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Is Guitar Center/Musican's Friend/Music 123 in dire financial straits?


charlie brown

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Just read an article, that mentioned Guitar Center as

having a B- credit rating and facing some tough times

(along with everyone else), ahead. There was a not

so subtle indication, that they are in some serious

financial straits. Anyone else, know anthing about this?

Some of our Business & financial wizards, for instance?

They were mentioned in a article about as many as 8

major companies may "go under," before the Holidays!

Didn't cite them, specifically, but it eluded to their (and other's)

inventory/cash flow problems. Yikes!!

 

CB

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I've read some unhappy customer complaints about GC right here in this forum. I'm wondering if this is contributing to their financial difficulties.

I've been to our local GC about 4 times. I have yet to see anyone buy anything. You know the routine. Play it at GC, then go home and order it from MF.

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More of an issue with brick and morter stores like GC usually but any big retailers that "floor plan" merchandise can get into trouble fast. That's what took out Mars music very quickly and it has alot to do with Circuit City's current situation as well.

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Yeah, and Rickenbacker, for one, severed it's relationship with Guitar Center (but not Musician's Friend), because of GC's questionable business practices, regarding Rickenbacker products. Not sure (exactly) what that meant, except maybe they were promising delivery dates, that Ric couldn't/wouldn't meet, due to their well known backlog of orders, and long delivery times, plus GC's pricing, of Ric products, maybe? But, I do know that Rickenbacker slammed the door on GC in short oder!

 

I wondered, too...if MF and Music 123 (being owned by CG) are in the mix, that way...or are seperated enough, as to not be so adversely effected? In any case, it doesn't look too good, but...who knows?

 

CB

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I've been preaching the text of buying locally for years, and if MF, GC (there's not one within a hundred miles of here) or Music123 (all components of the same company) go bust, I'll be OK. I like having the vast inventory available online, but I pretty much own every cool guitar, bass or amp I want (or, I've owned one and didn't like it that much!) so it doesn't matter a whole lot. If I hadn't been supporting my local store over the years, and he had gone bust, the loss of MF et al would be a blow, but that's not what I've done.

 

Music is still your skill, taste and touch through an instrument that accommodates you, using an amp that sings. The big stores mostly encourage the "ooooh I want one of those and one of those and one of those" mentality without making you commit to a particular style or instrument.

 

I've bought a lot of stuff from MF over the years, but I wouldn't miss 'em if they went belly-up. If I really wanted something, my local dealer will find it for me -- I have been careful to cultivate a healthy relationship with him over the years, and, importantly, he will take stuff I now longer use in trade without skinning me.

 

I do a lot of recording, and one trend that I've not liked is the ever-cheaper (and more useless) Chinese gear syndrome. I've got quality stuff, thank you very much, and I'm in no hurry to trade my beyerdynamic ribbon (for example) for a $100 Asian knockoff. But an outfit that depends upon volume to make its nut is under constant pressure to find cheaper suppliers and compromise quality. Or do you really fashion shop at Wal-Mart?

 

Another issue: I have a lovely late '30s Regal spider bridge resonator that I bought here in town for a bargain price. Try that with GC. I own a custom jumbo flat-top made for me by a local luthier. Try that with MF. The same luthier put a bear-claw spruce top on my old cheapo Ventura flat-top, transforming it into a lap piano. I have a '70 Gibson Les Paul Deluxe that I bought 15 years ago from a friend for $750, and a blond ES-335 I bought from a private party for just over $1500. I could go on and on, but the principle remains the same: there's a difference between being an active member of a musical community and merely being a consumer.

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The problem with the mom and pop music stores is that their inventory is basically the floor models. It doesn't take long before they are scratch 'n dent items. I saw two Gibson doublecuts at GC the day after they had arrived. Both were dented already. It's even worse at the small guitar place near the Quarter.

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Well, "Big Box" stores have all but put "Mom and Pop" out of business, in this part of the country!

So, there IS no (or little) choice. The small shops that do exist, and manage to stay in business,

are doing a decent "Internet" business, as well. In fact, it's most likely that business that's keeping

them IN business. Certainly wouldn't be the "walk in," because they're all at the Mall, or Walmart,

Home Depot, Guitar Center, etc. But, as much as we say we hate those big chain stores, we demand

cheaper prices, on goods we hardly use, before buying a new one...which is, of course, what they

count on, live for, ect. So...???

 

CB

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We still have 2 small shops here but unless I need a set of strings, a cable or something like that I don't even bother. One caries nothing but Peavey amps and Greg Bennett guitars, and I am serious that is 90% of the stores inventory. The other one could care less if you ever come in, I have been there a few times in the past month when I was looking to buy a new guitar and no one even bothered to say hello when I walked in.

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Oh, I know....that's a fact! Customer Service, is a LOST art! And, with small shops, it's even more critical, that

they do all they can, to win your sale, trust, and return business. But, that seems all but lost, on so many

stores, large and small. Of course, in all fairness, I have to say...some "shoppers/looky loo's" are pretty lame

and even confrontational. 8 hours of that, and I'd be less than enthusiastic, too. So, it works both ways.

Greed, and all that goes with it, is killing this country, and the so called "Civilized" world, in so many ways.

Civility, and Respect are two major casualties, already...IMHO. But, maybe it's just me?!

 

CB

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I've been to our local GC about 4 times. I have yet to see anyone buy anything. You know the routine. Play it at GC' date=' then go home and order it from MF.[/quote']

 

Well since GC and MF are under the same ownership, it really doesn't matter. GC was a $1.8 - $2 Billion company and was expanding to rapidly, certainly not taking into account these economical times (not that they are alone). I can't remember the list of web stores that are under the same ownership, but I believe it is GC, MF, M123, and a couple more under the same ownership umbrella.

 

Edit: add to that list - Woodwind and Brasswind

 

I've been to GC locally and I wouldn't buy a pick from them.

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Well' date=' [u']this [/u]is a bit of a problem for these guys now.

 

Yeah, this stuff is illegal. Used to be called "fair trade pricing" years ago. It was especially rampant in the appliance and television business. The rational was/is that the manufacturers are "protecting" the smaller dealers who can't match prices of the big dealers. It's called "price fixing". It was banned several years ago, yet it's still being done. Mfr's tell dealers to sell at "Manufacturers Suggested Retail Price" or lose the contract.

 

But, take a look at the pricing structures; Mfr's "list" or the higher of the pricing structure, is higher than "suggested retail", and suggested retail is higher than "lowest discount" price. Look at any online dealer and compare prices on say, an Epi LP Standard. They're all the same; MF, GC, 123, Sweetwater, every one sells the guitar at "rock bottom" we'll match any deal" price. Of course they will. All the prices are the same!

 

However I must say I've never had a bad experience at either of the two semi-local GC's. I always got a discount and usually a second "sweetener". I just posted the deal I made on a Roland Micro Cube. Same with a Dot, a LP, and a couple Ibanez.

 

So whether GC et al are in trouble is possibly true but most likely because of the economy, IMO.

 

I could be wrong.

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It's just the credit crunch...anyone watching the news these days? A company like GC exists on credit.

 

Also, as soon as the economy gets a little tight discretionary spending goes out the window. And buying guitars is discretionary spending.

 

I'm at our local GC often, and it sucks, but every time I'm there someone is hauling something out of there.

 

If GC goes down, Gibson will be kissing the a** of every mom & pop store in the country.

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Every time I walk in to a GC I'm turned off by their high prices. I guess I'm just used to the dirt cheap pricing on Ebay or the online retailers. They can pretend they want to sell at those prices (price match) but the cold truth is they can't afford to because of issues like leases, utilities, and payroll. It's a no win situation for them, and it's going to get ugly....unless the economy does a major turn around. I don't see that happening any time soon.

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The fact is, buying from the big box stores puts the mom and pop stores in the toilet. I'm lucky enough to live in a small town. If I wait for something to come in on an order, so be it. Instant gratification is its own disease, and doesn't lead to real gratification, but only constant disappointment. You're always looking for something "better" and "more perfect" which, in our consumer-driven world, doesn't exist. Music stores aren't Payless Shoe stores, where there's an endless inventory...earlier this month, I was in the Austin GC off Research Blvd, and it was impossible to find anything better than what I already have. Flashier, yes. Newer, sure thing. Better, not so sure.

 

I like to read the posts at the Les Paul forum, where (if you'd believe them) enlightenment will be yours if only you have a flame-top LP.

 

Well, I've got a road warrior gold-top Deluxe from the Norlin years, and it sings to me. I don't think a guitar bought squeaky new from an online dealer, even with an AAAA maple top, is going to improve on that. I realize, some people can't live without the bling, but I can, and it simplifies my life. I can evaluate what an instrument actually says when it speaks rather than obsessing over appearances.

 

I like the old drag racer saying, run what you brung. If you can't compete with what's in your hands, you're not going to make a splash just because you've got the latest Whamocaster.

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Good. I hope that all of the GC companies go out of business. I have had nothing but bad experiences with both GC and MF. I have bought many items from the GC companies in the past: NEVER AGAIN!

 

This is the latest one. With this latest experience from GC, I will NEVER buy from them again.

I bought a $ 500.00 gift card from GC for a gift(duh), which I needed for an occasion 2 weeks before I needed it. I never received it. So,I call up GC and tell them: Void out the card you say you sent that I never received, and send me a new one via "Trackable" shipping. Ther response: They need to wait 30 days.

 

30 days!

 

Who buys a gift card 30 days before you need it? All they had to do was verify that the card was never used, void out the original card, and send me a new one via UPS.

 

But no, those bastards made me wait the full 30 days, plus another 2 weeks waiting for the refund, which I had to call twice to get.

 

NEVER AGAIN with any GC Company.

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I've started getting emails from guitar stores in Australia to say that there are going to be big prices in November.

 

I bet they jump the price on old stock too. A shop owner told me that the Gibson/Epi distributor's warehouse in Australia is bulging at the seams with unsold stock. They still have 05 and 06 manufactured stuff.

 

A price rise ain't going to help them move guitars that are already over-priced on the Australian market.

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