Published Jul 13, 2016Potentially causing an devastating effect for numerous American indie record stores, Warner Music Group's distribution branch has ceased doing business with multiple stores in the U.S. As a result, a number of indie shops in the U.S. have seen their accounts with Warner's WEA division closed, forcing retailers to find alternative, more costly ways to stock their stores than working with the major label directly.
As Pitchfork reports, Warner's WEA division recently sent out notices to "about a hundred" small retailers to alert them of the change, explaining that relations were being severed with businesses that had done less than the $10,000 minimum annual order.
"WEA proudly supports hundreds of independent vinyl retailers across the country with direct distribution, and many more through other channels," a representative explained in a statement. "Last week, in accordance with our long-time policy, we recommended that a limited number of retailers would be better served by working with one of the many vinyl wholesale partners that carry all of our artists' releases."
Despite the statement focusing on vinyl products, it was added by the rep that not all of the U.S. stores affected dealt in selling wax. Some hadn't even ordered vinyl from Warner in over a year.
While the decision south of the border does not affect stores here in Canada, it has alarmed small business owners across the U.S., with some arguing that independent retailers have a big impact on the music industry, especially in the wake of closures of once dominant big box stores. That said, small shops have often been fighting an uphill battle with the majors.
"When we started, and were quite small, we found it very difficult to work with record companies — even some of the small ones — because we were seen as 'peanuts' compared to the big retailers out there," Rick Wojcik, co-founder of Chicago shop Dusty Groove, had told Pitchfork.
He continued: "These days, those big retailers are all gone, while we've slowly grown, and numbers that once seemed negligible to the music business are now the numbers of success. The vinyl revival is one example of that, where the numbers pressed are tiny, but seen as driving the bigger business of these companies, so it is a bit of a surprise that they'd be shaking loose customers who were small, but important."
With WEA severing ties to independent retailers, the small shops will have to order Warner releases via third party wholesalers. Dealing in business this way would likely add extra costs to the records, making them both more expensive for shops and customers.
Wojcik added of the situation: "Through all of this is the continuing self-fulfilling declin — in which the industry shuts doors on music retailing, then complains about its failure."
It should be noted that Warner Music Canada has not announced any similar move to take place here in Canada.