Louis Park warehouse by means of a bar code similar to those for supermarket products. In addition, he sought savings by taking the tiniest and least obvious of measures, including switching off back room store lights and shaving the number of paper bag sizes offered to the customer.Įugster's greatest contribution came with the introduction of a computerized inventory system that, according to Christopher Palmeri, was 'the standard in the record retailing business.' Called Retail Inventory Management (RIM), the two-way system tracked every individual item that left the St. A former Dayton Hudson and Gap Stores retailing executive, Eugster took several predictable steps over the next few years, including closing more than 100 poorly located or unprofitable outlets and centralizing distribution to just two (rather than the previous 18) warehouses.
Eugster, hired in 1980 by Deikel, that the arduous job of reshaping an overexpanded Musicland fell. Deikel's foremost task was to restructure Pickwick and return it to profitability.
The greatest factor, though, was likely the changing demographics of record buyers: baby boomers were no longer primarily teenagers, the largest record-buying group by age, but part of an older crowd fast approaching middle age.ġ980s: Eugster's Turnaround, an IPO, Then an LBOįrom 1979 to 1983, Ted Deikel (best known for his leadership of Minnesota-based mail-order firm Fingerhut) managed Musicland and Primerica's other retailing concerns. The recorded music business lurched into a long slide after 1978, while Primerica-with little knowledge of retailing in its top executive ranks-poured money into acquisitions of smaller record store chains and opening of new stores.' Some of the slide was due to the flash-in-the-pan music phenomenon of disco. Unfortunately for Primerica, wrote Langberg, 'the purchase of Pickwick was a classic case of bad timing. In 1977 Musicland was incorporated as the Musicland Group, Inc. At this juncture Musicland appeared a clear leader in record retailing, with approximately 230 stores.
Then in 1976, according to Mike Langberg, 'Amos Heilicher had a falling out with other members of the Pickwick board and sold his stake in the company.' The year after the break, packaging giant American Can (since renamed Primerica to reflect its diversification into financial services and other industries) purchased Pickwick for $102 million (Pickwick's revenues for the year ending April 30, 1976, totaled $264.9 million). The Heilicher brothers remained in the Twin Cities to head Musicland's distribution and retailing divisions. Musicland expanded rapidly to 48 stores under their management before the private concern merged with Pickwick International, a music and book production, distribution, and merchandising corporation based in New York with 300 retail outlets. Veterans of record distribution since the 1930s, the Heilichers had supplied Evenson with prerecorded music since his early days in Cloquet. Louis Park, Minnesota, brothers, Amos and Dan Heilicher. From 1964 until 1968, Musicland was the property of two St. Sayre, on the other hand, remained with Musicland until 1981. His entrepreneurial streak still alive, Evenson founded a sizeable chain of greeting card stores, which he ultimately sold to Hallmark. The partnership had grown to a chain of 15 stores by 1964, at which time Evenson and Sayre decided to sell their interest. He then resettled in Minneapolis and launched the Musicland business with partner Grover Sayre, a former member of his band. Following a college education he helped fund by leading a dance band, Evenson served in the Korean War. One of the founders, Terry Evenson, had opened his first music store in his hometown of Cloquet, Minnesota, while still a teenager some eight years earlier. Musicland began humbly enough in 1956 with a single outlet near downtown Minneapolis. As 2001 began, Musicland was in the process of being acquired by Best Buy Co., Inc., a leading operator of consumer electronics superstores. Each of these stores also has a sister e-commerce site, offering another sales channel to the company's customers. These include approximately 650 Sam Goody stores (selling prerecorded home entertainment products, primarily in suburban shopping malls) 400 Suncoast Motion Picture Company stores (selling video, DVD, and movie-related products, primarily in metropolitan shopping malls) around 75 Media Play superstores (selling books, music, videos, software, and other products in select large-to-mid-size markets) and some 200 On Cue stores (selling a variety of entertainment products in small town markets). The leading specialty retailer in the United States of prerecorded music, movies, and audio and video accessories, Musicland Stores Corporation operates more than 1,300 stores in 49 states, Puerto Rico, and the United Kingdom.
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