Another Deal Bites the Dust: Borders Goes Bankrupt

I’m a book freak.  I even love the smell of bookstores. 

So Borders' high-profile failure bums me out.  But you could see it coming.

This was a Kmart deal, born in the blending of Waldenbooks (bought in 1984) with the 1992 purchase of Borders.  Granted, there were a few good years.  But the two booksellers never became fully integrated, and that was the chicken that eventually came home to roost.  Borders never succeeded in combining its computer inventory management systems with Walden’s.  The dual systems bogged down Borders’ operations, while Barnes & Noble and Amazon rocketed ahead with better technology.

Then the management problems started.  Since 1999, Borders has not been headed up by an experienced book person.  That led to some bad strategy, and as more and more executives were drawn from outside the industry, the resulting culture clash took its toll on Borders’ financial results.

Well, that’s enough to slowly grind a deal into the dirt:  Big integration mistakes, executives at Borders without industry experience fouling up the strategy, and serious culture clash.  Plus, on top of all that, Amazon was putting relentless pressure on booksellers who were trying to make a go of it with traditional brick-and-mortar stores.

Of course, that’s the nature of mergers in today’s world of high-velocity change.  They just don’t have the margin for error that they had in the past.  Three strikes and, hey, you’re out. 

Game over.