I spoke with Doug Putnam a few years ago when he acquired many of the HMV locations in Canada and vowed to keep vinyl front and center in more than 80 new Sunrise locations. Sure vinyl was booming then and yes it still is, but Putman’s latest move is even grander than just stores in Canada. He is reportedly making a bid for HMV in the UK.
HMV has been on the ropes before. KPMG was recently appointed as administrator to oversee closure or restructuring of the company. This is the second administrative action in the past six years. No doubt a sign of the ongoing impact of digital and streaming music. Mike Ashley was the second bidder for the HMV chain following internal attempts by HMV executives to keep the chain afloat. KPMG indicated that there were “a number” of interested bidders, but was not forthcoming about who. Mike Ashley is a UK billionaire who owns numerous retail outlets as well as Newcastle United FC. His approach appears to be to buy up failing chains, cherry pick the best locations and then negotiate major tax vacations.
So who is Doug Putnam and why does he think he can tackle a UK billionaire? Heck, he doesn’t even have a Wikipedia entry.
Putnam is only 35 this year and didn’t enter into the music business until he bought Sunrise Records, a five-store chain, from the Perlman brothers in 2014. In 2017 he negotiated a significant expansion of Sunrise from five stores to eighty-two locations. Perhaps “significant” is an understatement. His business experience comes from Everest Toys. Everest is a family business that manufactures and distributes toys, games and gifts to retailers throughout the world. Everest Toys is a major distributor of Yo-Yo’s. He got into the music retailing world “because of a love of music”. Now this all sounds like a recipe for disaster if ever I heard one. I love music and vinyl too, and I’ve owned a couple of Yo-Yo’s, but I just don’t see that translating into a sound business enterprise. Luckily for Doug and Sunrise, he is not me. In 2017 Sunrise reportedly sold about half a million vinyl LPs in Canada at an average of thirty bucks a pop. Keep in mind that those are sales in Canada – arguably a small market compared to the US or UK.
Another measure of success is the support of the top echelons of the music industry. President and CEO of Universal Music Canada, Jeffrey Remedios “We’ve believed in Doug’s vision so partnered with him early on, his team’s results have exceeded our lofty expectations.”
To the best of my knowledge, Putnam is not a billionaire, so it will be very interesting to see how the kid from across the pond does against the current King of High Street. From my perspective, I’m rooting for Putnam because he seems to be more motivated by music than money.