Internet blamed as booksellers enter administration

Australian Broadcasting Corporation - Lateline
Broadcast: 17/02/2011
Reporter: Peter Lloyd

The growing popularity of online book buying and digital formats is being blamed for Angus and Robertson and Borders entering voluntary administration.

Transcript

TONY JONES, PRESENTER:
As many as 200 Angus & Robertson and Borders bookstores could be closing their doors, with the prospect of thousands of job losses after the parent company, the Red Group, was placed in voluntary administration late today.

A debt mountain, the growing popularity of online book-buying and digital formats are behind the chain's financial woes.

Although they have no financial connections, it's the same story behind today's news from the US that the American Borders book chain has filed for Chapter 11 bankruptcy protection.

The bombshell announcement here in Australia comes amid a tale of woe across the retail bookselling trade, as Peter Lloyd reports.

PETER LLOYD, REPORTER:
Borders and Angus & Robertson bookstores around the country were shutting their doors tonight as news filtered out that the parent company is in financial trouble.

MAREE MCCASKILL, CEO, AUSTRALIAN PUBLISHERS ASSOCIATION:
I think it's incredibly sad. I think the publishing sector will be mortified to know that this particular chain, which is the largest retail chain in Australia, has now found itself in administration.

PETER LLOYD:
The company under administration is called the Red Group. It includes 161 Angus & Robertson bookstores across the country, as well as 26 Borders stores in Australia, five in New Zealand and one in Singapore. Across the Tasman, Red Group also owns 72 Whitcoulls bookstores. Altogether, the group has 2,500 employees.
Administrator Ferrier Hodgson says it's business as usual, at least until a creditor's meeting early next month.
Today's announcement was no surprise to the publishing industry.

TIM CORONEL, BOOKSELLER AND PUBLISHER MAGAZINE:
The Red Group reported a $43 million loss for the year and lost some senior staff in the last half of last year, so they've definitely been doing it tough.

Full piece at ABC.