Touch & Go record label S&D

yeah (and yay) to above few posts. glad to hear it's just the distribution arm, should have taken time to read rusk's official statement in teh 1st place. hope the label is doing okay, and hope the transition goes smoothly. godspeed you one and all

seriously sometimes i think i would shut the internet down right now if i could bring back all the stuff we're going to lose because of it.

i feel bad for thinking that though, like it's a backwards way of thinking but i can't help it sometimes.

Uh why is the internet responsible for the lousy state of our economy?

my feelings don't make sense alex

matt otm, sadly

if they stop distro, some of the labels will probably jump up to ADA. From ADA's website:

http://www.touchandgorecords.com/ Full List of Titles Chicago-based Touch And Go, at the forefront of music for over a decade, is home to artists from the Yeah Yeah Yeah's, Enon, and Black Heart Procession to Blonde Redhead, Dirty Three, Man Or Astroman?, and The Jesus Lizard. The label is also the home of many other indie labels such as 2.13.61, 5 Rue Christine, All Natural Inc., Atavistic, Cold Crush, Dim Mak, Drag City, Emperor Jones, Estrus, In The Fishtank, Jade Tree, Kill Rock Stars, Le Tigre, Merge, Overcoat, Quarterstick, Robocore, Suicide Squeeze, Thrill Jockey, Trixie, Trance Syndicate, Voodoo Eros, and Warm Recordings.

Dan - Sure. But imagine the costs of switching your p & d. Also: this might just be the first P & D to go under. Imagine trying to figure out what to do in this situ if you're one of the affected labels. Yikes!

a friend told me the reason a lot of those labels had to go through T&G in the first place was because ADA wouldn't take them on

Then again maybe those labels knew this was coming...? Still, even if that were the case, the cost of disruption might be more than some of them can bear. Many people seemed to be hoping against hope that Xmas would be good, but it wasn't, and this might be the final nail for some of those labels, or push them into layoffs and/or significantly scaling back their business. Perhaps we'll end up with a single solvent distributor of smaller labels -- it's certainly possible. Yikes x 400.

How well is Merge's mp3 store doing?

I remember taking a look and being really impressed with the simplicity and flexibility (in media formats). If only I didn't already own on CD the stuff that I wanted from them.

System - Totally otm. A lot of labels will likely go digital/vinyl after this, maybe with vinyl as direct order only...? Which is what they all should've been doing a year-plus ago, but whatever. But vinyl business is limited -- it costs a lot more to manufacture them than CDs, not just because of the materials involved but because there's limited pressing capacity... And no new plants coming online anytime soon. Or so I'm told.

Well, to all y'all who have slept on those David Kilgour albums who if you like the indie rock, go buy them mp3s from Merge NOW!

And the Volcano Suns ones too!

bbbbbbut look at this news from a few weeks ago, and Pitchfork is now highlighting indie rock on ABC news (see other thread) so it's not all bad news...Nah, this is sad and the big sellers are more the lottery winning exceptions to the rule

January 28, 2009 Billboard--It's a great week for indie rock acts, as Andrew Bird, Animal Collective and Bon Iver all debut in the top 20 of the big chart

curmudgeon - indeed. but, from what I understand, Pitchfork has a sliver of ABC News *website*, not their broadcast...

As an artist with an album due out on Atavistic this year, I was naturally quite alarmed when I heard about this.

A quick call to the label this morning made it clear that there was no advance warning. In better news, it seems other distributors are already courting many of the labels that are being left in the lurch by this...

Funny, I was in a band on Skin Graft before who lost their T&G distro after the Buttholes lawsuit. Also received a contract from Man's Ruin 30 days before they shut their doors.

Born too late!

DIY!

Nate - And what about the monies one presumes T & G owes to the labels...? If the labels can't cover that, then...

I doubt T&G is planning to rip anyone off in this process... But of course I have no way of knowing what will actually transpire in the coming months. Hoping for the best for all involved!

Nate - It's not to do with anyone ripping off anyone, as it's to do with who will bear the burden of the debt that presumably exists in the system, and for how long, and so on.

from Kot's blog, an update:

Mac McCaughan, cofounder of North Carolina independent label Merge Records, called the announcement "a sad day for music, independent music and punk rock in particular, and the music business as we know it in the real world."

"Corey Rusk is the most meticulous, cautious, thoughtful business person I know, which is what makes this whole thing so unbelievable and such a bad portent for the rest of the independent music business," McCaughan said. "If a company that did everything the right way can't survive in this environment ... then who can?"

There's an article on Billboard citing an inside source saying the damage at T&G is deeper than just distribution -- they're laying off most of the staff, winding down new releases by the end of the year. If so, yesterday's announcement was just the first step. And that would suck worse. But it would totally be consistent with Corey's above-the-level way of doing business -- if he gives the distributed labels time to gather their stock and find new distributors first, he can help them avoid replaying the Rough Trade bloodbath of 1991, when some labels got wiped out because there were too many debts and creditors in line. Hoping it's not true, but if it is, the man earns even more respect than he already has for going under with integrity.

I don't know about doing everything right. Their weekend-long 25th Anniversary festival (with Didjits, Scratch Acid and Big Black!) was awesome, but they should have reissued some special remastered editions of some of their catalog. No merch that I could see, no CDs. It's like they don't want to make money. Much of the catalog is badly in need of remastering, but the company still seemed in denial that vinyl wasn't going to make a comeback. Hopefully it's not too late. Dischord and Fugazi did it. A 25th anniversary box set would have been a good way to sell something cool as a memento too, and an introduction to best cuts from lesser known bands for the kiddies. They could offer high bandwidth remastered downloads online too.

Here's an idea -- get enough people to pre-pay for a deluxe reissue of Shellac's At Action Park with all of their early singles, b-sides, and other rare tracks like "The Futurist" which they gave out only to friends. The Guy Who Invented Fire, Rambler Song, The Billiard Player Song, Doris, Wingwalker, The Admiral, '95 Jailbreak, The Copper Song, etc. Who wants one?

I worked at t&g for 6 months in '95-'96 (man did I ever suck at retail promotion, sorry about that t&g) and know enough of Corey Rusk to believe that exactly nobody's going to get screwed over burden-of-debt-wise. I would bet money that he'll close his books properly & gentleman-like.

John D., that's not what I'm talking about. Sorry if I'm not being clear here. Hmm. Okay, try and think about why Cory might have made this decision, and then try to think what will follow from it, going forward. One assumes that one thing in play here is that there are too many CDs that have been manufactured, shipped to stores and shipped back to distributor, unsold. One can reasonably assume that there are also vendors who have sold CDs (say) to customers but are behind in paying T & G. Distributors like T & G often operate as a bank here -- they extend credit (that is, they allow for late payment) to stores if they think it will help the store to stay alive and give T & G a better chance at eventually being paid; I would also assume that, given their reputation as good faith players and wise businessfolks, T & G also extended credit (that is, allowed for late payments) to labels for manufacturing costs. If you take these two reasonable assumptions, then it's reasonable to assume that T & G is holding a serious amount of debt that Cory doesn't think will ever be paid. So, he stops. Okay. This means a large, sturdy, dependable source of credit is now disappearing from the whole process. What happens to the money one presumes is owed to T & G for CD sales that retailers can't pay? What if stores say "we need another 60 days" or decide not to ever pay T & G since their relationship with them is now over since T & G is no longer in business? Remember that everything is done on terms/credit at this level, not with cash! The accounting work is significant. For the affected labels, this means that they have to do a whole lot of work right that they were hoping they wouldn't have to do, at what's probably the worst possible time...they're already dealing with problems on every front, and now THIS HAPPENS. Yikes, total triple red emergency alert.

This mirrors what's happening in the economy at large: there is huge over-capacity for production in the current economy, and nobody has the money to keep it going at the level it once was. Charles Potts wrote about this on the Arthur blog. Heck, Paul Krugman writes about this twice a week in the NYTimes. It's not as if it's news. Could I have predicted that T & G was going to be the first big indie distributor to get out, then? No way. Then again, if the whole system is indeed going down, the smart ones get out early...

OOPS: Dropped a very important word "now" there.

SHOULD READ:

"For the affected labels, this means that they have to do a whole lot of work right (((NOW))) that they were hoping they wouldn't have to do, at what's probably the worst possible time...they're already dealing with problems on every front, and now THIS HAPPENS."

Basically what I'm saying is: Cory can't afford to bleed anymore. So, who can? Or, as Mac put it, if Cory, as smart as he is, can't afford to bleed, then who can?

Personally, I've seen way way way too many CDs being released by all of these labels in the last 36 months. Good records, sure, but not records that can pay for themselves, all things considered. That stuff has to pile up. And eventually the bill comes due.

I know people are coming to grips with the news, and analogies are very common as far as sad news goes. But a credit union burst analogy for T&G is probably best avoided.

Granted, I say this being one of the Kings Of Bad Analogies on ILX. If even I think an analogy is bad, then wau, lulz.

System - Hmm. Not sure why you're saying what you're saying...? I'm not using a "credit union burst" analogy per se. I'm just talking about how credit is extended via negotiated payment terms, which is how business is done in industrial America, and exploring what the system-wide ramifications tend to be when a major holder of debt exits that system. Every party that works in a supply chain, or industry, or system, or whatever you want to call it, has a relationship with every other party that can be understood best by asking the question: Who floats who for how long? Following from that: when somebody decides to stop floating somebody else, what are the ramifications for the remaining players? Etc.

jay, my main point re: "omg bad analogy" was: What and why Corey (and to be fair, Tesco Vee) thinks he was put on this planet for probably couldn't be more opposite than how most business enterpreneurs approach that philosophy.

I could be wrong but Vee didn't start T&G thinking it would last beyond E. Lansing, much less become a relative haven for underground music distribution for the next 20 years run by that one guy in the Necros. see my point? I'm not saying your argument is full of shit, jay -- not at all. I'm just thinking we aren't going back far enough to the roots of T&G to see some really overlooked history there that's so un-enterpreneurial that maybe we should be looking at that a bit more, that's all. Just a strategy suggestion more than anything. I could have been more clear, so apologies.

(To be fair, a lot of Huge Comglomos today probably had very humble ad hoc beginnings too.)

Jay your whole deal in re: T&G specifically is a huge mess of assumptions & projections that afaik don't actually apply here, it's not like T&G is an unraveling pyramid scheme. There are other places to do P&D, and there's DYI, and the labels will have to work hard if they want to keep doing what they do but those that want to go on will be able to do so.

John D- It's not a pyramid scheme. It's a supply chain. This is a big disruption and will likely be the final straw for some folks in terms of doing real-world product. There will most definitely be people who want to go on who won't be able to do so now because credit is so tight.

you're making a fuckton's worth of assumptions and i think you need to hire a fail truck to carry them away

both makro and j0hn: i think yr. projecting weird things onto what jay's saying (ecluding the more metaphorical last paragraph). far as i can tell, what jay did was to describe the role of distributors/middlemen as credit holders. something fundamental to way almost all businesses operate, large and small, indie and outie. i expect, based on reputation, that corey will at least try to handle the closure of the distro responsiblity, but the loss of that credit pool will be a significant blow to a LOT of people, no matter how you slice it. as a thing in itself, but also in terms of the secondary effects jay mentioned: shift of the burden of accounting work, the way breaks in the chain tend to delay payment & confuse issues of responsibility, etc.

of course there are assumptions built in, but i think they're mostly fair assumptions. not guaranteed, but very reasonable.

System - I don't understand your point...? Are you saying that perhaps Cory's management style and strategic decisions have been financially foolish, and he just got lucky for a while and his luck ran out? That just doesn't make sense to me to say. I know too many smart people in the business who work with him, or speak highly of him; they don't work with dummies, and they don't say that kind of stuff lightly. So I dunno...

mr. que - Um. Look. Point out which assumption doesn't make sense to you, and I'll give you the basis for my making that assumption. Okay?

Contenderizer - Thanks for putting it better and more gracefully than I've been able to.

One assumes that one thing in play here is that there are too many CDs that have been manufactured, shipped to stores and shipped back to distributor, unsold. One can reasonably assume that there are also vendors who have sold CDs (say) to customers but are behind in paying T & G. Distributors like T & G often operate as a bank here -- they extend credit (that is, they allow for late payment) to stores if they think it will help the store to stay alive and give T & G a better chance at eventually being paid; I would also assume that, given their reputation as good faith players and wise businessfolks, T & G also extended credit (that is, allowed for late payments) to labels for manufacturing costs. If you take these two reasonable assumptions, then it's reasonable to assume that T & G is holding a serious amount of debt that Cory doesn't think will ever be paid. So, he stops. Okay. This means a large, sturdy, dependable source of credit is now disappearing from the whole process. What happens to the money one presumes is owed to T & G for CD sales that retailers can't pay? What if stores say "we need another 60 days" or decide not to ever pay T & G since their relationship with them is now over since T & G is no longer in business? Remember that everything is done on terms/credit at this level, not with cash! The accounting work is significant. For the affected labels, this means that they have to do a whole lot of work right that they were hoping they wouldn't have to do, at what's probably the worst possible time...they're already dealing with problems on every front, and now THIS HAPPENS. Yikes, total triple red emergency alert.

i mean when i worked at a record store it was all about cash not credit. but i could be wrong. but you have like 800 assumptions in this paragraph i'm not gonna enumerate em all for ya, but do indie record stores really ship back CD's to T&G????

HITLER
LADY GAGA
TRUCKER HATS

I'm trying to kill this argument dead via Godwin now.

Jay, why you thought I was inferring Corey was a bad bussinessman is beyond me. I'm sorry I said anything.

What if stores say "we need another 60 days" or decide not to ever pay T & G since their relationship with them is now over since T & G is no longer in business?

isn't this like totally illegal?

I'm just going to say this again:

There are other places to do P&D, and there's DYI, and the labels will have to work hard if they want to keep doing what they do but those that want to go on will be able to do so.

not minimizing how sad it is that one of the best p&d's working won't be doing it any more but there is no reason, on earth, for any of the affected labels to not soldier on. most of them were self-running indies before they allied with t&g, and many of them can probably going through ADA now. I don't imagine ADA can pick up all of them, but it's not like these labels can't do the job themselves. Slow down the release schedule, work on cash instead of terms, it's really not that rough. It does mean, yeah, you can't keep a credit revolving door going for a while, but that's going to be true across many sectors in a slumping economy and would be imo healthy for a lot of reasons.

John D: I agree with you, to a degree. But I think it's going to be much rougher going forward than you think. We'll see!

Mr. Que - Yes stores return CDs to distributors. My understanding from one other major indie distributor was that there was a huge uptick of returns in the second half of 2008. I don't have firsthand info on T & G in this regard, but um...yeah. I don't know many (any?) vendors of significance that are set up to buy cds in cash upfront from distributors as s.o.p.

re: legality of non-payment of debt. That's missing the point. You can have a contractually binding agreement with someone but if the cost of enforcing it is greater than the benefits derived from enforcing it, then...

I was a big Pinback fan at one time, but my favorite thin on Touch & Go is QUASI. That band still doesn't get enough credit.

Yes indie stores return unsold indie CDs to distributors. It sucks because you're like, I thought we sold a million, why are they coming back!

LATimes' Todd Martens blogs:

... Touch and Go has handled distribution for such labels as Merge Records (Arcade Fire, M. Ward), Suicide Squeeze (Minus the Bear) and Kill Rock Stars (the Decemberists' Colin Melloy). Yet Touch and Go has also been affiliated with Warner Music Group's distribution arm Alternative Distribution Alliance, which has handled the heavy lifting on major releases, including all of Merge's in the past few years.

Merge was distributed exclusively through Touch and Go for 15 years before going direct with the Warners' ADA. In a statement passed along to Pop & Hiss, Merge notes that had it not been for Touch and Go agreeing to manufacture and distribute the label, the Chapel Hill, N.C.-based indie could not have existed "as something other than a singles label."

In an e-mail, Merge founder Mac McCaughan calls Touch and Go "the most straight-up and ass-busting-for-music-they-love people we know."

"Corey Rusk is the most meticulous, cautious, thoughtful business person I know," he said, "which is what makes this whole thing so unbelievable and such a bad portent for the rest of the independent music business -- if a company that did everything the right way can't survive in this environment (and the environment existed before the current worldwide financial disaster -- the Bush economic legacy only piled on), then who can?"

It's unclear at the moment if Touch and Go will continue to sign new acts, or operate only as a catalog imprint. Billboard quotes a source that implies the latter, but a Touch and Go spokeswoman declined to clarify, and Rusk has not yet returned calls. Indications are that Touch & Go will continue to be distributed via ADA, but affiliated labels will soon have to seek new arrangements.

all of this jay babcock & dan seltzers

selzer