Barnes & Noble announced that its board is evaluating strategic alternatives to improve shareholder value, including the possible sale of the company.
According to reports, like other booksellers, B&N struggles with the changing publishing industry and retail environment. In recent years, books sales have moved to other big-box retailers and to online competitors such as Amazon. In addition, reading habits are changing as e-books and e-readers become more popular. B&N made efforts to adapt to the changing environment with its large online store and electronic reading options however, sales at the brick and mortar stores are still a significant part of the business.
David Schick, managing director at Stifel Nicolaus commented, “There’s been a long series of pressures. The market has not been kind to bookstores, and it’s for new reasons like competition with Apple and Amazon, and it’s for old reasons, like what we believe has been a decline in reading for the last 20 years. Americans have devoted less of what we call media time to books.”
An article from Reuters says that Leonard Riggo, founder of B&N, may be a possible buyer along with a larger investor group. The article notes that going private could help the company realign its business and invest more in digital options.
For college stores the future of B&N has interesting implications. As one of the largest contract management companies serving the college store industry, the fate of the company could ultimately affect hundreds of college campuses. Textbook publishers likely also feel concern as the number of large channel-aggregating players diminishes – leaving them to negotiate with a few players, such as Amazon and Apple, over future pricing models for their products. As the future of B&N and B&N College awaits determination, college stores might take the opportunity to ask themselves what they are doing to remain viable and relevant into the future, and how we improve the value we provide to our “shareholders” – students, faculty, and institutions.