Chain Closes the Book on Number of Stores for 2010
As part of its strategy to right-size its specialty retail segment, Borders Group says it will close approximately 200 Waldenbooks stores in January, leaving about 130 mall-based locations open.
“America has a number of malls that continue to do well and draw customer traffic, even in the current economy,” said Ron Marshall, Borders’ group chief executive officer. “We believe there remains an opportunity to profitably operate a much smaller Waldenbooks segment that complements our core Borders superstore business. Through this right-sizing, we will reduce the number of stores with operating losses, reduce our overall rent expense and lease-adjusted leverage, and generate cash flow through sales and working capital reductions.”
Stores that remain open will be integrated in the Borders superstore computer system, an investment Borders Group is making to merge all stores to a single platform. This is expected to produce operating efficiencies as well as benefits for mall shoppers.
The mall-based right-sizing initiative has been ongoing at Borders Group for a number of years as the retailer has closed underperforming Waldenbooks Specialty Retail stores annually as part of its overall turnaround strategy. The company shuttered 112 stores in this segment in fiscal 2008 and from fiscal 2001 through 2007, closed an average of 66 stores per year.