist titles maybe ordered a bit more often and some of the deep deep backlist being ordered only every two or three ordering cycles.  This was fine once upon a time when Borders was state-of-the art, but B&N had leapfrogged Borders in replenishment by the early 1990s, and Borders kept doing things the same way it always had been.  B&N was supposed to carry a book, they'd have a fresh copy on the shelf within a week or ten days after it had sold.  Borders was supposed to carry a book, they'd sell that copy and could go three weeks or ten weeks before it was replenished.  Now, Borders will place orders every two weeks or every four weeks, which means it is much more likely that Borders will have the books customers want on the shelf when customers want them.  About time, don't you think?  Borders also had this habit of going overboard in early reorders sometimes.  If books are looked at more often, they may not need to guess so much on how much a six or eight week supply would be for an early reorder, and so Marshall thinks they may be able to have fewer returns while ordering more often.  I'm not so sure about that, but maybe.

The music/DVD section that's been a drain on Borders as sales in these categories have shipped is being diminished.  The chain is being divided into four tiers of stores.  The top tier that can still sell music/DVD (as an example, Manhattan stores that tourists may frequent) will continue to have a good selection.  The bottom tier will have only a few hundred top titles in the category.  The space that's cleared up will be given over to expanded children's, bargain, wellness, and other top performing book categories.  George Jones had been taking down space in these categories as well, but Marshall seems to be doing it right.

In February 2008, Borders introduced its new concept store, which was designed to have fewer titles and more face-outs.  They liked this so much they decided all stores should carry fewer titles.  Then they announced their big cash crunch a little bit later and hacked at inventory even further.  This was a bad thing.  It's been an ongoing problem that the worst Borders had really bad depth but this was balanced out by the deep selection at the best Borders.  This cutback in titles cut away at the depth at top stores and made them less attractive and certainly didn't make the bad stores any better.  It killed some of the JABberwocky backlist, like the Hot Blood anthologies edited by Jeff Gelb and Michael Garrett that saw small but steady sales at the best Borders locations.  It wasn't helpful to Emissaries From the Dead by Adam-Troy Castro which I would say is the quintessential example of a book that was published in early 2008 and gone from Borders by late summer that would previously have been kept on at least at the top half of their stores.   This book seems to have become a sleeper hit based on sales trends over the past two months (and it deserves to be; it's an award-winning and very very good sf mystery by a very very talented writer) and the fact that you can't buy it at Borders is a bad bad thing for me, the author, and for Borders.

Ron Marshall recognizes that you can't be a bookstore selling lots of books to dedicated readers without carrying books, and he says that depth of stock issues will be addressed.  There are some signs of this.  Tanya Huff's Blood Books are back at Borders, and there are books like The Sleeping God by Violette Malan or Ragamuffin by Tobias Buckell that are hanging around at Borders (at least at some stores) which would certainly be gone if they were applying the same criteria that saw Adam-Troy Castro given the hook a year ago.   I don't know if they'll reverse course to the point of returning the Hot Blood books to their top 50 or 100 locations for horror or picking up Adam-Troy Castro again, but at least the attitude is that a Borders should carry books.

There are also plans to get booksellers more involved in hand-selling and recommending books to customers.  Interestingly enough, the new computer system has been given a facelift that will give booksellers tools to do this.  This makes me very happy, that when Ron Marshall says Borders should be doing something I can go into a store and see that the company is giving the employees good tools to do it.  If you ask for a book by a particular author, there certainly won't be tool-related excuses for a bookseller not to say "oh, bummer, we don't have this book by the author, but we do have..." or "that's right over here, and we've also been finding that people who like books in this category have really been going for that other book as well."

The one thing that saddens me is the company's plans to trim the mall store business down to under 100 stores.  Like the dump of middle managers, this may be necessary.  But I can remember the days when big shopping malls often had two or sometimes even three bookstores in them, and with B&N's B. Dalton outlets down to 50ish and Waldenbooks maybe down to 80 (which could include airport stores) we may enter an era when a mall has a big superstore or 16 books at the CVS and some cookbooks in the Williams Sonoma and nothing in-between.  That won't be good for the book business.

Borders is in a hole, but I think it can survive, I think Ron Marshall is doing things that enhance its chances of surviving and thriving, and I am very glad.

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