[1] By the mid-1990s, the company was so powerful that its decline toward bankruptcy between 1995 and 1997 initially appeared destined to set off a cascading failure of the entire Canadian music industry;[1] however, these early predictions of disaster were averted as affected labels sought out new distribution arrangements.
[3] Artists signed directly to Cargo's label arm included Shadowy Men on a Shadowy Planet,[5] Dyoxen, Change of Heart,[5] Lost Dakotas, The Smalls, Nomeansno,[5] The Killjoys, Asexuals,[5] SNFU and Grimskunk;[1] through its distribution deals, Cargo also held the Canadian rights to acts such as Mudhoney, Archers of Loaf, The Offspring,[6] NOFX and Rancid, as well as to the earlier, pre-breakthrough albums by bands such as Nirvana, Green Day and Soundgarden.
[7] The company's power reached its peak in 1995, when its existing contract as the Canadian distributor for Epitaph made it a significant beneficiary of the breakout success of The Offspring and Rancid.
[1] In that year, the company held a 2.3 per cent share of the music market in Canada, making it the second largest Canadian-owned music company behind only Quality Records; nonetheless, Cargo was considered more influential than Quality, as the latter was no longer distributing albums by individual artists and instead owed its market share entirely to MuchMusic-branded compilation albums.
[1] Goodis and Hill later told Billboard that they sold their shares after several months of sharp disagreement with Fox and Allen about the direction of the company; both felt that Fox and Allen actually knew very little about the music business, but instead merely seemed to view owning a record company, particularly one flush with cash from a recent pair of smash hit albums, as a ticket to fast wealth.
However, financial irregularities quickly began cropping up in Cargo's business dealings under Fox and Allen's management: some labels began to report that Cargo was making its own decisions about how many copies of an album to press without reporting back to the labels, often leaving the labels unable to square their accounts because of discrepancies between the number of copies they had ordered and the number that were actually sold and/or returned;[1] many labels reported unpaid bills from Cargo that in turn left them unable to pay their bands;[1] and some retail chains, including HMV, entirely ceased business dealings with Cargo due to the company's frequent delays in properly fulfilling orders.