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Originally Posted by nffc
This isn't necessarily totally true. A lot of the issues have been largely down to retailers' laziness to deal with the labels direct, preferring to deal with one company who supplies them totally, and then deals with the record labels - e.g. Entertainment UK and Zavvi.
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It's not a matter of "retailers' laziness". The fact of the matter is that major labels do not, by and large, deal directly with retailers.
Quote:
Originally Posted by nffc
Whereas a local independent dealer here will order directly from the labels themselves, or their UK distributors, often on personal terms - with a far less turnover than a major retailer, and yet still survive? Why? Mainly because they order what they can sell and don't rely on funding their existing stock on credit.
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On a point of interest, and I'm genuinely interested in knowing this, which of your local independent dealers don't fund their existing stock on credit / credit lines. I'm sure there are more but the only independent store I'm aware of in Nottingham is The Heavy Sounds and a fair percentile of their turnover is in second hand / used records & CD's.
Most recent figures in relation to local independent dealers suggest an ongoing decline in that sector. From
the Guardian, April 2009:
Over a quarter of the UK's independent music stores went out of business last year, according to the Entertainment Retailers Association. In the record store heyday of the 1980s there were 2,200 stores; by 1994 there were 1,200. Today only 305 remain. The shops, and their dwindling number of committed owners, are, however, refusing to go quietly. This Saturday, more than 50 independent record shops from across the UK, and thousands more worldwide, will team up with top independent labels for Record Store Day.
Quote:
Originally Posted by nffc
When Zavvi went into administration and it transpired how their business model worked, they were somewhat alarmed they operated in that way.
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It worked exactly the same way that Tescos arrangement with EUK worked. Did Tescos go under? No. Why? Because music was not their core business.
Quote:
Originally Posted by nffc
It's a fine balance, but if you hold small amounts of stock, and order in what you can guarantee to sell
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If you can predetermine a stock based only on "what you can guarantee to sell" you'd be a good one. If it were so simple and "a fine balance" do you not think that every remaining record store in the UK (independent or otherwise) would have returned their entire existing (unsold) stock and packed out their shelves with copies of "I dreamed a dream"?
Quote:
Originally Posted by nffc
.. or if you own your stock then your liabilities are more easily tied up in your business than if you don't own the stock - Zavvi didn't own the items in the shops because they hadn't paid EUK for them, hence when EUK went into liquidation, they caused a payment on the assets held by the likes of Zavvi, who since they had little they owned and didn't own the stock could either send the stock back, in which case they had no income, or go through themselves.
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See the reference above re: Tescos (which also applies to other major chains at the time). It was never in a distributors nor a labels interest for retailers to outright "own" their own stock as this would have involved greater credit lines based on the sale or return model, breakages, mechanicals, promos etc. People fail to see this. In the end Zavvi ended up with £100 - £106m worth of stock for £40m - not much comfort to those who lost their jobs but certainly no bad thing for a kickstart when they eventually resumed trading.
Quote:
Originally Posted by nffc
It's simple economics, and has little to do with illegal downloading. People have and always will pirate copyrighted material, and a lot of those who do will end up buying it.
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As I've pointed out above it's not as simple as "simple economics" - if only it were. I have already explained, no less than twice, how illegal downloading plays a major part on the bottom line yet people are either in denial or pretend they cannot understand the premise of "buying" something to see what it is like.
Yes, people will always pirate copyrighted material where there is a reasonable opportunity for them to do so. That does not make doing so right, even if they do go out and "end up buying it".