In the latest blow to direct market comics shops and to publishers, Diamond Comic Distributors, the largest distributor of comics in North America, announced that it will not pay publishers and other vendors this week. The distributor blames cash flow problems caused by disruptions in the supply chain as the reason for withholding the payments.

In a letter released to the public by Stan Heidman, president of Geppi Family Enterprises, parent company of Diamond Comic Distributors, Diamond said the move is in response to the impact of the Covid-19 pandemic on the supply chain. “While the full impact of this epidemic is still unknown, one thing is certain: supply chain disruptions have cash flow implications across the extended industry that can’t be underestimated.

“While we work to understand the current industry landscape, the unfortunate truth is that we are no longer receiving consistent payments from our customers. This requires that at this time, we hold payments to vendors previously scheduled to release this week,” he said.

This is the latest blow to the direct market, aka comics shops, a network of about 2,000 stores that buy their stock from Diamond Comic nonreturnable at wholesale prices. Diamond Comic Distributors delivers comics periodicals (mostly superhero), graphic novels, prose books, and pop culture merchandise, to these stores. Last week as comics shops around the country were forced to either shut down completely or restrict admittance to their shops due to the pandemic, Diamond announced it was halting shipments of new weekly comics to comics shops indefinitely.

Geppi Family Enterprises is also the parent company of Diamond Book Distributors, which specializes in the distribution of graphic novels, prose books and pop culture merch specifically to the general bookstore market. While these moves appear to primarily impact comics shops and comics periodicals, It does not appear that Diamond Comic Distributors decision will have any impact on Diamond Book Distributors and its clients.

Heidman said the company is working on a plan for when and how payments can be resumed to comics publishers. “This is a difficult decision and not one we make lightly. As this situation continues to evolve, we are committed to building out a plan for payment and will have more information to share later this week,” Heidman said.