FYI Fender: A Guitar Maker Aims to Stay Plugged In

[rp]

http://www.nytimes.com/2012/09/30/busin ... ef=general

BTW if you hit the paywall, Firefox addon Ghostery gets around it, as does this: http://toys.euri.ca/

[Structo]

Yeah I saw that when Fender tried to go public.
Facebook has really heightened everybody's awareness of possible failures of going public.

This current economy has claimed a lot of victims along the way.
Once successful companies have fallen by the wayside or have been bought
out at a pittance.

One only has to look at West 48th Street in Manhattan to see the effect of the economy on the musical instrument sales.
It's fast becoming graveyard row rather than music row.

Teenagers who in the past wanted to learn how to play guitar now are satisfied with the virtual reality of Guitar Hero....

Hopefully there is a light at the end of the tunnel for the industry.

[Phil_S]

+1 on today's NYT Fender article, which appears in the business section. I just finished reading and came here to post about it. Many thanks to rp for posing both the link and a solution to the paywall.

It gives IMO a pretty fair retrospective on the company as well as where it might be headed in these tough economic times. Though I don't play a Fender or own a Fender amp, it would be a real blow to see this fabled brand disappear from the market. It's come back from near death before, but it is hard to say how close it is again and how many of it's 9 lives have already been used up.

[Structo]

Yes, I was a bit startled by that NY Times bit about me only having 10 views left or something.

I really fear for the future of the internet as in how long before we are taxed by how many sites we visit a day.
I know in a way it's already here but the revenue hunters will always look for a way to fill their pockets.

[Reeltarded]

Unions and things that work like unions.. particular types of inflation for instance.. are what killed Fender.

When I was a kid a used 60-64 Strat was $200, and a new terrible Strat was $400. The quality kept going down until they finally gave up and gave that lower quality a name. Everytime the released a lower quality inststrument in place of the better one they lost a couple customers and finally we are where we are today where Fender wore themselves into the dirt trying to make a nickle off a $100, and Les Pauls list for $9000.

My prediction has come true, but it wasn't a prediction at all.

Told ya so.

There, I feel not better.

[katopan]

Unfortunately it's happening everywhere. I've had a number of emails lately about Australia's biggest music retail chain Allans Billy Hyde going into receivership. All stores are closing soon and they're trying to dump as much stock as possible before that happens. It was a sad day in my books when Allans and Billy Hyde had to merge, but to loose the lot now would be a shame. Lots of other independent stores to shop from in the future so it's not the end of the world, but the range isn't often as big. Some follow up reading I also find out part of the company is also a big wholesale distribution network that sells to a number of the independents. So they'll need to broker new deals with other wholesalers and meanwhile keep their head above the water line. Tough times.

[cbass]

I think the closing of music stores has alot to do with Internet sales as well as the economy.

I disagree about kids not wanting to learn guitar anymore and being content with virtual.

I see a ton of teenage kids that play guitar. More than when I was a kid I think.

Maybe things are different elsewhere.

[M Fowler]

The only thing keeping the music store I'm affiliated with is music lessons both piano and guitar. Sales are way down. Guitar set-ups is going well too.

Mark

[billyz]

I agree the economy, increased competition from abroad, the internet etc all have contributed to Fenders problems. But one of the biggest is the huge Debt burden placed on Guitar center( fenders largest reseller) by the Bain takeover. The Debt load on Guitar Center was cited as the main reason That Fender was over valued since Guitar center accounts for most of Fenders revenue. It was Bain Capital that leveraged the Value of GC into a huge Debt which Bain extracted.

[M Fowler]

Another local Guitar Shop couldn't sell enough Fenders or Gibson so they no longer are on the preferred seller list. Now they carry G&L which is my favorite anyway.

This is the same store that told me many years ago why buy a G&L when you can have a real Fender. I told them you can't get any more Fender then Leo and George, you F**king idiot.

Mark

[vibratoking]

Also, I believe that Guitar Center gets preferred pricing because they are so large. This means less profit margin for Fender on a significant number of guitars. I am guessing that Fender has a love/HATE relationship with GC.