Barnes & Noble (BKS) Looks to Cut Store Count by One-Third, But Competition Looms
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Barnes & Noble (NYSE: BKS) is leaning more and more on its NOOK e-reader and tablet lineup, looking to trim overhead with massive store closings.
According to CEO Mitchell Klipper, Barnes & Noble plans to run about 450 to 500 stores within the next 10 years, which assumes store closings of 20 per year. Those numbers compare with 689 retail locations being open as of January 23rd, not including about 674 college campus locations. Barnes & Noble range about 726 stores at its peak in 2008.
Barnes & Noble had been closing about 15 stores per year over the last 10 years, but that was offset with the opening of 30 stores on average through 2009.
Though the shift will be different for Barnes & Noble, the change has already been taking place. Latest Nielsen data had sales of print books down 9 percent in 2012 and down 22 percent since 2007.
The biggest competitive threat to Barnes & Noble is Amazon.com (Nasdaq: AMZN), which sells its market-leading Kindle line of tablets and readers, not to mention also having a robust e-book library. There's also Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG), and Samsung to deal with. Competition has pressured NOOK sales, with Barnes &Noble affirming this via its sales update for Holiday 2012, showing an 8.2 percent drop in retail comps and NOOK sales falling 12.6 percent.
Klipper also notes that just 3 percent of Barnes & Noble locations are deemed 'unprofitable.'
Shares are flat in early trading Monday.
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According to CEO Mitchell Klipper, Barnes & Noble plans to run about 450 to 500 stores within the next 10 years, which assumes store closings of 20 per year. Those numbers compare with 689 retail locations being open as of January 23rd, not including about 674 college campus locations. Barnes & Noble range about 726 stores at its peak in 2008.
Barnes & Noble had been closing about 15 stores per year over the last 10 years, but that was offset with the opening of 30 stores on average through 2009.
Though the shift will be different for Barnes & Noble, the change has already been taking place. Latest Nielsen data had sales of print books down 9 percent in 2012 and down 22 percent since 2007.
The biggest competitive threat to Barnes & Noble is Amazon.com (Nasdaq: AMZN), which sells its market-leading Kindle line of tablets and readers, not to mention also having a robust e-book library. There's also Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG), and Samsung to deal with. Competition has pressured NOOK sales, with Barnes &Noble affirming this via its sales update for Holiday 2012, showing an 8.2 percent drop in retail comps and NOOK sales falling 12.6 percent.
Klipper also notes that just 3 percent of Barnes & Noble locations are deemed 'unprofitable.'
Shares are flat in early trading Monday.
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