Robot 6

Diamond puts Borders on hold

Word is rocketing around the blogosphere that Diamond Book Distributors has suspended shipments to Borders stores because the book chain suspended payments to its suppliers earlier this week. Tom Spurgeon of The Comics Reporter got hold of an internal e-mail from Diamond Vice President of Purchasing Bill Schanes to several executives that says

This email is to confirm reports in the news that Borders is suspending payments to its suppliers, including Diamond. As a result, we have made the difficult decision to stop shipping them and put their account on hold, as of last week, until such time as they are able to resume payment.

Borders has been failing for a while (here’s a great account of what went wrong with Borders at The Atlantic’s blogs), and the chain confirmed on December 30 that it was delaying payments to vendors while it works on restructuring its debt. The next day, Calvin Reid of Publishers Weekly reported that one of the “big six” New York publishing houses had stopped shipping boos to Borders, and he added

Borders carries about $450 million in trade payables on its balance sheet and many publishers are anxiously waiting to see which houses will be paid and which will not be.

What’s more, with 509 Borders superstores and 168 Waldenbooks stores in the U.S., Borders is a significant segment of the retail market. Diamond handles distribution for Image and Oni Press, which dominated trade paperback sales in 2010 with multiple volumes of The Walking Dead and Scott Pilgrim making the top 20 graphic novels chart for the year, and it also handles distribution for Dark Horse, IDW, Dynamite and a host of smaller companies, from Abstract Studio to Zenescope. Borders may not specialize in comics, but it was a pioneer in bringing graphic novels and manga to the masses; ICv2 estimates that over 20% of manga sales in the bookstore channel are through Borders. If “delaying payments” turns into “never paying,” a lot of companies could take a big hit—and it’s reasonable to worry that some might not survive.

On the other hand, as ICv2 explains, if Borders does to into Chapter 11 bankruptcy, it may be able to pay its suppliers first, so it can get more product into the stores and start selling again.

Update: Here’s the text of the email, as received by Comic Book Resources:

This email is to confirm reports in the news that Borders is suspending payments to its suppliers, including Diamond. As a result, we have made the difficult decision to stop shipping them and put their account on hold, as of last week, until such time as they are able to resume payment.

DBD is actively seeking a resolution to this issue and will work with Borders to get shipments moving again provided that we can craft a solution that proves to be in the best interests of both DBD and our publishers. 

If you have any additional questions or concerns, please feel free to drop me an email or give me a call.

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Comments

22 Comments

This is bad news for the comics industry. Numbers will continue to decrease and it definitely will hurt the smaller companies such as ONI, Dark Horse and Top Shelf. I rarely purchased any comics, trades and/or graphic novels at these places as I would much rather $UPPORT my local comic shop(s). I do see this as a good thing for them- you want the new trade paperback of Superman, Scott Pilgrim or Spidey- head down to the comic shop!

Unfortunately, these shops are a gateway to the comic book store, but business is business. Hopefully the shops can continue to find more ways to be proactive in their community!

I do find it ironic there is a borders ad underneath this as I am about to submit.

Eric Mengel
http://www.ochocomics.com

this is another sign that sadly Boarders may soon be calling a bankrupty lawer for no goods shipped means boarders has no new stock . which means one less route for the companies to get their stuff to new buyers .though hope boarders finds some way to get back on track and pay dimond and its other suppliers

Shop at Book-a-Million in store and online. They have waaaaaay better discounts than Borders.

charlieromeobravo

January 13, 2011 at 10:43 am

My understanding (from another article I read) is that Marvel and DC don’t distribute their trades to book stores via Diamond but this still sucks for the comic industry and for us. I buy most of my trades through Borders because I regularly get 30 to 40% off coupons from them in my email. It’s going to really hurt sales for books like The Walking Dead and Scott Pilgrim that have mainstream buzz.

Why on earth would anyone support Borders when they could go to their local comic book shop? They have a crappy selection anyways. Not only that, even if you don’t have a good comic shop near you, there are dozens of online comic shops that offer substantial discounts. http://www.instocktrades.com is a personal favorite.

Marvel uses Hachette Book Group and DC uses Random House for bookstore distribution.

I can’t remember the last time I paid full retail price for a trade paperback…or ANY book for that matter! :-O

Bookstores are going the same way of the Video Rental store, dinosaurs of a bygone era.

There is a mass of people that still pay full price at bookstores. They are dumb and number in the millions.

I browse at bookstores, and order online. No tax. No shipping. Mwahahaha!

So far, of the two “big” chains, Borders has been the only one I’ve been able to hold book signings in over the past few months. Barnes and Noble charges publishers a nearly 50% discount to hold books in stock, which is fine for Big Houses, but not for the smaller press that published my book. But the flipside is that Borders won’t list me on their website because I have no agent–even though I sign and lecture at their stores! Barnes and Noble allows me to be listed, as does Amazon (and you can type Charles J. Baserap in either to see I’m not just making this up), so I’m kind of hoping if one buys out the other, they keep Barnes and Noble’s listing policy, but make it easier for my publisher to afford getting books in the store like Borders!

I love bookstores for many reasons and I’d be sad to see them go away. I will say that B&N’s Member Discount card is far better than the one at Borders, but either way, I love just shopping around at these stores. As far as comics go, I always go to my local shop each Wednesday, but sometimes I’ll pick up a graphic novel my store my not stock for whatever reason since my B&N discount is bigger than my LCS one.

A few months back, it seemed Borders was in position to buy out a piece of B&N, but now it seems fortunes have reversed.

I guess I’m just old fashioned, though only 31–there’s something about actually having and holding a book I like much better than just reading one on a screen. The latter seems so clinical and cold, but it’ll happen eventually.

Either way, I’m curiously watching this whole situation because for a small fry like me, this could either hurt or help me, and I need as much of the latter as I can darn well get!

-Charles J. Baserap

the Barnes and Noble in my neck of the woods is closing. And I have two Borders within 30 minutes of me.

@ Trey
And in five years, you won’t.

Browsing at bookstores will become impossible without bookstores.
And bookstores are going away.

Now how will you browse? LCS around the country are discontinuing
the practice of letting customers linger and browse. I guess you’ll just
have to buy blindly, or steal them via online.

Print’s decline, strangely enough, parallels the decline of many Western economies and the rise of information technology. I wonder if all three trends are related.

I regularly buy my trades at Borders here in Oahu, Hawaii, because 1) I, too, get the 33%-40% discount and they have a great selection, and 2) the people at my LCS (which is just a tiny corner of a larger used book/CD store, yes, I’m looking at YOU, Jelly’s) can’t deign to order anything worthwhile in sufficient copies or offer a discount to regular customers. Because of the regular crappiness of selection of new floppies, I’m increasingly moving to trades, which, as stated above, I can buy at Borders for much less.

@Matt: Remember not everyone has an LCS. To many people the big box stores are it.

AMERICA sucks in plain english

January 13, 2011 at 10:29 pm

This is a major blow to the comic industry.
Thank goodness for AMAZON with their CHEAPer GN prices anyway.

Oh to the the poster who said ” why not support your local comic shop”?
well i live in NJ and have to drive 30 minutes to a shitty LCS that is more into D&D gaming than a clean invantory.

No imagine other states in the shitty USA …. good luck fining a comic shop.

IF you have to make a planned vacation just to get to a comic shop– that says the day of digital distribution is the only viable way to keep this industry afloat.

Anthhony,

Have you checked out Gecko Books? It’s in the Kaimuki area. They have a discount for regulars and their selection is very good, both monthlies and trades.

I don’t know about the Borders stores in the US, but the ones here in Australia need to have their pricing system investigated. They are charging around $14 for a standard $2.99 book and $16 for a $3.99 book. I fail to see how any shop can charge that much for a 32 page comic, let alone expect anyone to pay that kind of money.

Also, their comic book/graphic novel section is poorly managed. Even if you were prepared to pay $16 for an issue of Secret Avengers, chances are the issue you are buying is damaged, bent, or has had the cover folded over.

While the Borders in Brisbane has to contend with 3 comic book shops within an easy 5 minute walk radius, the one on the Gold Coast pretty much has has the market place to itself. The closest comic shop is about a 20 minute drive away, but is in a difficult position to locate, and doesn’t carry a very large range.

I did mention this to the Marvel Paenl when I attended the NYCC last year, as it was my fear these high prices, along with what is being charged at the local news stand (between $7 to $9) was driving away any new/young readers. Thankfully there are some local comic shops who look after their customers and keep prices as low as possible, while some still price their books as if it was 2005 and the Australian Dollare was much much lower.

Yeah, I’m a Borders Reward member, and get very nice discounts, in store and online. I’ve been able to buy books like Walking Dead Omnibus (Christmas gift) and All Star Superman Omnibus (mine) at my local Borders for 50% and 60%. I do get a discount at my local shop and it’s great… But they can’t match Borders Rewards. If it comes down to saving 25% or anywhere between 35-60%, I’m going with the latter.

Plus, my local Borders has a huge selection on Graphic Novels, TPBs, and the such. 2 1/2 rows actually.

Brigid Alverson

January 14, 2011 at 3:25 am

While I’m all for supporting local comics shops, chain bookstores like Borders are essential to bringing new readers to the genre. I’m not sure how my daughters first got involved in manga, when they were about 8 and 10, but they bought it at our local bookstore, which we visit a lot anyway. Far more people go to bookstores than comics shops, which means that bookstores present a much better opportunity to expose graphic novels to new readers, especially since they have started putting them on the “Our Staff Recommends” or “New in Paperback” tables. Everyone who goes into a comics store is already looking for comics but lots of bookstore shoppers may be encountering graphic novels for the first time—and like what they see.

Got to say that I used to work for B&N, at a Bookstar, years back. I ordered a lot of graphic novels and a large selection of collected books (X Men, Sandman). I would set up some nice displays and get a lot of parents coming in asking about various characters and age apporopiateness.
We didn’t handle monthlys at the time (mid 90’s), so I would always refer them to several LCS’s. Of course, this was during the Grand Speculation Time, following the Death of Superman/ Crippling of Batman/ Spiderclone/Age of Apoclypse years and , in Las Vegas at least, there were a half dozen stores in a two mile area.
Personally, I tend to relay on my local libraries for my reading material, they stock a surprising large collection of graphic novels here in San Diego. Same with regular novels and dvds.
I do this mainly due to a two year bout of unemployment, now over. And since I am working full time again, I happily spend every Thursday afternoon at my local Comic Shop.

@Rob on January 14, 2011 at 1:48 am

I know what you mean. I walked into a Borders bookstore in Sydney, and I was astonished at how they even came to pricing a US $3 / $4 comic book around the $15 mark. I mean seriously, how does that even make sense? Unless they’re specifically importing these comics directly from a source that’s gouging them. I mean, even if you ordered from an online retailer you wouldn’t even be slugged that much for international shipping. And that’s not even considering the state of the comics are in, on the shelf. You’re guaranteed for them to be bent, and creased, let alone damaged by the price tag sticker.

And for those that think they’re smart by browsing at these stores, and buying them online, the argument has already been stated… how are you going to do that in the future, if all of these businesses are shutting down? Kind of like the argument about single issues, and trades (i.e. how are you going to get the trade, if no one supports the single issues as they come out?). I mean, I do this for other products, but I don’t gloat about it, nor do I call other customers that don’t do it stupid.

Guess we’re all to blame somehow.

Who’s going to plan a hostile take over of Borders to save the company?

First BN, now this.

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