How The Musical Instrument Industry Works. Manufacture To Store To Customer
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- Опубликовано: 21 окт 2024
- #knowyourgear #podcast #guitarpodcast #geekystuff
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When I worked for GC I found a couple of great deals. At GC most Gibson & Fender guitars have a 32% margin, but I found a few that were as high as 70%. The nice thing about those few instruments with such high margins is, that discounted price +10% is what you would pay as an employee. Case in point, GC had a few PSL (Pre-Sold Limited) Gibson Les Pauls with that were very pricey. The two I ended up buying was a True Historic R9 (1959 reissue) sunburst with Brazilian rosewood. Selling price was $10,000, but as an employee I was able to buy it for $3,300. Then the second year I found another Gibson Les Paul PSL in our system (SPO), a Gibson Custom VOS R7 Les Paul Standard, Natural Back in Antique Teal. Sales price was $5900, I got it for $1800. These are the rare killer deals on new gear that make it worthwhile to work at GC for a couple of years. Needless to say these are guitars I plan to never sell.
Love these subject-specific excerpts, Phil!
~Phil in Silver City, NM
"If they are desperate..." Expect that turn soon!
Thanks for posting this!
The podcast clips are a great idea !
That green swirl N4 is g-g-g-gorgeous.
This stuff is fascinating. Never had a business, no idea how it worked.
Nice insight. That's how it works in retail. Music, auto parts, etc. So how do the retailers make money at 30 points gross profit? It seems pretty slim. Can you give a breakdown on expense target percentage? Ex. Advertising x%, commission x%, fixed expenses x%
fascinating! thank you for the insight
You’ve never heard of a Fartington guitar? Phil I thought this was a pro gear channel.
Fartbox amps are pretty bad
Ohh, he dealt it
Something doesn't smell right.
That was a good one. Thanks
Economies of scale, the guitar player's version. Thanks PM.
My experience in the outdoor retailer industry that there was a 100% markup. We bought it for 50 and sold it for 100. If you worked there you got the pro deal, which was wholesale minus maybe 10 or 20%. so we would buy a 100 dollar item for 30 or 40. you end up spending several of your first paychecks on gear before you grow up. That said, i still have much of the stuff i bought in the mid 90s. You buy great quality gear, it lasts forever.
GC has a point system so that's kind of cool. Unless you need to tryout or purchase locally most purchases are going to be online.
I remember working for a full line music store back in 2000. They got Gibson and it was a $200K buy-in.
Then, they sent us all their crap guitars and amps………..
True, it's why you don't find Gibson in any stores other than those in larger cities or online. They snub their noses at smaller dealers, which is really a bad way to look at it. The smaller dealer which is most often ran by the owner who actually knows his stuff and gives a s**t would do a much better job of representing the brand than the local GC with a bunch of kids working on the floor that'll be gone in 90 days. Gibson has always been ran by idiots. If it weren't for the Les Paul they'd have been out of business a long time ago.
Folks at a local store I frequent were explaining this to me...they used to be a rickenbacker dealer but they couldn't keep inventory up because it was always backordered...then they switched to gibson and they forced them to take the oddball models no one wanted...so they switched to fender/gretsch and are doing better...but to me it seems like they're swamped now
Les Paul would be bummed😢
What do you think of the some companies not just music moving away from dealers, and just selling direct to consumer?
What about high-end, vintage collectible shops? It seems like they acquire super expensive vintage stuff, set the price real high, and proceed to carry everything at the same price for years. How do they survive waiting for lucrative paydays that long? I'm thinking of Willie's in St. Paul MN. They're a Martin dealer too and other brands as well, does that keep them afloat? They never cut prices on their vintage stuff.
Phillip did you skate back in the day? I noticed you wear alot of Vans gear.
Why is it that all online retailers charge exactly the same price for a given product?
If retailer A charges $699 for an item, and everyone else is charging $699 for the same item, what is my incentive to go anywhere else and how can other retailers get my business if the only difference between them is their web address?
Because the manufacturers dictate the price an item can be advertised for. It's called MAP, an acronym for Minimum Advertised Price. Go to your local dealer to both support your community and get a better price.
For me the number one deciding factor is the return policy. If I have to jump through hoops , I'm not buying from that establishment. If I'm buying online ,especially guitars, I always get it from GC or MF. No questions asked 45 day returns. This is important when there is no where close by that I could try out an instrument.
Agreed, it comes down to the customer service. Personally I buy everything from Sweetwater because they always take care of me and resolve all issues. And they have a 2-year warranty. But when it comes to guitars I have to hold the guitar and play it before I buy it, so I always purchase my guitars locally
So is that why lefty guitars are so rare in dealer music shops ?
Great and informative video
It’s gotta be a labor of love to run a music store. I can’t see a huge profit.
This clip needs to be viewed by everyone even thinking of opening a music store! Wow the _PLANNING_ required to stay profitable must be a nightmare.
What is that guitar in the top left corner?
What was the markup on Moonpie guitars? 😂
7:24 Peepee Finance ✨
And thats why guitar center hangs Gibsons 15 feet up on the wall
I Bought two Stratocasters directly from Fender.
I had to go to Guitar Center to get my Rumble 40🎸🔊
Such interesting stuff! 👍🏼
It's also instructive that Philip's tone here is rather wary & he's obviously not impressed with everything about how industry works. Sounds like a pain in the arse to me. I would have to have a lot of spare capital, much patience and a serious love of guitars to do retail. Dealing with 100 people coming in each day just to kick tires and not buy anything… Considering that's what I do often.. and not everybody treats merchandise with respect!
not sure it all works that way today, in fact I don't think any of it is correct.. you can do much of you're ordering online thru stocking warehouses, of course you cannot order what you want, well you can but it might take a while for the build process, I mean fenner has an actual build sheet anyone can use these days so yea they don't care who gets what anymore, if they ever really have, of course they had means to move gear no one wants or can sell
Do manufacturers hold back innovation , research and development, to dump inventory and less likely to embrace major manufacturing changes?
Manufacturers don't innovate because players don't want it. Guitar players are very irrational.
When Gibson changes the headstock size and angle or added a volute to reduce headstock breaks, people rioted.
❤
P Diddy knows how it works, up until government mandated rebates and lock downs!😂🎉
Informative vid . Seems we can't escape politics in any facet of life . LOL
How about the music industry takes a horrific L for a few years and it rethinks how it does biz.
Stores can pivot to selling used gear to stock up for low $.
Can you consistently get enough used gear in salable condition to keep a viable volume through your store?
Man 30% margin sucks, atleast in the cycling industry we get 40% or keystone.
Man, I know, right?
That sounds terrible lol
No wonder in Canada we have no good brands. Also fender, PRs, Gibson doesn’t let Sweetwater ship to us lol
This makes me sad. No wonder you see the same stuff again and again ...