Barnes & Noble founder Len Riggio, who returned as CEO in August following the sudden dismissal of Ron Boire, worked to assure shareholders, publishers and B&N employees that he is committed to growing the business during a Thursday conference call after the retailer’s release of disappointing results for the quarter ended July 30, 2016.
Riggio said B&N has lots of initiatives in the works to improve customer store traffic and improve sale “conversions” in the stores. He pointed to the planned introduction of four (or five) new concept stores set to open in the next few months. While he said B&N is confident the new stores, which will feature large cafes offering beer and wine, will bring in more customers, Riggio said if the stores don’t work it will be “back to the drawing board” to test other concepts. “We are not just going to close stores and go home. We are committed to this business,” he said.
Riggio and other B&N executives did not directly address the question of Boire’s ouster, but there were plenty of clues. Book sales in the quarter were below expectations and while the lack of big hits and the levelling off of adult coloring book sales were cited as one reason for the 6.0% decline in comp store sales in the quarter, the lack of books—and personnel—in the stores also played a role.
In his remarks, CFO Allen Lindstrom said B&N returned a “significant” amount of inventory in the quarter, something that the company is now addressing on a story by store basis. Riggio said B&N “[shot] ourselves in the foot somewhat by making unprecedented inventory reductions” as well “cutting expenses in the worst areas, mainly retail floor personnel. These conditions are being remedied as we speak.” B&N's broad selection is what sets it apart form other bookstores, he said.
Riggio said that while he would like to find a new CEO “sooner rather than later, I’ll not rush headlong this time because I am more than willing to put the time and effort into all the tasks at hand.”
Despite the disappointing first-quarter results, Riggio said there are no plans to close more than the 12 outlets that have already been targeted to shut. He noted that B&N will begin testing some new locations for stores and said most landlords are happy work with the chain to fine better sites.
He also promised that B&N would “jazz up” its in-store merchandising and do more promotional work in the stores. “No one in the company feels like doom and gloom, and all of us are committee, we love what we do,” he said.