Borders Inches Closer to Liquidation. What Happens Next?
The deadline to save Borders passed yesterday, meaning that they will now proceed to a bankruptcy-court auction tomorrow.
It’s not quite over for America’s second-largest bookstore chain, and a bidder could still emerge in the next day-and-a-half to save the company – which employs nearly 11,000 people – from being liquidated.
In fact, the Wall Street Journal reported today that Books-A-Million were in talks late last night about a deal. However, it seems clear that even if this move comes off, which is doubtful, it will only rescue part of the company, and a large amount of (further) store closures and layoffs is unavoidable.
It seems likely now that the bones of Borders will be picked apart, and the remaining investors will only seek to purchase unencumbered assets such as the brand name, the website, and the customer lists, leaving the stores themselves facing oblivion.
There is a certain grim inevitability about this news, which will hit publishers and their authors, as well as the Borders staff and their families, particularly hard.
Even if a last-minute investor is able to prevent liquidation, Borders will never be the book buying force it once was.
Since I started this blog, I have argued that print is doomed, and its collapse will take most bookstores with it, but I take no pleasure in being proved right.
What we are seeing now are the “negative feedback loops” that LibraryThing’s Tim Spalding predicted nine months ago.
Each drop in print sales causes bookstore closures, which means less stores to sell books, which means lower print runs, which means higher printing costs, which means higher prices, which means another drop in print sales.
Each bookstore closure is another town forced to go online to buy books, which leads to an increase in Amazon’s market share, which means more readers exposed to their wall-to-wall urgings to switch to the Kindle and e-books, which means a further drop in print sales, and more bookstore closures.
Each publisher reducing print runs must increase the retail price of their books, which makes the price difference between print and digital versions even more dramatic, which encourages more people to switch to e-books, which reduces print runs and increases costs.
As printing costs become more expensive, more publishers will release more titles as digital-only or digital-first editions which will encourage even more to switch to e-books, causing further bookstore closures.
This is a series of vicious circles, all feeding into each other.
Most of the argument surrounding how much market share e-books will capture seems to center on the advantages and disadvantages of e-books, e-readers, and e-bookstores in their current form. This ignores how the format, devices, and book buying experiences will evolve.
More importantly, it ignores all the readers who will be forced to switch to e-books for one reason or another, whether that’s down to the restricted selection of print titles or the increased cost.
Joe Konrath wrote an excellent post yesterday, focusing on what this Borders news means for midlisters. He argues, persuasively, that burden to shift print books will pass to the boxstores who only stock bestsellers:
This will mean fewer books printed, fewer books sold, and fewer choices for readers until they’re forced to buy an ereading device if they want to read anything other than Stephen King and James Patterson.
The obvious corollary is that if you are not of the same ilk of King and Patterson, that most of your future sales will be digital. And if this is the case, why go with a publisher at all? After all, as Joe points out, a 70% royalty is a lot more than a 17.5% royalty.
A new writer, deciding whether to self-publish or to submit to agents, needs to consider not just what the market is like now. They need to look at where its going to be in two years.
That’s the absolute quickest any new writer could get through the query system, snag an agent, go on submission, receive an offer, go through the lengthy publication process, and finally hit the bookstore shelves.
For most, of course, it will take significantly longer than that (if they are one of the tiny percentage that is successful at all). So a new writer, being a little more realistic, needs to look at where the market is going to be in three years, or even five years.
Will there even be agents accepting queries from unpublished writers in five years? Will there even be agents in five years? I don’t think anyone can answer in the affirmative with any confidence.
This might seem like heresy to defenders of the status quo, but as Joe points out:
This message needs to be repeated, over and over and over, because there are still thousands of authors who spend their hard-earned $$$ on conventions that supposedly teach them how to write killer query letters.
Of course, it goes without saying that this is money that could be spent on hiring a professional editor, a professional cover designer, and publishing yourself.
And all that time spent researching agents, learning how to write query letters, personalizing each submission, sending off each partial, and waiting for responses that will never come could be spent building an audience or, you know, writing.
Writing stuff you can publish yourself.
Writers have more choices than ever before. And I firmly believe that this is a great time to be a writer. But only if writers seize the opportunity that is staring them in the face.
The choice is yours.
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14 Comments
A most persuasive case for ditching the traditional method for representation. I hope someone counters for the other side.
I'm not saying that publishers should be avoided, or that agents should be avoided, I'm saying that authors should consider self-publishing, because if there book is good enough to get a deal, it's good enough to do well as a self-published work (as long as they approach it with professionalism). If it is a success, they can then deal with agents and publishers from a position of strength and get a better deal, if that's the way they want to go.
Dave, you talk in your blog about the time that a writer may spend in trying to attract an agent, get a deal, etc, instead of actually writing. But how about the time that writer will have to spend in publicising their self-published book? Even just at a level of Facebook and Twitter (which are unlikely to shift many copies) and blogs, it all takes a lot of time. I am a traditionally published author and I couldn't possibly find the time to write my books if I also had to promote them every day. As it is, I've just finished writing a small kit for a publisher and it's taken me days and days to fill in their author's questionnaire which they use for publicity purposes.
As for the problem with local bookshops going into a decline and closing, I know there are all sorts of difficulties in the publishing trade at the moment, but if we all actually bought books from our local bookshops instead of buying them from Amazon and rejoicing in a saving of a few pounds/dollars, while regretting the demise of the local bookshop, maybe the story would be very different. Our local bookshop is hanging on by a thread, I expect, but it's still there because it has lots of loyal customers. And the delivery time is a damn sight quicker than Amazon's.
I also worry about the possibility of talking ourselves into a depressed state of publishing. Just as commentators in the UK are in danger of talking us into another recession because they sow so many seeds of doubt and fear about the state of the economy. They don't seem to realize the harm they do by endlessly harping on about double dips and so forth. And the same is true, I suspect, for publishing. It isn't dead so we shouldn't start preparing for its funeral.
Sorry if I sound vehement. I feel very strongly about this, having spent all my career in publishing, first on one side of the editor's desk and then on the other. Yes, it's a flawed business but it has always been that way. Yes, it's in a state of flux but it's often been that way, too. And there are many areas of traditional publishing that will never translate to e-books, such as reference books, because they cost such a massive amount of money to produce. And websites don't perform the same function because they are often full of errors and omissions. Because they are self-published, often without any editor to oversee the process and provide a second pair of eyes.
the self publish ebook argument;
pro:
royalties,
ease of publication,
speed,
post publishing modifications,
Con,
I want a book on a bookshelf somewhere with my name on it.
Near the top of the long list of things I am crap at is marketing.
I watch this one with selfish interest.
Prop
You make a series of excellent points. I can't respond now, I'm up against a deadline myself and I'm knee deep in formatting, but I will get back to you later.
This kind of phenomenon is really more of a tipping-point than a loop. That's not semantics. It's just we all recognise that with a tipping-point the closer we get to the tip, the faster the change happens. Then its 'too late', then it tips, then its done, not reversible.
There are many other areas in which this pattern of change is currently manifesting.
In terms of what we're all to do about it, well I think you have it. We keep a weather eye on the old ways and take what we've learned then adapt that to the new ways - and the quicker the better. What choice do we have? We can do it whole-heartedly or reluctantly or partly or discerningly and we can look back sentimentally but we have to do it.
For the moment, Amazon is the most powerful story platform on the planet. They're a progressive company and have now cornered the e-reader market with the Kindle... for the moment. Their online platform will get more mobile and more sophisticated. Like Google, they have a lot of bright young things working for them. And like Google they are (on the surface at least) very agile and user-led. And Amazon favour self-publishing.
As people join the self-publishing frenzy there will surely be a drop in quality. But that's okay. People who believe in quality will maintain it. And quality will surely be a factor in the rise to the top of the heap - or the surface of the porridge, or whatever. :) I'm sure that you're correct - as writers, we abandon professional editing at our peril. I'm not so sure about the future of the 'cover' but again, its an area for the professional. There are still some fundamental laws.
Interesting times.
I wonder how typical I would be? If I do represent a substantial chunk of the public, then this means the situation may be a little more complex than we assume, as people are going to bookshops because of Amazon rather than despite it.
If we continue to purchase ebooks what will happen to author book signings? Will authors just not bother doing them as they have nothing for the reader to sign, or will they have to create some special device to electronically sign Kindles and iPads?
I'm very old fashioned I'm afraid and I also agree with Aonghus Fallon. I always purchased from my local book store until it closed. Now, I try and support Waterstone's in my own little way and will always purchase from them. I have currently set up a reading and writing scheme for children and am giving away free books for the scheme. I have paid out over £400 for books which the children could have downloaded from Amazon for free.
Mad you say? Yes, I probably am, but if my small contribution to the industry can help in just this small way, then I'll try my best.
The children are given the books and once they have finished reading them they write their favorite part inside the cover and pass it on to another group who are waiting to review the book. This will happen until the front covers are full.
How wonderful is it that a child can open a book and see many favorite chapters and parts that they just can't wait to read? Can they get that from an ebook? Probably not.
Although I am not completely against ebooks I feel that they should run alongside the traditional book rather than take over. As I am a first time writer (for children) I would love to become published. The self publishing route does not appeal to me at all as I would love to feel part of a business and have colleagues and friends I could work with, and really feel a part of something. To me, being self published would feel lonely and demanding - but that's just me.
So, another good blog which raises yet more unanswerable questions!
I had a first look at a KIndle at the weekend. Tacky little plastic things, aren't they?
That said, there's nothing to beat browsing in a bookshop to find new books and authors (as opposed to ones I know I like - I never browse on Amazon), and I just came away from a weekend in Hay-on-Wye with five bags of books, so there's definitely a place for the bookshop still. I'd be very sad if they all went (the loss of the Borders here was really sad. It's a TK Maxx now. There is no justice in the world).
GD, I don't have any children but my little nephew was very slow to start reading, despite coming from a family of bookworms. He didn't like reading, apparently, and there was much concern among his teachers. Then suddenly he got the bug and now every birthday and Christmas present for him is either a book or a book token. It's made a huge difference to his character, his vocabulary and his ideas. I now think he's going to be a writer because of some of the things he says.
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