Guitar Center is owned by Bain Capital, which has a history of buying up struggling chains and slowly squeezing them into bankruptcy. This is the same company that bought and killed Sears. This tends to be a slow process for them, but it's what they do.
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Guitar center is going under!
- Thread starter Sunset Shalom
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there's one of these posts every so often. I don't see why some people hate GC so much. I love them. I can go try out stuff, I can ask questions to someone, in person, and look at and talk about options with someone who actually knows a little about what i'm interested in. I can go grab strings last minute, from a great big selection of strings. I can go buy something different, like a cahone, or stomp box. I can browse an almost never ending supply of used gear and get it for a decent price.
GC going out won't bring back the mom and pop shops, the internet has taken them down already. Even if it didn't. I never found good deals at mom and pop shops. They had to pay rent, and couldn't swing much in the way of discounts. Used gear is very minimal, as is variety of things to try/buy. String selection was always abhorrent.
so, i say long live GC. If you do close down some stores, please don't close down the 2 near me, or I'll have to drive a little further to get to the 3rd one within the vicinity!
GC going out won't bring back the mom and pop shops, the internet has taken them down already. Even if it didn't. I never found good deals at mom and pop shops. They had to pay rent, and couldn't swing much in the way of discounts. Used gear is very minimal, as is variety of things to try/buy. String selection was always abhorrent.
so, i say long live GC. If you do close down some stores, please don't close down the 2 near me, or I'll have to drive a little further to get to the 3rd one within the vicinity!
Please explain how buying a business and forcing it into bankruptcy - either chapter 7 or chapter 11 - is a strategy for making super-economic profits. That really is not clear to me.
Bain Private Equity (which is the arm that holds GC) has about 70 investee companies. It is in the interest of Bain to make those companies more valuable then sell them on to others, not crush them into liquidation. But if a company is failing, it is in Bain's interest not to throw good money after bad. So a failing company will not garner any additional investment. Perhaps that is what you mean?
Well, around here at TB, it’s reoccurring topic of conversation; in fact I posted that same video in a thread last week. I can’t pretend to say I understand all that investment theory, it could be right on, it could be hot air. There’s still MF/Woodwinds-Brass/Music 123, not to mention GC online, to keep the revenue coming in to the conglomerate, so I could see the retail, if not disappearing altogether, reorganizing into a 7-11 convenience store concept(it’s practically there already). Maybe it would come back as “DJ Center”(ah, yes, the death of the guitar, there’s a whole’nuther Topic of conversation).Maybe I just need to check around more but I can't say I had ever heard about them going under before. Sounds like they will be going the way of Blockbuster though
Mom n pop stores carrying gear you can afford at good prices will not come back if GC goes under. Period.
Two good friends of mine own a mom n pop. They started out carrying nicer gear and providing great customer service. These days, live music gear is almost an annoyance to them. The only things that sell are entry level pieces and they only sell them to people who have money burning a hole in their pocket and can't wait 48 hours for an internet order to arrive for 15% less than they have to charge. Their profits come from church, school and commercial PA installs as well as band and orchestra rentals and maintenance contracts. They make virtually nothing on the kinds of gear we here at TB frequently use. They honestly wish they could drop all of that stuff but it creates foot traffic. Guy comes in for a new microphone for his church and you sell him a new PA install. Guy comes in for guitar strings and you sell his band a new compact PA system. That's the only thing basses and guitars and amps are good for in their world. Starter packs this time of year makes them about $12 a pop. Hardly worth stocking the 30 or 40 they will stock. But they do it hoping this young guitar players come back and buy a PA in 5 years or their mother signs their sister up for a flute rental.
The nearest GC is 75 miles away. What kills the market for them now is the interwebz.
I'm not beating up the interwebz or cryijng for mom n pop stores either. I like the free market just the way it is. Some survive and some don't. But their competing for our business always works out for us in the long run. It wouldn't hurt my feelings at all to see Fender Pro Player and Rumble stuff in Sam's Club for a hundy less than GC sold it for. D'addario XL Nickels and Chromes for $9.95 a set on the shelf at Wal-Mart? Sign me up!
I don't need a dear old friend with a smile and a cup of coffee waiting on me when I go to buy a bag of orange picks and a Fast Fret. I don't have time for the coffee anyway.
Agreed. Big retailers, be they online or brick & mortar, can sell at lower prices because of higher sales volume (economies of scale). Mom & pop shops are the opposite - they have to sell at higher prices because their costs per unit are higher, and this is due to lower sales volume.
Guitar Center's financial issues are neither new or unique. Brick & mortar stores in general are struggling due to competition with online retailers.
The demise of GC has been announced as imminent for several years in a row.
Yet they continue to survive. Their last move was to convert some of their outstanding debt into shares of the company.
I recently visited several GC in several states and they all had inventory.
So I tend to think it's unlikely they would go under.
That being said, I continue to wonder why they have not paired down their number of stores. Seattle has three of four GC, the San Francisco Bay Area has six.
Anyways, I hope they don't go out of business, it would leave a really large gap in the retail landscape. On the other hand, many other forms of retail have moved online.
Who ever thought Amazon would get as big as it is in 1994?
Yet they continue to survive. Their last move was to convert some of their outstanding debt into shares of the company.
I recently visited several GC in several states and they all had inventory.
So I tend to think it's unlikely they would go under.
That being said, I continue to wonder why they have not paired down their number of stores. Seattle has three of four GC, the San Francisco Bay Area has six.
Anyways, I hope they don't go out of business, it would leave a really large gap in the retail landscape. On the other hand, many other forms of retail have moved online.
Who ever thought Amazon would get as big as it is in 1994?
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Over all I'm not sad nor happy .
Because guitar center itself was super hard against my region and my nationallity.that much that if they found you are iranian they avoid sell you a thing .so I never had experience with them .
But maybe it's bad because now a lot of guitarist who had access to them ,can't try before buy .
Here a pic of GC website that they banned for iran.(some other brand is fender website that they close it even for looking at )
Because guitar center itself was super hard against my region and my nationallity.that much that if they found you are iranian they avoid sell you a thing .so I never had experience with them .
But maybe it's bad because now a lot of guitarist who had access to them ,can't try before buy .
Here a pic of GC website that they banned for iran.(some other brand is fender website that they close it even for looking at )
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Several quick thoughts:
1. At one time (maybe the law has changed) when a business filed for chapter (whatever I forget the number), the companies that provided them a line of credit legally had to extend the same amount of credit to the bankrupt company. I am certain there were many provisions with the legal speak, yet that was the reality.
2. It is like the economy pick a side, it will get better or it will get worse. Wait long enough and you will be right.
3. Most failing or struggling businesses get bought by someone who believes they can run it better.
1. At one time (maybe the law has changed) when a business filed for chapter (whatever I forget the number), the companies that provided them a line of credit legally had to extend the same amount of credit to the bankrupt company. I am certain there were many provisions with the legal speak, yet that was the reality.
2. It is like the economy pick a side, it will get better or it will get worse. Wait long enough and you will be right.
3. Most failing or struggling businesses get bought by someone who believes they can run it better.
That's pretty lame they would block IP addresses for Iranians... It's one thing to not ship somewhere because it's too far, but these days many places seem to ship globally.
Don't hold your breath. The whole street-retail model is as dated as a Commodore computer, and manufacturers are less and less interested in trad sales retail routes. At the same time the great diversity of instrument makers and user expectations that they will get the perfect thing at the perfect price makes trad retail a very unlikely startup bet. An example is The Bass Place, the only bass-specialized shop in AZ as far as I know. 15 years ago they kept a busy 2,000sf busy-street showroom. Today it's an almost exclusively online operation, with three or four basses on the wall of a maybe 400sf retail front in an obscure mall corpse. You have to ring a bell to get them to open the door.
Guitar Center or not, true or not, I don't think we should rejoice about a brick and mortar music instrument store closing. Where are we going to try the gear we buy online?
Nope. Not since 2014. The new owner Ares Management took control because Bain couldn't service the debt. Before replying, I had to check your post twice just to make sure this wasn't a zombie thread from a few years ago.
Digital changes everything! Driverless cars! Drones! Sex with robots! No guitars, only synthesizers!
Good post, I would only point out if their bond rating is at this level it’s meaningful in the sense that they can no longer finance their operations through the bond market. Hopefully they can find another source of funds rather than liquidating their assets.
Don't forget the sex robot synthesizers!
One crazy digital idea I had today was to train a neural network with music and teach it to "play" music using VST programs or MIDI controlled keyboards.
Imagine being in a band with an "AI" drummer or bassist, or both
Based on my own experiences with Mom and Pop music stores back in the 60s, 70s, and 80s, I don’t have any romantic notions about them. Most weren’t all that great. There were the occasional stellar exceptions like EU Wurlitzer in Boston or G Guitars in N.H. CT. But most weren’t that customer oriented or easy to deal with IMO. Even the legendary Manny’s in NYC could be a mixed experience, depending on who you were - or what they thought you might be when you walked in the door. Because most of the really good places were kinda clubbish. Anybody could walk in. But not everyone was made to feel welcome to do business there when they did. So for me, when the first pro oriented mail order music businesses opened up, it was like a breath of fresh air.
i don’t think the demise of GC will accomplish anything (should it come to pass) other than to reinforce the feeling among people with money to invest that brick & motor music stores are no longer viable.
i don’t think the demise of GC will accomplish anything (should it come to pass) other than to reinforce the feeling among people with money to invest that brick & motor music stores are no longer viable.
LOL! Yeah, just like the incredible RV sale that will only last for the next three days then it's all over, so act now! (even though they have been "on sale" every weekend for the past 40 years).
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