Declines in CD Sales hits Indie Distributor

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Distribution Fusion 3, a 25 year old Canadian independent distributor with a deep catalogue of jazz, blues, world and comedy recordings has filed for bankruptcy protection.

Billboard magazine reports that the company has reduced it's staff from over 50 to 13. Six positions were just recently cut. The company has 30 days to try to restructure. In the meantime, they have stopped selling and shipping recordings.

The troubles are reported to be the result of a confluence of events that include fewer record stores, smaller retail catalogue sections, lacklustre CD sales, and a distressed dollar.

Company founder Jim West  also owns Justin Time Records and has been an important figure in Canadian music industry development, serving as chair of FACTOR, CIRPA and CARAS over the years.

UPDATE: It's worth adding a note here about the collapse of one of the UK's most important independent distributors Pinnacle Entertainment. The company, which handled distro for around 400 indie labels in Britain, declared bankruptcy on Dec. 3.
The main problem facing labels is the prospect of not getting paid for the sales which Pinnacle have already conducted on their behalf. This will leave small companies with neither revenue, nor goods, scrambling to find another distribution channel in time for the Christmas shopping season.
Label owners and others from the industry have been meeting to discuss the situation. Read more in The Independent, Strangeglue, or NME.


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