The Wounds of a Friend

tsunamiThe news hit this week like the first massive wave of a Tsunami coming ashore. Family Christian Stores, the largest chain of Christian bookstores in America, was declaring bankruptcy. While some may have known that they were struggling, none of us knew the extent of the problems or that this was imminent. In their public statement about what had taken place, Chuck Bengochea, president and CEO, said the Grand Rapids, Mich.-based company “took on too much debt” due to declining sales and was hit by the 2008-09 recession and the digital revolution that has changed the sales of books, movies and music. MLive Media Group reported that the chain, which has stores in 36 states, suffered a 25% sales decline since 2008 as they only had $230 million in sales in 2014, down from $305 million in 2008.

This event on the heels of the closure of the Borders book chain in 2011, speaks to the reality of how hard it is to run brick and mortar bookstores in the internet age. That said, it probably also says as much about the peculiar challenges that face the Christian book retailing marketplace as anything else. In its heyday, the Christian bookstore in America represented the public face of a strident evangelical community on the ascendancy. Today, both muscular evangelicalism and Christian bookstores are in steep decline. For some of us that have toiled in these vineyards for many years, the changes that have taken place in the society around us have not been easy to watch and far less easy to adapt to. For many independent Christian stores, closing the doors was an easier choice than accepting the reality that America itself has become a mission field.

In a great irony, the day after Family Christian Stores declared bankruptcy, Publishers Weekly ran an article entitled, “Indie Bookstores Fill Void Left by Borders”. In describing what was going on with secular independent bookstores, writer Judith Rosen said, “Four years later, the bookselling landscape is changing once again. After several solid years, independents are looking at adding locations and taking back some of the physical bookshelf space that had been lost.” The truth is that ABA (American Booksellers Association) have actually been growing 6-8% a year since 2008, during the exact same time period that Family stores were losing customers in droves. Apparently, the digital revolution, is not affecting everyone the same way and not all bookstores are suffering equally.

Proverbs 27: 5 & 6 says,

“Better is open rebuke than hidden love. Faithful are the wounds of a friend;
profuse are the kisses of an enemy”.

This week it feels a little more like we were stabbed in the back by a friend as much of the debt that Family Christian Stores will be shedding in this bankruptcy process will fall to the feet of Christian publishers who may not be repaid at all. One publisher alone (Harper Collins Christian) is owed a staggering $7.5 million dollars. Unfortunately, these publishers who are considered “unsecured creditors” fall in line behind two financial intuitions that were secured creditors. The secured creditors themselves are owed tens of millions of dollars. The reorganization plan that was made public involves selling Family Christian Stores to a new entity sans the debt. At this point in time no one knows what the courts will approve and who will actually get paid what.

Looking forward there are many lessons to be learned. Building and sustaining a Christian retail empire with huge amounts of debt is not viable in this day and age. Relying on a robust and growing evangelical Christian community to visit and support your stores may not be a reality either. Most importantly, doing business as usual and expecting different results is as one person has said, “the definition of insanity.” How FCS emerges from this tragedy may depend as much on the store/ business model they choose as anything else.

The Christian publishing community faces many difficult decisions in the months ahead. Mark Taylor, the President of Tyndale House recently said, “We hope Family Christian can survive as a chain of stores. No one except the banks and the attorneys will get any money from FCS if we force them to liquidate.” I am sure that is a sentiment shared by many others. One of the most challenging decisions, however, may be the question of the continuing relationship with FCS. The courts have approved their ability to pay for products purchased and shipped to their stores after February 11th out of daily operating funds. It will be interesting to see if suppliers who stand to lose millions will actually continue shipping new books at all.

For those of us that are left in the wake of this Tsunami, we will have to ask some tough questions of ourselves. How do you respond in love when you feel betrayed? How do you treat a Christian who has wronged you? How do you help your brother get back on his feet again when he has made decisions with which you don’t agree? Most importantly, how do you respond to a crisis of this magnitude in the Christian community as a skeptical world is watching?

I pray that this will drive us all to our knees to genuinely pray for the leaders of Family Christian Stores and for the thousands of employees of both this company and many others that may be affected.  May this be a “Phoenix” moment for us all as we see something new and wonderful rise from the ashes of a catastrophe. That will only happen if true repentance and humility mark everything that we do in the days to come.

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3 Comments

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3 responses to “The Wounds of a Friend

  1. Very sad, but not surprising, I suppose.

  2. jacque

    Any idea how this will affect CLC?

  3. This parallels the problems experienced by Christian directories nationwide as a result of the economy and the internet. Christian Yellow Pages is down to Gideon’s Army…1 full-timer (myself) and 6 part-time territory directors, with 4 of these publishing bi-annually. The Shepherd’s Guide, once 191 directories strong a few years ago, is down to 11 areas at last count. Most of the territory directors have websites with local content. Pray for our ministries!

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