Breaking the Fall Is your industry in big trouble? Don't despair--just look for new ways to grow.
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When Josh Madell co-founded Other Music 12 years ago, the goal was to sell music that then-major retailers like Tower Records didn't carry. In fact, Other Music opened its doors across the street from Tower Records' East Village store in New York City. "A lot of big music fans would come and hit them, and maybe hit us, too," says Madell, 37.
Today, Other Music's 12 employees only see where Tower Records' store used to be. Tower Records, which declared bankruptcy in 2004, is just one high-profile casualty in an industry struggling with downloading, file sharing and the growing dominance of iTunes. As of September 2007, industrywide album sales for the year had declined 14 percent compared with the same period last year, according to Nielsen SoundScan. Revolutionary times require revolutionary tactics, so in April, Other Music launched an online music store at digital.othermusic.com, where visitors can sign up for e-newsletters, listen to music clips and download songs. "If there's going to be an Other Music in five years," Madell says, "we need to change."
If you're in a troubled or dying industry, how do you spot the warning signs before you fall? Entrepreneurs often miss market disruptions once they're in business, and today, disruptions are everywhere. "There is no safe industry," says Jeff Cornwall, director of the Center for Entrepreneurship at Belmont University. "We can't assume we're going to find a safe little niche to operate in."