Borders bookstore at Parkway Parade to shut
SINGAPORE: Thousands of bargain-hunters were at the
Borders bookstore at Parkway Parade mall, lured by the 70 per cent
sale this weekend ahead of its closure on Monday.
But up until about a week ago, there was still a
scramble behind the scenes to keep the retailer afloat in
Singapore.
The Parkway Parade outlet - the retailer's second in
Singapore - opened in 2007, a decade after its first store opened
in Wheelock Place.
"Prior to the decision to close it, it was a little bit slow. We
couldn't buy new books either, so traffic was dropping
significantly. We were booming the first year we opened. Second
year was quite good as well, but third year it had actually
declined. Book retailing has definitely changed; the customer
habits have definitely changed as well," said Elissa Crosswell,
sales manager of Borders Singapore.
On Wednesday, Borders USA terminated its Brand License Agreement
governing activities in Australia, New Zealand and Singapore,
giving stores in those countries 90 days to comply. Two days later,
Borders Singapore announced the Parkway Parade store will shut for
good.
The closure of the Parkway Parade store was not always a foregone
conclusion. Up until recently, corporate recovery firm Ferrier
Hodgson was in talks with about eight or nine retailers to take
over the outlet, and it believed it could have negotiated a
separate licence agreement with Borders USA.
But with the rental lease for the store running out in end-October,
there was simply not enough time for an agreement to be
reached.
Tim Reid, the judicial manager from Ferrier Hodgson, said besides
finding someone to buy the stock and take on the lease obligations,
a priority was to ensure continued employment for its 60
staff.
He said: "I told all the parties, if I had two similar bids, the
party that can offer employment for as many of the staff who wish
to carry on in this industry - that is clearly going to be a very
deciding factor."
Talks started shortly after Reid was appointed in August. Most of
the companies that came forward were Singapore firms, though not
all were from the book industry.
Eventually, the decision was made to shut, partly spurred by strong
sales at the clearance sale for the Wheelock outlet at the
Singapore Expo earlier this month.
Parkway Parade's mall management had also offered to extend the
lease, but was eventually turned down.
Reid explained: "If I incur the overheads of extending the lease,
and all the staff costs for another month or even longer, the
marginal benefit of doing so reduces dramatically because we have
only so much stock to sell.
"And at a 70 percent discount, it would be inappropriate for me to
bring in more stock, because we are possibly selling that stock at
a significant loss."
The 60 employees of Borders Singapore were told of the closure
about a week ago, and will get help in finding new jobs. About 30
of them on full-time contracts will also be entitled to
compensation.
"Morale back then was quite low, but as a sales team we had to keep
the staff happy. So now their morale is quite high, and we're
looking forward to sell off everything we have in the store," said
Azhari Zainal, department manager at Borders Singapore.
On Sunday, shelves were emptied as shoppers filled their
baskets.
"Whenever my mom comes to Parkway to shop at Giant or Cold Storage,
she'll always drop my brother and I here to read books. So now that
Borders is closing down, I can't do that anymore," lamented
customer Mitchell Lim.
Reid said he is seeking to give a "significant return" to gift card
holders who have made a claim against Borders, and has requested
that those who have not registered with the insolvency company to
do so quickly.
He expects to give an answer in one or two months.
- CNA /ls