I hope everyone had a great weekend, probably couldn’t have beaten mine – spent mostly watching the insane sports lineup of football and postseason baseball.
The last few weeks I have written about some smaller, niche businesses that I think are attractive. Well, it’s time to upgrade. Out with the old, in with the new. Time for the big boys.
Got a few extra million lying around? This one’s for you.
Whether you are aware or not, vinyl records are making a comeback. Records were once the most popular form of music, then cast into oblivion, and now they’re rallying like the drunk kid that just pulled trig before even leaving the pregame. Everyone from your parents who have always had a record machine, to the young kid who wants to be eclectic or alt and show they love music, to those who just enjoy how vinyl music sounds are increasing the demand for vinyl records.
From less than 5 million to 41.7 million in less than 10 years.
Supply and Demand Baby, Supply and Demand
With vinyl on its way out in the late 1900s most manufacturing facilities were either transformed to make CDsor just shut down completely. The number of plants dwindled all the way down to 15 in 2015.
Now there will be a projected 43 by the end of this year. And even with this additional support coming online, the wait times are still over a year for artist.
Adele needs to print records for her new album? That’s going to be about a year.
Adele crushed her tour, sold out of records, and needs more? Sorry, that’s going to be about a year.
With demand being so high, many of the manufacturers don’t even have to prioritize anything. For instance, sticking with our Adele example, if Adele comes to a manufacturer wanting to make vinyl and they were slated to print Houndmouth the next day, they won’t pull Adele up to the front because it’s a higher purchase order. Sorry honey, back of the line, that’s going to be about a year. No cutting and no exceptions, this isn’t Disney World with a fast pass.
But if anything, this is just another testament to how much demand there truly is. With record machines becoming collectible-esque or decorative artifacts of music history to, and vinyl records being a cool way to flex your music taste, I think the demand is probably here to stay.
I mean why else would all of these big companies be sinking so much capital into this trend? And even in a time when streaming is available.
Experts are projecting 100% growth (exponential) for the next several years, and if this is the case, there will be a need for about 100 vinyl production facilities (compared to the 43 there are now.)
But it’s Harder Than You Think
After reading this I thought “Well this can’t be that hard.” Like there’s probably one machine that can just crank out record after record, allowing me to turn my apartment into a sweatshop.
Turns out its much more complicated than that. You would need a commercial lease, $100K+ presses (that’s just one), find a source of unadulterated plastic beads, technology to make the master file, and someone who is good with legal/IP for the artists. That’s a lot of moving pieces.
And on top of that, apparently it takes a knowledgeable and highly skilled laborer to work this. You can’t just hire any ole temp or contract off the streets.
So, what ARE people doing?
Just like Levi’s during the gold rush, they aren’t going and starting their manufacturing operation, they’re servicing those who are. Like VIRYL. This company specializes in the machinery and offers operations consulting for the vinyl industry. Serving a high demand market and not taking on any of the risk, sounds like a win to me. Seems to be a theme.
Off the Bench
You know what else has demand that’s growing like crazy but isn’t harder than you think? Off the Bench with Odell. From college athlete, to NFL athlete, to doctor, Odell has built the expertise needed to guide and motivate you on your fitness journey. And all it takes is that first step. Need someone to motivate you? Odell’s got you covered. Need a workout plan with a routine? Odell’s got you covered. Need results? Odell’s got you covered. Go check it out and sign up before he also gets booked out a year in advance.
The Gut Check
Obviously with the start-up costs and steep learning curve, you would need a passionate and knowledgeable person with some deep, deep pockets. But without a doubt the demand is there.
If you do it right, it seems pretty invincible. After talking with some manufacturers, it seems like each new production facility gets booked out almost instantly after opening, and after a year or so are just swimming in cash (that is, ignoring any financing costs).
Idk, seems like a niche industry with a huge cost of entry barrier, but it would be pretty cool to work with music all day too.
TLDR; just check out this video on how records are made, and ask yourself “could I do this?”