Staff -- 11/27/00
Chapters Online Cuts 73 Jobs | Sales, Losses Fall at Golden
Cash-Poor Audiohighway Eliminates 70% of Staff
September Bookstore Sales Jump 20% | netLibrary, ABC-CLIO Expand E-Book Pact
New Direction for SKP Associates
Chapters Online Cuts 73 Jobs
Chapters Online, the e-commerce arm of Canada's largest bookstore chain, plans to reduce its operating costs by eliminating 73 staff positions, roughly 18% of its workforce. The staff to be let go has been mainly involved in producing Web site features--a segment of the site the company believed was not widely used by online shoppers. The severance packages will cost the company $500,000, but is expected to save about $2 million annually.
"Our customers tell us they want to be able to find products easily, buy them securely and receive their purchases on time," said David Hainline, executive v-p and COO of Chapters Online. "We're making sure our site offers exactly what our customers are telling us they want and need from their online shopping experience."
Larry Stevenson, chairman and CEO of Chapters Online, said the layoffs would ensure the company has sufficient funds to reach its business objectives. "It was a tough decision, but the right decision for the long-term success of the business," he said. The online division has been a consistent drain, losing $6.4 million alone in the most recent quarter on sales of $12.8 million; through the first half of the year, the loss was $16.1 million.
Sales, Losses Fall at GoldenRevenues fell 19.6%, to $34.1 million, at Golden Books for the third quarter ended September 30, 2000. Net loss at the children's book publisher was reduced to $5.9 million from $9.4 million in the comparable period in 1999. The company advised that because of accounting changes, figures are not directly comparable.
Sales in Golden's consumer products division fell 18.4%, to $30.6 million. The company said the decrease was due to lower sales of Pokémon product, which was partially offset by sales of Scooby Doo and Powerpuff Girls licensed product as well as higher international sales. Revenues also include a $1.3-million settlement related to a customer's minimum purchase commitment. Sales in the entertainment division dropped 16.7%, to $3.5 million; the decline reflected lower video sales and the elimination of the music publishing business, which was sold in December 1999.
For the nine-month period, total revenues fell 5.5%, to $103.1 million, and the net loss was cut to $17.8 million from $29.3 million.
Cash-Poor Audiohighway Eliminates 70% of StaffWith an accumulated deficit of $37.2 million and working capital of $163,000 as of September 30, 2000, Audiohighway.com laid off approximately 70% of its workforce earlier this month and
According to the company's quarterly filing with the Securities and Exchange Commission, Audiohighway d s not have enough capital to continue operating for the next 12 months, and that while it is looking for new funds, Audiohighway had no firm commitment at the time of the filing.
Results for the third quarter were disappointing, with revenues falling from $613,000 in last year's third period to $483,000, while the company's net loss rose to $3.2 million from $2.8 million. Audiohighway attributed the decline to the company's refocusing e-commerce sales toward higher margin products as well as to a decline in advertising revenue. For the nine-month period, sales increased 92.8% to $2 million, while its net loss deepened to $12 million.
September Bookstore Sales Jump 20%September marked the second consecutive month that retail bookstore sales rose by more than 20% over the comparable month in 1999. According to preliminary estimates from the Census Bureau, bookstore sales increased 20.1% in September, to $1.46 billion, far surpassing the 7.7% increase posted by the entire retail sector. For the first nine months of 2000, bookstore sales totaled $11.05 billion, an increase of 11.5%, and a gain that outpaced the 9.3% increase recorded by all of retail.
netLibrary, ABC-CLIO Expand E-Book PactnetLibrary, an e-book distributor and e-publishing services provider, announced an expanded agreement with reference book publisher ABC-CLIO to distribute its frontlist titles as e-books to academic, public and special libraries. Rich Rosy, netLibrary's executive v-p of sales, said its library customers have shown a "healthy demand for ABC-CLIO's reference content in e-book format."
NetLibrary has been digitizing, hosting and distributing ABC-CLIO content since 1998 and offers 250 ABC-CLIO backlist digital titles. The new deal will offer e-book versions of upcoming ABC-CLIO titles on the Burger Supreme Court and popular culture as well as ABC-CLIO encyclopedias on religion, the Civil War and other historical topics.
Vince Duggan, v-p of sales and marketing at ABC-CLIO, pointed to "fine sales results" from e-book editions of the company's Contemporary World Issues and World Bibliographic Series. "E-books have become increasingly more sophisticated as research tools that have begun to change the way we define books and publishing as a whole," said Duggan.
New Direction for SKP AssociatesBoth the Book Industry Study Group and the American Book Producers Association have begun searching for a new managing agent following the announcement that SKP Associates will be relocating from New York City to Miami, Fla., effective December 1, and will no longer offer association management services.
SKP was founded in 1978 by Sandy Paul, who has been named CEO of Ocean Books USA, the U.S. division of Ocean Books UK, a company that manages libraries aboard nearly a hundred ocean liners. Paul will remain president of SKP from Miami and will continue as president of the North American VISTA Users Group. And in the near term, Paul will represent BISG at several meetings around the country.
Although Paul had been the long-time managing agent for BISG, she assumed the title of executive director earlier this year as BISG assumed American responsibility for ONIX International and for activities related to e-books, XML and other areas of technology. BISG chairman Richard Hunt of F&W Publications said a search committee and transition team has been formed "to work through the next steps." Hunt said BISG "wishes Sandy all the best in her new home and position," and added, "We thank her for the considerable progress we've made on ONIX and other initiatives in the recent past."
Volume 246 Issue 48 11/27/2000