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Goodbye to Source Interlink Distribution

'We did our best to keep it afloat but, in the end, the model is just broken.'


Linda Ruth By Linda Ruth
06/03/2014 -10:57 AM






 

We are stunned, we are blindsided, or we saw this coming all along. We are scrambling for distribution, we are crying for attention, we are vying for our places in the lifeboat. Messages in my inbox and voices on my phone reflect fear, concern, survivors’ guilt, schadenfreude.

But most of all, in the scramble to find our feet, to ride this out, to get our copies out of the printers and off the docks and into the retail outlets, we—or at least I—feel grief. Old-fashioned, honest-to-God grief, like the kind you might feel when you lose a human friend.

As one of Source’s executives wrote me: “This is such a sad day as you note for not only Source, but for the industry as a whole. We did our best to keep it afloat but, in the end, the model is just broken and it has to be fixed. One can just hope that in the midst of disruption that something positive can evolve. As you can imagine, my priority has been trying to work through the human aspect of this, as it affects so many good people who dedicated years and years of their lives to Source.”

Among the first people I ever met in this business were Bill Jech and Dave Buescher, founders of IPD, later sold to Source Interlink as the basis of their distribution business. I watched as the direct distribution model was scaled up to national, merged back into mainstream, broken out in tielines and pick and packs; I watched as warehouses were set up and taken down, and information evolved and was reworked, as people came and went and systems improved or were replaced.

And in the course of those years, I met smart, hard-working people doing their best to find a way to keep their business afloat. People who worked to improve merchandising, to improve customer service, to improve warehousing, to improve efficiency. People who helped me, and my clients, solve difficult problems.

Practically, there are lots of questions that are not yet answered. Who will pick up all that retail business, and what portion of it will go away? Which publications will survive this upheaval—and which will not? What will happen to our industry when only two large wholesale groups, both of which share ownership of one major national distributor, control virtually all the distribution? Is there still a role for a national distributor when what you have is essentially a national wholesaler? And if no one has been making money until now, how will this change enable them to start doing so?

Those questions won’t be answered today, or tomorrow, or this month. We will revisit those questions, again and again. But for today, I can only think about the 6,000 Source Interlink people who are out of their jobs, and the company executives I have known for years, and the magazine business without a Source Interlink to turn to.

Goodbye, Source Interlink. We will miss you.

 





Linda Ruth By Linda Ruth -- Linda Ruth is Principal of PSCS Consulting. Her book of case studies, "How to Market Your Magazine on the Newsstand," is available at Amazon. Find her online at Google Plus.

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