Difference between revisions of "Rainbow House Distributors"

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What was Rainbow House Distributors ?

Rainbow House Distributors supplied Christian retailers with books, videos and gift products until December 2001.

Distributor shuts down

by Robert White Special to Christian Week

WATERLOO, ON–Ontario-based Rainbow House Distributors–which supplied Christian retailers with books, videos and gift products–closed the book on its operations in December.

"We're far from the only ones hurting," says Rainbow House President Roy Burrage. "When you have someone like Sam the Record Man going down, it's an indicator of the economic environment. There were economic pressures on everyone."

"It was a failure of the marketplace," he adds.

Burrage moved from Toronto to Waterloo in 1989 when he started a full-time distribution company. Rainbow House Distributors–by bringing smaller suppliers together–made it easier for stores to buy products from one place. It expanded into larger facilities, with a staff of 10, in 1999.

"The bottom line is, no pun intended, sales dropped and we weren't able to pay our bills. We moved into larger facilities with $1.4 million in sales. Ironically, since we moved into larger quarters, sales continued to slide," says Burrage.

Reactions from authors, retailers and publishers who dealt with Rainbow House are mixed.

"I'm not terribly upset," says Ray Wiseman, author of the self-published A Difficult Passage. Wiseman used Rainbow Distributors to get his book into local stores during speaking tours. "I was selling far more personally than in bookstores.

"I don't think it's bad management. It's a crazy business. General distributors have been in deep trouble for a long time. It all caught up with Roy," says Wiseman.

Burrage, when he decided to close, arranged for Wiseman to receive any remaining copies of A Difficult Passage and an outstanding payment.

Larry Willard, executive director of Augsburg Fortress Canada, sees Rainbow House's closure as the "first fatality" of a challenging market. He runs Augsburg Fortress Canada's Kitchener retail store–the other is in Calgary–and purchased a few lines from Rainbow House. He says retailers might have to go directly to suppliers until someone else picks the lines Rainbow House distributed.

"It (the closure) probably comes as a caution," says Willard. "The Christian publishing business is not strong except for a couple of people. I wouldn't be so sure there aren't others behind (Burrage)." Willard says the success–or lack thereof–during the Christmas 2001 and Easter 2002 sales periods will determine which distributors will stay open.

Rainbow House's closure is only one of the factors forcing book publishers to explore other avenues of distribution.

"We were already considering making changes in distribution before this happened," says Gus Henne, marketing director at Essence Publishing and ChristianWeek. Henne says the custom book publisher is currently developing an Internet-based fulfillment service.

"It doesn't have a major effect on us. Less than five per cent of Christians go into Christian bookstores once a year," he adds. "Of the 100,000 books published in North America, 50,000 are sold through channels other than bookstores. We're committed to getting author's books into readers' hands, whether that's through bookstores or direct sales."

In November, Burrage asked Henne to be part of an advisory group. Henne says they had one meeting before Burrage decided to close.

Rainbow House stopped selling products in December. Burrage is now trying to collect outstanding payments, sell off assets and pay suppliers until its May 31 fiscal year-end.

"I look back and have a lot of wonderful memories. There are no regrets–some sadness and grief, but no regrets," says Burrage, who sees God's hand in the closure. Burrage has had health problems recently and the business' demise brings some welcome stress relief.

"It's a sad situation but God has been gracious to us. It's been a wonderful experience but God's finished with it."

Source: Christian Week anuary 22, 2002 Volume 15 Issue 19
http://www.christianweek.org/stories/vol15/no19/story2.html