I'm not a big GC fan, but I do enjoy being able to walk into a music store and check out newer guitar models, as the local GC is really the only guitar store in 20 miles of me. I've had some good interactions with the employees. But, as has been mentioned in the thread, the days of big box stores are on the way out and COVID just hastened it. Now the traditional response of "go to your store and try it out" to questions about guitars and basses won't be as easy as it has been in the past. I make special trips to a "local" music store now, that's 45 mins away, once in awhile when I want to purchase items.
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Guitar Center Chapter 11 Imminent
- Thread starter Bassiclees
- Start date
GC, much to my surprise had actually been OK financially, IF you exclude the big honking turd of debt that Bain Capital saddled them with during the buy out back in the day. That was a terrible transaction and hopefully the C11 restructuring will help this.
My understanding was that during the last fiscal year (the one impacted by the pandemic), while other on-line retailers had great sales, GC was not as successful (even with them owning MF). If you have any real experience using the GC website vs some competitors, I do find it clunky and less responsive. This is really obvious when looking at used instruments which are making up a larger and larger percentage of revenue these days. GC had previously started diversifying their revenue stream into instruction and equipment maintenance, but that got crushed during the past year.
Anecdotally, I also think they have less of the high-end market these days since they have less ability to support. This is a smaller share of the revenue, but I think it's indicative of the type of store they are and need to be. I "think" most high end customers have either a relationship with a Vintage King, local retailer, or GCPro salesperson. These folks might leave and take their business with them.
I think it's highly probable (90%) GC survives, but survival could exacerbate the issues we all had with them. It will be harder for them to keep high rent stores open (unless they are also very profitable), may need to reduce redundant locations (see Silver Spring, MD), they are less likely to carry boutique or less established lines in-stock, and payroll costs likely get trimmed. In addition, some suppliers may be gun shy about providing stock on greater than 60 day net terms. All this could translate to a less positive experience at the brink and mortar locations. I think as a result of this, there will be a renewed push for better on-line sales experience and presence and this will be a positive thing.
At the end of the day, this could be a chance for them to fix a number of issues, however this will require understanding, forward thinking, and commitment. Poor leadership always exacerbates problems, so lets see how the C-Suite looks post Ch11.
Lets be clear, GC going away does not help the industry. It would represent the decline of a major buyer of equipment in a relatively small industry, not all of which will get picked-up by competitors. I don't want to even think about the bottom falling out of the used market for the next 12-36 months
For those who are active sellers of equipment for whatever reason, think about the next 3 years. The COVID bump that many firms got (Fender and Gibson record sales years) will translate to a huge flood of used instruments in the next 6 -18 months as people have less time again, decrease in focus, and just give up coupled with the natural attrition of new players. Couple this with the nightmare of the possibility the GC actually went "store closing out of business".....Holy crap the flood of equipment means a massive drop in value for all but higher-end and unique instruments. For those that remember what Mars Music closing was in the Boston area, coupled with a soft post dot-com economy, it was blood in the water for sellers. I remember picking up a ton of cheap product, which was great for me, but local retailers got crushed for years afterward. What little equipment I wanted to flip sat in my studio unused for years.
Bottom line is this - A large retailer such as GC going out of business can be a good thing depending on the state of the industry, but it depends on (among other things) the status of the economy, their suppliers resiliency, customer base (again the economy), and ability of market share to be absorbed by competitors. I have seen Daddy's and Mars go under, but watched smaller local store such as the Music Mill in NH thrive and expand.
Lastly, for those who root for it to close, understand that there are real people working there who will impacted. So please when you drool about saving $50 on that guitar, understand how we got here and what that means these days.
As always, the disclaimer is this is my opinion. I'm happy to discuss any of these points and welcome alternate opinions and information.
Be safe
My understanding was that during the last fiscal year (the one impacted by the pandemic), while other on-line retailers had great sales, GC was not as successful (even with them owning MF). If you have any real experience using the GC website vs some competitors, I do find it clunky and less responsive. This is really obvious when looking at used instruments which are making up a larger and larger percentage of revenue these days. GC had previously started diversifying their revenue stream into instruction and equipment maintenance, but that got crushed during the past year.
Anecdotally, I also think they have less of the high-end market these days since they have less ability to support. This is a smaller share of the revenue, but I think it's indicative of the type of store they are and need to be. I "think" most high end customers have either a relationship with a Vintage King, local retailer, or GCPro salesperson. These folks might leave and take their business with them.
I think it's highly probable (90%) GC survives, but survival could exacerbate the issues we all had with them. It will be harder for them to keep high rent stores open (unless they are also very profitable), may need to reduce redundant locations (see Silver Spring, MD), they are less likely to carry boutique or less established lines in-stock, and payroll costs likely get trimmed. In addition, some suppliers may be gun shy about providing stock on greater than 60 day net terms. All this could translate to a less positive experience at the brink and mortar locations. I think as a result of this, there will be a renewed push for better on-line sales experience and presence and this will be a positive thing.
At the end of the day, this could be a chance for them to fix a number of issues, however this will require understanding, forward thinking, and commitment. Poor leadership always exacerbates problems, so lets see how the C-Suite looks post Ch11.
Lets be clear, GC going away does not help the industry. It would represent the decline of a major buyer of equipment in a relatively small industry, not all of which will get picked-up by competitors. I don't want to even think about the bottom falling out of the used market for the next 12-36 months
For those who are active sellers of equipment for whatever reason, think about the next 3 years. The COVID bump that many firms got (Fender and Gibson record sales years) will translate to a huge flood of used instruments in the next 6 -18 months as people have less time again, decrease in focus, and just give up coupled with the natural attrition of new players. Couple this with the nightmare of the possibility the GC actually went "store closing out of business".....Holy crap the flood of equipment means a massive drop in value for all but higher-end and unique instruments. For those that remember what Mars Music closing was in the Boston area, coupled with a soft post dot-com economy, it was blood in the water for sellers. I remember picking up a ton of cheap product, which was great for me, but local retailers got crushed for years afterward. What little equipment I wanted to flip sat in my studio unused for years.
Bottom line is this - A large retailer such as GC going out of business can be a good thing depending on the state of the industry, but it depends on (among other things) the status of the economy, their suppliers resiliency, customer base (again the economy), and ability of market share to be absorbed by competitors. I have seen Daddy's and Mars go under, but watched smaller local store such as the Music Mill in NH thrive and expand.
Lastly, for those who root for it to close, understand that there are real people working there who will impacted. So please when you drool about saving $50 on that guitar, understand how we got here and what that means these days.
As always, the disclaimer is this is my opinion. I'm happy to discuss any of these points and welcome alternate opinions and information.
Be safe
I used to hit 2 or 3 Guitar Centers every weekend. That probably added 4-5k miles to my vehicle each year. Now I go once every other month. They just don't have the high end stuff that interests me. I guess I'm a snob, but I'm a snob that's saving 4500 miles per year and who knows how many thousands on silly little purchases that aren't happening now. I think I justified a Sadowsky, amirite?
I guess it depends on where you live, but I've never been in a GC that had a decent selection of anything but entry-level instruments and crappy combo amps. The staff has always been unhelpful at best, but mostly just indifferent. If they do actually close this time, which is unlikely, I won't miss them. Unless I need a squire bass with a horrible setup or a 15 watt combo amp.
"Many are just awful humans. I've had some bad interactions but there is one that happened years ago that the person was so awful and just flat out WRONG but they just could not admit it..."
I've had that happen a few times here on Talk Bass. LOL
If they do make it, i think they need to be less libral o
Correct. Chapter 7 is the bad one I believe. 11 is basically you are asking for help.
Correct. Chapter 7 is the bad one I believe. 11 is basically you are asking for help.
That's good news… Guitar Center has been a real great shopping tool. You can order stuff online or they prefer you to order it over the phone so the store gets credit for the sale then you can always return it like at Costco. That's a huge advantage. No having to mail stuff back like Amazon or any online store.
It has been said that "Rock and Roll will never die" or something very close to that, anyway.
However, no one likely thought that the ability to R & R would die or become non-responsive or brain dead or on life support or have its festivals or testicles removed.
With three cords, autotune and a clap track you can be a major force in Pop music, today. When 12 year olds are wearing printed T's from Walmart with the AC/DC logo on it. Ya know things are bad!
However, no one likely thought that the ability to R & R would die or become non-responsive or brain dead or on life support or have its festivals or testicles removed.
With three cords, autotune and a clap track you can be a major force in Pop music, today. When 12 year olds are wearing printed T's from Walmart with the AC/DC logo on it. Ya know things are bad!
I may be in the minority, but I like GC for what it is. I took lessons there when I first started and then I'd spend a nice chunk of time playing anything interesting that was hanging on the wall. Maybe because I took lessons there, but the staff was always very nice and helpful without being pushy. Whenever my sister comes to visit I take my nephew (who plays guitar) and we'll spend an hour or so there. We usually go find one (or a Sam Ash) when we do family trips too.
I bought my MIM Geddy Lee there and also got a used amp that I have been using for about three years now with no issues. I would miss the local one if closed, even though I haven't been there since COVID. I'd get over it if a Sam Ash moved in, though.
FWIW, I bought a guitar this year (a PRS) from Sweetwater. I got my last bass (a Stingray Special) from Sweetwater too.
I bought my MIM Geddy Lee there and also got a used amp that I have been using for about three years now with no issues. I would miss the local one if closed, even though I haven't been there since COVID. I'd get over it if a Sam Ash moved in, though.
FWIW, I bought a guitar this year (a PRS) from Sweetwater. I got my last bass (a Stingray Special) from Sweetwater too.
Well, once upon a time I went in to a GC to get some badly needed adapter cables. I could not find one human being anywhere. I did find the cables, went and put them by the register, and continued to hunt for someone to run the sale. I started to wonder if there had been an evacuation. I finally left without the cables. I wonder if they lost a lot of merchandise that day.
Later I was shopping for a deal on a pile of PA gear for a non-profit. So I made a list and sent it to Musician's Freind, GC, and Sweetwater. Sweetwater was the only one who replied with a real offer. They've been getting my business ever since.
Chapter 11? I thought they were already on Chapter 18 or so....
Remember when Gibson filed chapter 11? It really doesn't mean anything these days. The thing I don't understand is how Fender has been saying they're selling so many guitars? Tons of the smaller guitar shops around where I live have shut down. Whenever I've gone into any Guitar Center recently, there are lots of Fender guitars on the wall and nobody is buying anything. None of my friends who play music have bought anything new from Fender in years. So where are all these Fender guitars being bought, and by whom? The only thing I've been seeing sell well are USED keyboards, electric pianos, and acoustic guitars (and then only if they're a good deal).
Remember when Gibson filed chapter 11? It really doesn't mean anything these days. The thing I don't understand is how Fender has been saying they're selling so many guitars? Tons of the smaller guitar shops around where I live have shut down. Whenever I've gone into any Guitar Center recently, there are lots of Fender guitars on the wall and nobody is buying anything. None of my friends who play music have bought anything new from Fender in years. So where are all these Fender guitars being bought, and by whom? The only thing I've been seeing sell well are USED keyboards, electric pianos, and acoustic guitars (and then only if they're a good deal).
That's just silly. Of course, it was Amazon that took Sagans of investor $$ (you know, billions and billions) and used the cash to drive down book prices across the country. Barnes and Noble is the only chain survivor. The local Mom & Pop shops have made something of a comeback.
But the same thing, writ large, has happened to music stores. GC may not be the best store ever. But they're actually pretty good. I've used them for drums and PA gear plus guitar toys (pedals, cords, strings, etc., but no actual guitars or amps). They have decent keyboards and acoustic guitar departments, too. But online is killing brick and mortar, slow and steady. COVID has sped up the trend a lot. Even on non-depressed main streets, there are a lot of vacant shops. And they are not coming back.
Interestingly, it was GC sister company, Muscian's Friend, that became the blockbuster online vendor. But the online marketplace for music gear is healthier than books and most other stuff (Amazon, Amazon, Walmart, Amazon, ...). We have Sam Ash, Sweetwater, B&H Photo, a million independent boutique vendors, Reverb, EBay, CL, etc. It's gotten to the point that it's too hard for even GC to keep good stuff in stock. So why bother?
So, even if GC survives this round, I doubt they're viable long term.
Of course what I really wish would happen is that the individual stores would get sold of to local owners and become local forces again. Anyone around Dallas remember Arnold & Morgan Music?
I'll wager most of Fender's sales are online these days. Also, Fender has stepped up its marketing and product development game. They get lots of press. They have some fun, new guitars (that get press and discussion, even if not much sales). They have an app for lessons so that more of the newbies stick with it and become lifelong customers. etc., etc. A lot of these things are good for the industry as a whole. So good on Fender.
Barnes and Noble was literally dubbed "the Indie Killer" in the 90s and 00s. That's a fact.
Considering the last time I was in a Guitar Center, about a month or two ago, I walked out without a word ever being spoken to me or my wife, good riddance.
We were in the store to make a purchase plain and simple. Had cash and knew exactly what I needed. I had just picked up a drum set and needed a snare and a bass drum pedal, walked in the store about four or five employees standing around maybe three other customers, no phones ringing, so it should have been quick and simple. Not really, we go in and make our way back to the drum center. No one working back there but we find what we need head back up front to get some help, none of the workers would acknowledge our existence. After about 20-30 minutes we book and head to Sweetwater.
Yes, I am fortunate to live close enough to the absolute greatest music center in the world.
So, I say I will never miss guitar center when I have Sweetwater.
I received an email from GC last week (after I saw details elsewhere a while ago) about the bankruptcy. The message basically included how they will be working hard on their operations and supporting customers...then mentioned they will be voluntarily filing for Chapter 11. As usual, if you ask the employees about it, they claim not to know anything and that they will still be there.
The only future for GC in selling basses would be selling Japanese basses, where having a corporation to deal with tariffs CITEs, shipping would be beneficial.
