It is also clamping down on overshipping. It is understood that EMI had 65m unsold CDs returned to it by retailers last year at a cost of about
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studio infoThey say the heart of Rock & Roll is still beating, which is amazing if you consider all the blow it's done over the years. "The Internet enables pompous blowhards to interact with other pompous blowhards in a big circle jerk of pomposity." - Bill Maher "The negative aspects of this business, not only will continue to prevail, but will continue to accelerate in madness. Conditions aren't going to get better, because the economics of rock and roll are getting closer and closer to the economics of Big Business America." - Bill Graham
« Reply #8 on: December 11, 2007, 12:04:33 PM »
65 MILLION units returned last year? I find that hard to believe.
The Pound and a half comes from pressing, shipping, retail co-op and then the return ship. That sounds low in a 65 million return.
Think about this. Even if EMI was running an unprecedented 40% return rate, what product could they have shipped in the last 1.5 years that would have totaled over 100 million units worldwide and only sold through 60%? What retail outlets are going to over order stiffs? None. Retail can replenish their shelves in 48 hours today so they don't generally overstock.
In the US retailers generally will not keep in stock more than 6 weeks of product. With computerized inventory and weekly soundscan reports, shelf space and margins are too tight to keep stock on hand.
In many territories outside the US, sales are one way and not subject to return, so titles do not get over shipped.
Odd figure - But I guess anything is possible.
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R.N.
« Reply #9 on: December 11, 2007, 12:08:13 PM »
RSettee wrote on Mon, 10 December 2007 16:55 | Does anyone else have difficulty taking someone like "Guy Hands" seriously? What is this, an episode of Seinfeld?
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Think Mr. Bill.
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« Reply #10 on: December 11, 2007, 12:36:57 PM »
The more I think about the 65 million returns it makes me think of this Best Buy Scenario,
EMI head of sales calling Best Buy's Gary Arnold.
Hey Gary, we have this great new band The Dumpster Divers coming out Jan 3rd and we want you to order 200K CDs for your chain.
Um, why?
Because we love it and it's going to be a smash and sell all the units you order and then double that.
Um, How is it going to be a smash? What is your plan? What is your spread at the rest of retail?
We plan to have a huge hit at radio, MTV will be banging the video, they will tour and be on the cover of Rolling Stone.
Um yeah? Who is playing the track right now? What format? What is your reach? Can you get me a copy of the the tour dates, markets and ticket counts? When does the magazine piece hit? Is that firm? Send me the marketing plan.
OK will do. We don't have any stations on board yet, but we will. And Rolling Stone said they would do the piece when the band went gold. The tour will happen when we have the radio hit.
Um, ok, I will order 5K units and we'll see what we sell in the first 6 weeks.
Thanks!
Bye now.
Bye.
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R.N.
« Reply #11 on: December 11, 2007, 12:38:35 PM »
compasspnt wrote on Mon, 10 December 2007 16:26 | ...to evaluate what type of artists will generate the best returns across those categories over time...
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Sounds like EMI is going the way of Clear Channel et al, selling what are already proven commodities without risking their assets on anything new. Sounds like a recipe for a stagnant roster... Have these guys considered the possibility that eventually nobody will *want* to sign with them anymore, except in the twilight of their careers? Quote: | "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate."
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Really? Does anyone here agree with that? I kinda thought the opposite was true, and that truth was the reason that more and more (particularly new) artists are turning their back on major labels. Best, Marcel
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Best, Marcel
« Reply #12 on: December 11, 2007, 01:21:00 PM »
compasspnt wrote on Mon, 10 December 2007 16:26 | Subject: Re: EMI in today's Telegraph
Hands attempts to reassure EMI stars
... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate."
... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry."
...
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Yes, the bad old days, when record companies were run by people who knew music and knew how to make a buck from it. And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance?
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« Reply #13 on: December 11, 2007, 01:27:10 PM »
Usually a percentage of otherwise payable royalties is held out to offset potential returns, and then actuals calculated later.
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« Reply #14 on: December 11, 2007, 01:43:24 PM »
seriousfun wrote on Tue, 11 December 2007 10:21 |
compasspnt wrote on Mon, 10 December 2007 16:26 | Subject: Re: EMI in today's Telegraph
Hands attempts to reassure EMI stars
... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate."
... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry."
...
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Yes, the bad old days, when record companies were run by people who knew music and knew how to make a buck from it.
And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance?
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First, Chrysalis music is up for sale, so they aren't in it for the long haul by any means. But yes there is incredible waste in the record business. Most of that waste going to exec pay, perks and overhead. Returns are not a cost to the artist. Plus, once an artist gets the advance, they don't pay it back from their pocket, the only way it is paid back is though sales,
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R.N.
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