Hamilton man behind Sunrise Records just saved HMV — betting his money on vinyl
In a digital age, Doug Putman has a steadfast belief people like to have and collect things
Hamilton's Doug Putman might be the king of vinyl right now.
His Ancaster-based company — Sunrise Records — just struck a deal to buy British retailer HMV out of bankruptcy in purchase that will keep most of the locations in Britain open.
In a world where media from music to movies is increasingly streamed and not sold physically, Putman remains steadfast that there will always be room for tangible mediums — from resurgent vinyl, even to decidedly less popular options like DVDs and CDs.
"I think people are always going to buy physical. They want something to collect and have," Putman said.
"I just think it's not going away."
Putman came to vinyl as a business opportunity, when he purchased Sunrise Records back in 2014. The 34-year-old also runs a toy and board game distribution called Everest Toys.
When he first bought Sunrise, it was purely a business venture. But the more time he spent amongst the racks of vinyl and alongside employees who loved records, the more his love grew, too.
"It's a pretty recent passion," he said. "At first I was like, 'Why are you collecting this?' But that passion is infectious."
Sunrise first made a play for HMV's Canadian stores back in 2017, taking over 78 locations in malls across the country. Each year, Sunrise's footprint has grown, Putman said, surging to 82 Canadian stores in 2018, to 85 so far in 2019.
Founded in 1921, HMV grew to become one of the biggest sellers of music in the world, especially after it expanded to Canada in 1986. But the chain has been hit hard in recent years by the rise of online music streaming options.
The company went into corporate restructuring late last year, and a number of bidders came forward to buy it. Putman came out on top.
Sunrise will employ 1,600 people in Britain, he said (where the company will continue to be branded as HMV), while over 1,000 people are employed in Canada under the Sunrise moniker.
A big reason for the growth the company is seeing is vinyl, Putman said. According to Nielsen's mid-year 2018 report on Canadian music sales, digital and physical album sales were down year-over-year, but vinyl LP sales were up 67 per cent, boosted by the growing popularity of Record Store Day.
Record Store Day is now in its 11th year, and exclusive releases helped vinyl sales for the week of the celebration total over 27,000 units sold. That total accounted for a 96 per cent increase in vinyl sales compared to the same event the year before.
"We're not going to see the growth rates remain at that level, but they'll continue to be sizable," Putman said.
Conversely, audio streaming levels in Canada shot up 53 per cent to more than 26 billion streams, the report says, and total on-demand video stream volume increased 32 per cent year-over-year.
Putman says that while he just purchased 100 HMV stores across the UK, returning the brand to Canada is "unlikely, but definitely possible." 102 HMV stores in Canada were shuttered in 2017.
Christian Stadler, a management professor at Warwick Business School in Coventry, England, said while Sunrise's purchase of HMV is "excellent" news for anyone preferring to buy music from a shop, rather than streaming or online, it would be foolish to think there is "scope for considerable growth.
"HMV's new owners need to focus on carving out some sort of niche to ensure a future for the company," he said.
With files from the Canadian Press