B&N Prepares for Terrible Holiday
-- Publishers Weekly, 11/3/2008 12:31:00 PM
In a memo sent to employees last week, Barnes & Noble chairman Len Riggio said with the retail environment the worst he has ever seen as a bookseller, the nation’s largest bookstore chain is “bracing for a terrible holiday, and expect[s] the trend to continue well into 2009, and perhaps beyond.” The release of the memo was first reported this afternoon by the Wall Street Journal.
Riggio’s remarks follow statements made by B&N CFO Joe Lombardi in early September at an investor’s conference, where he said the retail environment was the worst the company had seen in 30 years. The company’s same store sales were down in the first part of the year, and the company projected that same store sales would fall in the low-single digits in the just ended third quarter.
While Riggio said he still expects B&N to post a “decent profit” this year, the difficult financial environment means the retailer will need to be even more diligent with expense controls, inventory management and capital expenditures. B&N will continue to invest in its systems, but new store openings will be curtailed and discretionary spending “cut to the bone,” Riggio wrote. In its second quarter report, B&N said it was reducing new store openings in 2009 to 20 to 25, down from its usual openings of 30 to 35 stores. A spokesperson said the company has issued no new figures for its 2009 plans. Any changes to its plans for new stores would likely come when B&N releases its third quarter results on November 20.
