Barnes & Noble to close hundreds of stores

The bookseller has historically closed 15 locations a year, and will continue that rate even as it tests new prototype stores.

By Jonathan Berr Jan 28, 2013 12:42PM
Image: Teenage boy behind a stack of books -- Jupiterimages, Brand X Pictures, Getty ImagesBarnes & Noble (BKS), which has struggled for years to reinvent itself for the digital age, plans to close up to 30% of its physical stores over the next decade to shed costs in order to better compete against Amazon (AMZN) and other online rivals.

Mitchell Klipper, chief executive of Barnes & Noble's retail group, told The Wall Street Journal that the New York chain will have 450 to 500 stores in 10 years, down from its current 689 locations. The company also owns a chain of 674 college bookstores.

The only thing surprising about this announcement was that it took Barnes & Noble this long to make it. It's hard to remember at time when Barnes & Noble wasn't struggling, and this past holiday season was no different.

During the time retailers earn most of their profit, Barnes & Noble reported an 8.2% decline in comparable store sales, a key retail metric measuring the performance of locations opened for at least a year. Sales of the company's Nook e-reader, a key part of its digital business, fell short of expectations.

Wall Street hasn't thrown in the towel on Barnes & Noble. The average 52-week price target on the stock is $17.75, about 37% higher than where it traded Monday. Microsoft (MSFT) last year agreed to invest hundreds of millions of dollars in Barnes & Noble's digital business. Its road ahead, however, is not easy. (Microsoft owns and publishes moneyNOW, an MSN Money site.)

According to the Journal, Barnes & Noble expects to shutter about 20 locations a year. Until about 2009, it was opening 30 or more a year. Monday, a spokeswoman told MSN Money that Barnes & Noble has historically closed about 15 stores per year. Some of those were unprofitable while others were relocations. The company opened two prototype stores last year and will continue testing store formats this year, she added.

The new stores likely attempt to address the sea change that the book business has undergone in recent years. Amazon announced in 2011 that sales of electronic books surpassed printed editions for the first time. There's no way the book business will go back to the way things used to be.

While e-books are cheaper and more environmentally friendly because they don't sacrifice trees, shopping for them just isn't as fun as traditional books. When my 6-year-old son gets older, he probably won't believe me when I tell him of the times I spent leisurely strolling through stack after stack of freshly printed books at my local Barnes & Noble. He may laugh when I tell him that the chain sold a wide selection of caffeinated beverages to encourage people to hang out.

Things change -- but not always for the better.

--Jonathan Berr does not own shares of the listed stocks.  Follow him on Twitter @jdberr

 

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35Comments
Jan 28, 2013 1:56PM
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Amen!  There's not a better way to spend a rainy Saturday or Sunday than browsing in a bookstore.  And reading from a Nook cannot compare to cuddling up by the fireplace with an old friend of a book, dog-eared from years of reading and re-reading, and traveling to whatever exotic place that old friend takes you. 
Jan 28, 2013 2:44PM
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Digital books aren't for me cause there is something about smell of a good old book, or a new one too.

I have a Barnes & Noble near me , so I like to go in there and shop for a book. I can actually sit down and read a little in the store before I buy the book too. The only complaint I have about the store is sometimes I can't find the book I want, but that is a minor concern.

Jan 28, 2013 3:51PM
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You know, paper is actually pretty good.  No need to charge, ever...drop it by accident and it still works....works in bright sunlight...easy to share with a friend.

 

While I do appreciate being able to have 10 books on my Kindle for travelling, I do also love the books I have in my home.   They add a character and civility to life.

 

Similarly, I suppose I can buy all my food prepared and frozen - but I personally prefer to have the choice of a small restaurant or making a fine meal myself.

Jan 28, 2013 3:05PM
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It saddens me that I who prefer holding a book in my hands and turn its pages will in the future have to purchase them on line.  i love going to the store, look for book titles I may have missed, drink a cup of coffee and enjoy the presence of those who feel as I do.  I purchase many titles every year as I am an avid reader, at least 3 books each month.

Keep us reading the way we want to.  Do not close our Manhattan, NY B&N locations.

Jan 28, 2013 2:39PM
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Sorry to hear about the troubles with Barnes and Noble book store.  I will surely miss the store and it's people. Buying the new books or ordering books I couldn't fine will now be an inconvenience. I hope them the best..  
Jan 28, 2013 3:55PM
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Uh, e-books environmentally friendlier than traditional books? Do you own stock in Amazon or a producer of another e-book reader? Or maybe you're not factoring in the relative energy expenditure required to produce an e-reader, or the nonrenewable and rare materials used in its circuitry, or the environmental hazard those components, particularly the battery, may represent when they're disposed of.  Vs. a real book, nowadays probably printed on recycled paper, in any case printed in a plant where recycled pulp is being consumed to co-generate heat and electricity not just for the plant but other consumers. Proper forestry practices will ensure a continued supply of those trees you are concerned about "sacrificing," and because paper is a natural resource product, even if it not pulped at the end of its usable life, it will only pollute the environment if it's burnt.  If you threw it away in the forest, it would biodegrade centuries quicker than your e-reader, and generate more forest life instead of toxic residues.
Jan 28, 2013 4:43PM
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Ever try using your electronics when the system fails due to a hurricane , tornado etc. for weeks. I did, never again. I still have all my paper backs, paper maps etc.

I was a fool once to believe in the so called great technology. 

Never again.

Survivor of Hurricane Sandy.
Jan 28, 2013 2:55PM
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Time for mom and pop shops to start new venues.
Jan 28, 2013 3:57PM
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Save the Barnes and Noble store in Arlington, TX. We like to read and see books outside the Big Apple, too.

 Browsing in a bookstore gives us a chance to serendipitously find new, interesting books (and handle them to be sure they really are interesting) and new books by favorite authors as well. My interests, both fiction and non-fiction, are fairly broad and I can't keep up with the new books in these areas without looking at the books first-hand.

Jan 28, 2013 4:42PM
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I find it a poor excuse to place blame on Amazon for the failure of B&N stores.

 

The fault does not lie in Amazon, but in B&N PR campaign. They put sooo very much focus on their Nooks that they neglected that they are the world's largest BOOKstore!

 

Personally, when I used to enter a B&N and find that I was entering into a NOOK PR statiion where books once were---- was a turnoff and I would walk right back out the door.

 

They hurt themselves by placing too much emphasis on their own Nooks then on their Books.

 

Hence the blame game prevents them from dealing with their own downfall and fixing the actual problem.

Jan 28, 2013 3:41PM
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At my local store they have a Starbuck coffee bar and sometimes it is so crowded with students taking advantage of WiFi there's no room for paying customers

Jan 28, 2013 3:06PM
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the ones around here are really nice stores. frankly i could never understand how they could possibly move enough product every month to make a profit with such a big lease space.
Jan 28, 2013 5:49PM
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Books are history on the shelf.   Digital books are a hard drive awaiting to CRASH AND BURN.

As we know all the recent digital movies, pictures and such continue to become obsolete in a few years.

This will be the fate of digital books.

Jan 28, 2013 3:07PM
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I'm surprised that more of their stores are not closing.  I'm sure rent is quite expensive where many stores are located & the pricing of new books does not make me want to go to B&N stores very often.  A sad sign of the times!
Jan 28, 2013 5:18PM
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I love books and I agree with most of the responses; there is nothing like having a book. The smell; the dog earred pages; everything. I will not own a digital book device. I think B and N needs to lower their prices and not charge for those membership cards or whatever they call them. Grocery stores, pet stores, drug stores, all have these cards that are free and you get discounts and money back with them. B and N charges for theirs and that is a turn off to me. And books on Amazon are cheaper so they need to be more price competitive.
Jan 28, 2013 6:17PM
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no batteries required on a regular traditonal book.  and if you drop it, it gets a little dirty but you can still read it
Jan 28, 2013 7:19PM
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I know this is a story about Barnes and Noble and I, too, lament the fact that we are losing so many great book stores, including the little Mom & Pop stores.  There's just something about touching and smelling a new book that "hooks" a bibliophile.  However, don't forget about our libraries.  In recent years what with the decline of decent television I have moved to reading instead of watching TV so I go thru a LOT of books per month.  Even with big box places like Costco and Sams Club, with their deeply discounted prices you can't always get what you want and they still cost a pretty penny. 

 I have re-discovered my local library and I'm glad I did.  I have found new (to me) authors and actually I can usually find anything I need and if I can't the librarian will order it for me.  Our library gives me three weeks to read what I choose and I can always renew if need be.  I usually check out about 15 books at a time and I am even able to get quite a few popular titles in large print for my 84 year old mom, too.  If I find a book that is particularly compelling, something I know I will want to read again and again, I can always purchase it at a book store later and know it is a book that won't "go to waste" since every book is not necessarily a winner.

Besides checking out books from the library, my library has four big used book sales every year put on by a library "friends" group.  I can buy sacks and sacks of books for little money and have even found several antique and rare books at the sale.  I read both hard back and paper back books and some of the books I buy are brand new with $30 price tags and I get them for $1, a really great deal!

In short, yes, it's sad that we readers are losing a very big part of our reading life.  But remember your local library, I think you will be glad you did.

Jan 28, 2013 5:04PM
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I have had a color nook for a couple of years.  I am drifting back to paper books since it is tiresome to charge it up and then go through the waiting period  as it starts up.  Sometimes  I might just want to do a couple of pages to just rest for ten minutes and a book  with its earmark or cornered page is almost instant reading.  In addition, the wireless internet is pretty slow and some pages are hard to read on this size screen. Checking your emails is a good feature and another is the screen save for images or a map etc.
Jan 28, 2013 4:13PM
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I am now a crazy fan of Songs of Fire and Ice, also known as The

Game of Thrones.  I've seen the TV efforts of HBO, but nothing can be compared to the rich prose of these  books.  Perhaps they will ignite an interest in reading to an older demography as did the Harry Potter series.

Jan 28, 2013 5:16PM
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how can i show everyone what books I've read if I have a kindle or nook?  (sarcasm)
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