Layoffs
From 1952 to late 1956, Goodman distributed this torrent of comics to newsstands through his self-owned distributor, the Atlas News Company. He shut this down in 1956, and began newsstand distribution through American News Company, the nation's largest distributor and a virtual monopoly — which shortly afterward lost a Justice Department lawsuit and discontinued its business. As historian and author Gerard Jones explains, the company in 1956
...had been found guilty of restraint of trade and ordered to divest itself of the newsstands it owned. Its biggest client, George Delacorte, announced he would seek a new distributor for his Dell Comics and paperbacks. The owners of American News estimated the effect that would have on their income. Then they looked at the value of the New Jersey real estate where their headquarters sat. They liquidated the company and sold the land. The company ... vanished without a trace in the suburban growth of the 1950s.
The Atlas globe remained on the covers, however, until American News went out of business. With no other options, Goodman turned to the distributor Independent News, owned by rival DC Comics, which agreed to distribute him on constrained terms that allowed only eight titles per month. The last comic to bear the Atlas globe on the cover was the funny-animal comic Dippy Duck #1, and the first to bear the new "Ind." distributors' mark was Patsy Walker #73, both cover-dated October 1957.
Stan Lee, in a 1988 interview, recalled that Goodman:
...had gone with the American News Company. I remember saying to him, 'Gee, why did you do that? I thought that we had a good distribution company.' His answer was like, 'Oh, Stan, you wouldn't understand. It has to do with finance.' I didn't really give a damn, and I went back to doing the comics. we were left without a distributor and we couldn't go back to distributing our own books because the fact that Martin quit doing it and went with American News had gotten the wholesalers very angry ... and it would have been impossible for Martin to just say, 'Okay, we'll go back to where we were and distribute our books.' turning out 40, 50, 60 books a month, maybe more, and the only company we could get to distribute our books was our closest rival, National Comics. Suddenly we went ... to either eight or 12 books a month, which was all Independent News Distributors would accept from us.
During this retrenchment, according to a fabled industry story, Goodman discovered a closet-full of unused, but paid-for, art, leading him to have virtually the entire staff fired while he used up the inventory. In the interview noted above, Lee, one of the few able to give a firsthand account, told a seemingly self-contradictory version of the downsizing:
It would never have happened just because he opened a closet door. But I think that I may have been in a little trouble when that happened. We had bought a lot of strips that I didn't think were really all that good, but I paid the artists and writers for them anyway, and I kinda hid them in the closet! And Martin found them and I think he wasn't too happy. If I wasn't satisfied with the work, I wasn't supposed to have paid, but I was never sure it was really the artist's or the writer's fault. But when the job was finished I didn't think that it was anything that I wanted to use. I felt that we could use it in inventory — put it out in other books. Martin, probably rightly so, was a little annoyed because it was his money I was spending.
In a 2003 interview, Joe Sinnott, one of the company's top artists for more than 50 years, recalled Lee citing the inventory issue as a primary cause. "Stan called me and said, 'Joe, Martin Goodman told me to suspend operations because I have all this artwork in house and have to use it up before I can hire you again.' It turned out to be six months, in my case. He may have called back some of the other artists later, but that's what happened with me.
The two fantasy titles (Strange Tales and World of Fantasy) clung on printing stored inventory material from late 1957 through late 1958.
Read more about this topic: Atlas Comics (1950s)