Navarre Again Reinvents Music Distribution Arm

In July, New Hope, Minn.-based Navarre announced that it was paring its music distribution company from four regions to three and instituted a round of personnel changes and additions (Billboard, July 12).
The restructuring came after the Nasdaq-traded firm posted a loss of $6.2 million for the 1997 fiscal year.
On Sept. 5, a new round of structural changes was announced to Navarre staffers internally and to its distributed labels via a communiquƒ from COO Guy Marsala.
Navarre has now shrunk its regional territories from three to two with the combination of the Eastern and Midwestern territories, and former Midwestern regional manager Ed Maxin has been promoted to Eastern regional director. Simultaneously, Eastern regional manager Mark Heyert and Western regional manager Ian Dealhoy have had their positions eliminated, and they have been reassigned as account executives (Billboard Bulletin, Sept. 9).
Albany, N.Y.-based Trans World Entertainment, formerly serviced by the Eastern sales force, will now come under the purview of national accounts director Vyto Lazauskas.
Western regional director Frank Mooney now takes on responsibility for Texas, which was previously a Midwestern territory. The Hawaiian branch of the company, which formerly reported to Mooney, will now report to Marsala.
With the changes came downsizing: Orange County/San Diego sales rep Leah Song, a three-year Navarre vet, and Atlanta sales rep Don Radcliffe, who spent four years with the distributor, were laid off. Song's territory will now be handled by the L.A. sales staff, while Atlanta will be covered by field marketing rep Danny Morton, who was hired by the company in July.
Navarre president/chairman/CEO Eric Paulson says of the current realignment, 'A company that doesn't continue to change reflecting the customer-base changes is nowhere, and that's really what we've been doing.'
Paulson ties the restructuring to such recent developments as Blockbuster Entertainment's move from Florida to Texas and Alliance Entertainment Corp.'s filing for Chapter 11 bankruptcy protection and to the impending purchases of Camelot Music by the Wall and Strawberries by Trans World.
'We combined four regions into three regions, as Blockbuster moved out of the Southeast,' Paulson says. 'It became apparent that you didn't need a regional manager and a regional office for that area, especially in light of Alliance having troubles also. As we started looking at the Strawberries deal, as we started looking at Camelot and the Wall and Alliance Entertainment filing Chapter 11, we (realized) we really needed a different type of expertise in the Southeast and Atlanta. We didn't need a salesman there--there's nobody to sell to. What you really need is a field marketing representative. It made more sense to focus your energy in field marketing than in sales, because all a salesman was doing was traveling. There was no reason for him to even be there. It's been that way for a long time.'
Paulson adds, 'At the same time, it made more sense to get a higher level of expertise close to the customers . . . We have one more person in the field calling on customers than we did two days before the (July Navarre sales) conference.'
Further changes could be in the offing as the account base continues to mutate, Paulson implies.
'I don't think our account base is done changing,' he says. 'I think there's still shifts that the accounts are going to do, and we'll continue to monitor that, and as we think we can improve our coverage with the accounts, we're going to do that. So we'll continue to make changes based on what the retail and wholesale account base in the country does.'
Some staff moves have also been made in Navarre's Minnesota home office.
'We had retail coordinators that we had instituted, and when we really looked at what we were doing and what our labels were doing, it was a duplication of effort, so those people have been reassigned,' Paulson says. 'One person has not been reassigned but is actually applying for a job in the computer products division and will get that job as long as they're qualified for it . . . There was one clerical person that was terminated.'
Paulson says that none of the current changes are tied to Navarre's inability to complete its long-pending purchase of 51% of Walnut, Calif.-based Thump Records, one of the distributor's key labels (Billboard, Sept. 13). Sources have reported that Thump has been discussing a deal with Universal.
Asked about the progress of the Navarre/Thump deal, Paulson says, 'It's still at the same place at this point in time.'
However, Navarre does have one new association to celebrate: Well-placed sources indicate that the distributor has picked up American Gramaphone for exclusive national distribution. Through August, the Omaha, Neb.-based label was handled by Alliance's Independent National Distributors Inc.
American Gramaphone, which also sells its product via mail order and direct to some accounts, is a potential gold mine for Navarre. The company is the home of label founder Chip Davis' best-selling instrumental group Mannheim Steamroller, whose seasonal releases 'Mannheim Steamroller Christmas' (1984) and 'A Fresh Aire Christmas' (1988) have gone quintuple-platinum; a third release, 'Christmas In The Aire' (1995), is triple-platinum.
The first new album to be issued under the pact with Navarre will be the freshly minted Christmas set 'Mannheim Steamroller Live,' to be released Oct. 14.
(c) BPI Communications, 1997 ALL RIGHTS RESERVED