The Beat has confirmed that Diamond laid off 13 employees yesterday, including the managing editor and designer for the recently canceled Diamond Dialog magazine. In addition to the layoffs, wages for management and other staff were reduced. According to a letter sent to staff by COO Chuck Parker, the cost cuts were a result of the generally poor economy and a four percent decline in sales in 2008.
While these layoffs are confirmed, rumblings of layoffs at DC are rampant this morning. We’ll have details as they emerge.
This is all really bad news to hear. And probably explains why I received a new Diamond customer service rep today.
Not a surprise that Diamond is cutting staff. They are in the process of moving their warehouse (which must be making them more efficient, or why do it?), and cutting their editorial output.
Rod,
Nice to know I’m not the only one with a new rep today.
That sucks. Truly this is the winter of our discontent, etc. Good luck to folks finding themselves back on the beat..so to speak.
The cash flow issue at Diamond appears to be more than just the 4% drop in sales – it appears to come from more than one of Steve’s businesses (the museum, Gemstone, etc)… but the issue remains:
More money is flowing OUT than is flowing IN… for a small business (even one with one business that has a pseudo-monopoly as Diamond does) that can mean big trouble. And with cash hard to get at the bank (and Steve not wanting to kill his entire retirement fund) things have to change.
Whether increasing the minimum order was a good idea or not… it was one that makes sense: they CANNOT make enough money from selling books that do not make the minimums. Interestingly enough (and this often goes unsaid) – NEITHER CAN THE CREATORS AND PUBLISHERS.
Comic books is often a business of passion… creators and publishers will create and publish in the absence of logic (i.e. when there is really no market for their product)… and will continue to create and publish when the market has gone on to something else but their passion keeps them going.
The inherent problem is that they will often keep producing EVEN WHEN they should logically have stopped (and now THEY are only losing money with each item that gets made.)… Think of an easy parallel… if a house builder continues to build MORE houses than he or she can sell… they lose money no matter how GOOD the houses are… comics are no different…
So now, Diamond (who is losing money) steps in and says to the product creators “enough is enough” and cancels some titles because it doesn’t make sense for the creators or the distributor to keep at it…
Should Steve and the powers at Diamond have been expected to have the foresight to try to find other businesses to expand into so that they can move the people to that business rather than fire them? That is the” ideal world model” but one that I have never seen in real life (except in very socialistic societies where it is really hard to lay someone off – and that is not the USA)… and if the owners of construction companies, mortgage brokerages and the banks don’t have that same foresight, how can Steve and his team of people that sell comics for a living? ? (no offense, Steve)
Boo Freaking Hoo
Diamonds service has been going steadily downhill for a long time now. I’m always missing items or they duplicate a previous order. I’m still waiting 3 months for a refund. Diamond needs to close up shop.