What was expected to happen has happened: Borders filed for bankruptcy protection yesterday.
Borders, which has 6,100 full time staff, operates 508 namesake superstores as well as a chain of smaller Waldenbooks stores.
The company said it would close about 30 percent of its stores in the next several weeks and plans to continue to pay its employees.
Borders’ largest unsecured creditors include major publishers that provide the books it sells. Borders owes Pearson PLC’s (PSON.L) Penguin $41.2 million, Hachette Book Group USA $36.9 million, and CBS’s (CBS.N) Simon & Schuster $33.8 million, according to court documents.
Everyone involved with Borders is going to be hurt by this, from employees to publishers to landlords.
I’m not sure what the chain can do at this point to turn around its fortunes. Smarter, more business-minded people I’m sure are working on this situation. But between competition from Amazon and Barnes and Noble, and the emerging (and fast-growing) e-book market, there doesn’t appear to be a whole lot of room left for a major bookstore chain of any kind. It’s as if the bookstore chain model no longer works in the current market.