Handleman pulls out of music distribution

The Handleman CompanyAs was presaged here in late March, Handleman Corp – a major distributor of recorded music to retailers – has announced that they will cease the music portion of their business activities.

The Detroit News has reported that Handleman will liquidate inventory and operating assets in their music division over the next few months, and it will be completely gone by the end of next year. Bluegrass labels had found a willing partner in Handleman in recent years, and many saw their product carried in Wal-Mart stores across the US as a result.

From The Detroit News:

“Our decision to exit the North American music business was difficult but unavoidable,” said [Handleman’s president and chief executive Al] Koch. “CD music sales have been declining at double-digit rates for several years both industrywide and at our customers’ stores, resulting in a sharp drop-off in our business. Unfortunately, even the significant steps we’ve taken over the past two years to reduce our costs have not enabled the Company to return to profitability.

“We have reluctantly concluded that there simply were not enough further cost reduction opportunities available to offset the margin erosion in future years from continuing sales declines.”

Handleman said it has agreed to sell its music inventory and some assets connected with its Wal-Mart business to Anderson Merchandisers, L.P. of Amarillo, Texas. Sales to Wal-Mart are the bulk of Handleman’s U.S. music sales, the company said.

You can read more about the company and their decision to pull out of music distribution in The Detroit News here and here.

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About the Author

John Lawless

John had served as primary author and editor for The Bluegrass Blog from its launch in 2006 until being folded into Bluegrass Today in September of 2011. He continues in that capacity here, managing a strong team of columnists and correspondents.