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The EvO:R-Pedia Musicians Tips Section
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reference library for Indie musicians...Just about every tip has been used so you won't find false
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Distributors: How To Attract Them & How To Work With Them
By, Christopher Knab (FourFront Media & Music )
Christopher Knab FourFront Media & Music
At a time in music business history when there is more product being manufactured, promoted,
and distributed than ever, the role of the distributor, and their relationship with labels is
an increasingly important one. The purpose of making a record is to (hopefully) sell it. The
following information is intended to introduce the role of, and the relationships between
Independent Distributors, and Record Labels.
Types of Distributors
To begin with, there are several different kinds of distributors in the US.
One-Stop Distributors carry a wide selection of major label and select independent label product, and sell to Chain Stores, Independent Stores, and misc. other retail outlets that sell recorded music product.
Rackjobbers are companies that rent or lease space in large department type stores, and other mass marketing retail outlets. They usually carry only the best selling commercial product available, concentrating on major label product, and some independent label product with a strong regional presence.
Independent Distributors are distributors of Independent Label product either on a regional basis, or more likely, as national distributors. The 1990's has seen as "alliance" of many regional distributors (I.N.D.I. & A.D.A.) bonding together to form larger conglomerates, representing many Independent Labels, and offering retailers a wider variety of product.
The primary job of a Distributor is to get CD's, Records, and Tapes into retail outlets.
They do this by working closely with the record labels to promote and market their CD's, Records, and
Tapes. Most distributors regularly publish catalogs listing the labels they carry, and the titles available.
They accept product on a negotiable billing schedule of between 60 to 120 days per invoice. They expect to
receive a negotiated number of "free goods" to be used as incentives for retailers to carry the product,
and also need "promotional copies" to be used in-house, as well as to give away to contacts in the media,
and at retail. they can also arrange for "co-op" advertising, wherein the costs of media ads are split
between the record label and a retailer.
Record Label Roles
The primary job of a record label is to attract the attention of distributors by having achieved a
modicum of success on their own, by selling product on consignment, or at live shows, and through
various mail order and direct sales methods. Having gotten their product accepted by a distributor,
the job of a record label is to work closely with their distributor(s), providing them with information
on successful airplay, print media support, and live performance successes. In addition the record labels
create "Distributor One Sheets", or fact sheets that include promotion and marketing plans, and list
price information.The record labels also provide the distributor with "P.O.P.'s" (Point of Purchase)
items, such as posters, flyers, cardboard standups etc., that can be used for in-store display.
Working With Distributors
The National Association of Independent Record Distributors (NAIRD) has an annual Directory available
that lists Independent Distributors operating in the United States.
The CD is the preferred format for recorded product in most cases, with vinyl and cassettes appropriate
for certain "niche" musical genre. The music should be professionally recorded. A good measuring stick
is to match the sound quality of the independent recording with the quality of the material played on the radio.
What the Label Must Supply
A Record Label wishing to have their product carried by a Distributor must have the following:
Its own trademarked name
Catalog numbers on each release (usually a 3 letter abbreviation followed by the numbers, i.e. CJK415).
A Universal Product Code: The Barcode on the back of the product. This is required because most retail
sales are now tracked through the Soundscan technology that monitors retail sales. Note: For informati
on on obtaining a UPC code, contact the Uniform Code Council, Inc., 8163 Old Yankee Rd. Suite J, Dayton,
OH. 45456 (513-435-3870).
What A Distributor Wants To Know
This is the information a distributor cares about when deciding whether to carry a label's product.
Has the artist had any success with established mainstream labels?
Does the artist have a following, if so, how well known are they?
If the artist is unknown, what specific promotion ideas does the label have?
Are there any well known "guest" musicians on the recording?
Does the recording, and artwork meet the standards of the musical genre?
Is there any current airplay on commercial or non-commercial radio?
Will there be independent promotion on the release to retail and to radio?
Has the artist hired a publicist, and/or what is the publicity campaign?
Will the artist be touring in support of their release, and is there a schedule?
Does the label have the financial resources to provide "co-op" advertising?
Does the label have the financial resources to press additional product?
Does the label have a salable "back catalog" of proven sellers?
How much product from the label is already out in the stores?
Does the label have other distributors selling the same product?
What are the next releases from the label, and when are they coming out?
The shipping charges are usually the burden of the label, but may be negotiated after a label has
established itself as a customer. Most national distributors require an "exclusive" arrangement,
making them the sole distributor of a label's product.
Many distributors have monthly newsletters, and/or update sheets, as well as catalogs. They may
require labels to advertise in them, with the costs of the ad deducted from a particular invoice.
The Distributor One Sheet
The Distributor One Sheet is one page (8 1/2" x 11") of basic information about the band, and includes:
Label's logo and contact information
Catalog # and UPC code (Barcode)
List price (i.e. $15.98) of each available format
Release Date (to Radio)
Street Date (for Retailers, if different from Release Date)
A brief Artist background description
Selling Points (Discounts, Marketing, and Promotion plans)
All "Promotional" product should have the artwork "punched, clipped, or drilled." This is to make sure that they are not returned to the distributor as "cleans". "Cleans" are the name for regular product sold in stores. Many people who receive "Promos" have friends in retail or at distributors, and can exchange "cleans" for CD's they personally want.
Labels sell their CD's and Tapes to distributors for approximately 50% of the list price of the release.
For example a $15.98 list CD might be purchased by the distributor for $8.
When an invoice becomes due for payment, the distributor may not necessarily pay that invoice in full.
For example, let's say a label has
billed a distributor for a total of $5,000 worth of product. Let's assume that $1,500 of this
product is still in their warehouse. This means that $3,500 worth of product is out in the stores,
some of which is probably still on the store's shelves, unsold. The distributor is responsible for
paying the $3,500 worth of product placed (less a reserve of 15% to 20% for the label's product which
may be returned to the distributor by the stores.) The distributor would hopefully send a check to the
label for about $2,800 to $3,000.
Co-op advertising is a way for record labels to pay for media ad space with product, and is an effective
way to use their inventory to promote sales. For example, when a label wants to promote a certain artist's
concert, they approach a retailer through their distributor. The label will pay for the cost of the ad,
the retailer can deduct their agreed upon "buy-in" of the label's product from their invoice with the distributor,
while the distributor then deducts the amount from their account with the label. In return for this,
the ad features the artist's release, with a mention of the concert. The retailer, in additon to carrying
the product (the buy-in), also agrees to give it good placement in their store(s), and put the product on
sale for a limited time. Basically, this arrangement is a win/win situation for all parties involved.
It is a standard practice that 100% of any defective and overstocked product can be returned by the stores
to the distributors. They insist that every label they deal with accept this policy. If a specific title
from a label is deleted from their catalog, the label must notify the distributor, and it can take up to
one year for the distributor to get deleted product back from the larger chain stores. These larger chains
will withhold up to 20% of their payables to distributors as a reserve against returns.
A packing slip must be enclosed with each order sent from a label to a distributor. This must include
details on what was ordered, what has been shipped, the number of cartons in the shipment, and the
Purchase Order number from the distributor. All product must be shrink wrapped. In most cases, for CD's,
the jewel box is the standard package.
Invoices are sent separately, through the mail. The invoice should include an Invoice Number, invoice
date, a detail of what was shipped, a ship date, unit prices of each title/format sent. The distributors
PO number, and the total amount due, should also appear on the invoice. Each shipment must have it's
The distributor's job is to make the buyers at retail outlets aware of a label's product. They use their sales
tools; promos, one sheets, airplay, press, and live performance reports to try and convince the buyers that they
should stock the product they carry. If a specific title sells, it is the job of the distributor, in cooperation
with the label to provide the retailers with a continuous flow of the product. It is essential that a label have
a consistent, professional, and mutually respectful relationship with their distributors. Selling recorded
product is a team effort, and that fact should never be forgotten. In the business of music, no one is an island.
Throughout his twenty-five year career in the music business, Christopher Knab has shared his experiences
at many industry conventions and conferences, including the New Music Seminar, the Northwest Area Music
Business Conference, and numerous radio industry seminars. Mr. Knab is also currently an instructor in the
music/video business program offered by the Art Institute of Seattle.