Barnes and Noble Strategic Audit

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Strategic Analysis: Barnes & Noble Executive Summary Barnes & Noble is a key player in the Book Retail Industry. This mature industry has been experiencing slow growth over the last several years, much slower than overall retail sales. Barriers to entry into this industry are quite high, and suppliers have modest influence over booksellers. The introduction of the Internet has brought about many changes to this industry. It has increased rivalry, buyer power, and substitutes. Spending time "surfing the net" is one of many substitutes to reading books nowadays. Other technological advances, such as VCR 's and video games, have replaced time otherwise spent reading. Buyers have greater influence over the industry, because they…show more content…
1999 sales reached $13.7 billion, up only 3.7% over 1998. By comparison, overall retail sales increased by a strong 9 percent for this same period. Total bookstore sales for 1997 were $12.5 billion. Industry surveys indicate that the four largest chains accounted for approximately 45.2% of total sales in 1997.  According to the 1997 Consumer Research Study on Book Purchasing, book purchases per U.S. household grew just 0.6 percent from 1996 to 1997. During the same period, the U.S. population grew approximately 1 percent. This statistic shows that the U.S. book market is growing slower than the population.  The 1998 Consumer Research Study on Book Purchasing found that as the American economy thrives and sets impressive new growth records, growth in book sales continues to slow. This survey found that it was the upper income (>$75,000) professional households, also the heaviest book buyers, who are most responsible for the drop in unit sales. According to the Book Industry Study Group, the study suggests that "the book industry appears to react counter-cyclically to the overall economy. In good times, consumers may spend their disposable income on other forms of entertainment or on more expensive durable goods." This study also revealed that 1.9
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