Becoming a Marvel Distributor

Once I found my strongest ally in reforming the distribution of comics in Jim Shooter, I began to sense that my May, 1979 trip to New York might actually succeed in changing the world. What had started out as simply a long-shot letter writing campaign designed to encourage Marvel to pressure Phil Seuling's Seagate Distributing company to start offering comics retailers 30-day credit terms, miraculously became the turning point in the entire history of direct distribution of comics.

The day after I met the main players at Marvel (President Jim Galton, Marketing VP Ed Shukin, and Editor-in-Chief Jim Shooter) turned out to be the watershed moment in this entire process. As I've mentioned previously, because Marvel was already up against the wall due to precipitiously declining newsstand sales, and the nasty anti-trust lawsuit filed against all the publishers earlier in 1979 by Irjax, Marvel management was more than willing to listen to a proposed alternative plan of action. In fact, Ed Shukin had already drawn up a new set of proposed trade terms under which Marvel intended to allow anyone who wished to distribute Marvel comics within the Direct Market to have clear guidelines about how to become a Marvel distributor.

My memory is hazy about who actually drew up the new proposed trade terms, but I think the underpinnings of the logic behind the specific requirements came primarily from the research that Jim Shooter had done into the level of market penetration that Seagate had achieved during their 1972-1979 monopoly. If I recall events correctly, Jim Shooter brought the results of his research into executive meetings with Jim Galton, Ed Shukin, and Barry Kaplan (Marvel's Financial VP), and they had hammered out prior to my arrival some very loose initial guidelines. It was this draft document that Ed Shukin showed to me upon my arrival at the Marvel offices on the second day of my visit.

Even today, I get a tingle when I remember first looking at those proposed new Marvel trade terms. The first thing that I saw when reading the new rules was that Marvel was clearly dedicated to breaking Seagate's monopoly. The most important element (as far as I was concerned...) was that Marvel was lowering the wholesale purchase requirement to be a Marvel distributor to only $3,000 per month! If you met that figure, they were offering a 60% discount, free freight, 30-day billing! This was an opportunity beyond my wildest imaginings. Just one year prior, I had been battling Seagate simply to become a sub-distributor at 50% off. Now I had a chance to reduce my overall wholesale cost of my new Marvel comics by nearly an additional 20%, and infuse my company with a big dose of new working capital as a result of not having to prepay Seagate any more. This was fantastic!

After I had a chance to think about the ramifications of the new deal for a while, the one drawback I could see was that I was not at that time purchasing $3,000 a month in Marvel comics. Even though I had four stores and a thriving mail order business, the current low cover prices of most Marvel comics in 1979 made reaching that $3,000/month figure quite daunting. The math is pretty simple: at 60% off a 30-cent cover priced Marvel comic book (1979 price...) cost 12 cents at wholesale price. It took a wholesale purchase of 25,000 (!) 12-cent comics to reach Marvel's required $3,000 lower limit. That number was mitigated a bit by the fact that there were a few Marvel magazines with higher cover prices that you could use to lower your overall required number of comic books, but the figure was still about 10,000 more Marvel comics than I was typically buying in any given month.

While adding 10,000 additional Marvel comics into my monthly order was a very scary proposition, I had a strong feeling that I could cover some of that required additional purchase volume by distributing Marvels at 50% off to some of the other stores in Colorado. While I had only a couple of small wholesale accounts as a Seagate sub-distributor, I was reasonalby confident that I could add almost every store in Colorado if I offered them 50% off, plus 30-day billing. So after reading the trade terms, I asked Ed Shukin if I could sign up Mile High Comics as the first Marvel Direct Market distributor of the new era. Shukin readily agreed to my request, and I suddenly found my entire world changed forever.

Just becoming a Marvel distributor that day was a cataclysmic change for me, but Ed Shukin followed that up with an offer that totally blew my mind. He told me that Marvel's senior management had decided that they wanted to hire someone who knew the Direct Market quite well to come in an organize an entirely new marketing division specifically designed to sell Marvel comics into the comics shop market. Based on the discussions I had had the previous day with himself, Jim Galton, and Jim Shooter, Ed was prepared to offer me first crack at that new position. I have to tell you that Ed's job proposal took me totally off guard. Just one day prior I had trepidatiously taken the elevator to Marvel's offices, and asked the receptionist to hide my battered suitcase behind her desk. Twenty-four hours later I'm being an offered the opportunity to establish an entirely new marketing division at Marvel comics? This was surreal by any measure of the term. What in the heck was I going to do now?

To be continued...

Mile High Comics, Inc.
Attn: Chuck Rozanski
2151 W. 56th Ave.
Denver, CO 80221



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