06-12-2012 06:25 PM
Yeah, this doesn't look good.
Well, GC is making money, but not enough to pay off old debts and interest without taking more loan. http://www.reuters.com/article/2012/05/08/idUSWNA6 78920120508
06-12-2012 06:44 PM
06-12-2012 07:34 PM
No. I get the "Language professors hate him!" ad as well as MacKeeper ads (twice on the same page when on The Guardian's site).
I don't really have anything to add except to ask is everyone that posted in this thread getting targeted ads by "The Economist" magazine everywhere? The internet is weird.
06-20-2012 09:49 AM
06-20-2012 09:54 AM
06-20-2012 10:14 AM
Brick and mortar is over. So over. I hate it, too, but too bad, so sad.
#1) Too many people on the payroll, any business' largest expense.
#2) Too much real estate, which never goes down in price, except when it does, and then it's a "huge loss", no longer a "good investment".
#3) Too much inventory on hand, getting more and more beat up every day.
There's really no longer any upside for maintaining a brick and mortar presence, except to try to please the dinosaurs.
The people profiting from all this will be the shipping companies. Buy, try, and return is the future. Look for even longer exchange policies, and automatic return labels included in your shipment. UPS and FedEx already offer these.
03-19-2013 04:04 PM
Yes GC is deeply in debt to the tune of 1.6 billion plus massive and I mean (MASSIVE) inventory debt. In 2011 they declared a loss of $111 million. 2012 I believe was much the same.They are basically bleeding money out of their collective a$$. In April of 2013 they have a payment of $137.6 million due to the bank and another 50 million due in October. Also they owe every vendor on the planet earth and are past due with many as far as I know. In October of last year the CEO left his job to pursue other interests. Hmm I wonder what that means. Get out while the going is good. Who knows. Not long after Bain took over the company in 2007/8 Fender hired the ex CEO of GC and proceeded to purge many of their independent dealers. As far as GC is concerned the business model no longer works. Frankly it doesn't work for many others such as Best Buy, Radio Shack and Borders etc. Think about the cost to keep 235 Brick and Mortar locations open 12 months a year. Thats 2,820 Lease, rent, phone and utility payments. Payroll, advertising, taxes, inventory and on and on. Not to mention the interest on the loan. From what I've read In 2011 they claimed a net profit of about 60 million on the $2.1 Billion gross everything combined (GC, Musicians Friend, Music 123, Music & Arts and Brasswiind Woodwind). Do the math. Thats not even enough to pay the interest on the money they borrowed. What's next. Ask the experts. My glass ball is broken. When MARS Guitars went down the vendors lost a ton of money which never was paid back. If GC goes under who knows. Right now as far as I can tell they are liquidating gear at or below cost just to stay afloat. It's very plausible that some of these Stupid Deals are on gear that they themselves still owe their vendors for. You know the old story rob Peter to pay Paul. Who knows. For those Romney lovers just read some history on how Bain used to operate under his command. I'm not a fan. That's my opinion. Take it as it is but read the Rolling Stone article and draw your own conclusions. So yes to what you've read it's all true.
03-19-2013 04:20 PM
Romney is not as awesome as you make him out to be. GC is not long for the world. Fact not fiction. Romney has plenty of issues. Unfortunately even under another commander they will take the banks and vendors for a ton of money. The industry needs the independents more than you think. 100% of ALL of the service that occurs in the MI industry happens at an independent level. Take those repair shops away and you just have broken gear and places to buy new. The same logic applies to the car industry. Many of the good repair shops are the independents. We have run a repair shop for 40 years and we are crushed in repairs. Why you ask? Well..........thankfully we R 1 of those Mom and Pops who have thrived in an industry dominated by the Box Stores. ALL of the knowledge in the music industry is housed under the roofs of the independents. I guess the next time you're in a GC ask someone how to adjust a neck, do a fret file, install a pickup, how to setup a compressor, recone a speaker etc. But don't be surprised when they give you a dumb look. I thank God everyday they are open because I know that no matter what we will always have work. Will I shed a tear when they are no longer around. NOPE.
03-19-2013 05:15 PM
They owe Fender millions of dollars. A rep in the industry that I recently talked to said that he believes it to be in excess of $30 million dollars. No small potatoes for sure. Dumb it down however you like but the big component of that is because the ex CEO of GC became the CEO of Fender. Now they are between a rock and a hard place. Not to mention Fender is $246 million in debt with about $236 million due next year. Do the math not a good place to be. Production is way outpacing demand. One reason why so many stores are switching to used rather than sustain these huge franchises.
03-19-2013 05:22 PM
They are no good for the industry and they don't have customer service or product know how. If all you shop for is the lowest price then your missing why the independents exist. Let me know how many GC's have a full blown service department. Also ask a professional musician where he/she goes to maintain there instrument. I'll bet the answer will be not a GC but one of those no good mom and pop stores with high prices. Do the math what little you pay higher is returned ten fold in customer service. When your gear breaks down go to GC and have them give you a loaner. Don't be surprised when they give you a dirty look.
03-19-2013 05:26 PM
03-19-2013 05:31 PM
They are $1.6 billion in debt. They owe there vendors in the multiple millions of dollars. They don't pay there vendors and owe the banks a truckload of cash. In 2011 they declared a loss of $111 million. 2012 was much the same. They don't even made enough money to pay the interest of the loans let alone the millions they owe there vendors. Do the math-they are in trouble. It was a BAD investment. Go to Ed Roman Guiatsr website or just google search the GC debt. You will be shocked believe me. It ALL true.In April of 2013 they have a payment of $137.6 million due the banks and another $50 million due in October. They are probably in debt with Fender alone for somewhere in the $30 million zone. Unless they have a huge crop of money trees the end is inevitable. Like all big companies they will cut there losses downsize, declare bankruptcy and thankfully go AWAY. Go riddence. They S.U.C.K.
03-20-2013 01:23 AM
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