Recently a topic on marketing records was discussed. Here is some information I got from Jackson music store owner/talent scout H. C. Speir in interviews in the 1960s.
78 records sold for 75 retail and Speir paid 45 cents wholesale for a record. He said the companies told him it cost them 27 cents to make and market a single record. All companies had jobbers or wholesalers or owned the wholesale operation. He said the second line companies like Paramount and Gennet spent around 19 cents to make a record--much less and one reason Paramounts are often cracked. They used very little shellac in their pressings.
He said the major companies Columbia, Victor, Okeh and Vocalion/Brunswich worked on a 1 in 10 basis. They needed one hit in 10 to pay for the other 9 that didn't sell. A hit was 10,000 copies sold. He said the record companies did NOT know what would be a hit in the RACE and HILLBILLY series. "They would try something and if it sold, they'd try more of it. If it didn't sell they drop it."
At location recordings in Atlanta/Dallas/Memphis/New Orleans, etc they recorded not only RACE but anything else they could market. San Antonio was used to mainly record Mexican talent for instance for Okeh but later did more western swing for the emerging jukebox market in Texas and the Southwest. .
He credited Blind Lemon's records for starting the recording of guitar bluesmen. He said the major companies had missed that marker totally and Lemon "opened their eyes." He credited Jim Jackson's 'recordings for Victor starting its RACE series. Victor was the last company to start a separate numerical series in 1929.
Victor and Columbia sent out more promotional material than other companies, Speir said. He sold more Columbia than any other label with Victor a close second--not Paramount. Remember Speir sold both Race, hillbilly and popular music but 90 % of his customers were Blacks. If records didn't sell, he marked them down to 2 for a dollar and still made a nickel profit on each.
Finally, there was NO return of records to a wholesaler in the 1920s or 30s. A dealer was stuck with a 78 if it did not sell and this is why dealers became very selective in 1930-33 as record sales plunged. It also explains why best selling artists only were bought by a dealer. That is why records by the Mississippi Sheiks and Bo Carter are often found on Okeh and Blind Willie Johnson and Bessie Smith on Columbias. Likewise, Memphis Minnies, Tampa Red and Georgia Tom and Leroy Carr were bought by dealers as opposed to say a Hi Henry Brown in 1932. Pressings of 78s were down to a few hundred in those years and some of the rarest Paramount and others sold less than 100 copies. One Big Bill on Superior sold 38 copies in 1932 for 35 cents.
He also said the record companies did not carry a guitar with them for a bluesman to use. Speir would provide his talent with a new $9.95 Stella before they recorded. Companies also worked on a goal of getting 18 masters a day and would work from 10 AM to 10 PM if needed. gdw.
