What happened to Borders? It is a classic American business tale of rags to bankruptcy in little more than a generation. Their classic marketing plan, “Let’s Get Big,” made it happen. Here are some of the key details concerning its U.S. operations.
Brothers Tom and Louis Borders founded their first bookstore in Ann Arbor, Michigan, in 1971. With its book wholesaler sister company, Borders primarily serviced more independent book stores than its own book stores until 1989 when company management decided to expand. It did and it got bought.
Kmart had already owned the mall-based book chain Waldenbooks since 1984 when it bought Borders in 1992. But not long after, Kmart faced management and stockholder problems with the acquisition, not to mention fierce competition from rival Barnes & Noble. So Kmart spun off Borders and by 2003 the new Borders Group had grown to 1249 stores, using the Borders and Waldenbooks names worldwide.
In 2004, Borders reached an agreement with Seattle's Best Coffee to operate cafés in its domestic superstores. In 2007, Borders installed digital video monitors in select stores and in 2009, it offered customers a free WiFi network.
Border went international in 1997 with expansion into Asia and the UK. However, by the end of 2009, all of Borders directly owned overseas locations had been sold or closed. Only the franchise stores in Dubai, Malaysia and Oman remain open.
The company showed its last profit in 2006. On February 16, 2011, the company announced that it had filed for Chapter 11 bankruptcy protection and that it would be closing up to 275 of its 642 bookstores. All of the stores to be closed would be superstores. Borders listed $1.275 billion in assets and $1.293 billion in debts in its filing. It employs approximately 19,500 people.