Diminishing dealer networks and the effect on sales...

[Sundown]

 

Hey all,

 

When I started in the eighties and nineties, there were only Mom & Pop music shops in my area. They were typically single or dual dealerships (e.g. Roland + Yamaha, Roland + Korg, etc.). Then in the late nineties the big guys came to town (Guitar Center), and the Mom & Pops stopped carrying high-end keyboards or closed their doors altogether. Now it seems like GC is carrying less, and it's becoming difficult to actually try an instrument before buying.

 

Take Kurzweil for example... They have a lot of new products (the PC3 line-up, the SP2 and SP3 stage pianos, etc.), but you'd be hard pressed to find a shop that carries them. There are stores that can order them, but no one that carries inventory.

 

Digital pianos are also hard to come by. Maybe I need to try a dedicated piano store, as some of them carry digitals as well. But it's very hard to find a specific model on the floor (in my case a Yamaha CP33). And the thought of ordering on-line and then potentially having to ship it back isn't very appealing. And if you're at the high end of the market (Roland V-piano, Yamaha CP1, etc.), good luck finding one of those in a store.

 

I live in the midwest, and there are three or four Guitar Centers in a 50 mile radius, but the offerings are very similar. In the big cities there are probably shops that carry more gear (New York, Chicago, L.A.), but that's not an option for me.

 

Are you seeing the same thing (and the same trend), or is this perhaps a local thing?

 

[mate stubb]

Welcome to the internet age.

[Synthoid]

Are you seeing the same thing (and the same trend), or is this perhaps a local thing?

 

Our Guitar Center in Lancaster, PA stopped carrying the Roland Fantom G last year because of lagging sales. They do carry the Motif XF and the Korg M3, but when I called to ask if they would be stocking the Kronos I was told "probably not." The sales rep in the keyboard department was apologetic, saying he has no control of what they can and cannot stock. Of course they can "order one for me," but I want to try out something that expensive before I buy.

 

Surprisingly, the Sam Ash store outside of Philadelphia is very well-stocked with gear, In addition to workstations and synths from the big three, they also carry offerings from Kurzweil, Moog, the new M-Audio Venom, and I think they also had something from Novation as well.

[VegasGT3]

Order from Sweetwater and send back what you don't like.

[DanS]

Montreal is pretty well stocked.

[Sven Golly]

Toronto is very well stocked.

[kanker.]

GC's a turd

 

The Sam Ash here is better stocked, but still not like it used to be.

 

I miss the days when mcgoo worked at my local mom and pop. I'm sure he doesn't...

[Synthoid]

Order from Sweetwater and send back what you don't like.

 

That can get expensive with return postage.

 

[The Real MC]

The GC in Rochester NY is drying up. The keyboard showroom is half what it used to be.

 

Yeah, it's the internet age.

[Bill W]

Order from Sweetwater and send back what you don't like.

 

That can get expensive with return postage.

 

 

Not to mention Sweetwater that is typically too expensive in the first place.

 

[Outkaster]

The GC in Rochester NY is drying up. The keyboard showroom is half what it used to be.

 

Yeah, it's the internet age.

 

Yeah it is terrible. They don't stock any thing for specialty needs. Especially the Hammond stuff.

[Synthoid]

Order from Sweetwater and send back what you don't like.

 

That can get expensive with return postage.

 

 

Not to mention Sweetwater that is typically too expensive in the first place.

 

They price-match almost everything for me when I call. I also like their extra year of warranty coverage, free knowledgeable tech support (better than Alesis tech support when I bought my ION several years ago), and their sales agents actually know what they're talking about compared to many other online stores.

 

[Outkaster]

I have great luck with sweetwater. Been dealing with them since 1994.

[Song80s]

Order from Sweetwater and send back what you don't like.

 

That can get expensive with return postage.

 

 

Not to mention Sweetwater that is typically too expensive in the first place.

 

They price-match almost everything for me when I call. I also like their extra year of warranty coverage, free knowledgeable tech support (better than Alesis tech support when I bought my ION several years ago), and their sales agents actually know what they're talking about compared to many other online stores.

 

 

I have zero luck with SW price matching. And it takes extraordinary effort to have that conversation. As such, I don't waste my time.

 

I have noticed that when I need support, those Internet forums are quite helpful

[Jason Stanfield]

Are you seeing the same thing (and the same trend), or is this perhaps a local thing?

 

Sorry for the long post, but this is a big can of worms ...

 

There's a chain of problems for indie stores to deal with when getting into high-end brands.

 

A high buy-in: Manufacturers want stores to stock up on a lot of SKUs rather than allow a store to carry just one item, so they require the store to order a lot up front. The manufacturer doesn't want to offer extended terms, so the store is required to pay their bill within 30 or 60 days - which may not be long enough for them to get word out that they carry Brand X, thus being "stuck" with unsold inventory and a decreased capacity to buy high-turnover items like accessories or cheap guitars. (Gibson Guitars is notorious for driving away indie dealers due to a minimum purchase requirement seen as very unreasonable by these dealers.)

 

Interest: Sometimes a store can get a loan to meet that buy-in, or get it on a floorplan account, meaning they don't have to pay for it until it sells (the lender sends in someone to inventory all the items monthly). But as long as they're holding that inventory, they're paying interest on the loan.

 

Little or no wholesale discounts: When GC or Musician's Friend order, they do so in large quantities, prompting mfrs to offer deep wholesale discounts. Indie dealers get smaller quantities, so the discounts are fewer, lesser, or even non-existent.

 

Little or no freight discounts: Just like buying products in bulk, shipping in bulk gets GC et al discounts on freight that indie dealers don't qualify for. Thus another layer of expense.

 

MAP/catalog pricing: Since the industry has adopted MAP (minimum advertised price, i.e. the reason why MF, SW, Ash, zZ, GC et al advertise the same prices) to prevent retail sales just over cost (or under, as a loss-leader), consumers see MAP as the beginning of price negotiation. Calling MF or SW may get you a discount from the advertised price that an indie store can't offer, due to the higher costs per stocking unit. (Some mfrs attempt to establish a minimum selling price policy, however the legality of that is questionable, some retailers have many ways to get around MSP and MAP, and if the store is big enough, the mfr isn't going to enforce it.)

 

Sales tax: Even if everyone sells at the same price, it's still often cheaper to buy via mail-order than locally because you don't have to pay sales tax if you're ordering out of state.

 

eBay: When retailers sit on gear for a long time, or are in need of cash, they'll dump new or nearly-new gear on eBay for a hair over cost (sometimes under) just to bring some cash in. Savvy consumers know they can get near-wholesale discounted prices that way.

 

Local popularity: Last, but not least, is how popular Brand X might be in your state or region. If there aren't enough local buyers to sustain selling Brand X, even if you're willing and able to discount heavily, then it's not worth carrying the brand.

 

- - -

 

Right now, there is no single logical solution for this quagmire. Whatever single solution is proposed, somebody loses incentive: the manufacturer, the distributor, the retail store, or the consumer.

 

Some suggestions for consumers are:

 

1. If you just can't turn down a good eBay or mail-order deal on a new keyboard or guitar, at least buy all your accessories locally. And don't beat the store up for a killer deal on cables, stands, etc. - indie stores live and die by the margin they make on accessories.

 

2. If you don't want to shop with the chains and mail-order sites, then shop with an indie dealer in a neighboring state. Most decent music stores have internet sites, and none will refuse a phone-in sale.

 

3. If you want to try before you buy, take advantage of the liberal return policies that large chains and internet stores offer. Some will take back anything, and not charge a restocking fee, even if you just don't like the gear. Make sure you read their policy and understand it fully, though, so you're not stuck with a firm store-credit-only situation. If it works out, then special-order the unit locally.

[Synthoid]

I have zero luck with SW price matching. And it takes extraordinary effort to have that conversation. As such, I don't waste my time.

 

Sorry to hear that, Greg. I've dealt with them for about 7 years now and have been very satisfied with my experience (and prices). I do, however, split my music gear purchases between Sweetwater, Guitar Center, and local mom & pop stores.

 

I have noticed that when I need support, those Internet forums are quite helpful

 

But of course. Have a beer!

 

http://www.bestbeerbuzz.com/images/Dogfish60Hor1.jpg

[Joe Muscara]

Thanks for that post, Jason! I think a lot of people overlook those details.

[Dana.]

I'm spoiled here in NYC, however I have to hit a few stores to try various things. The last time I was in Sam Ash, I did notice there were no Kawais on the floor; maybe they're waiting for the new MPs to arrive.

[ITGITC]

 

Apple has local stores. These are doing well in augmenting their mail order model. I read that Apple is opening yet another huge store in New York City's Grand Central Station. LINK LINK 2

 

I feel certain that Sweetwater is continually evaluating the profitability of opening brick & mortar stores around the country. They should be.

 

It's tough to be a customer in the market for an 88-key weighted keyboard and there is no local dealer. These really need to be auditioned and compared side-by-side in a store. It doesn't make sense to order four or five 88-key weighted keyboards from Sweetwater simply to do this.

 

There is value in being able to visit a dealer who has product like this in stock.

 

Sooner or later the worm will turn; the health of the economy will improve. Either stores will start stocking these again, or we'll see boutiques pop up where you can make an appointment to audition their keyboards. Don't expect to get much of a bargain on the price though.

 

Tom

 

[Steve Force]

Most of the thing I have recently ordered from Sweetwater were not in stock, even though their website inventory said they were. I suspect they are keeping their inventory to a bare minimum.

[Dana.]

I have the wonderful distinction of being asked to leave Guitar Center on two separate occasions at two different stores because I was auditioning boards with no intention of purchasing any of them. Both times I was using headphones, so it wasn't an issue of volume. There's really no reason to set foot in that store for any other reason but to audition something.

[Devnor]

I appreciate the Sweetwater guy calling a few weeks after shipment to follow up on my XK3C purchase. They double boxed the organ & included the little bag of candy too! Preordering Kronos couldnt have been simplier...just called up my guy to tell him I wanted the 88. He tells me "you are number 6". Took all of 30 seconds.

 

Trying to do the same in a Texas area Ma & Pa? LOL sure just pay 25% down, yada yada plus incoming freight charges plus sales tax do you need any cables too?

[MikeT156]

by D-Boon:

 

I have the wonderful distinction of being asked to leave Guitar Center on two separate occasions at two different stores because I was auditioning boards with no intention of purchasing any of them. Both times I was using headphones, so it wasn't an issue of volume. There's really no reason to set foot in that store for any other reason but to audition something.

 

Dana:

 

How did they know you had no intentions of buying any of the KB's?

 

 

Cheers,

 

 

 

Mike T.

[Song80s]

I have the wonderful distinction of being asked to leave Guitar Center on two separate occasions at two different stores because I was auditioning boards with no intention of purchasing any of them. Both times I was using headphones, so it wasn't an issue of volume. There's really no reason to set foot in that store for any other reason but to audition something.

 

I think you have book material. You could go on a coast to coast Guitar Center tour:

 

"I refuse to visit any GC that would have me as a customer. "

 

whaddya think ?

[Synthoid]

Trying to do the same in a Texas area Ma & Pa? LOL sure just pay 25% down, yada yada plus incoming freight charges plus sales tax do you need any cables too?

 

Freight charges? Over and above the price of the keyboard (with no discount because it's a special order)? No thanks.

 

 

 

[Dana.]

How did they know you had no intentions of buying any of the KB's?

Apparently GC doesn't like hearing the phrase "window shopping."

[Dana.]

I think you have book material. You could go on a coast to coast Guitar Center tour:

 

"I refuse to visit any GC that would have me as a customer. "

 

whaddya think ?

How much does the gig pay?

[rappa29]

There are 2 GC's and 2 SA's in my area. Out of the 4, only 1 Sam Ash is worth going to for keys. They're pretty well stocked and the keyboard guy has been with them since I was in HS (1989) back when they were a local megashop called Thoroughbred music! It helps that he's the organ grinder for our Tampa Bay Rays(MLB) so he makes sure they keep a good stock of the current clonewheels and vintage keys emulators, as well as DP's!

Only bummer is it's a bit of a drive and not all highway to get there.

 

Neither of the 2 GC's carry any of the clonewheel\vintage keys keyboards. Last time I saw anything of the sort at either GC was in 2009 when I bought my XK1, new in box on clearance.

 

As someone eluded to, a big part of it is demographic and what's 'in demand' in your specific area. There's mostly workstations on the floors at the 2 GC's and other SA. Apparently, clonewheels or SV1\Electro's are not very in demand in my parts. I suppose everyone either already has one, can't afford one, is not as meticulous about their B3 sound or is playing the real thing. Hard to say why only the one SA stocks them all.

[Song80s]

I think you have book material. You could go on a coast to coast Guitar Center tour:

 

"I refuse to visit any GC that would have me as a customer. "

 

whaddya think ?

How much does the gig pay?

 

check with a book publisher.

 

Usually a $50k-100k advance plus a share of sales.

[Synthoid]

Neither of the 2 GC's carry any of the clonewheel\vintage keys keyboards.

 

I have yet to see a Hammond XK series keyboard in any Sam Ash or Guitar Center store within driving distance.