from the business news corner - Sweetwater in AZ

[spokenward]

This showed up in my news feed. 

 

https://www.azcentral.com/story/news/local/glendale/2022/06/09/sweetwater-music-equipment-company-opening-arizona-distribution-site/7573259001/

 

At some point logistics and overnight or 2-day delivery zones have to be satisfied.

 

"Sweetwater said the 350,000 square-foot facility on Glendale Avenue, just west of the 303, will help the company ship customer orders more quickly. This is the company's first distribution center outside of its headquarters in Fort Wayne. "

 

 

[Philip OKeefe]

6 minutes ago, spokenward said:

 

At some point logistics and overnight or 2-day delivery zones have to be satisfied.

 

 

Yes, but it won't be for all of the products that they sell. I was just talking with my Sweetwater Engineer (sales rep) on Friday (I purchased a guitar amp cover online and she called me to say thanks) and she told me about the new facility in Arizona and how it will decrease shipping times. But she said they won't warehouse all product types there - for example, they'll be keeping all the guitars in Indiana so they can continue to do the photos of individual guitars for the website. But for the majority of the products they carry, the new facility will mean those of us on the west coast will no longer have to wait four or five days for them to arrive. 

 

In an era where many people have become used to the next day / 2nd day shipping times and near-instant gratification that Amazon Prime and some other vendors now deliver (double entendre intended), I think this is a smart move on Sweetwater's part. 

 

 

[spokenward]

2 minutes ago, Philip OKeefe said:

But she said they won't warehouse all product types there - for example, they'll be keeping all the guitars in Indiana so they can continue to do the photos of individual guitars for the website.

 

Honestly my first thought was about climate-control.

[Philip OKeefe]

A warehouse without any climate control in Arizona might be a less than ideal place to store guitars... but I don't know if the new facility will have climate control or not. It would be a pretty brutal working environment for people without any kind of AC. 

[RABid]

Of course they will have climate control. We even have that in Kentucky. Anyway, it is a logical move. Glad to hear something from them other than, "You are pre-approved for our credit card. Only 29.99 percent interest. Get it now."

[spokenward]

My musing about climate control was kind of guitar specific related to Phil's comment. It's a challenge no matter where your are. 350k is a very large space, think Ikea-sized, so there would be zones. The proposed 165 body-count for the building suggests that it would not be all warehouse staff.  Warehouses these days have greatly expanded the idea of what a big warehouse is. There are warehouses outside of Chicago (my area) with a million square ft. under roof.  Warehouses have also become denser with automated picking systems. You have a mix of spaces and functions. The micro-climates follow that feature. AZ is extreme though in its demands, speaking as someone who has only been there in the summer.

[Philip OKeefe]

I've lived in Arizona - it's also capable of getting surprisingly cold in the winter. But from a guitar perspective, it's all academic. They're not going to be shipping any guitars from there. At least that's what they told me. 

 

I have spoken to people who have seen the new facility in Fort Wayne, and it's apparently gigantic, and rather impressive. I'm sure the Arizona facility will be pretty nice, too. And if it provides shorter shipping times to west coast folks like me, it's going to help even the paying field (vs. Amazon) for Sweetwater for a lot of potential customers. 

 

[Anderton]

Makes sense to me...access to California, Nevada, Colorado, New Mexico, Utah, and West Texas. It's more of a stretch to the northwest, but I doubt that Wyoming, Montana, and Idaho are hotbeds of consumer spending on music gear. Also I don't know if Sweetwater is planning any pushes into Mexico, but...

 

Meanwhile, Indiana has the East Coast, the South, and a lot of the Midwest.

[KuruPrionz]

18 minutes ago, Anderton said:

Makes sense to me...access to California, Nevada, Colorado, New Mexico, Utah, and West Texas. It's more of a stretch to the northwest, but I doubt that Wyoming, Montana, and Idaho are hotbeds of consumer spending on music gear. Also I don't know if Sweetwater is planning any pushes into Mexico, but...

 

Meanwhile, Indiana has the East Coast, the South, and a lot of the Midwest.

It would be a mistake to ignore Oregon and Washington state. There are many cities in both states with vibrant music scenes - Eugene and Portand in OR and Sea-Tac (Seattle-Tacoma) and even little Bellingham, all of these places have lots of music and signicant history in the music industry. Arizona is at least closer than Indiana, I-5 is one of the busiest commercial routes in the world. 

We could add Vancouver BC but many Canadians purchase items to be delivered in Blaine, WA and then get them across the border in one way or another. On a busy day crossings both ways are pumped through as quickly as possible with cars lined up for a long ways north and south of the border. 

[Anderton]

13 hours ago, KuruPrionz said:

It would be a mistake to ignore Oregon and Washington state.

 

I don't think they'll be ignored, it's just more of a stretch to get to Oregon and Washington. Having a distribution center in Nevada looks like its location would be better than Arizona for being able to hit all the states you can hit from Arizona but also Oregon and Washington, but an evaluation of the business climate in Arizona vs. Nevada summarizes its conclusions as "Evaluations of the business climate in Nevada place it below the national average and near the bottom of the western states, while Arizona ranks among the middle of the states." So I don't have any inside information, but the advantages of doing business in Arizona might have offset Nevada's closer proximity to the Northwest.

[KuruPrionz]

6 minutes ago, Anderton said:

 

I don't think they'll be ignored, it's just more of a stretch to get to Oregon and Washington. Having a distribution center in Nevada looks like its location would be better than Arizona for being able to hit all the states you can hit from Arizona but also Oregon and Washington, but an evaluation of the business climate in Arizona vs. Nevada summarizes its conclusions as "Evaluations of the business climate in Nevada place it below the national average and near the bottom of the western states, while Arizona ranks among the middle of the states." So I don't have any inside information, but the advantages of doing business in Arizona might have offset Nevada's closer proximity to the Northwest.

Having driven through Nevada quite a few times, there are long stretches of highway with no real resources in the event of a breakdown, flat tire etc. You are on your own. 

In the winter, it gets really cold and windy. In the summer, it is a blast furnace. For those reasons, I'd rather drive from Arizona and through California, despite the traffic issues. 

Servicing a truck requires parts and personnel that are not abundant in the Nevada desert and much more common on the longer route. 

Sweetwater made a rational choice - one wantts to be relatively close to the population centers in southern California, and Arizona is still closer to OR and WA than IL is.

 

I wasn't disputing the location of the distribution center so much as you leaving OR and WA out of the conversation entirely when they are both important markets for musical instruments and gear. 

The shipments I've received from Ft. Wayne have been consistenly swift, Arizona should be faster still once they get everything up and running. 

 

[Joe Muscara]

I would have thought that Sweetwater TX would have been a more appropriate choice, but

[Anderton]

19 hours ago, KuruPrionz said:

I wasn't disputing the location of the distribution center so much as you leaving OR and WA out of the conversation entirely...

When I said "It's more of a stretch to the Northwest." I always thought the Northwest encompassed Oregon, Washington, Idaho, Montana and Wyoming. I did single out Idaho, Montana, and Wyoming as NOT being hotbeds of consumer spending on music gear because I don't think they are, but that's just an assumption.

[Anderton]

14 hours ago, Joe Muscara said:

I would have thought that Sweetwater TX would have been a more appropriate choice, but

 

I checked out the link. If Sweetwater moved in, it would increase the population by about 25%   But if they moved to Sweetwater, TN, they could increase the population by close to 50%...and probably take over the town!

[KuruPrionz]

7 hours ago, Anderton said:

When I said "It's more of a stretch to the Northwest." I always thought the Northwest encompassed Oregon, Washington, Idaho, Montana and Wyoming. I did single out Idaho, Montana, and Wyoming as NOT being hotbeds of consumer spending on music gear because I don't think they are, but that's just an assumption.

It's a minor quibble at best, let's move on!!! 😇

I'm sure Sweetwater considered carefully with their decision. The big buyer in this case would be Southern California (Los Angeles area) and Arizona has lower taxes so they went with it. 

I keep seeing the news about drought in the Southwest but it's not my problem at this point. I'm an early adapter, one of the first "drought migrants". The Mad Max movie starts later, when faucets have a slight brown dribble and people get thirsty. 

[Notes_Norton]

I vote for Sweetwater Florida - I could drive there!

 

https://en.wikipedia.org/wiki/Sweetwater,_Miami-Dade_County,_Florida

 

Notes ♫

[Anderton]

2 hours ago, KuruPrionz said:

I keep seeing the news about drought in the Southwest but it's not my problem at this point. I'm an early adapter, one of the first "drought migrants". The Mad Max movie starts later, when faucets have a slight brown dribble and people get thirsty. 

 

Hmmm...I assume a distribution center doesn't have industrial-type requirements for water for cooling, production, etc. Knowing Chuck, it will probably be solar-powered anyway   But it does seems that, based on past geological records, this kind of drought thing could go on for a long time. I don't think there are currently any technologically feasible solutions.  

[KuruPrionz]

1 hour ago, Anderton said:

 

Hmmm...I assume a distribution center doesn't have industrial-type requirements for water for cooling, production, etc. Knowing Chuck, it will probably be solar-powered anyway   But it does seems that, based on past geological records, this kind of drought thing could go on for a long time. I don't think there are currently any technologically feasible solutions.  

My perspective comes from having friends in Fresno who own/run a well drilling business. Sometime around 2003 I ran into John and asked him "How's business?"

John said they were doing well, they used to go 60 to 100 feet down to hit water and now it was 350-400 feet - they charged for drilling by the foot so $$$.

That's when I realized that the water table below us was finite in the sense that we were using more water than the aquifer was naturallly accumulating. 

I started planning and left the area in 2005, came to Bellingham where it rains enough to be much less worried about water. Quality of water is higher and air quality is off the charts higher. 

I moved for those two essential aspects, no regrets.

 

More recently, the news indicates that they are now drilling 1,000-1,500 feet to get water from the San Joaquin Basin. The water level below the Colorado River is subsiding rapidly, Lake Powell is almost a mudhole and history shows that drought in the Southwest in general is part of the bigger picture. Meanwhile, you have places like Palm Springs or Tucson that bring in water from elsewhere since they simply do not have enough to keep their precious golf courses lush and green. 

 

It's not a matter of Sweetwater needing water for anything other than drinking, AND a fire supression system - which they most certainly will have since it lowers insurance rates immensely. 

PEOPLE need water, we can survive for maybe 3-4 days without water and then, we die. 

 

With more and more people moving to arid places, there is going to be a serious problem with water shortages and some of that is not optional. 

Check the news on the Great Salt Lake, just for one. It is disappearing as Salt Lake City continues to grow in population. 

All this may take some time, no doubt. I'm glad I moved when I did, prices for living quarters are now insurmountable up here but I got in just before it became "difficult".

There is no way I'd ever move back down to where I came from!!!

[RABid]

Don't forget Las Vegas, which along with others had drained Lake Mead to 30% capacity, yet is still growing and expanding. 

[Anderton]

50 minutes ago, KuruPrionz said:

With more and more people moving to arid places, there is going to be a serious problem with water shortages and some of that is not optional. 

Check the news on the Great Salt Lake, just for one. It is disappearing as Salt Lake City continues to grow in population.

Actaully it's worse than that, Apparently as the Great Salt Lake shrinks, it's exposing toxic chemicals that could get into the air and basically, poison people who live near the lake, as well as cause cancers.

 

55 minutes ago, KuruPrionz said:

All this may take some time, no doubt. I'm glad I moved when I did, prices for living quarters are now insurmountable up here but I got in just before it became "difficult".

There is no way I'd ever move back down to where I came from!!!

 

I moved to Nashville from Santa Fe, water is not a problem here although there is some talk about tornado alley shifting further north, and it already gets pretty hot in the summer. This year, it's been triple-digit hot for days on end, and it's only June....first time I remember that happening.

 

When people ask about the weather here, I always say there are 14 days that are way too cold, 14 days that are way to hot, and those days aren't necessarily contiguous. I may have to revise the "way too hot" part of that...

 

I must say I really do like Nashville, and I also got in before the housing prices skyrocketed. It has that southern hospitality vibe, but is still cosmopolitan and of course, it truly is "music city." But the Northwest may be my next destination. My wife is from there, and if her daughter starts raising a family, we'd probably spend enough time there to justify moving. I was going to move there back in the 90s, but ended up going to Florida instead because the commute to gigs in Europe was so much more convenient. In retrospect, I should have gone to Seattle. I like it there. 

 

There is zero chance I would move to Arizona or Nevada, not my style.

[ToddP]

56 minutes ago, RABid said:

Don't forget Las Vegas, which along with others had drained Lake Mead to 30% capacity, yet is still growing and expanding. 

California takes 4.4 million acre feet, Arizona 1.2 million acre feet. Nevada gets 280,000 and uses even less than that. Las Vegas has reduced water use by 26% since 2002 despite adding 780,000 people. 

Las Vegas becomes unlikely model for water conservation

[KuruPrionz]

3 hours ago, Anderton said:

Actaully it's worse than that, Apparently as the Great Salt Lake shrinks, it's exposing toxic chemicals that could get into the air and basically, poison people who live near the lake, as well as cause cancers.

 

 

I moved to Nashville from Santa Fe, water is not a problem here although there is some talk about tornado alley shifting further north, and it already gets pretty hot in the summer. This year, it's been triple-digit hot for days on end, and it's only June....first time I remember that happening.

 

When people ask about the weather here, I always say there are 14 days that are way too cold, 14 days that are way to hot, and those days aren't necessarily contiguous. I may have to revise the "way too hot" part of that...

 

I must say I really do like Nashville, and I also got in before the housing prices skyrocketed. It has that southern hospitality vibe, but is still cosmopolitan and of course, it truly is "music city." But the Northwest may be my next destination. My wife is from there, and if her daughter starts raising a family, we'd probably spend enough time there to justify moving. I was going to move there back in the 90s, but ended up going to Florida instead because the commute to gigs in Europe was so much more convenient. In retrospect, I should have gone to Seattle. I like it there. 

 

There is zero chance I would move to Arizona or Nevada, not my style.

I read a recent article about the toxins exposed by the subsidence of Salt Lake. 

I have a sister who lives there, have been trying to get her to move away from there for quite a while now. I don't think she will, not much I can do about that. 

 

Nashville has tornadoes, up here we have the Juan De Fuca Plate subsiding under the North American plate and a some point a massive earthquake is inevitable and will probably initiate a tsunami as well. To make it more better, we also have a few active volcanos nearby!!!

 

I live on the east side of i-5 on a slope. So many people come up here and buy a place in the flat lands. Huge mistake, we had some serious flooding due to rainfall this last winter. A friend went down Iowa Street in a boat, that's where all the new car lots are - Toyota, Mercedes Benz/Porsche, Nissan etc. Lots full of new cars with water above the bottom door line, yikes!!!!

 

I sort of love/hate Seattle. If they could somehow finish the light rail system I would love it but I see no signs of completion. There are some good routes but it's not enough, it pales in comparison to Portland or San Francisco. On the other hand, ,almost anythng will beat Los Angeles for public transit - even Fresno was better. 

 

Bellingham is pretty damn good in that regard. Buses go all the way to the Canadian border, so does Amtrak (which goes farther still into Canada). 

Round trip bus and train to Seattle is about $15 or $25 on Amtrak with a beautiful view of the ocean if you choose the correct side (right side going down and left side coming back). 

It's $25 a month for an unlimited bus pass on Whatcom Transit, that will get you well into Skagit county and all over Bellingham. 

 

I mainly love the fresh, clean air and the high quality water system we have here. Like everywhere, we have our down sides too. 

[Notes_Norton]

Florida is probably going to be in trouble. Fortunately, I live 32' above sea level (I call it the Florida Alps). But thanks to the people who think a lawn is more important than drinking water, a few municipal wells near Fort Lauderdale, where I grew up, have had salt water intrusion, which shuts them down for good.

 

And thanks to a government who thinks sugar profits

 

Since we have the ocean and a brackish lagoon, where I live, I could probably solar distill enough water to drink. Right now, my personal well goes down almost 140 feet and the water is good.

 

A vacant lot, farther from the water than my lot with a small cottage on it, sold for over 8 times what I paid. And here, the closer to the water, the more your land is worth.

 

I could sell it for a tidy profit, but why? Everything else is more expensive, so what would I gain? And at least I don't need a lot of heat in the winter. It doesn't freeze here, but the 40s we might get a couple of days per year can seem very, very cold.

 

Besides, when the seas rise, I'll really have expensive land.

 

With climate change, which seems like something we cannot or will not control, I don't know of anywhere that isn't going to have a problem.

 

I'm sure Chuck and the new owners gave a lot of thought about where to put the warehouse/shipping center. I've had good service from that company, so I wish them a lot of luck.

 

Notes ♫

[KuruPrionz]

Probably off-topic and not real pretty but real...

Arizona will be affected, 7 states will be affected.

https://www.yahoo.com/news/moment-of-reckoning-federal-official-warns-of-colorado-river-water-supply-cuts-171955277.html?.tsrc=fp_deeplink

[Anderton]

“What has been a slow-motion train wreck for 20 years is accelerating..."

 

Which of course is why they're closing the barn door after the horse has escaped. Hey, they've had warnings for 20 effing years!

 

Humans are only reactive, not proactive. Which is why I keep mentioning the very real danger from solar flares, and how $2 billion to harden the grid is a comparatively minor amount given the incredibly large amount of damage it would prevent. But nothing will be done, because doing so would involve this thing called "the future."

[KuruPrionz]

27 minutes ago, Anderton said:

“What has been a slow-motion train wreck for 20 years is accelerating..."

 

Which of course is why they're closing the barn door after the horse has escaped. Hey, they've had warnings for 20 effing years!

 

Humans are only reactive, not proactive. Which is why I keep mentioning the very real danger from solar flares, and how $2 billion to harden the grid is a comparatively minor amount given the incredibly large amount of damage it would prevent. But nothing will be done, because doing so would involve this thing called "the future."

It is also very difficult to promote changes that go against the wishes of the very wealthy, which is certainly a factor in this case. 

If you bought huge tracts of land on the outskirts of Phoenix 30 years ago and now you've got contractors tossing up cracker boxes houses that are selling in abundance, you will do everything you can to slow down common sense and reality. 

That's just one example, there's plenty of stories like that if one could be bothered to dig through them despite the futility of knowing somethihg you can't really do anything about. 

Money talks, always has. 

[Notes_Norton]

10 hours ago, Anderton said:

“What has been a slow-motion train wreck for 20 years is accelerating..."

 

Which of course is why they're closing the barn door after the horse has escaped. Hey, they've had warnings for 20 effing years!

 

Humans are only reactive, not proactive. Which is why I keep mentioning the very real danger from solar flares, and how $2 billion to harden the grid is a comparatively minor amount given the incredibly large amount of damage it would prevent. But nothing will be done, because doing so would involve this thing called "the future."

The problem is short-term profits.

 

In a corporate/capitalist economy, each company is only as good as it's last quarter's profits. And those profits had better be ever-increasing. It's a perpetual growth model, and that is unsustainable.

 

If a corporation shows too many quarters of flat earnings, or worse than that, a momentary loss, the stockholders will bail for a better investment. The stockholders do not participate in the company at all, but expect perpetually increasing profits.

 

This leads to short term thinking. Investing $??M into our corporate infrastructure might make us more profitable in a couple of years, but it will wreck this and next quarter's profits, stockholders will jump ship, and I won't get my million dollar bonus this year.

 

On the other hand, a small non-corporate business without stockholders does not need perpetual growth. Since there are no stockholders that want ever-increasing profits, all a small business needs to do is to make enough to pay the employees and have enough left over for the owner. The only growth needed is enough to match inflation, everything else is certainly welcomed, but not necessary.

 

So the small business owner can think; If I invest money in this expense, it'll increase my long term profits in a few years, but I'll have to float a personal loan to afford it.

 

It's a problem with capitalism. Note: I think communism has a worse set of problems, so I don't think it's wise to switch, and I can't think of a better system. That doesn't mean I'm ignoring capitalism's problems, though. Everything has pros and cons.

 

Insights and incites by Notes.

[Joe Muscara]

On 6/16/2022 at 7:52 AM, Notes_Norton said:

It's a problem with capitalism.

Well, it's a problem with the form of capitalism that relies on stock markets. OTOH, I have seen companies that have created long term success and of course, their stock prices rose. But the company focused on good products and the long view and it all worked out. Maybe the company I'm thinking of was lucky in that many thought they were "doomed" or "beleaguered" for years, and that gave them the flexibility to say, "screw it, we don't have stockholders to appease, so let's do what we think is right for the long term."

 

@KuruPrionzis right that we are generally short-sighted. We're wired to focus on our next meal, not one way off in the future. We've learned that we can do some planning, but we're not terribly good at it.

[Notes_Norton]

8 hours ago, Joe Muscara said:

Well, it's a problem with the form of capitalism that relies on stock markets.

Correct. I should have said Corporationalism or Corporate Capitalism.

 

When 49% of the owners don't contribute anything to the company other than stock ownership, and expect perpetual growth in profits, it simply cannot work.

 

The company has to figure out ways to increase and increase and increase profits. Planned obsolescence, fashion, cutting costs, raising prices, and so on.

 

I wish I know how to fix the system. But then, they probably wouldn't listen anyway.

 

Notes ♫

[Philip OKeefe]

On 6/13/2022 at 9:11 AM, Anderton said:

 

I don't think they'll be ignored, it's just more of a stretch to get to Oregon and Washington. Having a distribution center in Nevada looks like its location would be better than Arizona for being able to hit all the states you can hit from Arizona but also Oregon and Washington, but an evaluation of the business climate in Arizona vs. Nevada summarizes its conclusions as "Evaluations of the business climate in Nevada place it below the national average and near the bottom of the western states, while Arizona ranks among the middle of the states." So I don't have any inside information, but the advantages of doing business in Arizona might have offset Nevada's closer proximity to the Northwest.

 

 

Parts of Nevada might offer faster ground shipping to the northwest states, but there's always air, and the new Phoenix area Sweetwater warehouse will have Sky Harbor international airport nearby. And as you said, Arizona may provide other benefits from a business standpoint that Sweetwater thinks makes it a better choice for them. Even for the northwest states, I imagine it's going to cut down the shipping times compared to sending something from Indiana.