Select-O-Hits marks 50 years in turbulent music industry

By Bob Mehr the Commercial Appeal 10/24/10

Last month, Memphis music distribution company Select-O-Hits celebrated its 50th anniversary. But for Select-O-Hits co-head Johnny Phillips, the occasion was not greeted with overwhelming joy, so much as a hard-earned sense of determination.

“We’re still here,” said Johnny of the company his father, Tom Phillips, started a half-century ago. “Which is more than you can say for just about everybody.”

During the past tumultuous 10 years, the music business has seen plenty of long-standing and once prosperous companies fall. But Select-O-Hits has endured. “We’re working twice as hard to make a quarter of the money,” said Johnny, “because the business has changed so much over the last five or six years, in particular.”

Inside the Select-O-Hits complex, a nondescript office and warehouse space located off Kirby-Whitten and Interstate 40, it’s clear the company is both a labor of love and true family affair.

There’s the second generation of Phillipses: siblings Johnny, Sam and sister Kathy Gordon, who’ve run Select-O-Hits since the late ’70s. And now there’s a third generation working here: Johnny’s son, Jeff Phillips, and Sam’s four children, Tiffany Couch, Lesle Heinz, Ashlee Bennett and Wes Phillips.

Clearly, there is much left to be sorted out about the very nature and direction of the music industry. But there’s also a sense Select-O-Hits will be a part of that future.

“In this business you have to take what’s good and maximize it. And you take what’s bad and redirect it, turn it into a positive,” said Wes Phillips. “That’s how we’ve always gotten through.”

It’s the philosophy that gave birth to Select-O-Hits in the first place.

Successful sideline

The Phillips family came to Memphis from Northern Alabama in the mid-1940s. There were seven children in the clan, but it was the last three who ended up in the strange, colorful and uncertain world of the music business.

There was Sam, the visionary founder of Sun Records. There was Judd, the wheeler-dealer, a born promotions man who also became a key figure in the label’s success. But Tom — who would ultimately found Select-O-Hits — was the shyest of the bunch, stuck working a stultifying and dangerous job in a paper mill in Mobile.

“When Sam had Elvis, he sent Dad some of his 45s and on the weekends he’d go to radio stations and push the records,” said Tom’s son, Johnny. “He was just trying to help, but it got him interested in the business. He was also eager to get out of the paper mill because it was killing him.”

In the late ’50s, Tom and Judd signed on as Sun Records star Jerry Lee Lewis’ management team. “Dad sold our house, everything he had to back Jerry Lee,” said Johnny. It would prove to be an ill-fated decision, however. Within a year, Lewis’ career came crashing down amid controversy over his marrying his teenaged cousin. For Tom it meant financial ruin.

Tom turned to his brother Sam for a job. The best he could offer was work supervising a warehouse on Chelsea, overseeing Sun and Phillips label record returns.

Eventually Tom became bored and came up with an idea of his own: He’d start selling the old Sun vinyl piling up in the warehouse. “He took five 45s and put them in a plastic bag,” said Johnny.

“He would pack a Jerry Lee record on one side and a Johnny Cash on the other, and put what was then considered filler — Sonny Burgess, Warren Smith, Billy Lee Riley — in the middle,” said Johnny. “That’s where the name came from; the (promotion) was called Select Our Hits.”

Tom’s novel little sideline soon grew into a profitable one-stop — a place where smaller mom-and-pop businesses in the South, mostly black-owned grocery stores, beauty salons and the like, could come and buy new records from bigger labels that wouldn’t otherwise service them.

Select-O-Hits’ one-stop business prospered throughout the ’60s and eventually the company became a full-fledged distributor, filling a vacuum created by the demise of another local distributor called Hot Line, and various other Southern companies that went belly up in the mid ’70s.

Select-O-Hits’ biggest move came in 1979 when it distributed the seminal “Rapper’s Delight” by the Sugar Hill Gang and Sugar Hill Records. “Rap and hip-hop catapulted us much more deeply into distribution,” said Johnny. “As that music started coming out, those labels would seek us out.”

Tom’s children, Johnny, Sam and Kathy, bought out their father in the late ’70s and were soon supervising a multimillion dollar business that included the Select-O-Hits distribution and one-stop, as well as several labels, an in-house studio and a pair of retail stores.

Though they would eventually divest themselves of the ancillary businesses, the distribution end continued to flourish through the late ’90s.

Then, the music business came crashing down.

‘We’re still here’

It’s a tired drumbeat now, recounting the litany of causes — corporate consolidation, the demise of radio, Internet file sharing, illegal downloading — that have pushed the traditional record business to the brink of extinction over the past decade.

For Select-O-Hits, the difference in its business numbers between 2000 and 2010 is dramatic. These days, the company is serving about 5,000 fewer retail outlets, and physical sales have shrunk by 60 percent. A decade ago, the company employed 100 people; today that number is down to about 30.

For Select-O-Hits, the core of the business remains the same. They take a percentage (basically 20 percent) of what their distributed labels sell. These labels include Southern stalwart Malaco, Jimmy Buffett’s Mailboat Records, hip-hop companies So So Def and Real Talk Records, as well as variety of successful Latin music labels.

Musically speaking, Select-O-Hits’ strongest markets remain the Latin, roots (soul, R&B, gospel, country) and rap genres. Within those formats there is new momentum, with Latin holding steady, gospel on an upswing among younger buyers, and rap/hip-hop slowly starting to recover some of the ground it lost in the mid-2000s.

Ironically, the same kinds of technologies that once decimated the company’s business may now prove to be its salvation: digital downloads, music-playing cell phones and ring tone sales are markets that are growing exponentially.

Recently, Select-O-Hits overhauled its website and distribution sign-up process, making it more easily accessible and providing the ability to analyze sales and target markets far more accurately than ever before.

And Select-O-Hits has also begun to see a small resurgence in retail — not big chains, but rather a new wave of mom-and-pop stores opening up. “Buyers are starved for attention and they’re giving it to them,” said Wes.

Among the remaining 15 or so office employees (the rest are in sales or in the warehouse), nearly half are Phillips family members. “And the other people we have here, they may as well be blood relatives,” said Wes’ sister, Ashle Dennis.

The Phillips family and Select-O-Hits it seems, aren’t going anywhere soon. “We’re still here,” said Wes. “We’re still here and we’re still fighting.”

Select-O-Hits facts
Select-O-Hits was officially founded in September 1960 by Tom Phillips, brother of Sun Records founder Sam Phillips. The company would go on to include a one-stop, distribution company and retail stores.

Tom’s children Sam W., Johnny and Kathy Gordon expanded and took over the operation of Select-O-Hits in the late ’70s, growing the company to include several in-house record labels and a studio.

Starting with Sugar Hill Gang’s “Rapper’s Delight” in 1979, Select-O-Hits became one of the biggest independent distributors of rap and hip-hop, working with artists like Three Six Mafia and Jermaine Durpri, among others.

The company, which has had a long running partnership with Jackson, Miss.-based music label Malaco Records, currently has a roster of labels that includes Mailboat Records, Real Talk Records and So So Def, and artists like Jimmy Buffett, Colt Ford, and BeBe and CeCe Winans.



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