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Thursday, July 09, 2020 

Recent conduct by Diamond proves they're not what retailers need anymore

Here's some news on the Hollywood Reporter from a few days ago I may have almost missed, telling that Diamond distribution is infuriarating comics store managers with increased shipping fees:
Post-reopening from coronavirus-directed shutdown, Diamond Comic Distributors have been charging customers increased shipping rates for product, eating into comic book retailers' profits at the same time as it runs a promotional campaign intended to raise funds for those same retailers, The Hollywood Reporter has learned.

Retailers tell THR payments to Diamond in recent weeks have increased, in part because of a relatively new policy that sees orders divided up into more shipments, meaning more charges. That’s not the only concern retailers have as stores struggle to get back on their feet post shutdown.

"I was paying roughly 6 percent of wholesale on shipping from Diamond pre-[pandemic]. ... This has raised up to approximately 10 percent, and we've had single weeks rise as high as 25 percent," Brian Hibbs, owner of Comix Experience and Comix Experience Outpost in San Francisco, explained via email.
It sounds like Diamond out of the blue decided to prove DC management correct in their departure from the business alliance. If Diamond really wanted to prove their business is worth it, they wouldn't have stooped to this. Diamond's spokesman denies they're doing anything wrong, but does say the following:
“A consolidation of orders from one source has always been the best way to maximize overall freight cost containment, and was a strength of Diamond’s distribution that greatly benefited retailers for the past 25 years,” Powell wrote. “Retailers who have now moved some of their purchases to other distributors, whether by their choice or when forced to do so by DC’s recent changes, are experiencing a reduction of that benefit, and are seeing their overall costs go up for goods. They’re going to have to look at their ordering procedures as part of a holistic process, determining how savings in one place may result in additional costs in another, and make the best decisions for their businesses.”

The mention of “DC’s recent changes” is a reference to DC — the number two publisher in the U.S. comic book market — cutting ties with Diamond, following signing up with two new distributors during Diamond’s COVID shutdown. The argument that retailers would benefit from consolidating their distribution sources is far from convincing to everyone.

“I haven't bought any graphic novels that I didn't have to from Diamond in something like a year and a half,”
Hibbs wrote, “We are a book-focused comic book stop, and Diamond's shipping policies have cost them tens of thousands of dollars in orders from stores like mine who long ago abandoned graphic novel purchases from Diamond for better terms. Most big-volume [graphic novel] stores who have switched didn't especially tell Diamond, so I personally believe that Diamond's metrics and understandings of sales and volume potential are fatally off.”
I don't know if Hibbs' stores have let go of pamphlets altogether, but if they did, they're honestly making the right choice. In this age, with monthly issues costing over 4 dollars, and some paperbacks priced cheaper than the sum of parts, that's why retailers and consumers would be making a better choice with something tidier that gives them the whole story in one volume, ensuring they haven't missed anything.
Diamond is unrepentant about the increased financial burden on comic stores at this time, judging by Powell’s response to THR. “In most of the cases we’ve researched so far, the cost increase was caused by the factors I outline above, so we have not issued freight credits. We have always done so when we identify an error on our part, but in most cases it’s simply the economics of shipping the goods,” he wrote.
If they have no regret over raising prices, that compounds all that's wrong with their MO. A company that got greedy from becoming a monopoly, and now, they've gone further to prove why they're not worth entering business deals with. If Diamond collapses, there probably won't be many missing them, except maybe all the mainstream press apologists who took Diamond's side in the whole affair, and all but blotted out the voices who had no serious issues with DC making the switch.

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It sounds like the retailers are no longer getting bulk shipping discounts. The orders are smaller because DC is not part of he package and Marvel has slowed down releases, so the cost per unit shipped goes up.

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