“I think if we wanted to make it easy for ourselves we’d sign to a major company, sign a deal for a million quid and make all the compromises. Because, whatever bands say, you’re always completely compromised when you sign to a major label. I know that, if we signed a band, we wouldn’t let them behave like us, doing what the hell they wanted, that’s for sure.”
- Jimmy Cauty to Melody Maker, 16th February 1991
“We hardly ever saw Jimmy. He used to be, well, I don’t think ‘intimidating’ is the right word but he just used to be there with his hood up, hair and sunglasses and just didn’t say anything. Whether it was shyness I don’t know, but he came across as a more aggressive Pet Shop Boy. He used to come into the office, sit down and put his feet up on the desk and smoke whoever’s cigarettes were hanging around. But I rarely ever saw him. Two or three times maybe. I think he was in the studio and Bill enjoyed being the self-employed Record Executive.”
- Andrew Lee, former Appearing employee, to the author
By the time 3AM Eternal hit Number One in the charts in February 1991, another piece of The KLF’s musical jigsaw was already in place. Enter Errol Nicholson, better known as Black Steel. “I was known as Steel as I chop like stainless steel on the guitar,” he tells me today, “That’s how they do it when they’re playing the Jamaican style of reggae music. It was a guitarist by the name of Jerry Lyons who first called me Steel. I thought, ‘Steel. Hmmm. OK, I’ll stick with that,’ but it was a bit too lonely. So I said, ‘Shall I put Black with that?’ Ah, Black Steel - it worked! That was in 1979.” At this time, Nicholson was making his way as a musician and developed as a multi-talented instrumentalist who could play bass, drums, keyboards and sing, both inside and out of the studio. As well as recording and playing live with a large number of reggae artists, he soon became a fixture at Mad Professor’s Ariwa studio in South London, where his talents were much in demand, and he was to appear on many of the records that Mad Professor issued on his own label, also called Ariwa.
It was his link to Mad Professor that saw Nicholson introduced to The KLF. “Professor called me to ask, was I interested in doing a session for this guy called Tony Thorpe? I said, ‘cool, no problem.’ I came up and that was the first time I heard Eternal. Tony asked me, ‘Blacksteel, can you sing?’ I said, ‘Of Course. What would you like me to do for you?’ He asked me, ‘Can you sing ‘Justified Ancients Of Mu Mu?’’ So I did and he loved it. He liked what I sang.”
Drummond and Cauty were building up a talented team similar to that which served Pete Waterman so well, and it wasn’t long before Nicholson was asked to come down to Lille Yard Studios in Fulham to meet them. “They said, ‘You’ve got a nice voice.’ I said, ‘Thank you very much,’ then Bill said, ‘Would you like to sing some lines for me?’” This led to Blacksteel recording some backing vocals with Maxine Harvey around the Justified and Ancient theme.
With the chart success of 3AM Eternal, Nicholson was also drafted into the presentational line-up of The KLF, “I said, ‘Mum and Dad, I’m going to be on Top Of The Pops!’ They went, ‘Really?’ ‘Yeah, so watch out for your son,’ and that was my very first time going to the BBC television studios. We were new in the charts then and it just went up and up until it hit the Number One spot. I appeared three times, and it was a good performance - they (Bill and Jimmy) liked my performance.”
There was a lot to like about Blacksteel playing bass and flashing his dreadlocks for the camera, and he also got to do the same thing in the promotional video for the song. According to Nicholson, he was also responsible for an iconic KLF visual moment, “When we was Number One and appeared (on Top Of The Pops) in red (robes), Bill was saying, ‘We have to have something different rather than holding a microphone. I said try my phone.’ This saw rapper Ricardo De La Force appear to be dialing out the opening tones of the song on what, at this time, was one of the first, and very brick-like, mobile phones ‘So they (then) went ‘KLF is gonna rock you’ – BOOM! Yes, oh yes. That was my idea.”
As well as working on what was becoming an assembly line of singles, Drummond and Cauty were at last completing The White Room. This would not only be used for the film, which, at that stage, was still being edited into its final form, but also issued as the next LP by The KLF. After the success of What Time Is Love? and 3AM Eternal a KLF LP would be, on a financial level, like side footing a football into an open goal from two yards out again. It was classic Pete Waterman, but they didn’t have the album ready!
A core group of Drummond, Cauty and Nick Coler were working hard on a number of tracks at Lillie Yard and Marcus Studios, and whilst the album would feature slightly revised versions of What Time Is Love? and 3AM Eternal there were a number of other tracks that had to be completed or recorded from scratch. Thus session musicians like Blacksteel and Maxine Harvey were added to the mix, along with long-term collaborator Tony Thorpe, who was providing breaks, and no doubt Cressida and some other session singers, who were laying down backing vocals. A number of other vocal refrains, like the “Mu Mu” chant, had been laid down some time ago at Village Recorders in Dagenham and, as they were stored on disc, could also be added to songs when required.
Tony Thorpe’s musical knowledge was an important tool in The KLF’s armory. Whilst Drummond and Cauty might be filmed for in Trancentral demonstrating to the TV cameras how they would capture a break from a record – “There’s a good groove in this one,” states Cauty in one, “Everybody’s using it, but it’s good.” “We’re going to find a bass drum beat on this record that we can sample and clean up,” adds Drummond – when the cameras weren’t there it was Thorpe who was also providing them. “How he knew people like Pete Tong and all that was because he had been part of the Caister (soul) thing, and they all knew each other from years before,” recalls Nigel Laybourne, “so he knew about that whole jazz funk thing. He knew all about the old records and so that was that. You can usually trace his basslines and things like that to old jazz funk records.”
Of course, many people were also sourcing old records, but Thorpe’s ear for a bassline or drum break was very helpful to The KLF when building up the ideas for some of their tracks, or giving them that little bit of additional spice other records didn’t have. Thorpe would also do a number of remixes of KLF singles, as well as taking his own Moody Boys into more expansive territory, ranging from reggae to African rhythms, “It’s taken me a while to separate all those influences,” he told Melody Maker in 1991, “there was a time when everything was mixed into one and some of the ideas didn’t work. It was like trying to mix oil and water, impossible. But now I’ve sussed out where I want to take The Moody Boys.” This was evident in a track like What Is Dub?, issued in 1991 and featuring the vocal talents of Screamer. Errol Nicholson, Nick Coler and Jimmy Cauty were also part of this session, but, according to Coler, as Cauty had flu he spent most of the time asleep on the sofa in the studio!
Last Train To Trancentral (Live From The Lost Continent) would become The KLF’s third top five single when it was released in May 1991. Drummond and Cauty were very much a team in the studio, and in an interview with Record Mirror they related how their different skill sets perfectly complemented each other. “Jimmy’s far better at time-keeping on the percussion side,” stated Drummond, “I usually come up with the basic chords. I think I’ve got more of a pop mentality whereas Jimmy’s got more of a groove mentality.” As for Cauty, “Bill has a more analytical brain, so he’s good at structuring the stuff, and I’m better at just jamming. But there’s no set pattern.”
Saying that, they were more than open to input from those working with them. “The part I created was, ‘All aboard, all aboard, Wooah’ recalls Nicholson, speaking about Last Train To Trancentral, “but the rest of the lyrics were written by Bill.” As well as programming and playing keyboards on this, and many other tracks, Nick Coler remembers that, “on Last Train To Trancentral they wanted to put some vocoder onto it. They used to always go to me, ‘You do it,’ and I would say, ‘I don’t want to do it but I’ll show you how to do it.’ They did it and said, ‘That’s it.’ I said, ‘It’s not in time,’ but they said, ‘That’s it!’ So.…That’s it then!”
Some of the other tracks on the LP were probably inspired by the footage that they were intended to accompany in the abandoned The White Room film, and may have even been refreshed material from earlier White Room sessions in Dagenham. The atmospheric Build A Fire not only had lovely slide guitar but saw Drummond acting as a film narrator, his spoken word lyrics including, among other things, a reference to Lee Marvin’s Wandering Star playing on the jukebox - a nod to his love of country music. With regards to her vocal contributions, Maxine Harvey recalls that, “some had more work than others, but Build A Fire was about two takes.”
The track The White Room, although propelled by a dance beat, also had an atmospheric vibe and another short Drummond narration, as well as a Nicholson scat-like vocal that he originally did as a joke. “I did some funny voice style that sounds like (reggae legend) Eek-A-Mouse,” he says, “and I wasn’t expecting that. I said, ‘Bill, that’s not my style, that’s Eek-A-Mouse! I don’t know if he’s gonna like that!’ But he (Bill) loved it, so I said, ‘OK, I’ll do it, no problem.’”
In many respects, studio work on singles and the album all blended into one, and Nick Coler recalls that, at times, different people were working on different tracks that were at different stages of development. “At one point when we were making Last Train To Trancentral we were in Townhouse four,” he says, “and there was this great snake of keyboards going out of the door, running live and everything. Jeremy Wheatley, who is now a big remixer, was Spike (Stent’s) tape operator and Pro Tools had just come out, so it was a four-track system you were able to edit and then stick it all on tape. He would be in the live room editing the track that was going to go out, which might have been 3AM or something, and they (Bill and Jimmy) would be working on Last Train To Trancentral. (Meanwhile) I was in the drum room with a great heap of sequencers and samplers programming the orchestra for It’s Grim Up North.”
In the midst of all this, in early February 1991 Drummond and Cauty lost a day working in the studio when the long arm of a paintbrush saw them encounter the long arm of the law. Scheduled to be interviewed by David Stubbs of the Melody Maker, the pair planned to deface a billboard near Battersea Power Station. They must have driven past it on the way to Lillie Yard in Fulham at some point and seen it advertising coverage of the Gulf War - “THE GULF - The coverage, the analysis, the facts.” Cauty and Drummond cleverly decided to paint a large K over the GU, thus changing the message of the poster to “THE KLF - The Coverage, the analysis, the facts.”
It was absolute heaven for Melody Maker photographer Kevin Westenberg, and although Stubbs was a little nervous due to his own flyposting past the copy wrote itself - “Jimmy in particular displays a steady hand, considering he’s painting fifteen feet up from ground level using two extensions. Nice brushwork.” With their defacement complete, painting tools dumped and photos snapped, it was the perfect raid. Now, back to the studio. But Drummond and Cauty decided that they should be photographed holding up their brushes in front of their handiwork, and it was at this point they were approached and arrested by three plainclothes officers. Ironically, one of them actually knew who they were, “You’re KLF? Yeah, I know you.” He then proceeded to comment on Cauty’s fashion sense, “I dunno why you wear those sunglasses. They’re crap!”
Drummond and Cauty were taken down to the police station and held in separate cells before eventually being let off with a “stern reprimand” by the Chief Inspector, who realised it was a publicity stunt of some kind. It was, and was gleefully reported as an exclusive in the next edition of the Melody Maker. Meanwhile, back at the studio Nick Coler was scratching his head and wondering where they were as they were all supposed to be working on a track together. “I was in there all day. They went off and said, ‘We’ll see you in a bit.’ I was just programming and they came back around seven o’clock. I said, ‘Where the hell have you two been?’ They went, ‘We’ve been in jail all day.’ ‘Oh, alright then.’ Then they went, ‘By the way, all that’s shit.’ I said ‘OK, Thanks for that!’”
The defacing of the Gulf poster, as well as serving to boost the image of Drummond and Cauty, was also noticed by another electronic duo. “I like the way they changed Gulf to KLF on that hoarding,” Chris Lowe of the Pet Shop Boys told the New Musical Express in May 1991. “Also, they had an incredibly recognisable sound,” added Neil Tennant, “I liked it when they said that EMF nicked the F from KLF. They’re in a different tradition to us in that they’re pranksters and we’ve never been pranksters.” By this point, the two acts had collaborated when the Pet Shop Boys asked The KLF to remix their track So Hard in 1990. But things hadn’t turned out how Tennant had expected, “When they did the remix of So Hard they didn’t do a remix at all, they re-wrote the record and that’s why I had to go in and sing the vocals again. They did it in a different way. I was impressed that Bill Drummond had written all the chords out and played it on an acoustic guitar. Very thorough.” Of course, there was no acoustic guitar on the final version of the song, which was a fantastic electronic powerhouse of a track.
Publicity aside, with regards to tracks that were still being laid down for The White Room, No More Tears added a wonderful dub reggae feel, with Blacksteel also playing bass and piano and adding vocals. “I obey everything they say,” recalls Nicholson, who played his bass part along to an existing drum pattern, “I obey. It’s not my thing, it’s their thing, so we have to listen to them. When they tell me what to do and what to sing I sing it.” He was glad, however, to add sweet harmonies on this track with Maxine Harvey – “she is so good, she is fantastic” – although when he thought it would be a good idea to try the same thing on the LP version of Justified And Ancient, on which he again contributed vocals, “Bill said it would be a little too sweet, and I understood that.”
One of the crucial aspects of The KLF’s sound, both on the singles and the subsequent LP, was the mixing, which was handled by Julian Gordon Hastings and Mark ‘Spike’ Stent. “He’s always had amazing ears,” Nick Coler recalls when talking about Stent, who cut his teeth on bands like The Cult and The Mission, “His hearing is so great. They just got in there and did what had to be done, with him editing. Jimmy would just say, ‘No! No! We need more – turn that up louder!’ They were pushing him to make what was the sound of the time.”
The sound of the time was very much what The KLF were creating, with deep, wide-angled sonics that had depth, space and clarity as well as some grit. Nick Coler recalls that he and Cauty used to have a lot of fun when making tracks by adding the sort of things that professional studio engineers hated, such as a drum stool or chair squeaking, or the sound of a spring on a kick drum. Actually, when it came to the kick drum sounds used on a lot of KLF records, “we would put two kick drums on there, and then there would be a high one as well - that was unusual for Spike. Jimmy really made him EQ. There were engineers who used to get a nice sound, (but) it wasn’t until dance music and digital stuff came along that everybody began to crank it up and distortion became fashionable.”
The KLF were one of the first acts to crank up this particular volume. At one point, Drummond and Cauty even decided that they wanted to overdub something onto one track at the cut. The cut of a record is the last stage in the process and is usually only used to do a last bit of EQing to a finished track, rather than any further work on it. “I’ve never seen a man so frightened,” laughs Coler, “The (cutting) engineer was like, ‘I haven’t got any inputs!’ They said, ‘You must have something.’ He said, ‘I’ve got one input!’ But he was just freaking out. There was always something mad going on.”
One such mad thing, according to Coler, was that Drummond and Cauty usually liked most tracks they recorded to run for around eight minutes. “On Make It Rain there was a (Yamaha) DX7 and a Cheetah MX-6, and we would turn the lights out and I would play two or three chords. And yeah, eight minutes of that and then you would listen back for eight minutes, and in about an hour you’ve done an overdub. That was the way it was.” In some respects, this probably had something to do with the fact that dance tracks at the time could run for six or seven minutes, but it did mean that mixers like Mark Stent had to work really hard to pare down tracks for final edits, which might only run for three or four minutes. Of course, when it came to remixes and different versions that appeared on B-sides of singles, the lengthy running times of the original tracks meant that there was plenty of material to work with.
With the huge success of What Time Is Love? and 3AM Eternal, it was obvious that a KLF LP was going to sell strongly, and the ground was laid by Sallie Fellowes to ensure that it was pre-sold by the Rough Trade sales team to retailers. But she left someone out of the loop. “He really loved The KLF, and the only time I ever saw him cross and hurt was when The White Room came out,” recalls Andrew Lee of Scott Piering, “I was living with this guy called Martin Carghill, who had got me my job at Rough Trade, and he went on to work in the sales team at the new Rough Trade in Seven Sisters Road. I got to hear The White Room before Scott because Sallie went and gave all the sales people, the telephone sales people, a copy of the album on cassette to pre-sell it. Scott came in and I said, ‘Have you heard the album? It’s great!’ He went ‘No.’ I said, ‘Have you not got a copy? Sallie has been giving them out, surely you’ve got one as well?’ No? Oh shit! ‘I’ve brought it with me, you can have it if you like.’ (He went) ‘FUCKING HELL! I’m selling this thing, if it’s promotion you want we’re your rocket to the moon. Sell all you like, but you won’t without us!’”
When it was finally released in March 1991, The White Room really was the sound of the time. Crucially, the first side of the album was sequenced like a concert, complete with crowd noise, and was a KLF greatest hits, kicking off with What Time Is Love, Make It Rain, 3AM Eternal and Church of The KLF and ending with Justified And Ancient. Reviews were positive, with Tim Nicholson of Record Mirror hitting the nail firmly on the head when stating, “Anyone whose introduction to the JAMMS-Disco 2000-Timelords-KLF saga was via the Stadium House reworking of What Time Is Love? last year will be ever so pleased with this strong and cohesive LP.”
The White Room crashed into the album charts at number three on 16th March 1991, and although it never got any higher than that it spent a total of forty-six weeks in the album charts, of which twenty-two were in the top thirty. The album sold in the region of two million copies in the UK alone, and was also issued in Europe and America, where sales were strong.
Behind the scenes at this time, there had been some interesting developments. As related earlier, Drummond and Cauty had sampled the voice of Wanda Dee from the To The Bone 12” on What Time Is Love? and, whilst the original versions of the song had enjoyed a low profile, the interstellar success of the definitive Stadium House version eventually came to the attention of Dee’s husband and manager Eric Floyd. According to Dee, in an interview with Werner Von Wallenrod’s Humble Little Hip Hop Blog in 2006, he went on a, “one man warpath that night, calling Wax Trax Records in Chicago, KLF Communications in London and so on and so forth.” Although the specific details of the agreement are unknown, Dee also revealed that her husband/manager got her a six figure settlement, as well as “featured credits on the White Room album, starring roles in the music videos and a lucrative co-publishing deal with them (as I wrote the hooks to their biggest worldwide hits).” Whilst she acknowledged that Drummond and Cauty, as producers, were, “light years ahead of their time,” claims that they would not have enjoyed success without her contributions were, to put it diplomatically, not entirely accurate. Whilst the, “I wanna make you sweat” refrain was a vital and memorable part of the final version of What Time Is Love? it was hardly the genesis of the song. Indeed, if you stripped this vocal line out the basic, beautiful sequenced engine would remain.
According the Nick Coler, everyone was amused by Eric Floyd’s initial attempts to contact The KLF when they were working at Lillie Yard Studios. “This guy Eric, every night on Hanzi’s (Hans Zimmer’s) answering machine there used to be this, ‘Wild dogs will come and grab you if you do not reply to this… I will so and so.’ I recorded some of them but – unfortunately – I don’t have them anymore. I was going to chop them all up and make a song out of it and put beats all over it.” This went on for some time, “Every night there would be another one. We used to crowd around the answer machine and have a good laugh. Obviously they (Bill and Jimmy) had to do something because they’d had the problem with the MCPS before with the original record (1987…) and everybody was getting really hot on samples at that time.” Not pre-clearing the sample and agreeing to pay a flat fee upfront left Drummond and Cauty open to challenge. This cost them money, and Dee and Floyd were to cause a totally different kind of headache in the future.
Of course, once a deal had been done it was all smiles, and Dee and her husband flew over for her to take part in the video shoot for the single edit of Last Train To Trancentral. Ironically, Dee’s one repeated lyrical refrain on this track was, “Come on boy, do you wanna ride?” which was also taken from the To The Bone single. The performance part of the video was intercut with scenes of a model of Ford Timelord flying through a mythical model city of Mu, which had been built by Cauty’s brother who did this for a living. Drummond and Cauty helped out and cleverly conductied magazine and TV interviews on the set during construction, which was great publicity and also gave magazines and TV shows great visuals to use in their features or brief broadcast spots.
Although Dee appeared in this lush video wearing a sexy white outfit, Errol Nicholson, who had contributed the “All Aboard!” line, did not. He was unavoidably delayed on that day and only arrived at the studio after filming was completed. “I would have stayed around Jimmy’s house, but because it was so crowded there I’d rather sleep in my own bed.” As with 3AM Eternal, Last Train To Trancentral was a lushly staged affair, with Cressida handling most of the aspects of the choreography and costume design, although she likely steered clear of Drummond and Cauty as they deployed sparking circular saws.
Whilst the Wanda Dee issue was, and would remain, costly, it was, in some respects, a price Drummond and Cauty had to swallow for the uncleared sample, in a similar way that Black Box had been legally clobbered by Loleatta Holloway for the unauthorised use of her voice on the Ride On Time single. Even when Drummond and Cauty used ‘60s soul singer P.P. Arnold for session work, she later took legal action against them, stating that she should receive royalties for her contribution at the beginning of 3AM Eternal – “KLF! Uhuuhuuhu.” Arnold also refused to appear in KLF videos wearing a blue robe over her head as she thought it made everyone look like relations of the Ku Klux Klan, which was not the case at all. The matter with Arnold was settled, but around the corner was another disaster that was to cost Drummond and Cauty much more money that any sampling issue…
By 1991 Rough Trade had come a long way from the day in 1976 when Geoff Travis had opened a record shop in Ladbroke Grove, having expanded into a record label, a publishing company and a powerhouse of an independent distribution company. The tipping point had been The Smiths and the ability of Rough Trade’s Cartel of distributors to get their records into every shop across the country, and also into the charts. From the mid ‘80s onwards, independent records became big business as bands like Yazoo, Depeche Mode and New Order sold millions in the UK through independent distribution. As the decade progressed, the definition of an ‘independent record’ became fuzzy. For example, many records issued by Pete Waterman’s PLW team were on their own Supreme and PWL labels and distributed through Rough Trade’s major independent rival Pinnacle, so a label that generated major chart topping singles and albums by artists like Jason Donovan and Kylie Minogue were, technically, as ‘indie’ as The Fall, Spacemen 3, The Cocteau Twins, My Bloody Valentine and the early output of The Stone Roses.
Initially run as a collective, with The Smiths’ success Rough Trade had grown, like the Orb track, into a huge pulsating brain that ruled from their offices and warehouse in Collier Street, Kings Cross. Although Geoff Travis helmed the record label, the distribution arm became the main engine for generating cashflow. Rough Trade even offered a service that would take care of vinyl pressing, sleeve printing and overall manufacture, and by 1989 the distribution turnover was £22 million. By 1990 this had shot up to £40 million. These were serious numbers and extraordinary growth, suggestive of robust health, but sadly these figures papered over massive cracks - in truth, Rough Trade Distribution was not being run as well as it could have been. For example, when Parkfield Video collapsed in 1990 it was revealed that Rough Trade’s credit control department, (responsible for collecting monies owed for distributing Parkfield product) were owed £500,000. This was very lax indeed. And after running down the regional Cartel distribution network to work from a new and larger central warehouse in North London, the upgrade was botched to the extent that when they moved into their new premises the lease on the old Collier Street office still had some time to run, so the company were paying rent on two large warehouses.
Rough Trade also famously invested over £600,000 in a computer system that was supposed to streamline orders and distribution but ended up being described as the most expensive computer catalogue ever built in the music business. The system simply could not complete the task it was created for. There was also another warehouse in Camley Street, Islington, full of unsold stock that continued to occupy space on which rent, light, heating and staff costs had to be paid.
Rough Trade Distribution had encountered financial difficulties before and managed to solve these problems and carry on trading, but by 1991 they were approaching a perfect storm that would shipwreck all aspects of the business, from the record company to the publishing arm. Matters were not helped by the fact that the management structure - from Rough Trade Records to Rough Trade Distribution - was run partially by committee rather than senior or middle management.
Also, a decision to try to focus on becoming the top independent distributor led to some crystal ball gazing wherein money was advanced to some new labels - including some in the dance sphere, where Rough Trade Distribution was making good money – in exchange for exclusive future distribution rights, all in the hope that one of these labels would become the new Mute, Factory, 4AD or Creation. Several of these labels served up duds, whilst in some cases no records appeared at all, despite their receiving, allegedly, five or six figure advances.
But what really moved Rough Trade towards the rocks was their decision to expand into America. Not only did they underestimate how large the country was when it came to distributing records across a continent, but also the business was underfunded, and the £3 million allocated for a five year roll out was swallowed up in nine months. Whilst Rough Trade distributed Mute records in the UK and Europe, their records were licensed to Sire/Reprise in America, and so the coffers of Rough Trade America couldn’t be bolstered by an earned percentage on shipping millions of copies of albums like Depeche Mode’s Violator.
Ultimately, Rough Trade America required regular cash infusions, and rather than go to a bank to fund a business that should have financially remained in its own silo, it was decided to funnel money into this black hole from profitable operations in Germany and the Benelux. Attempts were made to try to square the circle and head off disaster, and George Kimpton-Howe was poached from rivals Pinnacle to try to add some business rigor to Rough Trade’s Distribution operations, but he was drinking from a poisoned chalice from day one. Redundancies, streamlining, and attempts to run the collective-like consciousness like a normal business met with resistance from staff ingrained in the Rough Trade culture.
By 1991, with record sales down across the entire industry, word was beginning to leak out that Rough Trade was in trouble, “We are not in danger of going under,” Kimpton-Howe was quick to tell industry publication Music Week in February 1991, “we are currently waiting to finalise a very big financial deal.” Talk of £1 million was bandied around to fill the hole in the accounts of the distribution arm, although as Rough Trade owed no money to the bank one wonders why they didn’t try to negotiate a loan to float them over their current financial sandbar. But being wise after the event doesn’t change history, and at the time labels like Mute – who’d been here before with Rough Trade - were confident that matters would be resolved, and even provided Music Week with a statement of support,” We are aware that Rough Trade have had serious financial problems and we are committed to help them resolve their difficulties.”
The horizon grew dark and ominous when labels like Revolver moved their distribution elsewhere, and rival distributors Pinnacle and Charly began to receive enquiries from worried labels also looking to move, especially when forty staff were laid off when accountants from KPMG were summoned in February 1991 to try to save the company from collapse. David Murrell, head of KPMG’s Entertainment and Media division was appointed as acting Managing Director and shot from the hip, “While I greatly regret what has had to be done, if we had kept these jobs there would be no future for Rough Trade.” Murrell went on to state that the company had been losing money every week for the last year as revenues went down and overheads - especially for the new distribution warehouse - had increased.
Rough Trade was also in the position of not paying its creditors, many of which were the independent labels that it distributed. They were owed money for records already distributed and sold, but were told that under the new regime Rough Trade wanted to pay them all at once. However, although there was money in the bank there wasn’t enough to pay them all. A new financial model was therefore established whereby all monies received for records shipped out after 8th February would be held in trust and then paid out immediately to the labels concerned.
Murrell was optimistic about Rough Trade’s prospects and stressed that it was not in receivership. Although there was no immediate sign of cash injection there was talk of drafting a prospectus to send out to prospective buyers, such as Geffen records. A statement like this showed that Rough Trade Distribution was, for all intents and purposes, on the auction block. More staff were then laid off and The Catalogue magazine was shut down as a cost cutting exercise as Rough Trade was slimmed down to make it more attractive for potential investors.
Jazz Summers, Head of Big Life, gave words of support - “We are going make sure Rough Trade is not going to the wall. The future of the music industry depends upon the independents.” Neither Geoff Travis or George Kimpton-Howe were willing – or perhaps allowed – to comment to Music Week, or any other publication for that matter, on the state of play inside the crumbling Rough Trade empire. It was no wonder Jazz Summers wanted Rough Trade to find their way out of the woods - Big Life had enjoyed massive hit singles and album, all of which had been distributed through Rough Trade, and so he was a major creditor at this point, along with labels like Mute, 4AD, Situation 2, Rhythm King, and, crucially, KLF Communications. There was soon a meeting called that included around seventy labels Rough Trade distributed, to appraise them of the situation and probably explain why only interim rather than full payments had been made since February. These labels needed this cash to pay out royalties to their artists as well as meet the running costs of their own businesses.
By May, things had deteriorated further, with Pinnacle looking to take over distribution of a number of labels, and ranks were breaking as Jazz Summers took the distribution of Big Life through Polygram and stated, “I am angry with Geoff Travis. He is Mr. Rough trade, and although they enabled a lot of us to start up they strangled us with complete inefficiency and gross incompetence.”
As all KLF Communications records were distributed by Rough Trade, Drummond, Cauty, Fellowes and Cressida followed events closely. After all, by May 1991 they’d scored two top five singles and a top five album and were owed in the region of £750,000. Worse still, Last Train To Trancentral and The White Room were still in the charts, so not only was there the issue of the money still being generated by these massive selling records but also the strong possibility that, if Rough Trade collapsed, they would simply stop appearing in the shops, and thus the charts. The KLF were riding the top of a huge wave with the prospect of their surfboard vanishing into thin air.
When it came to dealing with the issue, it was Bill Drummond and Sallie Fellowes who went in to bat for KLF Communications. They attended the meeting held for the seventy labels, as well as subsequent meetings that were only held to address the biggest creditors. KLF Communications, it was calculated, were owed in the region of thirteen percent of the total debt.
Cauty told Richard King in an interview for his How Soon Is Now book that “Bill and Sally (sic) would be there working out how much money we were owed and I’d be in the studio trying to finish the track (Justified And Ancient) and trying not to think about the studio bill.” According to Mute’s John Dyer, who was at these meetings, Drummond rose to the challenge, and managed not only to contribute to the discussion but to take the time to book Pinewood Studios for a video shoot, as well as phone Cauty in the studio and listen in on mixes of Justified And Ancient, “Yeah, bit more bombastic Jimmy, bit more bombastic.”