An inside look at the real reasons for the once-beloved chain's demise
For the past decade and a half, Borders seems to have been in the business of making mistakes. Consider the company’s efforts to develop an online presence. Amazon was launched in 1995, and Barnes & Noble responded with its own website two years later.
It took Borders another year to get started online, and the venture quickly lost tens of millions of dollars. In 2001, Borders made a deal with Amazon to run all of its online business—a partnership, in retrospect, that comes across as tragically shortsighted. Danielle Fox, an equity analyst then covering Borders for J.P. Morgan, says many investors were actually excited about the idea of outsourcing Borders’s online sales to Amazon, which they believed would allow the physical retailer to focus on running physical stores. Amazingly, Borders wouldn’t end the Amazon deal and launch its own website until 2008.
Abstract only. For the full story go to: