It's make or, more likely, break time for most bricks-and-mortar music retailers. But, as Jim Carrollfinds, a few scrappy independents may just weather out the download juggernaut
T'S the music story of 2007 that will unfortunately keep on giving. In cities and towns around the globe, record shops are going out of business like never before. What were once retail giants are becoming Main Street minnows. The traditional music retail business is in serious trouble and there are no quick-fix solutions in sight.
In the US, Tower Records closed all of its 89 shops at the end of last year. While Tower franchises still operate in Ireland, Japan and Mexico, the US stores have been stripped bare of their fixtures and fittings. These vacant buildings now await new tenants who are unlikely to sell music of any kind.
On the second working day of this year, UK chain Music Zone went into administration and its 104 outlets are set to depart the scene for good, joining such chains as Our Price in the "where are they now?" files.
There were January blues as well for HMV, which announced losses of £16.1 million (€23.3 million) for their UK and Irish operations in the six months to October 2006.
Even once iconic independent stores face an uncertain future. Hip-hop's spiritual home, Beat Street in Brooklyn, closed down before Christmas, while Spillers in Cardiff, a store which has been selling music since 1894, is facing the chop due to a sharp rent rise.
At home, evergreen music chain Golden Discs reported a loss of €60,000 for its last trading year, despite flogging the lease on its prime Grafton Street outlet in Dublin to Marks & Spencer for €5.6 million. Sales in its 27 stores fell by 4 per cent due to what managing director Steve Fitzgerald called "a very challenging environment".
That environment has already led to many casualties around the country. Be it the closure of stores like Black Spot (Limerick), Synthetic (Cork), Carbon (Dublin) and Selectah (Dublin), or the likes of Galway-based Zhivago and Redlight, which have downsized by closing some of their outlets, the Irish music retail sector is in a state of considerable flux.
A familiar list of suspects can be blamed for these changes. The biggest factor in knocking the record shop from its perch has been customers moving to buy both physical and digital music online, with all the price savings and convenience this brings.
Also, a continuing bump in commercial property values means landlords are reckoning that their buildings could achieve higher rental yields from retailers hawking mobile phones or clothes. Landlords may not obsessively read the music trade press, yet it will hardly have escaped their attention that music retailers are not doing tremendously well.
And price competition from supermarket chains such as Tesco is cited again and again by music retailers as a major cause for concern. By buying stock in volume, supermarkets can cut the price of Top 40 CDs and treat them as an in-store loss-leader. You might find a Westlife CD there for €15, goes the argument, but you're unlikely to find a nurturing environment for a new band just starting out.
Of course, there are reasons for the slump which are solely attributable to the retailers themselves. It's not just the big chain stores that employ staff who don't have any knowledge about or enthusiasm for what they're selling. A lack of attention to customer service and too much overpriced merchandise have pushed people to buy their music online, where they won't encounter snotty staff or unavailable stock.
What's clear is that music consumption itself hasn't declined. If anything it has increased, thanks to people buying music via mobile phones or for digital music players. But the retail sector has been very slow to adjust to changes in how music is now consumed.
Tommy Tighe at Dublin's long-running metal and rock mecca Sound Cellar has experienced such ups and downs before. "I remember years ago, after tapes came in, people were saying to me that the records shops were finished. That didn't happen." But it is harder now because of pressure on every front. From the supermarkets ("How can the record labels let them away with those prices? And they give them sale or return terms, too, which they never offer to us") to property prices ("Every five years without fail, there's a rent increase"), Tighe says record stores just cannot catch a break.
Yet he's confident that Sound Cellar will survive because of its specialist position and especially the personal service. "I know my regular customers by name and I know what they want. If they buy one CD, I'll try to sell them a second one. You won't get the sort of service or knowledge you get here in other shops."
Two years ago, Julie Collins at Dublin's Road Records was worried about the future of the store, which has been in business since 1997. "There was all this talk about downloading and people were giving out about prices," she says. "We were really apprehensive about what might happen."
The shop proceeded to make some changes in how it operated. "We stopped stocking mainstream releases because we couldn't compete with the supermarkets on price. We decided to concentrate on more interesting stuff and more vinyl. We now take in every single independent Irish release we're offered, for instance. Most importantly, we've kept our prices down."
Such changes have paid off," she says. "We now have incredibly loyal customers because they know they can get stuff here they won't get elsewhere. We're helped by the likes of [indie label distributor] Vital, which gives the smaller shops a really good deal. They're not like a big label like Universal, who use every single oil price hike to put their prices up."
These days, Collins believes there will always be a place for the record store. "There are people who still want to go to a record shop, hear what we have to recommend and browse through the racks. If you can keep your prices down, I think the future is really good for small, specialist shops like us."
