Department Stores Put Record Labels on Consignment
#K100Radio • • • • • • • •
Story: \"If the majors don't play ball and give in to Target's new sale terms, it could considerably hasten the phase down of the CD format.\" - @billboard • • • • • •
Oh wait... there's more:
\"Best Buy has just told music suppliers that it will pull CDs from its stores come July 1. At one point, Best Buy was the most powerful music merchandiser in the U.S., but nowadays it's a shadow of its former self, with a reduced and shoddy offering of CDs. Sources suggest that the company's CD business is nowadays only generating about $40 million annually. While it says it's planning to pull out CDs, Best Buy will continue to carry vinyl for the next two years, keeping a commitment it made to vendors. The vinyl will now be merchandised with the turntables, sources suggest.\"
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And then there is this part:
\"Meanwhile, sources say that Target has demanded to music suppliers that it wants to be sold on what amounts to a consignment basis. Currently, Target takes the inventory risk by agreeing to pay for any goods it is shipped within 60 days, and must pay to ship back unsold CDs for credit. With consignment, the inventory risk shifts back to the labels.\"