Total sales at the nation's three largest bookstore chains fell 3.5% in the year ended January 31, dropping to just under $8 billion. Borders had the worst year, by far, with sales falling 17.6%, to approximately $2.3 billion. The decline at Borders came before the chain's February 16 bankruptcy filing and subsequent announcement that it will close 225 superstores during the first half of 2011. Although sales from Borders, Barnes & Noble, and Books-A-Million have fallen annually since peaking at $9.4 billion in 2007, they had been dropping at a relatively modest rate. The combination of Borders's downsizing and the growing popularity of e-books, however, is certain to accelerate the rate of decline in 2011.
BAM executives were the most recent booksellers to cite the rise in e-book sales as a factor in their sales decline, with the company's Terry Finley saying on a conference call discussing year-end results last week that the popularity of e-books and digital sales channels had hurt BAM last year, particularly in the fourth quarter. BAM did well selling Nook digital readers in the final quarter, executives said, but the chain's e-bookstore has gained little traction. BAM could point to one accomplishment in 2010 that its rivals could not—it operated more stores at the end of the year than it did in the beginning. BAM finished 2010 with 231 outlets compared to 225 at the start of the year. BAM is shifting its mix of stores, however, putting more emphasis on smaller format stores than superstores. During the year, BAM opened nine smaller stores and one superstore as well as its first used bookstore, 2nd & Charles; it also converted a superstore to a second 2nd & Charles outlet. The company closed five outlets in the year.
B&N was the only one of the big three to post a sales increase in the year, with the gain due entirely to increases at BN.com. The gains at BN.com, fueled by sales of e-books, actually helped to slow the rate of decrease at the top three chains last year; in 2009, sales through the three fell 6.9% compared to the 3.5% decline in 2010. B&N's strength in the e-book market and the downsizing of Borders is certain to increase its market share in 2011 compared to its two competitors. Of the total revenue generated by the top three chains in 2010, B&N had a 65% share, up from 60% in 2009; Borders's share fell to 29%, from 34%, while BAM held even at 6%.
Chain Sales, 2009–2010 (In millions) Full Year
|Barnes & Noble*||$4,965.1||$5,176.0||4.3%|
Books-A-Million, 2010 Results ($ in millions)