Monday, February 21, 2011

a résumé of reasons for the demise of Whitcoulls, Borders etc

Those who have read our posts on this subject since 2009 shouldn't be surprised at the turn of events announced officially last Thursday.

Here are some of the reasons that we have mentioned for the demise of REDgroup:-

* treating their stores as giant dump-bins for overseas remainders

* trying to compete with Paper Plus, the $2 Shop and The Warehouse for the same product lines - sure there are big profit margins involved with these lines, but that doesn't mean you can do it better than they can

* centralising all buying decisions into the Head Office, based at first in Auckland and then moving that to Australia

* then letting the buyer for NZ titles go, having one person responsible for everything (typically the publishers/distributors in Australia alone were showing the booktrade 2,000 new titles a month, how can one person cope with that let alone NZ as well?)

*  deliberately staffing their stores with school leavers and recent migrants on the minimum wage who have no knowledge of or interest in the products they sell

* ignoring locally published titles except those by or about "big names"

* having an absolutely hopeless website

* pricing normal full price books 12-15% above the recommended retail prices

* expecting loss leaders to bring in customers to buy the aforementioned over-priced books - people aren't that stupid

Graham Beattie also has this piece on his blog.

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