Fender biz problems, New York Times article

[MBJW]

Long biz story on Fender's problems staying relevant with young people and mistakes by management and owners. Hard to believe they aren't rolling in cash, but then I view them, probably like many on TGP, through the prism of their outrageous mark-ups for Custom Shop gear. The reality is Fender is losing out to overseas cheap guitar builders and are irrelevant to the young. And they have no plan to reverse the downslide.


http://www.nytimes.com/2012/09/30/b...plugged-in-amid-changing-music-trends.html?hp

 

[jtm622]

interesting article... thanks...

 

[zenfreud]

The reality is Fender is losing out to overseas cheap guitar builders
http://www.nytimes.com/2012/09/30/b...plugged-in-amid-changing-music-trends.html?hp

But aren't the majority of current FMIC products likely made overseas? Or at least outside of the U.S.?

If FMIC is hurting, I'd guess that much of the m.i. business is hurting; with few exceptions it's a race to the bottom.

 

[BarryE]

Not surprising. Isn't Gibson looking at some similar issues. As the article mentions, the music business is reinventing itself and things change.

 

[jhvox]

Best line: "It’s worth remembering that the accordion was once the most popular instrument in America."

 

[djdrdave]

Best line: "It’s worth remembering that the accordion was once the most popular instrument in America."

It might be the most popular instrument again, if population demographics change the way they do. Accordion is pretty popular with some of my friends bands, obviously I'm referring to Mexican music. There are some pretty amazing according players out there. Soloists in their own right.

 

[tele118]

It might be the most popular instrument again, if population demographics change the way they do. Accordion is pretty popular with some of my friends bands, obviously I'm referring to Mexican music. There are some pretty amazing according players out there. Soloists in their own right.

Agreed. There are some amazing accordion players out there.

Anyways, kinda sad for Fender as I do love them. Not even sure what they can do about it. The majority of younger people are switching over to more mainstream-catchy-hip hop styled music. Of course, I don't mean everyone, but the majority are into that now. Almost everything can be done now on a computer, so people probably don't feel the need to purchase real instruments.

 

[coldfingaz]

There were a lot of threads about Fender's state (woeful in my view, many disagreed) around the time it was announced they were going to go public.

None of this should surprise anyone, IMHO. Many investment firms are trying to dump + run right now after paying way too much for companies when times were better.

I don't wish FMIC ill will, but I'm honestly surprised they weren't scrambling long before now given their incredulous business model... namely their inability to increase quality during a **** economy when they've continually raised prices, bulldozed dealers & have custom shop pricing that I'll never understand given the comparable alternatives at less than half the price.

 

[Kentano2000]

(btw, if the accordion ever does make that comeback, I'm sure Fender will be in a position to gain from it.)

Well, there is this...

 

[Tone_Terrific]

What was Fender revenue in those glory years of the 60's?
They probably are HUGE in comparison to those times.
(sold to CBS for $13M...tried a recent public offering at $396M)
The fact that growth reduction is taking place in the face of changing demographics and worldwide economic slowdown shouldn't be surprising.
Lower standards of living will hit nearly everybody as worldwide competition increases for shrinking resources.

 

[pete692]

Bloated company, selling instruments at a premium price that sound no better to the hobbiest/beginning guitarist than instruments made overseas at less than half that price. I don't want to see cheaper Fenders, I want to see quality Fenders, but in smaller numbers.