MRR #274-decline of independent record stores
This month I want to take a break from hardcore to address something that has been at the forefront of my mind lately: The decline of independent record stores in America.

I spent over two months on tour in the usa this year, and as usual I visited every possible record store on our route. I've written about some of my favorite stores and how important I think indpendent stores are to the scene in this space before. This time around, hardly anyone I talked too had any good news for me. Independent stores are closing at a very rapid rate across the country, and those that remain are mostly barely holding on. Even at Extreme Noise, the all volunteer, DIY record co op in minneapolis sales are down close to 20% from last year and 40% from 2001. Extreme Noise is barely hanging in despite having an all volunteer staff and and a good selection of new and used stock. I'd like to take some time to discuss the many factors that are undermining independent music retail.

The most important thing to note is that there isn't a single factor putting record stores out of business. There are numerous factors working in combination that combined make it very difficult to survive. I'll talk a little bit about store survival strategies later on. But there is no silver bullet or one size fits all solution to the problem. Every city has a somewhat different music scene so factors that might weigh heavily on one store, are trivial to another, but taken together they are driving most store owners backs up against the wall.

The most frequent culprit for the music business woes is downloading, file sharing and home CD burning. While a lot of industry types like to blame these activities for all their problems, observers are quick to note that the industry survived the home taping scare of the late 70's and ealry 80's just fine. However, I think that the popularity of the Ipod and digital music as a format in general have made downloading and file sharing more convenient, faster and of course cheaper than going to a store and buying music. A whole generation of young people has grown up never having a stereo, record player, or making a weekly trip to a record store. They have no asthetic attachment to vinyl or even compact disc. Except for a small segment who become more sophistacated in their musical tastes and buying habits there is little hope for this generation changing their ways. If you can download dozens of records in an hour while you are hanging out online and load the songs right to your ipod or listen to them instantly on your computer, all for free, why be bothered paying 10$ or more for a hard copy of just one record? With thousands of people preferring to spend their days on Myspace and message boards rather than leave their homes, it only follows that a music format tailored to this life style would grow rapidly in popularity.

I think at first a lot of people in the underground didn't think that downloading was going to affect underground labels the way it was the majors. However, in the last year or so, I think it has really caught up. Stores have long counted on sales of new release CDs as one of the major areas of revenue. For years a store could count on selling dozens of copies a week, sometimes dozens a day of a new release by a popular band like say Avail, Dillinger Four, Agnostic Front or NOFX. Releases like this were well advertised and promoted with a large fan base and store owners could sell through case after case of this sort of release. Now new releases by popular artists still sell, but only a fraction of what they once did. Common wisdom is that a few die hards buy the CDs new, but most people are happy to burn them from friends or download them.

Furthermore, with the underground entering the mainstream in such a broad way as it has in the last few years, independent stores that used to be the only place to get new releases by popular independent artists now have to compete with major retail chains. There was a time when you had to go to an independent store to get hardcore punk or other underground releases. Now with the hyper commericialization of music most all of the popular, and many of the marginal, independent releases are available at chain stores like Best Buy or Wal Mart often at or below the retailers cost. Furthermore, one doesn't have to reach very far underground to hear aggressive or punk inspired music anymore, as commercial versions of hardcore and punk such as Hatebreed and Rancid are mass marketted and ubiquitous. Another thing to consider is that even a band that sells a few thousand copies these days attracts attention from major labels and their releases move up the distributor food chain to bigger distributors that independent stores have difficulty ordering from. Distributors that specialize in selling to chain stores often insist on minimum orders or that a store order by the case etc. This pushes a lot of "major indie" artists that an independent store might have sold out of their price range and into the retial superstore chain environment. The declining retail environment is not limited to underground or independent stores either. Most chain music stores have gone bankrupt or are close to doing so. Even the discount superstores sell music at a loss or break even, and instead make their profit on music from selling advertising space in the store to record labels and from "co op" payments from labels.

Keep in mind that in the early days of hardcore there was no cable tv, no home video systems, no video games except at arcades, no internet and the mass marketing of youth culture was still in it's infancy. Young people who weren't interested in sports or drugs usually turned to music and records for entertainment. Comic books and movie theatres were the main rivals. Now there are a lot of other factors competing for people's entertainment time and money, the internet, movies on DVD and VHS, video games, and free digital music. With all of these choices only those who are really amped about music are still making the friday afternoon trip to the record store to see what's happening. Indeed, the video game industry is now bigger than the music business, and one of the only sectors of the mainstream music business that still makes money is licensing songs to movies and video games.

I talked a few months ago about the fall of compact disc in this column. I think one of the decisive factors in many people's minds that led them to stop buying new music, was the value to cost trade off of the compact disc. The music industry switched to the higher priced "less for your money" CD format at the same time most mainstream music started to flow downstream from shitsville. Most consumers accurately maintained that it wasn't worth paying full price for a new CD to get the artists one good song. In an age where most popular artists are one hit wonders at best, digital music makes the playlist of only good songs sound a lot more appealing than high priced full length CDs of mostly filler. Ironically, one of the most profitable sectors in music retail remains used CDs. With skilled buyers a retailer can turn a much higher profit margin than new stock with traditional "buy low, sell high" tactics and still retail the used CDs for much less than their new counter parts. However, as more and more people dump their CD collections to help pay for their Ipods, the price of used CDs is bound to drop, hereby robbing retailers of one of their most profitable/high turn over areas.

The other big winner for most indpendent stores is quality used vinyl. When less sophisticated buyers are leaving for digital, die hard fans and collectors remain the backbone of any store's customer base. Collectors are the one group willing to consistently pay good money for quality vinyl and often comb through local stores several times a week looking to score. However, as we have discussed in this column in the past, record collecting has been radically altered by the internet and online auctions. Record store owners, desperate to make ends meet can now cherry pick the best of their used stock and sell it online for the maximum possible amount to the highest bidder. While this results in a much needed stream of revenue for the store, it simulateneously alienates the store's most loyal customer base. Time and time again, I hear fellow collectors saying "that store is picked clean" or "he sells all the good stuff on eBay". The store owner would retort that if they were sell rare records below the inflated eBay price, then local collectors would just buy them and resell them online themselves. This process is especially infuriating on both sides of the counter.

From my experience working at Extreme Noise, qauality used vinyl is in extremely high demand. Good used records sell within hours of hitting the floor. The supply of hardcore punk vinyl, especially from the early 80's is finite but the demand continues to rise and prices have gone up accordingly. There is a huge fan base for good punk music, but bands and labels stubbornly refuse to re issue material, or do so only on the CD format. There is in fact considerable evidence that a CD re issue actually increases demand for vinyl editions. It's not surprising that bootlegs and re issues consistently outsell all but a handful of new releases. Fortunes are currently being made by bootleggers because bands and labels sit on their back catalog. Keeping on top of hot new releases, re issues, bootelgs and having good used stock, is the one sure way most of the stores that aren't in crisis survive. Another factor, not much examined, is that people spending all their money on rare records on ebay have little left over to spend on new releases at the local record store. But all this looking at punk's past brings me to my next point.

In todays over saturated market there are more bands and releases than ever before. Thousands and thousands of bands, tens of tousands of new CDs and records every year. This is a factor I've discussed several times in this column. In this tidal wave of independent releases, many would argue that there are only a handful of standouts. That is to say, there are a ton of bands today, but not many records worth buying. The lack of current records that can stand up to the classics is pretty profound. Most people would rather buy an Adolescents or Black Flag record that has stood the test of time than gamble on a new band that has maybe one or two good songs on an LP, two 7"s and four splits. From the store's perspective this means stocking everything people could want is almost impossible. There are tried and true releases and a few popular new bands, but to have every genre represented in depth means investing huge sums on records that only might sell. This leads me to another factor, the new release window and the restock shortfall. Most new releases are "new" for only a few weeks before becoming old news. Stores that in the past may have ordered 5 or 10 copies of a new release, now only have the budget to order 1 or 2 copies of 10 different new releases. And once those sell, instead of being re stocked, they are likely to never be ordered again, as more new releases are coming every month. This means for the customer if you aren't quick on the draw, many times you visit the store, chances of them having much of what you want are limited. And it's more and more difficult for even the most inormed buyer to predict which titles will continue to sell and which have hit the wall. Few stores these days can afford to stock hundreds of titles that "might" sell, only the records they know "will" sell. The end result is that as the possible selection increases, the chances of finding what you are looking for at a store, decreases.

Another factor I've noted is, that with so many bands putting out records and going on tour, a lot of people who possibly would have been buying other bands records in the past, are saving their money up to put out their own records. Also, as a significant portion of the punk scene is now older there seems to be a certain point at which a lot of people move from being active to passive fans. That is to say they graduate to becoming "bar punks" who spend their money on beer and nice punk outfits rather than records, fanzines or shows. This leaves a customer base of mostly enthusiastic young kids and jaded old collectors. As opposed to a broad cross section.

Which leads me to competition from online sales. Even the most multifaceted store with the most diverse stock, can't compete against the whole of the internet for selection, or often price. Internet retailers operating on a lower overhead can offer a broad selection cheaper than most retail outlets. Furthermore, most labels and bands are selling their releases directly online as well. In the past a loyal customer who didn't find what they wanted at a store would have to special order it from the store. Now if the store is out of stock, the customer can just go home and search online and order the release the same day. As we noted above the chances of the store having everything, all the time is slim. So with genres and subgenres splintering it's easier and easier for small websites and distributors to cater to a narrow fan base, and harder for the store to do the same. And of course, like with digital music, in an era where many people spend their work days and much of their leisure time online, ordering records or CDs online is faster, easier and often cheaper than going to the store.

Another factor that I don't think many people have factored in, is shakeups on the distributor side of the equation. With so many labels and genres there are no longer many benchmark "one stop" distirbutors that can keep a store well stocked. A store that relies too heavily on one or two distributors will artificially tilt their selection to the handful of exclusive labels carried by those distributors, thereby potentially not stocking dozens of genres and labels that customers might want. Furthermore, the shady business of record distribution means that many labels, sick of not getting paid and being ripped off by distributors have pulled their stock or moved to different distributors. I know at Extreme Noise we have trouble keeping track of where to re order sold out titles from as distributors go out of business and labels bounce around. A considerable number of the most in demand labels refuse to use any distributors at all, Kick N Punch is a good example. Many of the best releases are not available to stores through traditional distribution channels, since the labels have no trouble selling all their copies mail order and online. This means many distributors are left with only a good selection of the more mediocre labels and releases.

When I was younger I went to several record stores every week. I spend every dollar I had at stores like Vinyl Ink and Yesterday and Today, both now out of business. In the 80's the main problem was there were more good records to buy than I could afford. Now, I have enough cash to buy most records I would want, but no matter how many record stores I go to, I rarely find anything worth buying. The days of scoring great records and good prices are mostly over. Most stores are picked clean, and any good new records to come in, are snagged quickly or go straight to ebay. Which brings me to my last point. Stores faced with precipitously declining sales have to struggle just to pay their rent. As sales decline the available budget to buy new releases shrinks. Customers are frustrated because the store never gets any new records and the store is frustrated because it's sales continue to fall. At a certain point the ratio becomes unbearable and the store fails. More and more store owners have realised that they need a survival strategy to cope because almost no one is making it on just retail sales.

Some of the most common survival strategies are stores starting labels of their own, or using their space to promote shows. A lot of stores are subsidized by labels because they can trade their releases for other labels stock instead of laying out cash. This is of course the same pattern most label based distros operate under and it can help underwrite some of the costs of bringing in new stock. However, as we have seen, the last few years haven't been the best for independent labels either and these days it's probably just as easy to lose money running a label as it is doing a store. Using space in the store to promote shows is a good way to bring in potential customers and possibly some extra income. But the unwillingness of most show goers to pay more than a sub-subsistence door price, coupled with problems like people trashing and disrespecting the store often make this more of a hassle than it's worth. Some stores move into online sales, which as we pointed out above, can be a double edged sword. Many close up shop completely and just sell online from their home, which works as long as they can keep new stock coming in, something that's difficult to do without a store front advertising "we buy used records." Some stores these days sell as much or more clothing and accessories than records. I know places like Smash, Radiation, Dr. Strange and Cash for Chaos have a full line of shoes, shirts, bondage pants etc. For a generation of kids weened on free digital music, and raised in an image conscious era such as this, clothing and accessories are their connection to the culture rather than records or magazines.

Ironically, a lot of mail orders have told me that they are doing more business than ever. I would retort that this is not because the popularity of hardcore has increased, but just because there are now fewer stores for most people to go to. A distributor told me that the list of stores they serviced had declinced from over 2000 to less than 1500 just in the last year. A local record store helps serve as an anchor to a music scene. When the store goes under, the scene is almost always affected negatively. There are fewer new records, bands or shows and less opportunities for new fans to discover underground music. Just as the rest of American society is being undermined by corporate culture with it's lowest common demoninator appeal, so too is indpendent music retail. Wal Mart puts local retailers out of business when they move into a community and neighborhood hardware and video stores go under when faced with competition from corporate chains like Home Depot and Blockbuster. However, the drive by corporations for the cheapest possible products at the lowest cost to appeal to the widest possible audience results in a chillingly banal almost Soviet style culture devoid of any taste, stye, creative spark or substance. As local stores with their informed staff and diverse selection leave the landscape the bleak future of chain retail offering only the major label version of hardcore becomes a reality.

Publication Date:
January 1, 1984

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