Report: Barnes & Noble Shuttering 35% of Stores in the Next Decade28 Jan, 2013 By: Erik Gruenwedel
Barnes & Noble Inc. plans to close about 20 retail stores a year throughout the next decade, Mitchell Klipper, CEO of the retail group told The Wall Street Journal.
The nation’s largest remaining bookseller plans to have from 450 to 500 stores operating in 10 years compared to the 689 stores it operated as of Jan. 23. Barnes & Noble separately operates 674 college bookstores.
B&N is one of the largest retailers of packaged media, including Blu-ray Disc and DVD movies and TV shows.
New York-based Barnes & Noble, which has been dealing with online competitors such as Amazon for print books for years, has recently begun to feel additional pressure from burgeoning digital book sales — a competitive front it has contributed to with the launch of the Nook tablet.
Like the Amazon Kindle Fire and Apple iPad, the Nook facilitates sales of digital entertainment, including movies and TV shows.
Indeed, Nook digital content sales increased 13.1% during the recent the nine-week holiday period ended Dec. 29, 2012. Yet, Nook sales were disappointing, according to CEO William Lynch.
“Nook device sales got off to a good start over the Black Friday period, but then fell short of expectations for the balance of holiday,” Lynch said earlier this month. “We are examining the root cause of the December shortfall in sales, and will adjust our strategies accordingly going forward.”
Meanwhile, Barnes & Noble bookstores and BN.com had combined revenue of $1.2 billion, decreasing 10.9% over the prior year. The decrease was attributable to an 8.2% decline in comparable store sales, store closures and lower online sales. Core comparable store sales, which exclude sales of Nook products, decreased 3.1% as compared with the prior year due to lower bookstore traffic.
The Nook segment had revenue of $311 million for the nine-week holiday period, decreasing 12.6% as compared with a year ago.
Regardless, Klipper said operating a smaller retail footprint over time would be a good thing.
“It’s a good business model,” he said. “You have to adjust your overhead, and get smart with your [business] systems. Is it what it used to be when you were opening 80 stores a year and dropping stores everywhere? Probably not. It’s different. But every business evolves.”