Another Amazon client bites the dust. Borders will compete directly with Amazon when it ends a seven year partnership next month. The transition is expected by early February. Borders has been hard at work building its own system for almost a year now, using IBM Websphere for order capture and Sterling Commerce for order management. A beta version of the site went live last quarter.
Until now, Borders had been selling through Amazon on a consignment basis. This meant that Amazon booked the sale and then provided Borders with commissions. Going forward, Borders will recognize the entire transaction, growing topline revenue by an expected $80 million or more.
Because Borders operates stores in all 50 states, U.S. shoppers will now need to pay sales tax online. However, Borders is working on much tighter integration with its Borders Reward program, of which there are 17 million consumers registered already.