MUSICLAND'S LITTLE WAREHOUSE ON THE PRAIRIE

CEO Eric Weisman announced the compay is partnering with Deluxe Media Services to provide warehousing, fulfillment and returns processing for more than 950 Sam Goody, Suncoast and Media Play stores nationwide. The multi-year deal, spearheaded by ML Vice Chairman (and former head of Sony Music Distribution) Danny Yarbrough, fills a major need in Musicland’s game plan to extricate itself from former owner Best Buy. The transition, which should be concluded by late June, moves ML’s distribution center away from Best Buy’s Franklin, IN, complex and to Deluxe’s facility in Pleasant Prairie, WI.

When Sun Capital Partners acquired Musicland from Best Buy last June, ML’s former distribution center was not a part of the deal. They then signed a six-month agreement with Best Buy to use the Franklin DC until other arrangements could be made.

“This move gives us the ability to operate our business more cost-effectively, which we have been successfully working on throughout our company," volunteers Weisman. "It also gives us the ability strategically to further our pursuit of product diversification in our retail operation and also use that as a platform for future growth.”

Distribution legend Yarbrough had retained the services of Tompkins Associates, a leading supply chain consultancy, to help evaluate their DC options. “Danny has been working on a number of business initiatives here,” says Weisman, “But this one was clearly in his bailiwick.”

“I have to defer to my boss here,” interjects Yarbrough, “Mr Weisman has some distribution experience himself.”

Weisman is quick to point out that this does not completely sever Musicland’s relations with Best Buy: “The transition services between Musicland and Best Buy are broad and extend well beyond just distribution services. But this is one of the most significant migrations away from Best Buy services to running and controlling our business on a stand-alone basis.”

Yarbrough adds: “We’ve obviously been a separate company since the acquisition. But this is about us having more control over this part of our business.”

Deluxe has primarily been a video software, manufacturing and distribution facility owned by UK-based Rank Group, which runs a worldwide operation.