Todd Durrant’s Random Thoughts
Follow the efforts of a creative, crazed entrepreneur.

Saving the Store

As most of my regular readers know, keeping my business alive the last couple of years has been an ongoing struggle.  That fight seems to be leading to one particular path with a couple of goals:

First of all, the focus of A Different Drum’s store needs to become tighter.  Rather than branching out and trying to cover too much in terms of the shear numbers of products and the kinds of music carried.  The inventory needs to be thinned out and the music offered needs to focus strongly on a niche that is the least satisfied by other businesses in our “scene”.   To some, this may seem counter intuitive.  After all, wouldn’t a small business that is struggling try to become larger and more all-encompassing?  Well, no.  Actually, many businesses that face serious threat end up cutting back, cutting costs, finding a tighter focus, and heading in a direction that targets a specific consumer base rather than trying to compete on too many fronts.  We’ve already seen this done within the “industrial” music scene by big players.  Look at Metropolis Records, for example.  For as long as A Different Drum has been in business, Metropolis has not only been a label but has been a one-stop distributor and mail-order for all things industrial, gothic, and even synthpop.   They sold ADD releases through their online store and also to other outlets.  They imported releases from Europe and sold them both wholesale and retail.  Well, a year ago they opted out of that “we do it all” mentality and decided to only sell their own label releases.  They don’t bother with the expensive imports, and they no long stock releases from A Different Drum or any other separate label.   They turned inward toward their own label catalog and decided they’d put their focus on that.

By tightening my own focus and making sure that the inventory I carry is precisely aimed at a target audience, I can make sure that people who find themselves in that audience feel that their needs are best met through a place like A Different Drum.   If they have industrial music needs, they can turn to Metropolis.  If they have gothic needs, they can turn to Isolation Tank, or whoever.  But when they want the newest in independent electro pop and synthpop, they can turn to A Different Drum.    I have a history of selling very few units of releases that fell outside that focus anyway, even when things were good.  I could sell hundreds of a new De/Vision release, but only 2 or 3 copies of Frontline Assembly.   So, why bother with the Frontline Assembly, so to speak?

Next, I’ve had to focus all income on paying off old debts, and I needed to start paying as much as possible in advance for all new inventory.  In a world with bad economics, credit has become a near debilitating factor when it is not in your favor.  I racked up debts by trying to do too much too quickly, and that has haunted me for a long time.  If you depend on getting loans that you believe will be easily paid based on your “current situation” and then find that situation drastically changed, like it has been in my own case, then you’re in trouble.   In fact, this situation inspired the lyrics of my newest Saudade song, “Restricted”.   Listen to that song and watch the silly video here:

So, I usually pay new orders immediately, before the product is received.  I’m still paying off old bills from factory manufacturing for label releases along with old mastering costs.   I still have a payment schedule with a couple larger European distributors.  I still owe certain bands royalties.  But most of the inventory sitting on the shelves is paid.  I hope that I can keep enough business going to head even more in this general direction.   It has meant sacrifice– putting out fewer new releases and doing the few I have contracted on a slow schedule, but alas, I can’t crank up new bills faster than I can pay the old ones or I won’t be headed in the right direction.

These approaches will hopefully allow me to keep A Different Drum alive for the sake of the customers, and probably for my own sanity while allowing me to find other ways to work for a living.   Yes, it’s true.  By narrowing the focus and concentrating on what works, I hope to have enough time in my day to do other things that actually support my family.  ADD is more focused on paying off it’s debts and merely surviving.  I can’t dedicate myself full-time to that kind of business since my family requires food, shelter, etc. more than they require cool music.

Now that I’ve explained my current approach in general terms, I want to throw in some thoughts about a phone call I received yesterday.  I have a very good customer who has been loyal for years, counting on A Different Drum to hunt down the hardest-to-find CD’s of his favorite kind of music.  This guy is really cool– not only a good customer, but a good friend.  After a conversation we had on the phone about music, he seemed surprised to discover that A Different Drum and the music industry in general was barely limping along.  In his own life, where music is critical to his own happiness and even sanity, he couldn’t believe he was in the minority.  He called back about an hour later and offered a solution to my troubles.

Basically, he said, “What you need to do is move your business to Salt Lake City because we have a million people here, and you live in the country.   Nobody in the country cares about this kind of music, but I bet there are a lot of people in Salt Lake City that do.  Then you can open up a physical store again, buy a big billboard advertisement by the freeway that says GET THE BEST MUSIC IN THE WORLD and get some TV ads going.  Then everybody in Salt Lake City would want to get their stuff from you!”

Do you see how this goes against my focus?  Can you see why this would be more than the current slow death, but would bring on an almost instant death sentence for A Different Drum?   First of all, I live in a smaller town because it was the only place where my family could afford to buy a home.  Even when financial times were better, being self-employed and low income, we didn’t want to rent forever, so we had to move where we could afford house payments.  That meant moving away from the city.  Second of all, moving to Salt Lake City wouldn’t be the kind of boost in population, especially in terms of finding the demographic that likes modern synthpop, to keep a store alive.  Maybe New York City, or someplace like that…  I only have a handful of current customers in the Salt Lake City area (this friend is one of them).

Next, look at the expenses.  You suddenly have to find an extra $1000 per month, at least, just to pay rent on a small retail location, not to mention properly equipping that location in the first place.  Then you have to pay $100 per month for that big billboard that nobody would care about.   Then TV advertising…ouch!   How many CD’s would I have to sell of artists nobody has heard of to pay those kinds of bills?  I can tell you already, the only store in Salt Lake City that used to sell synthpop, industrial, gothic, alternative, etc. died a few years ago because it could not generate enough CD sales to even pay their minimal rent.  It was a hopeless cause.  You can’t move enough product to do it, and you have to maintain all your store hours as well, which can be costly.   Running mail-order, once I’m done shipping the orders, updating the catalog, etc. I can go do other things rather than stand around and wait for a customer to walk in.

I asked my friend, “Do you remember Media Play?”

“Yes, they were awesome!”

“And where are they now?”

“Well, they all closed down.  I don’t know why!”

Let me explain.  Media Play was a branch of Sam Goody Music.  Do you even remember them?  That was a store in almost every shopping mall on the west coast…maybe even beyond.   They opened about six “Media Play” stores which were like super-centers for music, movies, video games, and books.  Sure, they were fun to visit.  But they DIED.  They want bankrupt, right along with all those mall stores.  They’ve been gone for years.   So, I told my friend, “The reason they are gone is because they had big stores and big bills and TV ads, and they couldn’t sell enough music and movies to pay for it all.”   Heck, we’re in a world where Tower Records is dead.  In fact, can you think of any free-standing music stores in your area that are still alive?  If you can, then you’re most likely in Los Angeles or New York or some such place where there are enough collectors to keep a small store open.  Most likely those are stores focused on used music.  But aside from Virgin Megastore, which is probably on a fast path to death if not for their larger focus on movies, there are very few stores left.  Do you think I want to join the ranks of all those dead music stores?  Nope.  I’ve already run a brick-and-mortar store and I closed to focus on internet sales because the expenses were just too high.

Folks, you’ve already seen the wrath of the market pull down music stores everywhere.  They are a rarity now.  Current music stores mostly live and breath only online, and even those online sellers are bleeding.   That doesn’t mean we can’t bandage the wounds, find our niche and continue on a scale that sustains come kind of viability, but it does mean you won’t be seeing a lot of positive growth anytime soon.  You won’t see MORE releases.  You’ll see fewer.  As I discussed in my last blog posting, many of the releases you see now are CDR “on-the-cheap” releases because bands see it as the only way to release at all (unfortunately).

We’re not dead yet!  Things have changed for sure.  They’ll continue to change.  But I’ll hang in there as long as I can.

-Todd

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12 Responses to “Saving the Store”

  1. I hear you- my goal is no debt by the end of the year. It iwll mean a lean release sked but hey, better off in the long run.
    Hang in there Todd 🙂

  2. I’ve noticed in Minneapolis/St. Paul that most independent music stores that stock fairly mainstream product, along with a decent selection of used product, have survived. The really cool “alternative” music stores with eclectic collections of imports along with domestics are mostly gone. I’m sure the internet availability for ordering imports lead to their demise. We still have a few stores that are pretty darn good in terms of selection, Cheapo and Electric Fetus, where the people working there really love music and are knowlegable about it. Cheapo is a huge supporter of local music, they will consign anything, and they have a huge section dedicated to it. So, things are pretty good here for music retail. We might just be a more passionately, music-focused city? It also seems to help if the music store has a “smoking” section. :o)

  3. It boggles my mind that many, many people no longer place any value on owning a CD or record or whatever the current popular delivery system for music is. The fact that iTunes (and honestly, illegal downloads) are so popular is due to that lack of need to hold something in your hands to feel that you own something.

    This is certainly a generational thing that is only is only going to trend more and more in that direction.

    Although I’m not really into that trend and will always have a special place in my heart for unwrapping a new CD or going to buy a popular release at a midnight release party, it’s not really our choice. This is in the hands of the majority of people who find those ideas a bit antiquated.

    Although I’m not really much of a customer these days due to where my music interests currently are, I wish you the best, Todd. I hope that you can find a way to earn a living in the changed music business climate. You do provide a valuable service to your customers and the bands on your label. It would be a shame to have that become another casualty of this continually changing market.

  4. Just had another thought that I didn’t express above:

    The diminishing returns from CD sales will continue to grow as music becomes more and more of a commodity. And that day may have already arrived. The biggest music sellers now are Walmart and Best Buy. I’ll repeat that. The biggest music sellers now are Walmart and Best Buy. These are two places that I wouldn’t have even considered buying music several years back. Now, they are really getting close to my only choice.

    Also, without trying to stir up a discussion about illegal downloads, it is a reality now. Laws may be found to limit them, but it’s a reality that is likely to never completely go away.

    Anyway, I bring them up because of what it represents to those trying to make money in this business. We are at the point where anything and everything that can be duplicated and distributed for free likely will be duplicated and distributed for free. It’s a fact and no amount of hand wringing and finger wagging is going to change that.

    The focus of the entrepreneur is to determine what CANNOT be duplicated and distributed for free and market that. What does that mean exactly, I’m not sure. But I’m sure that there are any of number of things that big music fans out there would love to have that can’t be sufficed by an MP3 or an AVI file. (Honestly if that’s all a potential customer wants, they are not likely to be much of a customer going forward anyway.)

    Certainly this involves going after a niche market of music fans that want these “other things”, but unfortunately selling music the traditional way has already become a niche market.

    Again, best of luck!!

  5. Then move to NYC!! (just joking-or maybe a little serious)

    Not sure if you know about the Downtown Music Gallery? They are a (physical) store that sells mostly modern/avant-garde jazz, with some rock. They were located on The Bowery, a few blocks from CBGBs. But the area gentrified and their lease ran out, with an option to renew at big bux.
    They moved to a basement store in the non-gentrified part of Chinatown, and are “only” open 4 days a week. They have put much more emphasis on online sales.
    I try to pop in from time to time and pick up a cd or two.

  6. I’m not sure “popular music” has ever been so vapidly valueless as it seems to be these days. The way I look at it, the younger generation doesn’t want to pay much or anything for it because it’s really not worth paying for. I would hope that talent and value is still recognized when it exists and they would then be willing to pay for it. “They,” “the younger generation,” God I’m old!

    • Wow, that’s pretty harsh. Although I don’t really like much of the current popular music, I’m sure that there are people just as passionate about it as I am about what I like. Labelling music as “good” and “bad” is pretty pointless. And your opinion that that it’s vapid and valueless is certainly not the reason why music sales are so different from how they were 20 years ago.

      You’re also indicting the entire “younger generations” by calling them cheapskates that don’t want to pay for music. While it may be true that people now are less willing to put out money for CDs now, it’s the technology driving this movement … not the other way around.

      People have more options now. Granted, some of them are legal and some of them aren’t. But you can’t tell me that the young people of 20 years ago wouldn’t have taken advantage of the technology had it been available back then.

      This issue is not about the music (good or bad) or people (good or bad), but about technology … pure and simple.

  7. It’s a difficult one … we run a digital label and we are quietly trundling along, but we’re not expecting much … however it isn’t our main source of income either. Hang in their mate – I hope it starts to pick up for you …

  8. Do what you can to keep afloat Todd. You do not need to be the haven for every new synthpop band out there. Stock the guaranteed sellers and the rest, I would sell on consignment. I think that’s the term where the bands or labels send you stuff to sell but you don’t have to pay them until you sell the product. Correct me if I’m wrong. 🙂

  9. Any pictures of the old store from the 90ies? You should post them, it would be interesting to see ADD in its old brick and morter incarnation.

  10. Even CD Baby, the biggest indie reseller only second to Amazon, talks about in their most recent podcast how people don’t buy music anymore:

    http://feeds.feedburner.com/cdbabydiymusicpodcast

    It’s already gone the way of the newspaper, horse-and-buggy, etc. So, now everyone is thinking “How can you make money with music without actually record sales?” This could take decades to get sorted out.

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