The online store Borders handed to Amazon
In 2001, Borders turned over the operation of Borders.com to Amazon. The arrangement let the bookstore chain offer online shopping without building and running all the technology, inventory systems, and order handling itself. Amazon, then a growing online retailer, supplied the machinery behind a website that still carried the Borders name.
That tradeoff offered a quick way into e-commerce, but it also meant Borders was not developing the same capabilities in-house. The company handling the website could accumulate practical experience with online merchandising, customer behavior, and order fulfillment—skills that would become increasingly valuable as shopping moved onto the internet.
Convenience with a long-term cost
Outsourcing can save a company the expense and difficulty of building a complicated operation from scratch. But it can also leave the company dependent on a partner for a channel that may later become central to its business. Borders eventually ended the arrangement and brought its online store back under its own control, but reclaiming a channel is not the same as having spent years building expertise in it.
The partnership became a striking symbol of Borders’ digital misstep, though it did not by itself cause the chain’s collapse. Borders filed for bankruptcy in 2011 amid broader financial and competitive pressures. The irony is sharper than a simple handoff of sales: Borders rented access to online retail rather than making the capabilities behind it a core part of its own business—and its partner went on to become a retail giant.
