Borders CEO Ron Marshall, who took over the position last January, is leaving the company to become CEO of the Great Atlantic & Pacific Tea Company. Executive vice president Michael Edwards has been appointed interim CEO.
CEO Ron Marshall is leaving Borders Group only a year after taking on the task of revitalizing the bookselling chain and establishing it as a full-fledged e-commerce player.
Borders, No. 212 in the Internet Retailer Top 500 Guide (a PDF version of the company’s financial and operating profile can be ordered by clicking on its name), announced this morning that Marshall, who took over as CEO last January, is leaving the company, effectively immediately, to become CEO of the Great Atlantic & Pacific Tea Company Inc. supermarket chain.
To replace Marshall on a temporary basis, Borders has named chief merchandising officer and executive vice president Michael Edwards as interim CEO. Edwards will report directly to Borders chairman Mick McGuire. Edwards joined Borders in September after having been president and CEO of Ellington Leather, a wholesaler of leather handbags and accessories.
Marshall, who joined Borders after serving as a principal at private equity firm Wildridge Capital Management, was hired to help the company improve its financial position and establish the multichannel books retailer’s fledgling e-commerce program. In late 2006 Borders ended its longstanding relationship with Borders, No. 1 in the Internet Retailer Top 500 Guide, and spent 2007 building up its own sophisticated online store. The new e-commerce site launched in early 2008.
But even with a major new e-commerce site, Borders struggled financially in 2009. The company has yet to report its final year-end numbers or provide guidance, but for the third quarter ended Oct. 31:
- Total sales declined 13.1% to $602.5 million from $693.4 million. Borders discontinued breaking out separate e-commerce figures in the first quarter. Web sales in 2008 totaled $45.7 million.
- Comparable-store sales at Borders superstores declined 12.1%.
- Net loss was $39 million in the third quarter and the same as in Q3 2008.
- Total sales for the first three quarters declined 14.4% to $1.85 billion from $2.16 billion.
- Net loss was $67.6 million in the first three quarters and $81.7 million in the prior year.
Borders has retained executive recruiting firm Korn/Ferry International to lead the search for a permanent CEO, the retailer says.