To counter a continuing decline in sales, Barnes & Noble CEO Demos Parneros outlined a number of initiatives the chain is taking to improve its merchandising efforts. During a conference call Thursday detailing the chain's first quarter results, in which sales fell 6.6%, Parneros made a surprising announcement. He said he hopes that in fiscal 2019 (which starts May 2018) the company will start to grow its store count.
“We are reviewing our entire portfolio in identifying opportunities to open new stores in new markets," he said. Parneros added that the chain is considering how "to relocate stores as their leases expire, instead of simply vacating markets." The goal, he continued, "is to position the company for net store expansion.”
B&N has been closing stores steadily for years. It shuttered one store in the most recent quarter, and now has 632 outlets. Parneros said that, with the leases of about 130 stores set to expire annually over the next few years, B&N has an opportunity for either “renewing or relocating” stores.
“In the past couple of years, we have closed some stores in markets we like very much," Parneros explained. "So we’ve got our eyes on those markets. There are also some very attractive targets where we don’t have stores.”
Any new store will likely be smaller than an average current B&N outlet. Parneros said B&N has been developing a smaller prototype store that is almost ready to test. He told analysts that B&N is not against keeping larger stores, but that “as a rule of thumb, if we can be a little smaller we’ll do that.”
Parneros said the exact timetable for growing the store base was less important than to position the company to move from a net loss of stores to net growth.