So does anyone know if there will be any more layoffs by the end of the year? Currently the job market is over saturated due to millions being out of work so finding something new might take months.
15 replies (most recent on top)
@6imq+176XIyyF There can be no denying used books played a huge part but yes, you are right.
Publishers could have stopped it but were too arrogant. And all the decision makers knew they could kick the can down the road and it would be someone else’s problem.
All those people who made those bad decisions are now retired or dead.
I would beg to differ about well run used book companies. The big publishers could have put them out of business early on. Margin for MBS, Follett, and NBC were always narrow. I got so many excuses about why we wouldn't buy our own books back: royalties, warehouse costs, etc. etc.
@5agk+176XIyyF Yes. The race to the bottom started decades ago when publishers lost control of the channel and very well run used book companies with national reach entered the scene.
After that it was simply “raise prices” to combat fewer unit sales.
The internet changed everything. It made access to information simple. Before that you had to walk to the library or buy a textbook.
The funny thing is that investors believed that a global thirst for knowledge and education would result in dinosaurs i.e legacy publishers, reaping the rewards.
They were wrong
@5xwo+176XIyyF I think that's accurate. There's a reason why McGraw wanted the merger as badly as we did. They see what's coming and are in as bad of financial shape as Cengage is if not worse.
But the industry just can't support 3 large publishers anymore. The pie shrinks every single year. Since consolidation is off the table, its only a matter of time until one of the three goes away, and it's not likely to be Pearson.
Really there was no turning back once students realized they had purchasing power and could do without our products in many cases. Piracy and textbook rentals will be the official cause of death of the Big 3. We used to sell prized content to professors who were the gatekeepers. Once students cut them out it was over. Cengage (and MGH/Pearson) were arrogant enough to believe that we could appeal to students with flashy software that they would HAVE to have, but that was never going to happen – especially not with our buggy platforms.
Let's face it, students have never been our customers. They use our products because they have to for 2-5 years and then never buy one of our products again. Professors are the ones we have the lifelong relationship with. Textbooks are an avoidance product like insurance. You buy it because you have to, not because you want to. Go do a Twitter search on "cengage" sometime to see what they really think of us.
@5fmg+176XIyyF. There's really nothing Cengage can do. Sure, management is incompetent, but guess what? So is management at Pearson and MGH. The business, for years has been run by incestuous insiders, who have mostly all worked for a competitor at some point.
The point is, the entire business (what used to be called "college publishing") is pretty much gone. It was headed that way before COVID.
I've read on here about "double digit increases" for small competitors. Well of course. Thats not too hard when you are a company with a few million dollars of revenue.
Cengage, Pearson and McGraw are just not configured to survive in today's environment. Too many costs, no growth and customers who dont care about the product.
Say what you want about MH. His virtue signaling and transparancy bs, but at least he tried to shake things up with unlimited.
When a company cannot make payroll and is unable to pay out on last year's bonus plans, that company is in a death spiral.
They indicated that the back pay would be made up in October if things went well with fall sales. Has there been any indication at all that this is going to happen?
Ever stop to think: "why haven't the other publishing companies unveiled a subscription program to compete with Unlimited?" Surly if that discount scheme were actually the game-changer management claims it to be, the other companies would have responded by now, wouldn't they?
Cengage has been in a death spiral for years, now. And we aren't even approaching the balloon payments on the massive debt weighing this company down.
No, things are not okay.
What makes you say Cengage is in a death spiral? I hear things may be okay?
Ooooh let’s hope there are no layoffs this year or else we’ll all be eating SOUP for the holidays
Bankruptcy in 2021. Cengage is in a death spiral.
Every business took out loans which would transfer to grants, non payback, stipulating only if during the length of the loan no layoffs would occur which would nullify the no payback. The stipulation expires in October.
The incel is back.
@1iqa+176XIyyF Cengage wasn’t able to borrow more money and stockpile cash like most companies have because they were already over leveraged. They are done like dinner.
Cengage didn’t take out any COVID loans.
The layoffs will begin when the covid loans run out, for the airlines it’s set for October when the crash begins.
No one knows. But if you're that concerned why not start looking now?