Download, but Not Out
An Interview with Six Seattle Record Store Heads on How Their Stores are Surviving
Let's introduce the players: Dave Voorhees, owner of Bop Street Records, a two-level sanctuary of mostly old, oft-collectible vinyl (reputedly 750,000 records, though we didn't count 'em) in many genres; Jeffery Taylor, co-owner of Wall of Sound, a small but expertly curated emporium of experimental, electronic, world, and beyond, with stock almost evenly split between wax and CDs; Jason Hughes, owner of Sonic Boom Records, an archetypal indie-rock shop bolstered with fairly substantial electronic, hiphop, world, jazz sections and great array of zines and books; David Miranda, manager of Everyday Music's Capitol Hill store, a vast all-things-to-all-people place abounding with new and used CDs, vinyl, cassettes, DVDs, and audio accessories; David Day, owner of Jive Time Records, a used-vinyl-centric crate-digger's paradise; Matt Vaughan, owner of Easy Street Records, a slightly smaller all-things-to-all-people establishment, with sizable new and used vinyl and CD stashes, and a fab magazine stand.
Voorhees: It's good. The last two or three years, I've never sold as many records in my life, and I've always sold records. I never phased my records out when CDs came into my store, around 1987.
Taylor: It seems a little better for us at the moment (thanks, people!). It's always a wild ride on the day-to-day for us, but we manage to stay afloat and weather the slow days.
Miranda: Of all of our stores [Everyday Music has five in Seattle, Bellingham, and Portland], we were doing the best in January. After being at that location [Broadway and Pine in Capitol Hill] for a year and a half, we finally felt like we were getting our bearings [Everyday Music closed January 18 in order to relocate a block north; it's tentatively slated to reopen March 15]. Things were going well. I could only imagine better things at that location. It seems like it's holding steady in regards to the past few weeks. Christmas was a success, whereas the previous year was a disaster due to the snowstorm. I've been doing this for almost 12 years and it always seems like it goes back and forth. The past four or five years, it was definitely going downhill. It seems like [business] might be starting to creep back up to a stable, profitable environment.
Hughes: Business is down overall; 2009 was down for both stores, but you need to keep in mind that our Capitol Hill location was closed from October 26 through December 12. It was a really unfortunate turn of events that left us without a storefront while the new building location was finished. Ballard was off by roughly 10 percent and, as you can imagine, Capitol Hill was way off. Our Christmas at the new location was 50 percent off from the previous year and 2009 was off by about 20 percent on the Hill. That was part of the reason I decided to close the location on 15th and move to a bigger location with more foot traffic. It was a huge gamble and I'm hoping it pays off. I think I'll have a better idea as we roll into spring. There is also less money available from labels for co-op (advertising/marketing), which hurts, as well.
Vaughan: We don't sell as many copies of big records. The days of ordering 1,000 copies of a Modest Mouse CD or a Wilco CD are over. There are a few factors for that. Of course, much of it has been widely documented; MP3s and iTunes, but there are maybe some other factors that have a bigger role, at least for us. The major record labels have been decimated to a shell of their former selves. There is not one major record company that has a branch or team of people working their respective records... Those companies have not had the resources to promote and market their records as they once did. Five years ago they all had offices here in the Northwest; today there is basically one regional person trying to sell, market, display, and advertise all these records. Each one of these companies has about 20 new releases each week. It's just too much to ask of the reps; they can't do it all and the records have a tougher time getting off the ground. Furthermore, they are constantly in fear... or in hopes (in some cases) of losing their job. Just look through The Stranger: The days of seeing quarter-page ads for new records are pretty much nonexistent. Listen to the radio; you won't hear ads for new records being released; the record companies just don't have the money to advertise.
For my Queen Anne store, losing the Sonics two years ago was a blow; it took the soul out of Lower Queen Anne and with it we lost some of that civic pride. The bars, cafes, shops, and restaurants have all been hurt by it. Along with losing the Sonics, there just aren't as many big events or concerts at the Key or Seattle Center in general. It just doesn't feel like Seattle's center. Bumbershoot and Folklife are great events, however, it's like Christmas for us, and we play a significant role in sponsoring and supporting these events, along with Sasquatch, Decibel, and any local music festival we can help with.
Seattle is made up of a bunch of bedroom communities: West Seattle, Queen Anne, Capitol Hill, Wallingford, etc. We are hubs, we are hoods, we are boroughs. There are people I know in West Seattle who haven't crossed the bridge in months. There are people on the Hill who have a tough time finding Queen Anne. So, with that being said, people have gotten insulated and more so than ever before. They don't drive as much, they shop online, they walk down the street, they cut their own hair, they brew their own beer, whatever, ya know they are saving money, they are getting resourceful.
Indie stores have basically been pitted against each other at this point. Maybe it's more hood versus hood? Of course, some have closed: Cellophane Square, Fremont Sonic Boom, the Landing, and a few others, but overall, music consumers in Seattle are pretty lucky. We have a ton of record stores to fill most of your music desires. With the competition, the average price for music is cheaper than you'd find in just about any other city in the U.S. Also, it forces us all to be on our game a bit more, but I think we understand that there are only so many sales to get split up and those sales are less and less.
When I first opened the Queen Anne store, I did so because I felt that there was a void in Seattle to be represented by a good-sized independent record shop. We got off to a good start and have done some great things there, but I don't think we will ever see the kind of sales we had three to four years ago. We filled that void and did so with great pride and even with a little bit of innovation, but I think other indie retailers wanted to get their share and a few of them have made strong efforts. I can't say if it has benefited them, but it did give consumers more choices.
The used market is huge right now. People are purging and people want cash, but we have to be careful. There are days we give out more than we take in. Our used inventory is better than ever and my used guys are the best in the game. Our prices are super fair and only get cheaper. Our used vinyl is only getting better too. Again, we tend to be cheaper than most; we like to turn and burn. Very rarely will we sell our goods on eBay; our customers get first crack at it, the good stuff isn't going out the back door. We just sold a Butcher Baby [the infamous Beatles Yesterday and Today LP] cover in the store today; rarely will you see that live in person. We had a Warsaw/Joy Division record; most stores would eBay that immediately and try to get the maximum. It just takes all the fun out of it when you do that, though. I mean, are you a record store or are you just a dude sitting in his basement selling records on eBay?
How's business compared to five years ago?
Voorhees: I would say business now is better, but it was good back then, too. Many of my customers don't even have CD players, don't want 'em or are getting their vinyl back. Anybody who wanted vinyl knew that I was sort of the place to go. I've never seen a big fall in record sales.
Taylor: We'd like to think the belts have loosened a bit in the last year or so. Again, perhaps a little bit better.
Miranda: That's hard to say. I'd like to see what we would've done in February to make a good gauge on that. Like I said, over the past five years, it's been pretty grim. I check Billboard magazine and the percentages of digital sales are skyrocketing, the amount of people downloading and the exposure that that media's getting, it's highly profitable. The music-company CEOs at major labels are focusing on that instead of keeping the brick-and-mortar stores going. They do make an effort, but the independent labels seem to be doing more on that front—ADA and Redeye.
Hughes: Business is not what it used to be five years ago. It's not that sales have completely fallen off but more that the composition of our sales numbers has changed a lot. New CD sales don't dominate the percentages as much. Sales of vinyl, accessories, books, magazines, and other items have slowly grown.
What strategies have you implemented to deal with the current realities of music-consumer behavior?
Voorhees: I've pretty much kept the same strategy. I've maybe cut back buying CDs. As far as vinyl goes, a friend of mine was telling me there were 2.4 million new LPs sold last year, and that was up 35 percent from the year before. That was the most albums sold in a year since 1991. So vinyl is definitely on the rebound for the general public. My customers have always bought vinyl; they're just buying more of it.
Taylor: We have a website that we sell some of our higher priced items through. Other than that, we are strictly old school. We try to be friendly and helpful and carry interesting high-quality music.
Miranda: The owner [Scott Kuzma] has stuck with his formula that he's had for 15-plus years. It's a pretty bare-bones equation of stocking stuff; there's no frills, no fancy displays. The greatest change he made once we noticed declining business was to carry DVDs. And we expanded the headphone lines we carry. Basically, it's been to offer more products. In general, I think that's why we're holding steady. We sell a lot of Skullcandy. People just come in to buy a pair of earbuds, because their fifth pair broke. We still sell turntables, the digital ones that connect by USB in a computer to let the CD consumer know you're not just restricted to this format.
Hughes: We've put more thought into the composition of our stores. There's more lifestyle inventory and more room for vinyl. The margins on new CDs and LPs is ridiculously low and I'm not sure people get that. If you buy a pair of shoes or a shirt the markup is usually 100 percent or more. Our markup is about 33 percent. The obvious strategy for us was to find higher margins, so we've gone after used vinyl collections, headphones, cards, books, etc.
Day: As an all-used and a vinyl specialty store, the state of the industry doesn't really affect us too much directly. Specializing in vinyl has served us well and business has been consistently good. Our strategy? We work hard to make sure there's always something new in the racks for our customers.
Vaughan: Last year we took major strides in developing our website and getting a better online presence. It's hard to tell just how successful it has been, but overall, online sales contribute to about 5 percent of our sales. A lot of those sales come from people who once lived in Seattle and still enjoy shopping with us and having that connection, or it comes from folks who just don't have a record shop in their town and they've picked us to fulfill their record shopping.
We just initiated our LP Vinyl Club Card. It has been a huge hit and has resonated throughout the vinyl world here in Seattle. It works similar to our CD Club Card, of which we have redeemed over 50,000 now. Anyhow, you basically will save about 15 percent if you use it and fill it up. Our prices are already the best in town, so with this card you will get the best price you could ever get. We run a lot more sales, they tend to be used-specific CD, DVD, and vinyl. We still do a lot of in-stores.
Do you think Seattle has fared better than most American cities with regard to music-retail viability?
Taylor: Not sure, but we have a healthy and thriving live music scene, which in turn should buoy a healthy music-retail community.
Miranda: Seattle, along with Portland, is the place to be if you want to own a record store. There's a heavy concentration of vinyl in this area; that helps record stores. Especially over the past year or two with the recession, the stuff customers are bringing in is unbelievable. Huge collections full of amazing stuff I thought I would never see. Probably stuff people thought they'd never sell, but now they have mortgages to pay and no job. Sadly, we were getting this stuff under those circumstances. It opened my eyes to how many physical records are out here. This is what keeps record stores going. If we didn't have people bringing in vinyl and CDs, we would be out of business. People behind digital media are making it a popular idea that this is better for you, this is easier, transparent, you don't have to hold it or file it. Obviously, convenience is a number one factor. There are probably other factors about why record stores are going down, other than them being a non-necessity, as opposed to food—although I would argue that.
Hughes: Seattle is really lucky in a lot of ways. It's remote and doesn't feel the shifts in the economy as quickly or painfully as other cities. There is also a great infrastructure here for music including KEXP, local shows on our commercial stations, great clubs, a ton of bands, designers, poster makers, all-ages clubs, local press, and some great stores. If you go to a lot of other cities, you'd be hard-pressed to find such a healthy scene, and that translates into consumers and music sales. The last half of 2009 was really rough for us, though, and that's part of the lag that happens up here. We're watching our bottom line really carefully at the moment.
Day: Growing up here, it's easy to take it for granted, but we constantly hear from our out-of-town customers that we have an unusually high number of great record stores in Seattle. I think we do, too.
Vaughan: Oh, good God, yes, Seattle is an anomaly. Portland has a pretty good one, too, and of course LA/SF has Amoeba and Austin, Texas, has had the great Waterloo for years now, but overall, you are hard-pressed to find a vibrant music-retail community in this country.
Have you noticed any changes in the demographics of your clientele in the last few years?
Taylor: Not really, our customers are and always have been wide-ranging. A lot of younger people are buying vinyl, however.
Miranda: Not really. We appeal to all ages, because we sell everything.
Day: Our customer base is more diverse than ever. All ages, and we've noticed more women buying vinyl.
Vaughan: A few years back it looked like we were losing the teenagers, but we are seeing them again and that has been refreshing, a new generation of record shoppers.
Are you surprised by the resurgence of interest in vinyl?
Taylor: No. It is the sexiest format and it carries the desirable traits of any lusted-after fetish object.
Miranda: Yes. When I first started working at Everyday Music in Seattle, we had no new vinyl. The boss said, "Here's two grand, order a bunch of vinyl." Before that, I ordered 30 to 40 records, created a new vinyl section, and within a week it was half full. That's when the lightbulb went on: There's a demand for this. It just never stopped after that. It did plateau over the last couple of years because of the recession, but the more we stock, the more classic albums that get reissued on 180-gram vinyl with downloads, the more we sell.
Hughes: Not really surprised but reassured. There are more choices and stock, so sales should naturally go up. I think there is also something about vinyl that just makes it cool. It sounds better, feels better, and you can actually enjoy the artwork. The download card/CD insert makes it a great piece. I buy more vinyl now than ever.
Day: Not really. As an early MP3/iPod adopter, I've always felt that vinyl was the perfect complementary medium. MP3s are practical and they're always with us. There's nothing practical about vinyl, but it gives us something tangible to hold while we listen. When we play our records, we're interacting with the music in a much different way. We're more involved. And album covers are sexy and will always appeal to music and art lovers. I love my iPod. I love my records more! I wouldn't want to give up either.
Vaughan: Not really. My store started 22 years ago in West Seattle selling used records with a handful of CDs. As a kid shopping or working in record shops, I bought vinyl; I got started with it, so it never really left as far as I was concerned. Our passion and sentiment has always been with vinyl. My Queen Anne store was designed with 20 percent of the space dedicated to vinyl. We still use the same amount of space for vinyl as we did then. I do think we will need to expand it a bit, but overall it doesn't surprise me too much. I think most of our regulars would agree that we naturally and unpretentiously changed with the times and we were ahead of the curve when it came to this whole vinyl resurgence.
If you were an aspiring entrepreneur, would you open a record store now?
Voorhees: The main reason I'm so good at selling records is I love talking with people, I love finding things for people. I have a lot of knowledge over the years. A person can't just open a record store; you have to know what to buy, what to sell, what to pay for it, what not to buy. If a person's going to open a record store, he has to have something that makes it better than other record stores.
Taylor: No. We'd open a beer.
Miranda: Yes and no. I would like to because I would like to keep my finger on the pulse and be my own boss. It's not easy to make money when you own your own record store. In college, I took an entrepreneurship class and busted out a 40-page business plan on a record store. I realized that I'd have to work two years, seven days a week, by myself, in order to make my first profit. [< i>laughs] Things have changed since I did that business plan, but I don't think it's very much different.
Hughes: Only if I were an aspiring entrepreneur who loved music, worked hard, and didn't want to be rich. This is one of those things you do because you love it.
Day: We've seen a lot of stores come and go, but I doubt many of them regret it. If you love music and dream of owning a store, go for it! Just have realistic expectations, don't quit the day job, and realize that it's as much about systems and procedures and putting out fires than it is about the music. Personally, I love these daily challenges, so I'm naturally wired for owning retail. Sometimes it's tough financially, but it's the lean months that force us to step up our game.
Vaughan: Half-ass record stores won't cut it. If you are considering it, you better have a bunch of cash to stock your store. Music consumers in Seattle have high expectations. We have the greatest music scene and we have had some great record stores over the years (Peaches, Fallout, Cellophane Square, Tower Mercer, to name a few). I'd recommend that if you are to open a store, that you have an allegiance to the community and all that it has epitomized, and that you have a deep and caring nature toward your fellow human being. Easy Street has inspired a few folks here and there to open record stores, and that has maybe bitten us in the butt, but at the same time, it's made for a better music community as a whole.
On a scale of 1 to 10, with 1 being the highest, how freaked out about music retail's future are you?
Voorhees: I'm not freaked out at all. I've been selling records for nearly 37 years. I have a big enough market of people who know I carry records and they'll come to whatever location where I am. I've heard of various CD stores that are trying to augment their sales by T-shirts, mugs, dolls, stickers, digital downloads, and selling tickets to shows. The place I'm hoping to move to [Bop Street plans to move in June], I want a 10-year lease.
Taylor: Until the music you want to hear is directly beamed into your skull by some magical telepathic means or until we suffer a complete economic collapse, we'll give it a 5.
Miranda: I would say 6. I don't see [music retail] going away—at least not in the Northwest. I feel positive about the community sustaining record stores. There are people here who want these shops in their neighborhoods.
Hughes: I think a 6. We're in a tough spot at the moment. The economy is in the tank and just starting to come back. The record industry is in turmoil and keeps making bad decisions. Digital downloading has become a huge threat to CD sales. But I think record stores are more than just retail stores. They are social hubs. I still have fond memories of shopping at Orpheum and Fallout and I can't say that about any other retail. We just need to figure out how to make it work with the shifts that are happening now, and we are trying.
Vaughan: 5. Challenges breed opportunities and innovation. I've seen it before, going from vinyl to tape to CD, and maybe now back to vinyl, from VHS to Blu-ray, from the threat of Amazon to the threat of Best Buy to the threat of iTunes, but when it gets down to it, you want to be taken in, get a smile on your face, and shop around and feel part of your community. Record stores were supposed to be gone 10 years ago—this is old news. So, here we are.
What freaks me out is the economic climate today, the implosion of the record companies, and the loss of jobs. People don't work, they don't have money. At Easy Street, we once had 50 employees; we now only have 35.
A good record store can be the ultimate place for social networking... that is, if you are looking to meet people who love music too. There are days when I'm at one of my stores and everything is working: the staff is interacting, people are on the listening stations or asking what you're playing, everyone is buying and perusing and getting turned on; couple that with some good displays, a good in-store, and a good conversation.