FM Likely to Close
by Judith Rosen, PW Comics Week -- Publishers Weekly, 3/14/2006
The phone has been disconnected, the Web site yanked and the warehouse emptied, but FM International in Madison, Wis., is still trying to hold on as an alternative distributor to Diamond. "We're not officially closed yet," co-owner Wayne Markley told PWCW. "We're still evaluating what we're doing. Hopefully by the end of the month we'll make a decision. It doesn't seem like it's feasible to keep going, but nothing's 100% decided yet."
One option that Markley and partner Jerry Stoltenberg are pursuing during this hiatus is taking other jobs to help finance FM, which they would operate in a lessened capacity, still to be worked out. The pair are negotiating with Diamond Comic Distributors to buy their bad debt from retailers so that they can pay off their own bills to publishers. "We have no leverage to collect," said Markley, "while Diamond could refuse to ship new product until accounts are paid up."
Although Markley declined to say just how much FM owes since its business took a downward spiral two years ago, when Tokyopop signed an exclusive agreement with Diamond, it is likely in the high five figures. One of FM's largest creditors, Fantagraphics, which stood by the troubled distributor until it stopped shipping new books late last year, is owed about $24,000, according to cofounder Gary Groth. IDW, which signed an exclusive deal with Diamond that began in January, declined to comment on the FM situation, but is likely owed a similar amount. FM has tried to return old inventory or sell it to Diamond, but for the most part, there has been no interest.
Bruce Ayres of Capital City Comics in Madison, Wis., FM's first customer and possibly its last, is saddened by the turn in FM's affairs and what it will mean for small press distribution. "We're terribly frustrated with Diamond," he said. "They just won't cut purchase orders for small press items we want." He even has trouble getting some Gemstone Publishing comics, even though Gemstone and Diamond are both owned by Stephen Geppi. If FM closes, Ayres anticipates doing more buying direct from publishers, as well as turning to book trade distributors like Ingram and Baker & Taylor.
