There has been a ton of buzz surrounding Guitar Center in recent press which to some may not seem like anything new. The current rumor is that Guitar Center is close to going out of business. The following is what we have heard along with our opinions and predictions on the matter.
Even though the big box retail powerhouse is part of an estimated $13 billion dollar industry, like so many other brick and mortar music shops they are plagued with debt and loosing business to tech savvy e-commerce stores that have brought forth new emotions and experiences for those buying musical instruments. Eric Garland, a business strategist and guitar player, writes that under GC’s current deals they will be in the hole close to $950 millon and that they will continue to collapse deeper into debt in the continuing years. Check out the entire article here.
Let’s face it most of us have gone to Guitar Center sometime in our tenure as a guitarist. Some of us have likely had some good experiences but most of us have had even more bad experiences. In recent years locally in Ohio, we have noticed a decline in instrument quality and customer service that is likely due to low cash flow, poor training techniques for employees, and the fact that everyone can grab a $3000 PRS or Taylor off the wall and beat it to a pulp.
After being the sales manager and director of marketing at a local music shop I have grown too fond of the dilemma that consumers face while shopping for gear. In the end Guitar Center is a love hate situation where no-one wants to pay more for their guitar strings and accessories so they go to Guitar Center. That same customer however hates the service and product that comes with the cheap price. Everyone in America wants a deal. That is just the reality of it. The kicker is that everyone also wants to be treated as royalty and receive a product that is perfect. I hate to say it but those two expectations are literally like mixing oil and water. It just does not work.
I began to expect a slow decline in sales at Guitar Center after hearing so many horror stories of bad service and product. I knew that eventually the economy would start to recover and people would stop thinking in terms of end price but total value for the product. Sure enough in the past few years we have seen a huge influx of guitar shops that sell not only great instruments but an experience. Instead of pricing everything at the bare minimum, running manufacturers out of business with demanding wholesale prices and treating customers like a number, these shops have pioneered a buying experience that is nothing short of visiting the Ritz Carlton. Shops such as Chicago Music Exchange, Elderly Instruments, Woodsy’s Music, The Music Zoo, Lark Guitars, Humbucker Music and so many more have added leather couches, chandeliers, and private demo rooms to their stores to provide a better experience for their customers.
The real question is whether Guitar Center will go out of business. Surprisingly, I extremely doubt it. I think that in spite of other guitar shops offering better service and products there will always be some multi-billion dollar investment company that sees potential in the debt laden beast. There will always be someone there to bail them out. That being said I sincerely doubt that the situation will ever get better. I have heard incredible stories of the right CEO coming in and totally reversing a company headed for destruction but I think that the Grand Canyon sized whole Guitar Center has dug is just too deep to get through. They will always probably provide great prices on destroyed gear and terrible service because they will likely never put emphasis on training people and paying them well.
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I even worked at guitar center for a short time, and based off of the training provided to me at the time and past experiences purchasing from various employees… I could easily say that I’ve gotten more help from monthly calls from sweetwater and a general online description of the product than any person willing to be in guitar center for more than 20 minutes.