MAIN NEWS HEADLINES
November 6 – November 13, 2008 Edition
B&N Chairman
Tells Staff to Brace
For Lean Holidays
NEW YORK, NY (Authorlink News/11/6/08)–Leonard Riggio, chairman of Barnes & Noble, Inc., sent a memo to the companys 40,000 employees last week, alerting them to brace for hard times, according to the Wall Street Journal.
“Never in all of the years I’ve been in business have I seen a worse outlook for the economy,” wrote Mr. Riggio. “And never in all my years as a bookseller have I seen a retail climate as poor as the one we are in. Nothing even close.”
He said that the full extent of Americas financial disasters is unknown. He warned that uncertainty itself can lead to more damage in the system, and thereby help accelerate the downward slide. Alas, we live in a consumer-driven economy: the paradox being that if we don’t spend, we go broke.
Barnes & Noble has suffered from this crisis, albeit not as severely as most retailers, and certainly not as much as other booksellers, he said. Barnes & Noble comparable store sales have declined for the first time in the companys history. As a result, we are bracing for a terrible holiday season, and expect the trend to continue well into 2009, and perhaps beyond, Riggio said.
On the macro front, many millions of Americans will be laid off, money will be scarce nonetheless, and many once famous retailers will shut their doors. We will not be one of them, he declared. Still, the decline in retail traffic will affect our business as less people will pass our doors, and competition for the remaining business will become more intense. The result will be a “Darwinian” environment (only the fittest will survive), and the retail species will have to adapt or face extinction. We have and will continue to adapt, and we plan to be around for a long time.
Riggio said that the company still intends to pay out a $50 million dividend to our shareholders this year. In addition, B&N has a solid balance sheet, excellent standing with the banking community, and more importantly, a large line of unused credit to draw upon. And, even with this year’s large sales shortfall, we will make a decent profit, and end the year without owing a penny to our banks.
He concluded by writing, The main purpose of this forthright and heartfelt communication is to assure everyone that the leaders of this great company remain committed to the common good.
Finally, customer service becomes ever more important in times like these. And, as Mitchell might say, Put the book in our customers’ hands and don’t keep them waiting in line!
