Guitar Center In The News

[hawkeye17]

Not in a good way either. The company is on Standard and Poor's "Weakest Links" list of the 140 companies that are most likely to go bankrupt sometime in 2009 due to a large pool of debt. They're listed about halfway down. Some other's are a surprise too...tough times :/ :

http://www.usatoday.com/money/companies/2008-03-21-sp-weakest-links-list_N.htm

[leofenderbender]

Looks like a buying opportunity for inventory [in market terms].

[jazzandmetal?]

:knitting







:munch

Bain Capital just bought them for a ton of money on a credit deal that wouldn't allow them to sell GC very quickly and it would probably be at a loss. Bain isn't in the business of losing money. Read this article on the acquisition:
http://www.allbusiness.com/banking-finance/financial-markets-investing-securities/5513054-1.html

[stark]

Panavison is more of a big deal. They provide most of the camera gear for feature film production.

Adam Stark

[BluesForDan]

no way. I actually bought some strings, for the first time ever, tonight from my local guitar center.

I usually get them at my friend's shop, but i totally spaced them the last time I was there. I went to play my strat today, and the strings were toast. I forgot I had let my friend's brother play that guitar this weekend, and his sweat makes my industrial strength super villain acid look like distilled water. I could NOT tune my guitar, the strings were so funkified. And I wanted to play tonight, not after the next time I go to my buddy's shop. Which could be next week.

So, for the first time in years, I actually left the house on a purposeful mission to acquire guitar strings. I managed to flag somebody down to sell me some strings. I had the 10 dollar bill in my hands.

"Name and phone number?"

sigh. "John Smith. Ah, forget it, sorry about that. Didn't mean to give you shit. Cash? Ok?" He just smiled, typed a short novella into the computer, gave me my change. It's not his fault they make him ask, and he's probably not going to have that job for much longer.

[VCuomo]

To hell with GC - Krispy Kreme is on that list! :eek:

[karmadave]

Not likely to go under, but their credit rating makes it more expensive for them to borrow. I assume that GC, like most retailers, finances their inventory. But I agree with another poster, Bain won't likely pull the plug, unless things get really tight and nobody can borrow. This is basically what was happening to Credit Markets a couple weeks ago, With the recent steps taken by the Treasury, the Credit Markets are starting to 'thaw' a bit.

-KD

[bluesjuke]

To hell with GC - Krispy Kreme is on that list! :eek:



A sign of the End TImes!

[HurricaneJesus]

So does this mean I'll soon get a PRS hollowbody for a grand?

[Rotten]

All I know is that I went to their guitar department the other day and asked if I could try out a Princeton Reverb RI. They did not have any in stock and their salesman (kid) had never heard of a Princeton Reverb. Ouch!

[MuseCafeChris]

To hell with GC - Krispy Kreme is on that list! :eek:

Doesn't surprise me at all. A couple years ago they opened a HUGE restaurant near me. Both the building and the plot of land were ridiculously big for a place where people go to get doughnuts. Didn't take long for that one to close.

I still think their retail space is killing them. My bet is they go under.

Yeah, they expanded like the bejesus right around the time the internet, eBay and Craig's List started to become ubiquitous. Terrible timing.

[Jon Silberman]

When they go out of business we'll clean up on the fire sale for sure.

[spacelord]

Linens and Things is on the list.. I saw a big Going out of Business sign on their store yesterday.

Panavision has been renting their expensive camera equipment for years. Unless they have been investing in digital, they are going to lose. Digital hasn't been able to compete for big movie productions, but some companies are coming out with some fantastic equipment with features as good as real film lately. They can buy the new fancy digital cameras for less than renting the Panavision setups. thats what I read anyways...

[guitarmook]

So when GC goes under, will it be because of the decrease in discretionary spending, or because they alienated their core customers with the 'no more negotiating' policy?

[bluesjuke]

I doubt they'll go under, maybe reorganize, but that policy hurts them I'm sure.

[jaxworlds]

they are getting some big competition from BestBuy.. my guess is you will see a Sam Ash/GC merger in 09.. they will combine and be huge-er...

[jaxworlds]

yikes that list is 7 months old.. it reeks..

[madvek]

When they go out of business we'll clean up on the fire sale for sure.

Anybody remember when the Mars Music chain went under in '02? The inventory was liquidated at auction (at least here in the Boston area store), got some sweet deals!! I outfitted my project studio for about 1/3 of retail prices.;)

[Trandy]

To hell with GC - Krispy Kreme is on that list! :eek:


NOOOO! :eek:

[FJTurner]

I wonder if they'd just close a bunch of their stores. I talked to a manager at the Nashville GC a few months back and he said Nashville, Hollywood and a few other stores are "carrying" the whole company with their high volume. I'd guess they have a lot of marginally profitable locations out there...

[Timmo]

GC opened a store where I live about 4 years ago and I've watched a decline in customers on a monthly basis. Once the novelty wore off it was ugly and quick.
I have no idea how they stay in business these days.............
The parking lot is empty for the most part and this is way before the recent crash.

[CharAznable]

The Fender/Gibson price increases can't be helping

[GtrWiz]

So when GC goes under, will it be because of the decrease in discretionary spending, or because they alienated their core customers with the 'no more negotiating' policy?

Or the fact that most of the employees know nothing about guitars?

[telecopter]

I don't know why anyone would think that it was good news. I personally love my local GC, I deal with some great people there.

My purchasing has never been higher since GC's came around.

Going back to "Mr. Mom and Pop retail everything music store" and their $10 pack of strings doesn't sound too exciting. I won't go.

It'll then be all internet purchasing/Craig's List for me.

[ctoddrun]

they are getting some big competition from BestBuy.. my guess is you will see a Sam Ash/GC merger in 09.. they will combine and be huge-er...


The one BB in Houston that sells equipment is about the size of 1/5 of the 3 GC's.


And I cant seem to get a better deal from ANY mom and pop in town. I cant see why everyone wants to bash GC for having kids who dont know their stuff.

I mean, YOU are the customer shopping for equipment. If you dont educate yourself prior to purchase, why blame it on a kid making minimum wage?

One last point, I deal with the same guy every time I go and he still hooks me up with discounts.

No mom and pop, in my experience, will do that.

[ctoddrun]

Going back to "Mr. Mom and Pop retail everything music store" and their $10 pack of strings doesn't sound too exciting. I won't go.




Precisely.

And whats worse, if you dont go in with long hair and tats, they dont even want to acknowledge you beyond, "ok... I GUESS you can try out this Collings" all the while having a hard time containing their contempt.

Screw that.

[telefmt]

Not likely to go under, but their credit rating makes it more expensive for them to borrow. I assume that GC, like most retailers, finances their inventory. But I agree with another poster, Bain won't likely pull the plug, unless things get really tight and nobody can borrow. This is basically what was happening to Credit Markets a couple weeks ago, With the recent steps taken by the Treasury, the Credit Markets are starting to 'thaw' a bit.

This is an example of our greatest resource - denial. 1 in 7 children in the US experience homelessness and the media says things are looking up. We are nowhere near the end of this crisis yet.

[RockStarNick]

If guitar center and musicians friend are the same company, and musicians friend is basically Music123 as well... waht does THAT mean?

[3 Mile Stone]

If guitar center and musicians friend are the same company, and musicians friend is basically Music123 as well... waht does THAT mean?

It might mean that they have two profitable parent companies that make having a "factory seconds outlet store" feasable for tax write offs, if you know what I mean Nick.

[semi-hollowbody]

I thought for sure someone went postal and strangled a few pre-pubescent shredders for shredding through a marshall stack at full volume...

them having financial issues doesnt surprise me, but talking to a friend who sells guitars there he is having the best year so far in a while...seems the worse the economy gets the more people want a diversion and buy guitars/amps/pedals

hell I went a long time without buying pedals, but now I cant afford to go on vacation so instead of comfort food i am buying comfort effects

[jpervin]

they are getting some big competition from BestBuy.. my guess is you will see a Sam Ash/GC merger in 09.. they will combine and be huge-er...

I've often wondered how the Sam Ash chain is doing these days. Last few times I was in my local SA, the store was nearly empty (save for a few employees), and this was like 2 years ago.

[susudio]

Linens and Things is on the list.. I saw a big Going out of Business sign on their store yesterday.

Panavision has been renting their expensive camera equipment for years. Unless they have been investing in digital, they are going to lose. Digital hasn't been able to compete for big movie productions, but some companies are coming out with some fantastic equipment with features as good as real film lately. They can buy the new fancy digital cameras for less than renting the Panavision setups. thats what I read anyways...

L and T closed stores here on the east coast months ago. Had their going out of business sale and they are gone!

[stratbred]

Believe it or not, Samash, GC, and MF are all owned by the same super corporation. Its true, they have the same corporate street address. I've ordered from all 3 repeatedly, everything comes from the same place. Shared warehouses, shared CEOs, everything.

[cr8z4life]

Well, the trickle down wont be good! I highly doubt that all the inventory from Gibson, Fender, etc is paid up front or in full........so if they file they will all get pennys on the dollar!! Wonder where that will leave alot of the music industries suppliers since guitar center is probably the largest volume account any of these manufacturers have!!

[billy budapest]

Oh, baby, did I take a wonderful ride on the Krispy Kreme railroad in the weeks and months following their IPO.

I got out the day I saw boxes of KK stacked up in my local supermarket. I thought, "There goes all the cache!," and called my broker the same afternoon.

Overexpansion eventually kills all of these ventures.

[RCM78]

Sam Ash is it's own co. And they buy all their inventory. Unlike GC. They finance 100% of it.

[kurtsstuff]

Soon..there will be no store fronts and it's just as well..

[WeTheLiving]

Oh, baby, did I take a wonderful ride on the Krispy Kreme railroad in the weeks and months following their IPO.

I got out the day I saw boxes of KK stacked up in my local supermarket. I thought, "There goes all the cache!," and called my broker the same afternoon.

Overexpansion eventually kills all of these ventures.
Yes, and the overexpansion is because of the excess cheap capital because of our federal reserve system creating artificially low interest rates, it creates the boom bust cycle. The real market can't consume the fake expansion brought about by these rates. thats why interest rates, which determine how easy it is for these companies to borrow money (capital) should be determined by the market and not the fed-if this was the case, there wouldnt be piles of donuts staked up because there wouldnt be the excess capital to produce all of them. Overexpansion is what caused the housing bubble too, its the same thing. Next is commerical real estate. All of these companies are going to go out of business and there will be vacant buildings everywhere.
Rant over; At least my guitar is paid for; but they sure were damn good donuts

[mrmjp]

I hope they go under. Places like GC, promote everything that is wrong with the music industry.

[kurtsstuff]

I hope they go under. Places like GC, promote everything that is wrong with the music industry.

But..If that does happen...They'll be nothing for the people of "superior" knowledge to bitch about after dealing with some 18 year old kid that didn't know what a germanium microflux handpainted #1 of #3 built that year was....Oh the horror

[gpro34]

I can't say that I will miss them either. They've done me wrong more times than I care to remember.

[Wagster]

A friend of mine just picked up a brand new Marshall 1987 hand wired head for $950.And 40th anniversary cab for $800.If I had the money I'd go down there and clean house.

[JohnK24]

To hell with GC - Krispy Kreme is on that list! :eek:


They should be, people finally caught on that $7 for a dozen of paper thin, flavorless donuts is CRAZY !!!! And I don't want them hot, sticking to my fingers

[m@2]

ugh, i might be in the minority, but i hope GC survives. very slim options in my neck of the woods to try/buy gear, and i've had more good than bad experiences there. i hate the idea of only being able to buy online.

[LavaMan]

It's so bad they are writing songs about them.....

http://www.youtube.com/watch?v=jfcPtsH05ls

[Taylor 339]

It's so bad they are writing songs about them.....

http://www.youtube.com/watch?v=jfcPtsH05ls

Drugs are bad and what an ugly guitar he's playing. Bet he got it at Guitar Center.

[townsend]

ugh, i might be in the minority, but i hope GC survives. very slim options in my neck of the woods to try/buy gear, and i've had more good than bad experiences there. i hate the idea of only being able to buy online.

I hope they survive too. I usually only buy accessories from them, but I like having a place where I can go and look at guitars and amps, and try them out.

[ESPLTD200FM]

but..if that does happen...they'll be nothing for the people of "superior" knowledge to bitch about after dealing with some 18 year old kid that didn't know what a germanium microflux handpainted #1 of #3 built that year was....oh the horror

lol!!!!!!!!!!

[datguytim]

BestBuy will take over GC by the end of 2009. Just watch.....

[tjmicsak]

Oh man, Krispy Kreems and GC are in the same plaza here, and KK went out 6 months ago, at least. Suprised the heck out of me as I thought they were so popular they were selling the brand in small convenience stores too.
Yeah, I don't think Fender and Gibson are making good moves for the chain stores by moving the carrot farther away from all us reaching for it. we get produce from all around the world these days.
And to the question of would you consider buying an import guitar, well I think anyone in business has to be competitive in the world marketplace these days to stay afloat. Buyers always shop for the most quality for the money. Whoever provides that wins. That is good for the consumer. It takes motivation, business savy, leadership and wisdom.
It used to be that a good selling product was kept to a reasonable profit so as to be affordable. These days the game is motivated by MAXIMIZING profit and forgetting everything else. We write our own books and have to live them. Somehow everyone else can steal our technology, ideas, and raw materials and do more for less with them. That is our fault.
These days truth spreads at the speed of light. A few buyers get better guitars overseas and it is on web boards and emails. If quality and affordability were still job one then we would not be here to begin with. Do folks across the globe put in half a day of work, make their "quota" and then earn another half day pay for sitting reading the paper? And then we wonder what is happening with the auto industry. GM has been selling off more and more for many years.
Over the past 40 years all philosophy has changed for the worse and caused this demise. Profit, do less for more pay, and so on. We expect quality in America, but yet we all don't really care if we provide it, at least as a whole. We blame corporations but the companys are nothing more than the working wage earners who live next door to us all.
Jack Z posted a picture of a guitar with a crooked pickup. Someone didn;t care. Those things these days are the rule rather than exception.
Can we blame the generation who worked and built us up as an economic marvel, or should we start seeing why the end result of the 60s and 70s and the changes in our mindset were perhaps bad ideas rather than good?
Half of America is on antidepressants. We have no real gross national product because we don't compete. Cars cost almost as much as my first mortgage. And then we wonder why we all can't afford to keep buying the autos.
Quality was our poker chip. Back in other decades things were cheap from other places but no way did they compare in quality. That is not true anymore. The American companys who finally see that will pull through. But I don't see that happening yet.

[guitarguy9597]

Let me get this straight. GC is merging with Krispy Kreme?! Won't the fingerboards get sticky?

Seriously, I just realized how blessed I am to have a couple of great Mom 'n' Pops in my area. One has an instrument selection that rivals (perhaps surpasses) GC and you can deal with them for a decent price. The other doesn't gouge on accessories and will usually match or beat GC's pricing on instruments, etc..

That being said, I also frequent a GC in a nearby town (better accessories selection)The staff is knowlegeable, for the most part, and friendly. I would hope that after playing for 27 years I know more than the 20 year old behind the counter, but none of us know everything. They have treated me very well. I hope GC pulls through.

As the ocean rises, all ships rise.

[matthet]

I hope they go under. Places like GC, promote everything that is wrong with the music industry.
YEA! like.......guitars........and.......or maybe........and.............TEENAGERS!:thud

[carltonh]

I have my free t-shirt from when Mars Music opened in Arlington, TX. I have my free t-shirt from when Guitar Center opened a new store in North Dallas too.

People who think the economy will recover soon should see charts of the massive numbers of ARM mortgages that will continue to raise interest rates on reset and lead to defaults through 2011. Then look at what is going to happen to commercial real estate with massive vacancies and companies going out of business. As multi-year commercial real estate contracts end and get renegotiated, they will go down in price 30-40%. As Wall St. problems have spilled out to Main St. this bear market rally will fizzle as Main St.'s problems return to dog Wall St. like unfunded liabilities for retires of US automakers.

GC will go under, no doubt. The only question is when or if there will be a pre-bankruptcy buyout. Listen to those of us who are getting +20 to +40% rates of return on our 401Ks in 2008 & 2009 and tried to warn people back in 2006.

Notice that Blockbuster is another doomed company whose storefront expansion in the face of internet competition also spelled its fate.

[carltonh]

One more thing. I hope the small time dealers on here don't sell to GC on credit. I don't know their buying methods, but I bet Fender and Gibson take a hit when GC goes down.

[Garygtr]

But..If that does happen...They'll be nothing for the people of "superior" knowledge to bitch about after dealing with some 18 year old kid that didn't know what a germanium microflux handpainted #1 of #3 built that year was....

Want!!! :love::love:

[LHanson]

This is an example of our greatest resource - denial. 1 in 7 children in the US experience homelessness and the media says things are looking up. We are nowhere near the end of this crisis yet.


Really?

http://www.cnn.com/2009/US/03/10/homeless.children/

That after only 3 minutes of google-fu. Still a horrendous number compared to what it should be (zero), but let's not inflate it x6....

[drgonzoguitar]

When they go out of business we'll clean up on the fire sale for sure.

Typically when a liquidator takes over, they raise prices. It is not until the last few days that you might find a deal. It is the illusion of the bargain that makes money for the liquidator. Ask a former Circuit City employee how this process works...

http://www.thisamericanlife.org/Radio_Episode.aspx?episode=377

[hunter]

Really?

http://www.cnn.com/2009/US/03/10/homeless.children/

That after only 3 minutes of google-fu. Still a horrendous number compared to what it should be (zero), but let's not inflate it x6....

Your link says 1 in 50 a year. Just as an example, if a different 1 in 50 child is homeless each year for 7 years at the end of that 7 years, 7 of 50 (or ~1 in 7) will have experienced homelessness or stated another way 1 in 7 children experience homelessness.

Not saying right or wrong, just the two statistics are not necessarily at odds.

As for GC, I'd hate to see em go. In many fair sized metro areas, corner stores often don't have the goods. Not every need can be served via mail order.

hunter

[mdog114]

This is an example of our greatest resource - denial.

Actually, our most abundant resource would be ignorance.

[bluesjuke]

Typically when a liquidator takes over, they raise prices. It is not until the last few days that you might find a deal. It is the illusion of the bargain that makes money for the liquidator. Ask a former Circuit City employee how this process works...

http://www.thisamericanlife.org/Radio_Episode.aspx?episode=377



Yep. I went to Mars when they were closing out and the prices were sky high.
That was for new guitars beat to crap too.

[Jon Silberman]

So I'll wait for the last few days.

[opdev]

I was at GC vintage room in Hollywood Wed. They have the vintage stuff priced like it's 2006 .

I did get to watch Joe Bonamassa play and buy a vintage ES-295. That guy is pretty good.

[carltonh]

Vintage prices won't necessarily come down. Foreigners have lots of dollars, and although the dollar has been holding value reasonably so far this year, by next year we are likely to see it fall significantly relative to other currencies. Enough foreigners will recognize this to start using their dollars to buy quality stuff that can be bought in dollars.

[thewhit]

I see Chiquita Bananas is on the death list. That's too bad because the company always had a peel.

[franksguitar]

GC has been on the S & P endanged list for over a year