Best Buy to drop CD sales July 1 while Target may only pay labels per sale
The Compact Disc has seen its better days in the music industry, though some may wonder how it has been able to survive through the waning digital download age, also known as the iTunes age. As the market begins to enthusiastically adopt streaming solutions while vinyl clings onto its niche market, CDs look to take the fall from major retailers.
Billboard reports from sources that Best Buy has notified suppliers that it would begin pulling CD stock from stores from July 1. It will apparently honor a vendor contract to continue selling records for at least the next two years, though, packaging them with players.
The consumer tech big box store used to generate hundreds of millions of dollars per year in CD sales, but has been cutting floor space for merchandise for the past decade or so — just as music stores have shuttered their doors since the turn of the century.
Another big box retailer, Target, is also reportedly flipping the tables on CD and DVD suppliers, having demanded that they assume risk of unsold inventory after 60 days instead of the stores. It made its ultimatum back in the fourth quarter and originally targeted to launch the initiative on February 1, but may have moved the date back to April 1 or May 1. Suppliers may end up withholding stock from one of the remaining big forces in physical media for music and steepen the decline for the sector.
The company issued the following statement in response to the reporting:
Entertainment has been and continues to be an important part of Target’s brand. We are committed to working closely with our partners to bring the latest movies and music titles, along with exclusive content, to our guests. The changes we’re evaluating to our operating model, which shows a continued investment in our Entertainment business, reflect a broader shift in the industry and consumer behavior.