My Life With Comic Books: Part # 92

The current cast of characters:
Paul Howley: age 39
Mal Howley: my wife

MY LIFE WITH COMIC BOOKS: THE HISTORY OF A COMIC SHOP - Part 92

As the president of Marvel Comics in the mid-1990’s, Terry Stewart proved that he had no interest in working in “partnership” with the comic book stores that made Marvel Comics the number one comic book publisher in the United States. Stewart reduced our discounts on the Marvel comic books we ordered each month. He also publicly stated to stockholders that his long-term goal was to sell directly to our customers so that Marvel wouldn’t have to share any of the profits with any of us. He had a “mail-order” catalog inserted into some Marvel comic books and insinuated that comic book shops were dangerous places to visit. He viewed us as unnecessary “middlemen” and worked hard to get rid of us. All of these changes irritated most comic book retailers but Stewart’s biggest mistake was the most destructive blunder for Marvel Comics. Stewart thought that the current group of independent distributors was not doing a good enough job promoting Marvel Comics so he authorized the purchase of a small, second-rate comic book distributor (Heroes World) in New Jersey. In his misguided plans, there was no reason to let the existing comic book distributors make a profit on the distribution of Marvel product.

Heroes World was made the exclusive distributor of the entire Marvel product line. Since Marvel produced almost 60% of the comic books in the United States, this move by Stewart adversely affected the remaining distributors who now lost 60% of their entire revenues! Diamond Comics Distributor immediately negotiated with some of the other comic book publishers to become the exclusive distributors for their respective companies. Most of the publishers understood that Diamond did a great job and they were the most financially stable distributor in the business. Many of these publishers signed up with Diamond Comics. Because of the enormous loss of revenue, this was the final “straw” for the remaining comic distributors and it wasn’t long before they all went out of business or were bought-out by Diamond. In the meantime, Heroes World struggled to figure out what they were up against. They went from a tiny distributorship handling a few hundred accounts to trying to process orders and take care of thousands of retailers overnight. They failed, miserably, on almost every detail. They lacked adequate personnel, phone lines, facilities, and employees who could actually count. Thousands of retailers complained about missing books from each weekly shipment. Frequently, the invoices were incorrect. Overall, it was a nightmare for the retailer. The retailer’s life was further complicated by now being forced to order from an “extra” distributor. For many years we were able to order almost all of the comic book-related products from one distributor. Now we were forced to deal with this inept group of unprofessional and ill-prepared people. Terry Stewart also began to charge shipping costs to each individual comic book store. Diamond Comics had spoiled us for many years as they offered us “free freight” for all of our regular weekly shipments. They offered us this in order to maintain their competitive edge over “Capital City Distribution” and the other smaller distributors. Now we found ourselves paying hundreds of dollars each week for shipping costs. Many retailers fought back by reducing their dependence on Marvel’s products. We cut our advance orders for Marvel comic books as low as we could without adversely affecting our customers. I was lucky because I had an employee, David Hartwell, whose primary job was to order all new comic book products and he had anticipated Terry Stewarts “betrayal.” David had been recommending other publisher’s comic books to our customer base for almost a year and we had reduced Marvel’s market share in our store from 55% to only 25% while our overall comic book sales actually increased. We still needed Marvel for our survival but we were determined to try to reduce our dependence on them. Apparently, many other storeowners had the same general idea. Sales of Marvel Comics dropped like a rock. Unfortunately, Terry Stewart’s policies caused hundreds of other comic book stores to go out of business. As these stores closed, the sales of every comic book publisher, including Marvel, plummeted. It didn’t take long before Marvel declared bankruptcy. They closed their stupid “Marvel Mania” restaurant. They began to discontinue many low and moderate selling titles in an attempt to reduce their fast-growing losses. The situation looked grim.

If Marvel went out of business every comic book store would be in danger of losing so much revenue that they may also be forced out of business. Although we had no respect for Terry Stewart and a handful of his underlings, we wanted Marvel Comics to survive. We joked that we looked forward to the day when we’d get to see Terry Stewart wearing a paper hat asking us, “Would you like fries with that?”

Our wish didn’t quite come true but it wasn’t too long before Stewart was gone from Marvel. Heroes World was closed down and Diamond Comics began to distribute Marvel comic books to the remaining comic book stores. However, significant damage had been done to the industry. Annual sales of new comic books dropped from over one billion dollars in sales to $240,000,000 dollars in sales and almost 4,000 comic book stores had gone out of business in the United States during Terry Stewart’s reign at Marvel.

Next chapter: A quick wrap-up of 1993.