This story is part of CNBC's new quarterly Cities of Success series, which explores cities that have been transformed into business hubs with an entrepreneurial spirit that has attracted capital, companies and workers.

Once considered a dying industry, the vinyl record business has undergone a remarkable multibillion-dollar resurgence in the past decade. It has been fueled by popular artists such as Taylor Swift and major retailers including Target and Walmart, along with a growing wave of consumers rekindling their love for the nostalgic format during the Covid pandemic.

"Never in a million years did I think it would, as a market and as an industry, become what it's become today," Mark Michaels, CEO and chairman of United Record Pressing, the largest vinyl recording pressing plant in North America, told CNBC's Andrea Day in the upcoming primetime special "Cities of Success," which airs Dec. 6 at 10 p.m. ET.

The global vinyl record market was valued at $1.98 billion in 2022 and is projected to reach $4.12 billion by 2030, according to Verified Market Research. More than 41 million vinyl albums were sold in the U.S. last year — the highest number since 1988, according to the Recording Industry Association of America.

United Record Pressing has become a major player in the vinyl market, producing approximately 40,000 records daily at its Nashville, Tennessee, facility. Founded in 1949 as Southern Plastics, the company has a rich history of producing vinyl records for iconic artists, including The Beatles, Stevie Wonder, Michael Jackson, Adele and Jack White.

But the company was facing an uncertain future 16 years ago when Michaels acquired it.

Second wind

The vinyl record industry had been in decline for several decades due to the emergence of more convenient physical formats such as cassette tapes and CDs, a decrease in the quality of vinyl records due to lower-quality materials and processes, and the rise of digital music, such as MP3s and online streaming.

Vinyl record sales plummeted in the 1980s and 1990s. And by the early 2000s, the industry was on the verge of extinction: In 2006, only 1 million vinyl records were sold in the U.S., according to RIAA.

"I questioned what I did all the time," Michaels recounted after acquiring the company. "I had many sleepless nights. [Even] my family questioned what I had done."

But in the years that followed, Michaels said, he noticed a promising trend: Indie artists displayed a growing interest in vinyl.

Hoping to position United Record Pressing as the go-to pressing plant for those artists and music producers who valued the tangible vinyl experience, Michaels purchased old record presses from closed plants to accommodate potential growth.

"Prior to 2016, you had to be able to find and restore an old record press, and that was a real tough, tough search," Michaels said.

The demand for vinyl from both indie and mainstream artists soon led to reissues and colored variants, marking a turning point, according to Michaels. That growth gained further momentum with the entry of major retailers such as Target and Walmart into the vinyl market in the early 2010s.

Mainstream lift

When Target and Walmart, two of the largest retailers in North America, decided to stock vinyl the entire supply chain was significantly affected, according to Michaels.

Vinyl began reaching a wider market segment: consumers who may not have traditionally shopped in independent record stores but were keen on acquiring mainstream vinyl titles.

"We recognized that with all the old presses that we had acquired, and we built the company around, that was inadequate to be able to service the needs of where the market was going," Michaels said. "Conveniently, in sort of 2016, a couple of companies started manufacturing new record presses."

Soon after, United Record Pressing implemented a growth strategy, relocating to a larger facility in 2017. The company established a creative marketing team that engaged with artists and labels, conceptualizing unique vinyl ideas such as liquid-filled, split-colored and scented records.

The company also included a digital download coupon with each record and initiated a record label, recording artists on tape and pressing directly to vinyl.

Michaels said the company also orchestrated a grassroots public relations campaign to highlight its 60-year history as the premier vinyl pressing plant in North America.

The new space, spanning 155,000 square feet in Nashville, not only met present requirements but also positioned the company for future growth — which would come just a few years later when the Covid pandemic provided an additional boost to the industry as people reengaged with the nostalgic format.

Today, the medium reigns as the most popular physical music format in the U.S., representing 72% of all physical music sales, ahead of CDs and cassettes, according to mid-2023 data — the most recent information available from the RIAA.

According to Billboard, the average price of a vinyl record increased from $26.12 in 2021 to $29.65 in 2022, reflecting heightened production costs and the impact of inflation.

In addition, the landscape of vinyl retailers has evolved over time. Indie record stores led the market in 2015 with 45.4% of sales, Billboard reported, followed by internet or mail-order sellers such as Amazon at 32.9%, and chain stores such as Best Buy at 15%.

By 2018, Amazon had eaten into indie stores' dominance, with both categories representing 41% of market share, while Best Buy's share had decreased to just over 10%. And by 2019, major retailers such as Walmart and Target were registering on the scene.

Where big-box retailers made up only 1% of vinyl record market share in 2015, they accounted for 14.6% of sales in 2021, according to Billboard.

Artist-driven

Michaels told CNBC he is confident that the market's continued growth will be artist-driven. That plus a general shift in interest, as younger listeners discover vinyl, suggest the medium is here to stay, he said.

Artists such as Taylor Swift offer collectible versions of their albums, called "variants," which are multicolored vinyl records.

"When Taylor releases a new record, there may be eight, nine, 10, different variants of that same record — different colors, different combinations, maybe there's some unique tracks that weren't included on the digital release, or the CD, but you get it on the vinyl," Michaels explained. "There's a lot of fans that say, 'There are eight different variants. I want one of each, please.' They're very supportive."

The CEO attributes a portion of his company's success to the city of Nashville, too, praising its deep-rooted connection to music and the creative industry, which has provided a dedicated and skilled workforce.

"You have the whole musical ecosystem here," he said. "You have artists, producers, studios — it all works together in a highly symbiotic way. It's the perfect place, and we're very fortunate to be here."

TUNE IN: The "Cities of Success" special featuring Nashville will air on CNBC on Dec. 6 at 10 p.m. ET/PT.

Correction: A photo caption in this story has been updated to correct that most of Taylor Swift's catalog has been pressed at United Record Pressing.