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The Ins and Outs of Distribution
Learning how physical product goes round in the music biz...
By Jon Bare

Distribution. It sounds like such a wonderful thing. Your CD in every store with millions of potential fans checking you out. You’re on the map now, baby.

But is it for you? If you are an artist or a member of a band with a self-released CD then you should know something about this thing that you desire. As they say, be careful what you wish for—you just might get it.

Back in the good ol’ days there were lots of distributors—mostly regional. They all had a specific territory. Independent labels would deal with many of them to promote their artists. That all changed when large national chains like Tower and Blockbuster and internet sites like Amazon.com required a single source. Now all distributors had to be national.

Are you a national act? Do you have a national footprint? Are people three states away going to flock to the stores to buy your CD?

Distribution is a double-edged sword. On the one hand, it’s easier to send a box of 100 CDs to a distributor than it is to send 100 CDs to 100 different people that hit your web site. On the other hand, if the product that your distributor puts in stores doesn’t sell, then it all comes back and no one is happy.

Some distributors will want a minimum number of new releases a year. Unless you are a record label with several artists, that may be hard to do. Some will want to see your anticipated promotional campaign expenditures. If you are spending money raising awareness for the product, they will be more inclined to distribute it.

Horses for courses

If you seek distribution, the choice of distributor will be a function of the style of music you play. Many distributors specialize in a few styles of music. If you are into Country & Western and they are into Urban & Techno, they can’t really help you. Every distributor has a web site. Go there and see which artists they represent. Look for sites that embrace artists like you.

Doing the deal

If you are serious about acquiring independent distribution, do the research and find one or more distributors that seem like a good fit for your product. Each company has someone who evaluates new submissions. Find out who that person is and contact him or her. If there is interest on their end they will want a few CDs to evaluate and sooner or later you will need to supply them with one-sheets.

As its name implies, a one-sheet is a one-page advertisement for your product that the distributor’s reps will provide to the buyers in the retail stores. All new releases have one-sheets. They are usually 3-hole punched, have a picture of the CD cover art as well as a list of songs on the CD and some discussion of the product. They can be color or black and white but remember that you may have to print several hundred copies when the time comes. Always include the bar code from the CD and contact info for your record label. Any marketing efforts you are planning to undertake should be described on the one-sheet.

Ask your distributor to send you a few sample one-sheets that they feel were effective in communicating the merits of the product and design your one-sheet in a similar fashion. You can be as artsy as you want, so long as the key information is presented clearly and concisely.

There was a time when you could get a distributor to invest a little money to promote your product but those days are long gone. Nowadays, every distributor expects the record label to do the promotion. Do you have a budget? Is the band touring? Your distributor will want to know these things. The more detail you can provide, the better your chances are of securing the deal.

If you are lucky enough to get more than one distributor interested in your label’s catalog, you must pick one. Retail stores can only deal with one distributor for a record label. They don’t want to have a choice. And distributors don’t really want to share you with their competition.

Your distributor will want a reasonable number of promotional CDs so that their reps can become familiar with your product. When you manufacture CDs it’s a good idea to print some up without a bar code, or with the words “Not For Sale” clearly marked. If your promos are indistinguishable from the CDs you intend to sell, you may find yourself in the unfortunate position of having to buy them back from your distributor along with other returns—even though you gave them away for free.

There are four important dates that your distributor will require you to respond to. The first is the street date—always a Tuesday—when your product will appear in stores. Prior to that is the date your CDs are expected to arrive at the distributor’s warehouse. Prior to that will be a date by which any ads you may want to place in the distributor’s catalog must be made available to them. Finally, there will be a date by which all your one-sheets must arrive. Your distributor will tell you what these dates are. You must comply with these dates or you will blow the deal.

Money money money

Distributors want your product to move, so you will have to decide on a retail price that makes sense for your product. You have a range of options here. If you have the fan base to support it, you could choose “full price”—usually $14.99 for a CD. The distributor will sell CDs to the store for approximately $9.75 and buy them from you for around $7.50. On the other end of the scale, a “discount” retail price of $10.99 means that the distributor will only pay you around $5.00 per CD.

If your CD costs you a buck or two to manufacture and another fifty cents to ship to the distributor, at $5.00 a CD you’re not going to get rich unless you move a lot of product. But if you price your CD at $14.99, and customers would rather save a few bucks and buy someone else’s CD, then you are on the horns of an enema.

Your distributor may offer you a Pressing & Distribution (P&D) deal. This means that you authorize them to arrange for manufacturing as needed—but you still have to pay for it up front. They may get a slightly better deal with their manufacturer since they order in volume. And this arrangement may be more convenient for you when your band is out on the road.

Distributors don’t want to pay you for CDs that don’t get sold, so most of them use SoundScan (a division of Nielsen) to track sales at the point of purchase. They will have this information summarized on their web site so you can go there, log into your account and see where you stand. Forget about opening an account with SoundScan directly as this is prohibitively expensive.

Surprise!

I attended a conference hosted by NARIP (National Association of Record Industry Professionals) where the speaker had made a career consulting to various distribution companies. Most of the information he presented was stuff I already knew, but I’m sure the other attendees learned something about the business. By a show of hands I was the only person there who had actually acquired national distribution.

I was surprised that after two or three hours of lecturing the presenter hadn’t mentioned distribution over the Internet. So at the end of the meeting, in a question-and-answer session, I asked the sixty-four thousand dollar question. “What do traditional distribution companies think about web sites like cdbaby.com?”

Since his clientele is in direct competition with sites like CD Baby and garageband.com, I could understand his reluctance to advertise their existence. But when prodded, he did acknowledge that every artist should have his or her CDs on CD Baby, whether that artist has conventional distribution or not. I would have to agree. You can find my product there at www.cdbaby.com/all/jonbare.

After a few more minutes of questions and answers, the seminar ended. I saw a young lady walk up to the podium and give the speaker her CD and package. I had a CD with me so I decided to do the same. I was thinking that this person listens to many CDs as part of his job and maybe he would appreciate mine.

If you think that anyone involved in music distribution will actually care about you or your music—beyond the dollars and cents—you may be in for a disappointment. The speaker and I chatted briefly and as I walked away I distinctly heard him say to someone standing nearby, “When someone gives you a CD it’s like they just spit on you.” I later confirmed his comment with my contact at NARIP, who said he admitted that those were indeed his words.

Wow. Welcome to the music business!

“Jon Bare’s recordings sound every bit as good as those made at major studios.” – Bill Hartew, Program Director, KLOS 95.5 FM Los Angeles.

 

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