The Crazy Plan to Save Barnes & Noble

barnes and noblePublishing industry observers rooting for the continued solvency of the nation’s largest bookstore chain are probably concerned that Barnes & Noble is struggling to grow its Nook device and ebook business while its physical bookstore business shrinks.

Nook is supposed to be the company’s white knight but it is losing hundreds of millions of dollars a year on about a billion dollars of revenue and its sales aren’t growing. Despite a boom in tablets, its Nook tablets sold fewer this past holiday season than in the prior year; it’s getting lapped by competitors like Asus and Samsung. (Read much more about this here.)

That said, at least one industry observer hasn’t given up on B&N and he has proposed a radical plan to save the company: (mildly NSFW, depending on where you work).

The sparse site, launched about a month ago by Scott Shui, a Los Angeles based author and founder of the website The Library Infinite, doesn’t offer any remedies to Barnes & Noble’s problems. It does, however, link back to an earlier website from Shui, whose interest in the matter is as a reader and book-buyer:

When we spoke with Shui through Twitter, he indicated that the Borders solutions (evidently not adopted) would work for Barnes & Noble as well.

Below is a list of our favorite suggestions from his plan:

1. Suggestion: Post executive salaries, duties and responsibilities on a private online website where all company employees can review and comment on them.

Commentary: Because Barnes & Noble is a publicly traded company, it does make public the salaries and other forms of compensation for its most senior executives. One wonders how managers of Barnes & Noble stores that will be closing in the next few years feel about the company’s chief executive William Lynch taking home $10 million in stock and other forms of compensation in 2012.

When Citigroup floundered and needed a government bailout in the wake of the 2008 financial crisis, its CEO Vikram Pandit took a $1 annual salary until the company righted itself.


2. Suggestion: Executive non-store salaries are to be capped at two times the salary of a store manager until six consecutive quarters of profit.

Commentary: Barnes & Noble is profitable overall, but Nook is not. Perhaps this remedy should apply specifically to Nook. The problem with this idea even for Nook is that it’s a technology company and many of its mid-level employees — developers, product designers and other technologists — command high salaries in the open market. If Nook wants to win versus Amazon, Apple and others, it needs top talent. Top talent costs a lot of money in this field. Still, the idea of making Nook employee compensation more closely tied to success may have merit.


3. Suggestion: Management will be required to work shifts at different stores on a monthly basis to obtain in person employee and customer feedback.

Commentary: Is management at Barnes & Noble out of touch with what’s happening in its retail stores? Perhaps. Either way, the company is interested in becoming less of a bookstore and more of a cultural department store, which is a significant shift. It couldn’t hurt for the company’s senior leadership to be spending more time on the ground with its employees figuring out how to make that happen.


4. Suggestion: Store employees will visit company headquarters monthly on a rotating basis to provide store feedback and participate in strategy meetings.

Commentary: This seems unrealistic and expensive. However, it does imply a business practice that Toyota has made famous: Kaizen. It’s the company’s philosophy of continuous improvement and central to this philosophy is taking suggestions from employees across the organization, not just business leaders. The practice has been credited, in part, with Toyota’s rise to one of the largest motor companies in the world.


5. Suggestion: Partner with local libraries for in-store book drives.

Commentary: The library community is eager to make friends and serve its patrons in doing so. If Barnes & Noble were to lend its space and clout to these kinds of book drives, it could help it make some allies in libraries. It could also give reason for people to come to the stores (and replace the books they’re giving away — unless, like Barnes & Noble, they are filling their shelves with toys and games instead of books these days).


6. Suggestion: Host job skill fairs where readers can look at books that can help them find a job and manage their career.

Commentary: Information can make the difference in a successful job search and in a successful career. Bookstores, despite the beating they’ve taken over the past several years, are still great places to get such information. With national unemployment hovering around 8%, a jobs-related Barnes & Noble event could be a way for the store to help struggling job seekers as well as help build its position as an important central player in the community.

Read more about potential solutions to Barnes & Noble’s problems here.

12 thoughts on “The Crazy Plan to Save Barnes & Noble

  1. James Moushon

    BN has an advantage over Amazon. They have physical stores. They need to do something different with them.

    Now about dropping the Nook horse and market other readers and devices with ereader software. That way they can adapt to a changing market.

    Now about giving readers an in-store discount or reward points for purchasing an ebook in the store at a kiosk. Currently their rewards program is paper only.

    Now about a display area where customers can browse paper books like a library and order the ebook online if they wish to buy. Only one copy required.

    Now about print on demand of any book in their deliver cloud, while the reader waits.

    Now about ebook giveaways in store or author signings or ….

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  3. Anonymous

    Having worked at B&N during college, I can say you don’t make any money as a store employees – manager or not. In addition, with the experience of a handful of managers, the rest of the employees are part time only with no benefits except a discount that doesn’t make the books cheaper than amazon.
    Maybe this is to save money, but it does not make a loyal employee.

  4. AvidReader

    I’ve been part of book clubs hosted in B&N in a couple of states. One of the states allowed book club members a 30% discount, the other states did not. In the state that allowed discounts, book club members always bought their books from B&N. In the states that did not, the majority of book club members got their books free from the library.
    In the state where I currently live there are NO book clubs, so I hardly ever go into B&N.
    My suggestion would be for B&N to encourage Book Clubs and give members an incentive to buy their books from B&N. It’s a small move, but can help show the company’s commitment to the community and encourage avid readers to frequent the store.

  5. Fred

    I have worked at Barnes & Noble my entire adult life – almost 20 years now (currently a store manager). The earlier commenter is right – there’s no money in it at the store level. So why do I do it? Because I love physical books and bookstores and being a bookseller. Not \content\, books. A while ago B&N did a survey that discovered (surprise) that the large majority of its employees work at a bookstore because they love books and bookstores and being booksellers. Guess what disappears if the nook succeeds? Physical books and bookstores and our jobs. Think we want it to succeed? Guess what happens when the people selling a product don’t want to sell the product.

  6. Anonymous2

    Press for immediate legislation that requires Amazon and any other online bookseller to pay state taxes like bricks and mortar stores do. Why should Amazon (or any online operation) have that kind of (huge) competitive edge?

  7. Atilla

    Why does N&N have to be saved? Times change and businesses come and go. Amazon will be replaced someday too and books will change into something different in the future. There will be some print books in the future, but they will not be the dominate form. Other information storage and delivery models will exist and more and different kinds of media and information will be delivered in the new forms than just printed words on paper sold in piles in warehouse kinds of buildings. Humans are moving past print just like they moved past riding animals to travel.

  8. Max Downham

    Fred got it right: staff won’t sell themselves out of a job. Despite the B&N CEO’s massive salary (paid because he’s so much brighter than us ordinary mortals) he oversees this internal sabotage (surprise, surprise). And for that, no doubt he’ll pay himself a massive bonus. I’m with Attila. History/Nature aren’t kind to dinosaurs whose time is up. America is supposed to be a free market society, so why all this banter about telling the market how things are going to be to prop up a dinosaur? When eBook CEOs start paying themselves $20M salaries, get so out of touch that they can’t get anything right and see themselves as masters of their own fiefdom, they’ll go out of business too, by the same exit route as B&N. B&N’s fifteen minutes are up. Let’s get over it and move on with a little dignity.

  9. anonymous6

    I do love Barnes and Noble stores, but I detest the Barnes and Noble College Store takeovers of independent college stores … college presidents and administrators can’t resist the money thrown at them (hopefully, all over-the-table) and bookstore managers and staff aren’t retained. Perhaps sometimes, but none of us were offered a job with BN despite decades of service and a profitable, unique, beloved store. Now that the college stores have been folded into the retail BN system, BN should get out of the college store business.

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