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Let me start with an unequivocal declaration: I hope Borders finds the means to avoid bankruptcy, or worse, liquidation. The immediate consequence of a Borders default on what it owes publishers would be a cash short-fall of millions of dollars. Even the most profitable publishers have limited leeway to deal with months of unpaid bills. The irony is that the surge in e-book sales across many platforms, the popularity of reading devices and tablets, some effective re-tooling at Barnes & Noble and the stronger independents, plus the continuing growth of Amazon actually have improved the overall outlook for the book business—which would take a considerable hit if the country's second-largest book chain goes under. Borders management is scrambling to get new financing and is soliciting publishers to accept bonds instead of payment. Will that strategy work? My guess is that most publishers want Borders to survive, and will find ways to keep it going at least for a while. But the longer term prospects for Borders—with 674 stores (many already scheduled to be closed)—remain, at best, a major challenge.

So what happened to Borders? An early innovator in controlling inventory, there was expert staff at its Ann Arbor headquarters and store managers who believed in the value of book-selling. At its peak, Borders superstores had all the attributes of good book-selling—extensive selections, browsing space, coffee bars, and outreach programs to surrounding communities. In 1998, Borders shares hit an all-time high of $41.75.

To understand Borders' decline, it is worth going back to its origins on State Street in Ann Arbor. The store was founded in the early 1970s by Tom and Louis Borders, University of Michigan graduates who developed an inventory tracking system that, by the standards of the time, was as sophisticated as computers allowed. When I came into publishing in the middle 1980s, I was impressed with the shrewd team of buyers who dealt with publishers' sales representatives and the store staff that made the most of the simple aluminum fixtures where books were displayed. The Borders brothers began licensing their inventory system and began to expand to locations in Michigan and around Philadelphia. I especially remember a night in 1992 at the height of the presidential primary season when a Borders events coordinator filled an auditorium in downtown Philadelphia by featuring political books I was publishing: a model for how a store could become a venue for public engagement and customer loyalty.