Consumer Confidential: Bye-bye, Borders; back-to-school shopping
--Hasta la vista, Borders. The once-mighty bookstore chain is liquidating its 399 stores nationwide, including huge sales at its 18 remaining stores in Southern California. Books, DVDs and furniture valued at more than $700 million will be discounted up to 40% starting today. The sales are expected to wrap up in September. Up to 10,700 employees nationwide, including 524 in SoCal, will lose their jobs after the liquidation. Still up in the air is a possible sale of up to 35 locations to an Alabama company. The liquidation plan was approved by a U.S. bankruptcy judge in New York on Thursday. Borders' closing will be a boon to rival Barnes & Noble -- until it too starts feeling the heat.
--The economy may be rough, but we're not skimping on our kids. Back-to-school spending is expected to increase 3.8% over last year, according to the retail analyzer ShopperTrak. But ShopperTrak, which tallies the number of visitors to 25,000 stores nationwide, hedged a little on its figures: If Congress and the president can't solve the debt-ceiling puzzle, Americans might become skittish about spending an extra few bucks on jeans and backpacks. Back-to-school sales often act as a crystal ball for holiday retail trends, so analysts will be watching closely. For its part, the National Retail Federation expects flat to modest retail sales growth for the season, the second-biggest consumer spending period, after the winter holidays.
--Speaking of kid-related consumption, it's not cheap being a Harry Potter fan. People who bought all seven hardcover books, attended all eight movies in their first run, and purchased every DVD paid an average total of $401.08, according to estimates. Followers will be forking over an additional $20 to $30 for the DVD or Blu-ray of the final flick several months from now. No wonder Harry's creator, author J.K. Rowling, is now one of the wealthiest people in Britain, with a net worth estimated at $1 billion. Not bad for a Muggle.
-- David Lazarus
Photo: It hasn't been cheap knowing these three for so long. Credit: Ho / Reuters