The Rising Price of Vinyl
After being away from the vinyl industry for the best part of 15 years, the first thing that struck me when I returned and started 45-rpm was the high prices of vinyl. I discovered quite quickly that in order to make a business out of buying and selling vinyl, I needed to sell at ridiculously high prices, which, of course, wasn’t going to be successful. As an example, recently I was offered a jazz LP for £30 excluding VAT, which was one slab of vinyl. That’s a £45 + LP, so why are vinyl record prices now so expensive?
With labels and artists constantly raising the issue of streaming revenues, you would think that making vinyl as attractive to the marketplace as possible would be a high priority. My personal stance is that I don’t think in a lot of cases the price is artificially high. After the licencing and pressing plant are paid for, a distributor will then add their markup of around 10-15%, before a retailer then adds their 30%. However, I do find it strange that I can pay £8.99 +VAT for UK 7 inch (pressed in the UK), yet I can pay as little as £4.99 +VAT for a 7” that’s from a US label, pressed in the US and distributed in the UK by an importer. Looking around at UK pressing plant prices, it’s hard to see how any label makes decent money, even with the high retail prices. So, it would seem the outlook is bleak for the record buyer’s wallet. But why?
Reasons why vinyl record prices have increased in recent years
Increased demand from a few years ago
Vinyl records have experienced a resurgence in popularity among music enthusiasts, collectors, and younger generations. This increased demand has driven up vinyl’s value and in turn, the prices, as more people are willing to pay a premium for certain records.
As an example, the popularity of a Fleetwood Mac re-issue has a knock-on effect down the food chain, so a niche soul or funk 7” will eventually be more expensive because it’s slowing down more classic re-issues being pressed.
Limited choice of pressing plants
Vinyl records are produced using specialised equipment and require specific manufacturing processes. Many record pressing plants closed during the rise of digital music, resulting in a limited supply of vinyl records. The remaining plants are now often struggling to keep up with supply and demand, leading to scarcity and higher prices.
Speaking to label owners, they are often frustrated at the lack of options, especially when they experience problems. The technology is incredibly expensive to invest in and needs certain expertise that’s almost impossible to find now.
Speaking with Ornate label boss and ex-pressing and distribution manager for a huge online vinyl retailer, James Thomson said:
“After the increase in demand after the ‘vinyl resurgence’, the crippling increase in the cost of raw materials and shipping due to Brexit, delays caused by covid and the handful of remaining plants struggling to deal with capacity, it’s no real surprise the cost of a record is higher than it has ever been. And, as often with these things it’s the buyer who gets the rough end of the pineapple. In my opinion, especially in regard to electronic music, to keep things exciting things need to move at a quick pace which is not possible when it can take over 6 months from submission to release date. That’s not even taking into consideration the time it’s taken to make an ep or the A&R process. Good things do come to those who wait but as a vinyl label the process can often be frustrating and challenging. And as a result, hard to keep a consistent fluid release schedule.”
The rise of limited-edition versions
This is another factor to consider amongst the rising price of vinyl. Collectors are often willing to pay more for rare or limited-edition vinyl records. Artists and record labels have recognised this and have started releasing exclusive vinyl editions with bonus content, coloured vinyl, or unique packaging. These limited releases create a sense of exclusivity and drive up the prices, even though sometimes they cost exactly the same to manufacture.
Production costs
The cost of mastering the audio specifically for vinyl, cutting grooves onto lacquer discs (due to a fire at a lacquer factory in the US), creating metal stampers, and pressing records, printing sleeves and labels has all gone up. This is mainly due to raw material costs but also, it’s a labour-intensive process, meaning wages need to go up in line with the cost of living.
Resale market
The growing popularity of vinyl records has also led to an active resale market. Record collectors and sellers take advantage of the increased demand by re-selling rare or sought-after records at higher prices. This secondary market further drives up vinyl records’ value overall, and in turn, the price. Why? Because often people are buying multiple copies to trade on Discogs, so hot releases sell quicker. This means either the retailer or the label takes advantage of the demand by raising the price of vinyl.
Speaking to some of my customers about the rising prices, there’s a consensus that the current price of vinyl does make digital so much more practical financially. And, the result of the rising prices is that they have no choice but to buy less and less vinyl.
In conclusion
Back when I was managing a roster of pressing and distribution deals, it was deemed a failure if you couldn’t sell 1000 copies of a single that retailed for £5. Today, it seems the benchmark is around 300 copies. It’s then no surprise that the price will rise, otherwise it’s just a vanity project to have the release on vinyl and nothing to do with making money for the artist and label. Personally, I do hope the prices stabilise or come down, as I love the format, as both a consumer and seller of vinyl. Fingers crossed.