Bad news for the musical instrument industry

Dave W · April 17, 2020, 10:23:21 PM

These aren't permalinks so read the second and third links now if you're interested.

If Guitar Center/Musicians Friend has suspended payments to vendors, then that may cause much more than just a ripple effect. It could be a tidal wave. GC could easily go under altogether, and think of how many manufacturers rely on them.

Operations At Guitar Center Distribution Center Suspended

Facility shuttered under COVID-19 statute closing "nonessential businesses."

KANSAS CITY HEALTH OFFICIALS have ordered Guitar Center to suspend operations at its 700,000-square-foot distribution center, under a statute that permits only "essential" businesses to operate during the COVID-19 pandemic. The operation, which employs 300, fulfills orders for all of Guitar Center's online platforms, including Musician's Friend, GuitarCenter.com, and Woodwind&Brasswind.com.

Guitar Center management had previously argued that automated systems in the facility made it possible for employees to maintain the 6-foot social distancing recommended by health officials. They also said that the facility maintained a rigorous cleaning regime. Local officials were not persuaded.

Separately, several prominent manufacturers have reported that Guitar Center is suspending payments to vendors to conserve cash for the duration of the shutdown.

Guitar Center Employees Furloughed
Amid Store Closures

Coronavirus Crisis Cripples Industry

gearHed289 · April 17, 2020, 10:44:55 PM

We're screwed at work (custom flight cases). Tours and corporate events are our bread and butter. As soon as those stopped, so did we. And all my customers (MAJOR audio/video/lighting companies, as well as smaller guys around the country) are sitting on warehouses full of gear that came back. Which of course means gear manufacturers are screwed because nobody is buying anything. We're currently sitting on $90,000 worth of past due invoices owed to us, and I don't expect many to be paid any time soon. Everyone but me (16 guys) is furloughed. I'm at about 30% of my normal salary. Better than nothing. My friends who gig for a living are really getting boned as the PPP money has been exhausted. Nobody knows when large gatherings are going to start up again, and when it does, what the landscape is going to be like. I read that Disney is losing 13 million a DAY worldwide. Interesting times...

amptech · April 18, 2020, 12:36:10 AM

These are interesting times, you got that right. I'm glad I live in a country with good health service (Norway) but everything is shut down here too. I'm able to work a bit (tube distribution and amp repair) but the music instrument store where I rent workspace is shut down, so business is very slow. Makes you think though, how much we actually depend on each other. You'd think we could at least buy fish locally, but because of labour costs we send all fish to China for packing

On the positive side, everybody looks like mad scientists these days because all hairdressers are shut down

Grog · April 18, 2020, 08:38:31 AM

This is going to cripple the industry if they can no longer sell on line. I bought the "Stupid Deal of the Day" from MF last weekend. It's coming today but they didn't ship it until Thursday. They still have a notice that due to Covid-19, shipping will be slower. I wonder how much longer they can keep selling with the main facility closed.....

ajkula66 · April 18, 2020, 11:23:06 AM

I bought some smaller stuff from MF more than a week ago and it hasn't been shipped yet. My best guess is that I'm not seeing it anytime soon, which prompts the question whether I should just cancel the order and re-order from Sweetwater...I did have a coupon from MF which is what pi$$es me off even more...

Decisions, decisions..

Pilgrim · April 18, 2020, 12:49:21 PM

I've gotta think that preserving their online business is their primary hope of survival. If they can't do that, they're either stupid or in desperate trouble (I know, someone will suggest both, but I think that's not the case.)

Psycho Bass Guy · April 18, 2020, 09:08:56 PM

GC killed Mackie, Crown, SWR, and several others by holding out on credit payments in years past as a business tactic. What goes around comes around.

Dave W · April 18, 2020, 10:18:45 PM

Quote from: gearHed289 on April 17, 2020, 10:44:55 PM
We're screwed at work (custom flight cases). Tours and corporate events are our bread and butter. As soon as those stopped, so did we. And all my customers (MAJOR audio/video/lighting companies, as well as smaller guys around the country) are sitting on warehouses full of gear that came back. Which of course means gear manufacturers are screwed because nobody is buying anything. We're currently sitting on $90,000 worth of past due invoices owed to us, and I don't expect many to be paid any time soon. Everyone but me (16 guys) is furloughed. I'm at about 30% of my normal salary. Better than nothing. My friends who gig for a living are really getting boned as the PPP money has been exhausted. Nobody knows when large gatherings are going to start up again, and when it does, what the landscape is going to be like. I read that Disney is losing 13 million a DAY worldwide. Interesting times...

Wow, that's too bad, Tom. Even if everything opened back up tomorrow, the damage will be long lasting, and in many cases it will be permanent. A lot of jobs won't be coming back, and we'll see some big names go under in all industries.

My younger son is in a similar situation. He manages a small casino which is shut down. He's getting a percentage of his regular salary but all the hourly employees are furloughed.

Quote from: Grog on April 18, 2020, 08:38:31 AM
This is going to cripple the industry if they can no longer sell on line. I bought the "Stupid Deal of the Day" from MF last weekend. It's coming today but they didn't ship it until Thursday. They still have a notice that due to Covid-19, shipping will be slower. I wonder how much longer they can keep selling with the main facility closed.....

Quote from: ajkula66 on April 18, 2020, 11:23:06 AM
I bought some smaller stuff from MF more than a week ago and it hasn't been shipped yet. My best guess is that I'm not seeing it anytime soon, which prompts the question whether I should just cancel the order and re-order from Sweetwater...I did have a coupon from MF which is what pi$$es me off even more...

Decisions, decisions..

If they can ship from one of the GC retail stores that are still open then you should get your orders. If I were in your position, though, I'd cancel anything that isn't already in transit.

Quote from: Pilgrim on April 18, 2020, 12:49:21 PM
I've gotta think that preserving their online business is their primary hope of survival. If they can't do that, they're either stupid or in desperate trouble (I know, someone will suggest both, but I think that's not the case.)

with GC's debt load, they have to have both in order to survive. I'm more concerned about what it will do to their vendors who likely wouldn't get paid.

Quote from: Psycho Bass Guy on April 18, 2020, 09:08:56 PM
GC killed Mackie, Crown, SWR, and several others by holding out on credit payments in years past as a business tactic. What goes around comes around.

It sure does, doesn't it? That was also one of Henry J's tactics at Gibson. Look what happened to his investment.

Grog · April 19, 2020, 08:35:13 AM

My purchase did show up late yesterday. I was beginning to wonder if they paid UPS. It might be a good time to suppress my GAS, at least as far as GC/MF are concerned.

Dave W · April 19, 2020, 09:19:26 PM

Quote from: Grog on April 19, 2020, 08:35:13 AM
My purchase did show up late yesterday. I was beginning to wonder if they paid UPS. It might be a good time to suppress my GAS, at least as far as GC/MF are concerned.

I see that MF is still taking orders with a warning that there will be extended shipping times.

ajkula66 · April 19, 2020, 09:25:03 PM

Quote from: Dave W on April 19, 2020, 09:19:26 PM
I see that MF is still taking orders with a warning that there will be extended shipping times.

I'll be calling them tomorrow to see what's going on with my order...

westen44 · May 14, 2020, 02:53:54 PM

Does anyone know yet if it's safe to order from MF? I can endure extended shipping times. But if the uncertainty goes beyond that, I would be hesitant.

Rob · May 14, 2020, 06:27:58 PM

Quote from: westen44 on May 14, 2020, 02:53:54 PM
Does anyone know yet if it's safe to order from MF? I can endure extended shipping times. But if the uncertainty goes beyond that, I would be hesitant.

My grandson ordered a guitar from GC and after a small hassle and call to their customer service recieved it within a week.

ajkula66 · May 14, 2020, 08:36:57 PM

Quote from: westen44 on May 14, 2020, 02:53:54 PM
Does anyone know yet if it's safe to order from MF? I can endure extended shipping times. But if the uncertainty goes beyond that, I would be hesitant.

My aforementioned order from MF took more than two weeks altogether. OTOH, ZZ Sounds delivered the stuff within 48 hours.

If the item was available elsewhere, I'd likely pass on MF.

If not, and I *really* needed it...I'd bite the bullet.

My $0.02 only...

westen44 · May 14, 2020, 09:59:32 PM

Thanks for the info everybody. I've got three basses I'm trying to decide on. Or now two. Because the first choice is already gone. Recently, I gave away one of my really good basses to a relative. I wasn't exactly planning on it, but it was the right thing to do.
I'm just trying to replenish my supply. It was harder than I expected to find what I really wanted. Also, as much as I like, for instance, AMS and Sweetwater, sometimes MF is the only place that has what I want.