The Bookseller.com

2nd December 2008

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Borders looks for supply solution

10.03.08 Graeme Neill

Borders has started discussions with publishers about the best solution for supplying stores, after the retailer announced the closure of its distribution centre on Friday.

Chief executive Philip Downer said that the decision to close the Cornwall centre on 29th August was driven "not by cash but efficiency". He said that Borders believed its business needs would be best served by publishers and wholesalers delivering direct to stores. "We need to talk to publishers about the best solution," said Downer. "It's one to address at forthcoming meetings." He added that terms would be discussed with publishers on an individual basis.

Once the distribution centre is cut out of the supply chain, Downer said that delivery times to stores would be cut. "We can replenish on a daily basis rather than on this cycle of every few days. Stores won't need to carry so much safety stock, which in turn means that they will have a much lower level of returns."

Borders' decision contrasts with Waterstone's, which will be opening its new distribution centre in Burton-Upon-Trent in June. One of the reasons Waterstone's gave for the decision to centralise supply was to increase its green credentials. However, Downer said that Borders' move away from a consolidated distribution centre would be greener for its business. "Because our distribution centre is in Cornwall, books are travelling more than they should. We will save several million book miles per year. If we are running more efficiently then there will be less surplus stock in the business. This will help address any green concerns."

Downer said that he will be announcing the implementation of Borders' new IT systems to staff at its internal conference on Friday. "We have been running on a US model for the past 10 years, which had an integral reliance on the distribution centre," he said. "It was built to service a US environment and it was more than our business needs."

Downer said that while buying methods would be discussed with staff at Friday's conference, the retailer's future still lay with central buying. "We carry the largest and broadest range of titles of any major bookstore across the country," he said. "Our appeal to customers is based on our ability to show things of interest to customers and carry a deep range that appropriate to stores. I think there would be more opportunity for specialist publishers in the future to sell more books through our stores."

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