Diamond Halts Payments to Comic Publishers, Vendors Amid Coronavirus Freeze
Sonic comic publisher IDW, and much of the rest of the comic book industry, will be pinched even more, following distributor Diamond Comics’ decision on Tuesday to halt payments to all vendors temporarily.
In a letter to vendors obtained by Newsarama, Diamond parent company Geppi Family Enterprises notes the decision was made to balance a strong but uncertain economic impact the coronavirus outbreak has had on the industry, with the safety and well being of its own employees:
As the world responds to the outbreak of COVID-19, our focus is on protecting employees, understanding the risks to our business, evaluating the risks to our industry and examining the Federal Government resources available. While the full impact of this epidemic is still unknown, one thing is certain: supply chain disruptions have cash flow implications across the extended industry that can’t be underestimated.
While we work to understand the current industry landscape, the unfortunate truth is that we are no longer receiving consistent payments from our customers. This requires that at this time, we hold payments to vendors previously scheduled to release this week. This is a difficult decision and not one we make lightly. As this situation continues to evolve, we are committed to building out a plan for payment and will have more information to share later this week.
What does this mean? In a nutshell, IDW wasn’t paid this week for the comics it sent to Diamond for physical distribution. IDW has also announced they will not release any comics for the balance of May, furthering straining its balance sheet.
Even the last resort of digital distribution may be in question. Both Marvel and DC Comics announced earlier this week planned digital releases of new issues would not go forward as intended this week. DC Comics will only release back catalogue titles into the space. The move is being made to protect stores that can make it through to the other side of widespread business shutdowns around the world. A few stores across the United States, considered nonessential by state governments, have already made the decision to close permanently.
There is increasing concern that Diamond itself, like affected stores, may not have enough cash on hand to make it through an extended shutdown period. Adding to anxiety: no one can be sure when most economic activity will resume anywhere.
IDW has not yet made an official announcement about the fate of its pending digital releases for April.
This story was originally written for TSSZ News.