On September 4th, wholesaler Super D signed an acquisition deal which gave them ownership of Alliance Entertainment — it has been described in industry news as a “minnow swallowing a whale” deal because Super D’s annual revenue (about $195 million) is a fraction of Alliance’s ($725 million) but this is a story that will hardly benefit those of us who are actually ‘minnows.’ You can read about it on Billboard’s website here. This big money deal will give Super D about a six an a half percent market share (which, for media distribution, is pretty heavily DVD/movie oriented) — this is chump change compared to iTunes’ 40% or so but nothing to dismiss as small scale.
The deal matters to those of us who still buy records. Here’s why:
SoundScan estimates vinyl sales are still under 2% of the music market, which is driven by downloads these days — of course, these figures seldom take into account independent releases below their radar (those local albums you buy without bar codes, for instance). Even a generous estimate suggests that Super D’s new massive conglomerate will see less than 5% of its sales from vinyl records.
Here’s where this becomes news we can all use, and ultimately refuse — this new monster controls a much larger share of vinyl sales to mom n’ pop record shops like us. This is where we get the new albums by industry standards like Bob Dylan and Bruce Springsteen, as well as those old reliable reissues (think Pet Sounds) from major labels mining their back catalogs. A lot of the new vinyl Hymie’s likes to stock comes from smaller niche wholesalers — places like the awesome punk rock wholesaler/label No Idea — but these big entertainment conglomerates are the devil with whom we must deal.
Now ask yourself, will less competition lead to a lower wholesale price for Bob Dylan’s next album, or a higher one?
We’re often in a position of justifying over-high prices on new LPs from established artists — most recently it was the latest installment in the Bob Dylan “Bootleg Series,” Another Self Portrait. We opened a copy to play here in the shop (glad we did, too) — sometimes that’s a cost of being a record store, which is okay. We also understand the sticker shock when fans see the eighty dollar price tag, we felt the same way when we first saw the box set’s wholesale price. We were even more offended when somebody from another record store came in to buy it (our price is $9.99 below the official ‘list price’) and asked for a deal. After shipping costs and the expenses of being open every day, we don’t walk away with eighty dollars — he should have known that. And if the record doesn’t sell we get nothing — this has been the case for a lot of lauded releases by really established groups. It sometimes takes years to sell our initial stock of only three or four copies of a new release. Ordering a half-dozen copies of an eighty-dollar Bob Dylan set is a risk.
Neil Young’s 2010 dog Le Noise taking the cake at an outlandish $30+ price tag for a single LP with no download code or disc included. Your average record shop makes very little off these sales — used albums keep them in business. What doesn’t make sense to us is why Neil Young’s album has to be three times the price of a small-run local album (500 or 1000 copies) — Economy of scale would suggest the opposite. The band who makes their own album, bringing it around to record shops themselves, should be making a little more. Neil Young — making millions off downloads alone whether his album is good or not (and Le Noise most certainly was not) could press ten or fifteen thousand LPs with confidence they’d sell. His per-unit cost (or specifically Reprise Records’ per unit cost) should be substantially lower. Why is the price not lower?
We have no idea what the answer is, but a cynical explanation is probably found in a second question. Why wasn’t Le Noise better? We don’t believe a band with a local or regional following couldn’t have gotten away with what seemed like a rote rehash of previously recorded ideas. They are far less likely to sell albums entirely on name recognition — the strength of a smaller act is the sound of their latest single, whether we’re hearing it on Spotify, iTunes, Youtube or — people still do this — the radio. This is why we’re so impressed here at Hymie’s by the people making their own records or working with small local labels. They’re making the sort of courageously lean and hungry music Neil Young was in that great arch of recordings that started with his first collaboration with Crazy Horse in 1969. They’re also taking enormous chances, personal and financial, to pursue their passion.
I wrote this post on a Saturday afternoon in the shop while also trying to figure out why the color of the website’s text and titles has changed (hence the “Help…!” post below). During the course of the afternoon I rocked out to new albums by the Blind Shake, Pennyroyal, Walker Fields, Martin Devaney and Charlie Parr. All have arrived here in the shop in the last month, and in every case we’ve put cash directly into the artists’ hand. When people make a special trip to the record shop just to buy a new local release — as a couple regulars did for Devaney’s new album yesterday — it feels like we’re doing what a record store is supposed to doing. It’s also a lot of fun to dig through the countless albums from more than a half century of LPs scattered around the shop, and I also really enjoyed the Hot Dogs’ 1973 album on Ardent until somebody came up and asked to buy it. And I listened to Dire Straits’ Making Movies for about the hundredth time.
I guess the point of all this is to encourage you to pay attention to what happens to the cost of new LPs in the next couple years — with more and more being sold at the gigantic level of the new Super D/Alliance Entertainment conglomerate, the price should go down. We don’t have a lot of say on this subject, because when you get down to it we’re small potatoes. In the mean time, we always bring the previous month’s new releases to our sale at the Turf Club (15% off) on the first Wednesdays. We also offer random weekly specials on the blackboard in the shop & have a coupon in this year’s Chinook Book. You can always buy most local releases for $15 and under, too. And Making Movies for three bucks at the most. Hopefully this helps make up for the fact that some of these recent major label releases have just been too expensive.
Tomorrow maybe we can figure out why the letters here on the blog have turned blue. Probably from too much talking.