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If Gibson were to go extinct, who would PRS copy their designs from?
Gibson CEO says he blames himself for the company's current status
Henry sounds as if he knows he has to go in August.
Henry sounds as if he knows he has to go in August.
I worked as a service manager at an Indian Motorcycle dealership in 03 just before Indian went belly up for the second time in their history. They,too, spent more time and money developing their fashion brand than the bikes themselves. Consequentially the bikes were absolute junk! I mean JUNK. But you could buy the nicest $800 dollar leather jacket available. Which would come in handy while you were waiting at the side of the road for the tow truck to arrive. Plus, to add insult to injury, the company itself made no qualms about it.
I can see it now. Mark Zuckerberg buys Gibson. Their guitars capture data on every song you play, parses out your demographic and sells the data to the highest bidder.
Their known for putting a high polish on knobs there
The John Mayer guitar is a hedge against this possibility
Reality eventually sets in and most business execs in a position like Henry start thinking about the endgame and what the history books are going to say about their tenure. Sometimes a mature acceptance of full responsibility and a graceful exit from the stage will have history renember you more kindly than it would otherwise.
And the simple truth is the baton is going to go to someone else. Period. Whether Henry passes it willingly, or it’s simply taken from him and given to someone else, is moot from an operational standpoint. He’s finished. And with luck Gibson will endure.
You can be sure the people he owes already have well thought out transition plans in place and succesors in mind to steer the ship once Henry is gone. Capital investors always have contingency plans in place in case a company defaults. Long before the first check is written they’ve already decided what they will do if you can’t meet you obligation. Because failures and defaults are not uncommon in the corporate finance world.
If this goes like most things like this go, a carefully selected transition management team will step in and bring the employees up to speed on what the deal is and let them know Gibson as Gibson is still in business. If they’re smart, they’ll also set up one on one interviews with each employee to get their input on what they saw happening.
While they’re doing that they’ll have their people reach out the distribution chain and get input from the dealers and give them reassurances as well. Because they’ll need the support of the retail channel if they’re going to succeed.
At the same time they’ll hit the industry pundits and news channels and let them know what the New Gibson is going to look like to reassure Gibson’s customer base as well.
Done intelligently they can turn the thing completely around in a year.
Fortunately Gibson doesn’t have anything in the company worth carving up and selling off other than their acquisitions, much of which will probably be sold in short order. The core guitar company (and Epiphone) however is worth far more intact. So it’s very likely they’ll do everything in their power to make Gibson and its sister brand Epiphone a success.
I think the biggest change will be that the Gibson brand will no longer be exclusively made in the USA. Some of their products will. But I expect alliance manufacturing deals with Asia and Europe are in the future for Gibson.
But we’ll see.
Henry went into Alex Jones prepper mode! It was somewhat entertaining. For what was basically a paperwork snafu, give or take, he treated it as though the feds had booted down the door and shot his dog. Then he released that dreadful 'government grey' Les Paul as a Nugent-esque retaliation. A lot of Les Paul players appear to be emotionally stunted man-children who lapped this nonsense up, so I guess for once he actually figured out his audience.
That would be amazing. Gibson... by Behringer.Gibson, and their annoying simpleton fanboys, richly deserve this.
none of the les paul players i know - and i know many - appreciated either the robo guitars or the government grey ones. i realize someone must be buying them - well, i don't realize that at all. sam ash hollywood sold like 3 of those robo les pauls in a year with them prominently displayed. i wonder who IS buying them!
At full price, probably nobody. I did seriously consider one when they were selling at fairly steep discounts
When you owe the bank $100, it's your problem. When you the bank $375 million, it's their problem.
Yep. Very true. Worst thing that usually happens when you owe really big is you wind up with a few new bank supplied members sitting on your board of directors and you have to relinquish your corner office.
Who? Me that's who. I've got a Robo Les Paul and a robo SG. No I did NOT pay full price. Who would? I got them at Sam Ash WAY reduced. They are very nice guitars. Nitro finish, well made, play great, sound killer and I liked the robo tune idea too since I play a lot of alternate tunings. Problem with them is pure Gibson. First off the robo tuner leaves a LOT to be desired. It is not particularly effective nor robust in either function or hardware (had to fix the control-display knob myself when it fell apart). But it's WAY worse than that. The battery system is quite spastic and is a true pain to use. and being I was worried since batteries are not very highly developed electrical products, I called Gibson about replacement batteries. WOW! They essentially just blew me off. NO you can't buy replacement batteries. NO they won't tell you what they are. And if the guitar battery dies, no problem, just ship the whole guitar to Gibson and they will put a new battery in for you and ship it back. No wonder there was a fire sale at Sam Ash! And here's the kick in the butt. There is a German made tuner system that fits Gibson LP guitars where I could replace the ENTIRE system for less than the price a new battery from Gibson. And even more the German system WORKS! It's fast, precise, and easy to install. So I figured when I bought the Gibsons that worse comes to worse I could just rip out the tuner and have a pretty nice Les Paul, but now I"ll just go with the other system. So talk about CEO malpractice. Gibson, should have just ripped their system out and started buying the German (or any other WORKING system) and putting them in guitars. But no. Instead they just heap nonsense like no batteries on customers. As the Gibson article remarks said Gibson's problems are just CEO malpractice. When you think you are too cool to have customer support, pretty soon you have few customers.
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Most manufacturers don't really care if pee buy their guitars, as long as the DEALERS buy them. Given Gibson's penchant for huge (and ridiculous mixes) annual dealer commitments, big dealers have to buy a bunch of unsellable crap to get the bread and butter items. And this has been going on since at least '77 when I got into retail. Small dealers get shut out, and the company looses touch with the wider retail market.
Agree...but if the investors were smart, they would have pulled the plug & executed the recovery plan years ago. Hopefully investors & new management will take a look at TB, too.
Until you default or otherwise breach whatever agreement you signed there’s not much a creditor can do to pull the plug in advance. The law doesn’t allow many situations where a creditor can take preemptive action. Usually the borrower has to do something extraordinary, such as moving funds outside the country, or selling off assets pledged as collateral against a loan before a creditor is allowed to intervene.
There is such a thing as predatory lending where a creditor will advance funding beyond what they know a naive debtor can possibly hope to repay. This is done with the intent of eventually taking over the company. But you rarely see that happen these days. And when it does, the company that got sucker punched almost always owns something unique that the creditor is secretly after, such as patents or other intellectual property, a valuable parcel of real estate or a historic building, or something similar that can be flipped for fast cash. It’s seldom done because the creditor wants the actual company.
It’s kinda rare these days because courts often take a dim view of the practice if it’s too obvious. But either way, that’s not what happened to Gibson. Henry bet the farm…and lost. It’s as simple as that.
“Twas ever thus.” as Mr. Natural would say.
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Imagine if Fender were to buy Gibson in July...
I used to work for someone who founded 2 Fortune 500 companies. He always told us, “Never buy that which you can take.”
Let's get something straight, I'm from where they made the original Indian.
They bought a logo, barely. The name wasn't even correct, Indian MotoRcycle........there was no R in Indian Motocycle. The engines I believe, were S&S stuffed into a frame wrapped in retro sheet metal, the "craftsmanship" was only visible with an electron microscope.
Philip Zanghi ran a scam, tried to sell jackets to finance the manufacturing side using all sorts of inventive financing.
