Too Little, Too Late for Guitar Center?

[doubletrackinjive]

What was it I heard over Christmas dinner? Some company bought guitar center or something and isn’t sufficiently funding them, and the stores aren’t doing anything to adapt, so one of two things are going to happen

1. They’ll go out of business and never be heard of again.
2. They’ll go out of business, then get bought out.

Thinking now, it was something like they were made private after being public or vice versa, hazy on the details, but whatever switch happened it caused their stocks to drop right before the 2008 recession. I’m off to find an article so I don’t sound like a rambling old man.

[doubletrackinjive]

This sort of explains it. Something about taking on a lot of debt right before the recession which rendered them unable to pay it back.
https://www.bloomberg.com/news/articles/2017-04-24/guitar-center-debt-hits-sour-note-as-bonds-hover-near-new-lows

[holster]

My feeling the last few years is that GC’s extreme debt problem is a big part of why we’ve seen such a big decline in Fender and Gibson’s quality and bazaar business decisions. It’s all a bit like the bank/mortgage bubble we saw. The big players thought they were all unsinkable and the bubble burst.

[doubletrackinjive]

I think Mr. Paul Reed Smith is laughing at them all now. Reaping the rewards of keeping his company relatively small.

[holster]

Yeah, he really stepped up his game too. PRS has been keeping things simple and concentrating on what they do best as of late. They dropped some models and cleaned stuff up for 2018 too. That’s really what the other 2 should’ve done several years ago.
Gibson especially. They have themselves spread so thin with odd models and changes that they really can’t do much of anything well any more.

[CPF]

You know they throw the manuals that come with the guitar away because they don’t think people want them? I asked them about it, and said “Well you can just download the PDF.” Can’t wait to see them fail, they’re a bunch of assclowns that overcharge for mediocre beaten up guitars, that employ people that don’t know a thing about setting them up. They’ve shot themselves in the foot, they deserve to go down for it.

One of the Washburn Acoustics they had on display had a broken truss rod, and when I pointed it out the employees told me I could just duct tape it.

[Jonathan]

edit: I shouldn’t have blasted this AVDG company…I support small businesses, and don’t wish to trash anyone’s business that hasn’t done me any harm. My apologies.

I can’t imagine that this will cause a big turnaround for them.

First of all, I think this merger is a pretty small time deal. this is nowhere nears as big of a deal as it looks.

At first I was excited to hear about the merger, but then I took a look at the AVDG website…and…they seem to be quite good at um…hanging TV’s on the wall??

Ok. Now that you see what this company really is…who is anybody fooling?

I get that you need nice pictures to make a website look sophisticated. I congratulate this company for employing 80 people.

…But when I look at industries for which they hang TV’s on the wall, I’m surprised GC found this to be a fit.

I don’t get how either side benefits from this deal? This company needed to get bought by B&H or Mono Price or Bestbuy. What is GC gonna start selling TV screens? And home stereo equipment??? What the HELL were those ass clowns at GC thinking? It almost makes you laugh!

“Guitar Center has been seeking opportunities to bolster our Business Solutions Group and we have found an ideal partner in AVDG. This mutually beneficial relationship will provide AVDG’s team the vast resources offered by Guitar Center, while opening up Guitar Center’s Business Solutions Group to opportunities in the commercial and residential market sectors.”

just saw this article the other day and it has me wondering if this is a last ditch effort for Guitar Center.

I’m so pissed at GC for the last 10 things I bought there and had to return that I’m just done with it.

This one really gets me…from their CEO.

“There’s still a reason to have stores,” Majeski said. “If you’re going to buy a $1,500 guitar, you’re not going to do it on Amazon.”

Think about what that’s really saying. Is this guy clueless as to how competitive online retail is?? Now he may be right that most people want to play a guitar in person. But a $1500 interface? A $1500 midi controller? A $1500 hardware compressor? A $1500 copy of Nuendo? Those things are not like guitars. They’re all identical. You’re damn straight we’re ordering it online!

Something about taking on a lot of debt right before the recession which rendered them unable to pay it back.

Oh no no no. Just so you know, the Ares acquisition was in 2014. Well after the recession. And junk bonds mean high risk high yield. Not ‘unable to pay back’. Bain leveraged to acquire GC. (That means it borrowed to invest). Ares re-infused cash into GC paying down its debt in exchange for equity. I think all of this was good. For both groups.

But ultimately Bain and its shareholders allowed this company to be run into the ground. I don’t believe it was deliberately negligent or overly insensitive to customers. It was just a company it failed to save from itself.

[Jon-Jon]

been playing for 30 years…never been in a Guitar Center lol. Its funny, there is one in the next town over but I always drive past it to go to the Music Go Round (used instrument store)

[miked]

Just to play devil’s advocate. Not ALL GCs are horrible. Where I live we have 1 option where you can go in and look at new gear, listen to monitors, poke around etc. I’ll say too, that I was much happier with the setup job on my bass by the GC guy than the other local used-gear-music-store-that’s-more-like-a-Pawn-Shop place in town. My kid sold back a keyboard at GC and they treated him right. I like having a retail shop to look at stuff. Next to Reverb.com, their online Used Gear section is place place I shop for that sort of thing too. So it’s not ALL bad.

Plus, I’ll always have a special place in my heart for Musician’s Friend - I understand they were bought by GC a while ago. I got their catalogues back in the 80’s and bought a few pieces of gear from them, including my Tascam 4-Track. To come full circle, I bought my Tascam Audio Interface from MF on a Stupid Deal a couple of years ago…

That said, GC’s and MF’s discount coupon emails are laughable and the number of emails they send out is irritating.

[tensen]

Guitar Center is only good because you can look at the gear in person. I only wish they stocked gear that I wanted to look at.

[tensen]

Maybe the merge means they are getting into the business of installing home audio systems.
Too bad, I’d rather they come to my home with gear I wanted to try out going through my pre-existing gear.

[Jonathan]

Just to play devil’s advocate. Not ALL GCs are horrible.

You’re right. I agree that some stores are immaculately well kept. In other stores, it takes 20 minutes to check out pack of strings, every guitar hanging on the wall has shit out of whack truss rods, and half of the gear in the pre-owned section is overpriced and not working. But yes, not all GC’s are horrible. I guess my opinion gets pretty slanted though by the ones nearby. I remember having a very pleasant experience in a few. Houston, Raleigh NC, Atlanta come to mind.

What I have a hard time overlooking is the lack of training in the area of product knowledge. But I guess its unrealistic to wish those guys had more product knowledge given the overall GC business model.

Guitar Center is only good because you can look at the gear in person. I only wish they stocked gear that I wanted to look at.

I thought being able to snag stuff out of their online used inventory was the biggest bonus, given that you can return it with no questions asked. The problem is the guys on the floor don’t have the knowledge or the tools to test it before it comes in. This is a HUGE problem with microphones, preamps, interfaces, control surfaces, and guitar amps. Wouldn’t give a shit GC was 5 minutes down the road. I’m 2 hours away.

Maybe the merge means they are getting into the business of installing home audio systems.

They so don’t belong in that space of the service industry.

[skua]

It’s the death of just about any company to underestimate the threat that online sales present to their brick-and-mortar existence. Not too long ago I was in the market for my first set of monitor speakers. A friend told me that he had visited the local GC and seen a sale offering a nice deal on the LSR 305’s. My first stop was online and found that it wasn’t a GC deal… it was a JBL promotion that was available through most of their retailers.

Result: I bought my speakers from Sweetwater and had them delivered to my door at a very nice price. The bonus was that my sales ‘rep’ seemed very knowledgeable and very willing to answer my noob questions, making sure I got proper cables for my setup. After the sale he even followed up to make sure I was happy with my purchase and to see if I needed anything further. Impeccable service for my small purchase that probably topped out under the $250 mark. I don’t believe the local GC could have provided such a satisfying experience.

[StylesBitchley]

I have worked in the custom audio/installation integration business for 25 years, and I now work in distribution. GC buying an integrator is a huge mistake. The integration industry is every bit as cutthroat as selling widgets on ebay now, with even very wealthy clients thinking it is in their best interest to purchase all their stuff on line and have a “professional” install it.

Don’t get me wrong, there a reputable companies everywhere that can design and install nice automation systems. In Orlando, I used to work for a pretty good regional company, and everyone that worked there opened their own install company, and this has happened all over the place, leaving 20 Ma and Pa shops for every reasonable customer looking to do something. The internet has killed this industry, which was in trouble until HD tv came along, and everybody jumped in to get one, along with other pieces to update their home theaters or multiroom audio systems. It was great for about 5 years, at which point flat screen prices dropped precipitously, and became available on line, blah blah blah, which killed the retail business. At that point all the installers that had been working for any decent company went on their own, and made twice as much per install if they were good at what they were doing.

If this place thinks they are going nationwide based on the backing of a severely teetering Guitar Center, who only has warehousing and transportation to offer, along with a client base that is extremely unlikely to take advantage of their services, they’d better have a lot of rabbits in hats all over the country.

[Chordwainer]

@holster

Gibson especially. They have themselves spread so thin with odd models and changes that they really can’t do much of anything well any more.

Speaking of Gibson, here’s a piece reporting that Gibson won’t be at the 2018 NAMM. Now there’s a telling development.

NAMM 2018: Gibson no-show confirmed

On topic, my biggest issue with GC as a store to visit in person is that, at least at every one I have ever been to, they blast really loud music over the PA, which means every shredder wannabe kid that comes in has to crank up the amp to hear, and if you want to actually listen to the guitar you’re considering, it’s pretty hopeless. Even when the store is equipped with an acoustic room, the din from the main floor makes it impossible for me (at least) to hear the fine details of the instrument.

Also, with maybe one or two exceptions, every employee I’ve encountered there has had a major attitude, like they’re some shit-hot musician who is slumming it with a day job. Lots of eyerolling and condescension when they finally tear themselves away from their phone or conversation with their workmate. That’s just a dealbreaker for me, if I can’t get at least some cursory customer service, I’m outta there.

Last time I GC’d was when I was researching my most recent electric guitar purchase. Although the young woman helping me was very pleasant and very professional, the other aspects were all there in spades. Not a very useful experience at all, and only reinforced all these biases (but one).

[Jonathan]

I bought my speakers from Sweetwater and had them delivered to my door at a very nice price.

Impeccable service for my small purchase that probably topped out under the $250 mark. I don’t believe the local GC could have provided such a satisfying experience.

I like Sweetwater mainly for their tech support line, but also for their follow through and willingness to see that their mistakes are fixed when they mess something up. I don’t mind paying a few dollars more to get stuff done correctly.

[Jonathan]

On topic, my biggest issue with GC as a store to visit in person is that, at least at every one I have ever been to, they blast really loud music over the PA, which means every shredder wannabe kid that comes in has to crank up the amp to hear, and if you want to actually listen to the guitar you’re considering, it’s pretty hopeless. Even when the store is equipped with an acoustic room, the din from the main floor makes it impossible for me (at least) to hear the fine details of the instrument.

That’s too bad. I believe I visited that GC way back in 2003 when I was on tour in Texas. That one and Raleigh NC stood out in my mind one of the top 3 best GC’s I’ve ever been in. Too bad. But I know things change a lot in 10 years.

Edit: Now that I’m thinking about it, I’m not sure it was the same one. I think there’s 3 in Houston…have you been to the others? Are they all pretty lousy these days?

[Chordwainer]

Edit: Now that I’m thinking about it, I’m not sure it was the same one. I think there’s 3 in Houston…have you been to the others? Are they all pretty lousy these days?

At least three, maybe more. The one I was talking about is down here in the Clear Lake area-- in Webster, right by I45. Doubtless not the one you would have visited.

I’ve also been to one out on the far west side, just one time, about five years ago, and it was just the same. But that’s all my experience here in Texas. Also frequented the one in Albuquerque when I lived there, same story there too.

[Jonathan]

At least three, maybe more. The one I was talking about is down here in the Clear Lake area-- in Webster, right by I45. Doubtless not the one you would have visited.

I can’t remember that far back. 2003 was sooooooo long ago. I thought I remembered being on the east side of Houston though. I remember a zoo. And I remember some huge gigantic mall. But I don’t even remember the half the names of the people in the band.

When I was down there 2 years ago, I asked Danae if she remembers which ones we went to on that trip I met up with you the first time (at that brewery/restaurant across from Outback). She said we went to all of the Guitar Centers, and Katy was the only one I had anything decent to talk about when I got out of there.

That was the one that had this hilarious rack of fake Neve gear lol. This was soon funny. It was a bunch of knobs on a faceplate. I tried to buy it off them buy they wouldn’t sell it to me.

[CCbro]

This has come up before, the GC going under. I think Barclay took over their credit cards (like Sears was in trouble and Visa took over their cc).

In this Dallas area there must be 4 or 5 in a 30 minute drive for me. Each store has its own personality in a way. My trips there have died off a lot but its pretty empty until the weekends usually. I am still in shock how many stores are in a 50 mile radius its insane! If you type in Dallas and like 100 mile radius ofr Used gear theres a list and its a bunch of stores…crazy, but seems bad for business.

Theres so many of them around here. One Sam Ash and one old store. The others closed down…GC won!!!
Off topic, one old store had history, Morgan an sons…and thats the one the greats walked, like Hendrix and SRV and band who were in town would always stop by the music store of course. Long before my time but the pics on the walls and some of the older owners had stories. Ive heard the stories, never there.

GC … seems these days I order online and go pick up stuff try it, realize I dont need it and take it back. I lose shipping but thats fair. I had issues long ago with one GC the others were all pretty cool, though they became kind of like WalMart taking over and everyone else out of biz.

One bored day I counted all their pages of used stuff, then multiplied that by a average of $$$$ on each page and they are swamped with old used stuff…damn…they have so much Used stuff!! I think it was in the $$$ millions in used stuff alone.

I think they own Musician Friend too right?