Customers look for bargains at Dimple Records in Roseville in July (left). Dimple brought in a liquidation company to help sell inventory at its seven
stores, including the Arden Way location (above). photos by matthew keys
one of several tactics Dimple used to stave off competition
from digital and streaming music formats. Another one:
buying used records, CDs and tapes (and eventually movies,
games and books) from the public.
“When I started at Dimple, we were almost 99 percent new
(inventory). When we bought something from a vendor, we’d
owe money on that,” says Brian McCulloch, Dimple’s market-
ing manager who started as a clerk in 1987. “If someone stole
something, our margin on that is so low, we’d have to sell five of
those to make up for that.”
Andrew says the labels made it tough for independent store
owners like Dimple to turn a profit. The suggested retail price
of a CD was around $25.99 in the 1980s, he estimates, while the
cost to the store was around $14 or $15. Dimple would often sell
for well-below MSRP — around $20 at the most, but sometimes
even lower. And they were often stuck with inventory because
they had to pay up front. But the margins on used media is bet-
ter — buy an album from a customer for a few bucks, sell it to
another customer for a few dollars more.
What opened the door for Dimple to sell used albums
was the popularity of record clubs like Columbia House:
Members were lured by the appeal of buying 12 CDs for a
penny, even though they had to purchase additional CDs at
full MSRP. Customers came into Dimple asking to get a re-
fund on those marked-up CDs they got through the record
clubs or seeking to swap a copy of an unopened CD for a dif-
ferent album.
“We can’t buy that, we can’t send it back, we can’t sell it,
because it says Columbia House,” Dilyn says. But they could
buy it from the customer if the CD was opened — as a used
item. Dimple gave customers $1 or $2 (or more if they opted
for store credit) for a CD, then resold it as a used item for a
little more than $5 (the Radakovitzs unanimously agree that
entering the used-media market is likely the reason Dimple
outlived Tower Records, whose inventory was almost exclu-
sively new. Tower Records filed for bankruptcy in 2006).
The idea of buying and selling used items caught on with
other independent stores, but labels didn’t like the practice.
In the early 1990s, they enacted a policy that threatened to
withhold popular new albums from retail outlets that sold
used CDs. The label’s biggest backer of the policy was coun-
try superstar Garth Brooks; he relented after the Federal
Trade Commission launched an investigation into alleged
price-fixing by music labels.
The labels lost that battle, but it wasn’t the only one
Dimple and others faced. In 2016, the music industry de-
cided new albums would be released on Friday instead of
Tuesday. Labels said the move was intended to help gen-
erate buzz behind popular acts like Taylor Swift and Lady
Gaga in the era of streaming music. Dilyn says it was a
harmful move for record stores because it meant stores had
to wait out the weekend before they could restock popular
albums, suggesting the labels were moving away from re-
tail distribution altogether.
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