Feb. 16 2011 10:23 AM

San Diego record stores struggle for survival

Lou Russell, owner of Lou’s Records in Leucadia, says he’s struggling to keep business afloat.
Photo by David Rolland
Barely a minute into a conversation with Lou Russell and you can hear melancholy in his voice. When asked to describe the state of Lou’s Records, the iconic Leucadia record store that Russell’s owned and operated for more than three decades, he uses words and phrases like “descent,” “decline” and “downward slope.”

Any business owner will tell you that the last couple years have been tough, but Russell had a particularly dismal 2010.

When business was at its peak, he had three contiguous shops selling everything from CDs and vinyl to turntables and T-shirts. Now, he’s down to one. After giving up one shop a few years ago, he had to close another this past December. The space next to the famous Lou’s Records sign on Highway 101 sits empty, waiting to rent.

“I don’t know where it’s going to end,” Russell says. “We have a lot of customers who are extremely loyal, and they are all, like, ‘You guys can’t go away. You have to stay. What am I going to do if you’re not here?’”

The economy has been tough on most independent businesses, but nowhere is the struggle more evident than in physical media, particularly music. When a pub or restaurant closes, a new one often opens in the same location. Nowadays, once an independent music, book or video store closes, that’s it. It’s gone. Direct-mail services like Netflix and on-demand services from the cable companies have all but killed the neighborhood video store. Independent bookstores are increasingly rare while sales of Kindle and iPads soar. Even a corporate behemoth like Borders isn’t safe these days.

Independent record stores may never become extinct, but in San Diego, they could be considered an endangered species. Even with the news that the economy may have rebounded a bit in 2010, it was the worst recorded year ever for physical music sales. Album sales were down 13 percent, according to a report in Rolling Stone in January. Even digital sales, once the only platform showing annual growth, increased by only half a percent this past year, according to Nielsen Sound- Scan, the official tracking system for music sales in the United States and Canada.

Russell doesn’t solely blame the economy. He also factors in his location and an aging customer base. And there’s the obvious culprit: the internet.

That one hits record-store employees where they live.

“It pisses me off sometimes that fucking kids just steal music and ask me to give them all of my music in one slutty swoop,” says Sasha Syeed, a musician and employee at Off the Record in North Park. “It’s all digital information exchange instead of caring about the artists, the work, the aesthetics, records shops—all that.”

The biggest difference between the late ’90s—when down loading was still in its infancy—and now is that record companies, consumers and artists have finally caught up with technology. Record companies and artists can sell music with lower overhead costs while the consumer has the option of searching the internet for the best price. However, this scenario isn’t so great for mom-and-pop operations, because no one needs the store anymore. Add a near-cataclysmic economic crisis and the situation becomes even bleaker. It’s safe to presume that, given the choice, penny-pinching customers would rather download Arcade Fire’s The Suburbs for $3.99 on Amazon than get in their car, drive to the store and buy the CD for upwards of $10. Even Russell’s bargain prices don’t cut it anymore.

“We have a lot of CDs that are really cheap,” Russell says, “99 cents, a dollar-99, stuff like that. You’ll overhear conversations and there’ll be a girl looking at one of these CDs and she’ll just say something like, ‘Oh, I’ll just download it for free.’ So, in her mind, $1.99 is too much to pay for a CD. With that kind of mentality, it’s difficult to compete, much less sell a new CD for 10 or 15 bucks.”

Record stores have recently relied heavily on special promotions like in-store artist performances and sidewalk sales to get customers to come. A spark of hope has also come from an old medium. While CD sales have tanked, vinyl is booming, with more copies sold in 2010 (roughly 2.8 million units) than in any year since 1991, according to SoundScan. The demand can be attributed to everything from a new generation of audiophiles discovering the format to record companies finally re-releasing old titles.

Rick Tyner, manager at M-Theory Records in Mission Hills, also sees digital download cards—which are included in vinyl records and allow customers to download the album as well—as a positive middle ground between physical and digitalized formats.

“I think people also realize the art and the experience have value,” he says. “Digital has its benefits. It’s convenient. What I’m seeing more is new vinyl coming with a digital download. Every label should offer this. It oftentimes makes or breaks a sale. Once something is recorded, it costs nothing to re-create it digitally.”

Back at Lou’s, Russell gets excited when talking about vinyl. He says he’s never downloaded anything. Call him a purist or old-fashioned, but when asked how confidant he is that his store will be around for much longer, he hesitates, and then gives it to you straight, just like any good record store clerk would.

“We’re just trying to survive,” he says. “We’re in a battle.

And it’s a battle for our business lives.”

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