An scent of stale coffee and new newsprint clung to the air in Duke's makeshift office on Madison Avenue.
The first reports from the Marvel distribution switch to Charlton were on the desk, spread across the polished mahogany.
David Chen, his face typically full of calm control, looked genuinely stressed.
"The good news, Duke, is that we are not bankrupt," Chen stated, pushing his spectacles up his nose. "In fact, we've proven the premise of the entire acquisition correct."
Duke leaned forward, ignoring the faint drumming headache that was now a permanent fixture in his life. "Give me the numbers, David. How does Charlton compare to DC?"
Chen tapped a sheet that detailed the output of the previous three months under Independent News (DC's distributor) versus the first four weeks under Charlton.
"Under the old regime, we were restricted to eight titles monthly. With an average of a fifty percent sell-through which was excellent, given the demand that generated a gross margin that barely covered payroll and printing."
Chen explained. "Under Charlton, for this initial batch, we pushed out ten titles, still well below our capacity, but nearly double the output."
He paused, the suspense hanging heavy in the air. "The sell-through rate is poor. Alarmingly poor, in fact, we are averaging only a forty percent sell-through."
"The fall comes from waste due to damaged copies, late deliveries, and just plain poor routing which is unacceptable."
Duke felt a familiar, cold dread wash over him.
Forty percent.
That meant sixty percent of their printed stock was coming back as unsold, damaged returns.
"But here is the critical pivot," Chen continued, tapping the final number on the bottom line.
"Despite the shocking inefficiency, due to the sheer volume the fact that we doubled the shelf space our net revenue for this period is twenty-five percent higher than we would have cleared under the old Independent News contract."
Duke let out a slow breath he hadn't realized he was holding. "Twenty-five percent. So, we are making more money, despite the distribution being run by amateurs."
"Slightly more money," Chen corrected meticulously. "Slightly more. We should be making double. The problem is not the content; it's the logistics."
The victory was paper-thin, resting on the backs of thousands of flimsy, four-color comic books that were barely making it to the newsstands intact.
The tension eased as Chen slid a small, separate report across the desk a bright, unexpected star in the darkness.
"This, however, is pure vindication for the content strategy," Chen said, a hint of pride in his voice.
"We took a chance. We released a single issue of Iron Man a character whose sales were middling and used it as a test vehicle."
"We sent a controlled, high-volume batch to key markets in Michigan, Florida, and Texas. We chose territories where Charlton historically had strong, well-established local contractors."
(I try to not make long paragraphs since people seem to not like them, thoughs?)
"The results?" Duke asked, his gaze fixed on the image of the golden avenger.
"The results are spectacular. The Iron Man issue sold out in every single test market. A complete, unadulterated sell-out."
"The demand is ferocious, and the forty percent sell-through is a lie; it's an average of bad delivery damaging sales of a good product. Where the books gor delivered, they sold."
Duke smiled a genuine, tired smile.
The audience was hungry. The material was potent. The only barrier was the physical reality of getting the product into their hands.
"That proves the value of the IP," Duke said, leaning back. "We were right. We just have to fix the delivery in some way."
Chen, energized by the Iron Man success, immediately moved on to the core reason they had secured Stan Lee's promotion: expansion.
"Since the volume strategy is proven, we can no longer afford to delay the title expansion. We need to maintain this velocity, regardless of the distribution hiccup," Chen said, pushing a new production schedule forward.
"Stan, surprisingly, is thriving under the pressure. He's working with Kirby and Romita on the new output. We need to go from our current ten titles to twenty-four titles by the end of the year."
(John Romita Sr. was a marvel employee who was in charge of Spiderman and later Art Director.)
Chen pointed to the ambitious launch list:
The Incredible Hulk will be given his own monthly title, moving him out of the shared Tales to Astonish.
Two new superhero book, potentially called Silver Surfer and Captain Marvel(Mar-Vell)—will be test-launched in three key state markets.
(Captain Marvel was a man/Kree at this point)
Sub-Mariner(Namor) is being pulled into his own book, taking advantage of the increased public awareness of the ocean, and his popularity.
"This is aggressive," Duke acknowledged, looking at the number of issues per month. "We are pushing the printers to the absolute limit, which means we have to be absolutely certain the distribution can handle this influx."
"We must," Chen insisted. "The bank is tracking our output volume as a key performance indicator for the debt service."
"We promised them expansion, and we must deliver. But this brings us back to the forty percent sell-through, Duke. We cannot afford the losses on twenty-two titles."
The focus shifted entirely to the logistical gap, the weak, unreliable infrastructure of Charlton Distribution.
"Charlton is fundamentally sound on paper, but their operations are run by a collection of regional contractors who still use old trucks," Chen sighed, pushing his analysis. "They are late, unreliable, and frequently damage the heavy boxes of comics."
"The long-term solution is to build our own network, but that requires massive capital expenditure. I have projected the cost of purchasing and staffing our own small fleet of five trucks for the East Coast alone at $350,000."
"This would be the ideal option Duke." Chen looked at Duke, his financial conservatism etched on his face.
"We do not have $350,000 to spare, Chen. Every available penny is currently either servicing the Marvel loan or being invested into the things like Butch Cassidy pre-production."
"So, what's the cheap solution, Chen?"
Chen leaned forward, "We pressure Charlton. We send in our logistics managers to audit their systems. It will take a long time to change their ways."
Duke rose from his chair, walking over to the window that overlooked the constant, rushing river of traffic on Madison Avenue.
Duke turned back, his energy shifting. "Let's not buy trucks then. That ties up capital, creates maintenance liability, and makes us a trucking company, as you rightly point out. But we can't run risk with Charlton Distribution."
Duke slammed his hand lightly on the desk, emphasizing the cheap, immediate solution.
"We are not capable of buying a fleet; but we can hire independent haulers in the key regional hubs like New York, California, Chicago, Atlanta, and Boston."
"We can use the same methodology Goldberg is planning for the Night of the Living Dead drive-ins. We find independent guys who already own two vans, are hungry for consistent work, and pay them a premium, per-route rate."
"But that is still expenditure, Duke," Chen protested.
"We use the money left aside for the Jackson 5," Duke stated simply. "We take $50,000 from the Jackson 5 operational budget the money earmarked for their promotional tour and divert it to logistics since it has been sitting for 2 months at this point."
"You are going to make Wals go crazy, he already complains about our lack of reinvesments on the Record Label."
"I plan on making it up to him later" Duke clarified.
"We use that $50,000 to hire independent haulers in the three worst-performing regional zones for ninety days. We pay them daily for proof of delivery. It's decentralized, it's cheap, and it's immediate."
Duke looked at Chen, who was already running the figures in his head.
"It's a cheap solution that buys us the time needed to force Charlton to get their act together, or to try to find a more stable long-term partner."
Chen conceded the point with a slow, reluctant nod.
"It will work," Chen admitted, running the numbers on his notepad. "The $50,000 covers the premium rate for the three hubs. It cuts our damage return rate in those profitable zones, which justifies the expense."
"Good," Duke said, satisfied. "Send the word to Walsh: tell him the Jackson 5 promotional budget has been slightly adjusted."
"Blame it on Joe Jackson's excessive demands. He'll believe it."
Duke smiled, standing again, the relief of solving an expensive problem with a cheap idea invigorating him.
---
I have read so much about Marvel in 1968 that my head hurts.
This thing actually happened, Marvel stopped working with DC in distribution and expanded from 8 titles to 24 titles very fast.
(you can look up the Marvel Explosion 1968)