February 23, 2011: The Bankruptcy Of Borders

As you may have heard, Borders has filed for bankruptcy and is closing around 200 stores (including all three here in Austin). The natural question -- especially considering the Game Nights we participated in last month -- is, "What does this mean for Steve Jackson Games?"

In the short term, the bankruptcy won't affect us. The last big shakeout of game publishers, more than a decade ago now, was largely triggered by massive returns from the book trade. We watched that happen. We have processes in place to prevent a backlash from hurting our cash flow, and industry observers have been predicting Borders' fall for months -- we were ready.

In the long term, the shrinkage of the second-largest physical book chain will produce a drop in sales from the book trade. Those sales may shift over to online retailers, but we're also hoping some of the business flows to the traditional hobby game retailer.

As a business, we'll be fine. As book buyers, we're sad to see a major bookseller fail. As sellers of games to bookstores, we want all our customers to succeed, and Borders sold a lot of our games to people who otherwise might never have seen them! However, the internet has changed the way everyone does business, and it looks like Borders missed its opportunity to change with it. As SJ's sig file once said: "Learn Web or die."