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Author Topic:  Another one bites the dust
Jack Hanson


From:
San Luis Valley, USA
Post Posted 1 May 2018 7:29 am     Reply with quote

Gibson Brands, Inc. filed for bankruptcy protection this morning in Nashville. Guess all it takes is a Harvard MBA to run a great brand name into the ground.

C'est la vie.
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Jack Stoner


From:
Inverness, Fl
Post Posted 1 May 2018 7:48 am     Reply with quote

We saw that coming last fall. They axed the music electronics GURU Craig Anderton and then abruptly shut down Cakewalk Sonar (recording program). There were other signs such as selling off buildings, closing production facilities, etc.

Someone will step in and at least buy the Gibson brand apart from the other brands they still have.

Cakewalk Sonar was purchased by BandLab about 2 months ago. They also hired two of the senior Sonar staff to continue with Sonar. It is now rebranded as "Cakewalk by Bandlab".
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Mark Eaton


From:
Sonoma County in The Great State Of Northern California
Post Posted 1 May 2018 8:12 am     Reply with quote

They won't be biting the dust, it's Chapter 11 bankruptcy reorganization.

It will be a different company after the process is completed but it's very unlikely that it is going away.
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Chris Templeton


From:
The Green Mountain State
Post Posted 1 May 2018 8:13 am     Reply with quote

Here's an article about Gibson and It's foray into "musical lifestyle": https://www.bloomberg.com/news/articles/2018-05-01/gibson-files-for-bankruptcy-with-deal-to-renew-guitar-business
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Brooks Montgomery


From:
Idaho, USA
Post Posted 1 May 2018 10:25 am     Reply with quote

Another company that was led astray by focusing on lifestyle and blue sky make-believe equity instead of the hard goods that the logo goes on.
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Last edited by Brooks Montgomery on 1 May 2018 11:32 pm; edited 1 time in total
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Tucker Jackson


From:
Portland, Oregon, USA
Post Posted 1 May 2018 10:37 am     Reply with quote

And while attributing the cause there's the elephant in the room: young people don't buy guitars at the rate they once did... because popular music has changed. All the guitar manufacturers are concerned. I expect this will not turn out to be a Gibson-only issue.

"In the past decade, electric guitar sales have plummeted, from about 1.5 million sold annually to just over 1 million. The two biggest companies, Gibson and Fender, are in debt, and a third, PRS Guitars, had to cut staff and expand production of cheaper guitars. In April, Moody’s downgraded Guitar Center, the largest chain retailer, as it faces $1.6 billion in debt. And at Sweetwater.com, the online retailer, a brand-new, interest-free Fender can be had for as little as $8 a month."
https://www.washingtonpost.com/graphics/2017/lifestyle/the-slow-secret-death-of-the-electric-guitar/
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Donny Hinson


From:
Glen Burnie, Md. U.S.A.
Post Posted 2 May 2018 5:32 am     Reply with quote

Sign of the times, I guess. Who needs a guitar when you've got a smart-phone?

Laughing
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Barry Blackwood


Post Posted 2 May 2018 6:33 am     Reply with quote

Quote:
Sign of the times, I guess. Who needs a guitar when you've got a smart-phone?

...and Guitar Hero.

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Dave Mudgett


From:
Central Pennsylvania
Post Posted 2 May 2018 8:48 am     Reply with quote

The current Gibson management took them over in the mid-80s and brought them back from the precipice for the next 15-20 years. I think it was a 2nd golden age for them. In my opinion, they lost their way after that. The usual conglomerate story - they lost appreciation for what made them good, which was primarily their workers and dealers, as well as designs that have stood the test of time when properly executed. They especially started jettisoning dealers in the mid-2000s, to the point where it's now hard to find new Gibsons sold anywhere but big-box/online stores. They made dubious "investments" in all these "lifestyle" products, and generally lost their core vision, IMO.

This is just the same nonsense that happened with American businesses in the 70s and early 80s. People with vision that know how to make things start a business, then beancounters and marketeers appropriate the vision and start doing, IMO, stupid stuff. Crash, burn, and then someone else takes over if there's something at the core worth saving. I think Gibson has that something. Hopefully, someone with an intact, clear vision for a core business will take over.

As far as guitars being dead - again, the suits wring their hands whining about a drop in annual guitar sales from 1.5 million to 1.0 million and how everything is going to hell. The problem is that there are and have been too many guitars and related stuff like amps and effects being built in a bubble of lofty predictions. This is not new. When synths started their initial attack in the early 80s, similar predictions were made. We'll see. There's been an overall consolidation going on for the last 10 years, since the grand-recession started in 2008. But I think smart operators should have no problem finding a robust market if they scale to the right price/volume point and do things right. I know lots of dealers out there who would love to have new Gibsons if they made sense.

Look at Rickenbacker as an example. They have scaled their business increases modestly to handle an overall long-term increase in demand, but never bought into the grandiose ideas that some others did. They have somewhat more demand than they can supply, a relatively small but loyal dealer network (just try to get a Rick dealership, it's just about impossible), and a loyal customer base who will pay for a good guitar. Their current guitars are about the same as they ever were - excellent - and they maintain their value. They never lost their vision.

IMO, this is all Basic Business 101.
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Donny Hinson


From:
Glen Burnie, Md. U.S.A.
Post Posted 2 May 2018 1:41 pm     Reply with quote

Personally, I don't see it as a serious situation. Companies, big and small, sometimes come and go. (Even ones that I've worked for!) There's no more Packard, no more Studebaker, and no more Hudson, just to name a few. But good cars (and guitars) are still available, and at a price for every pocketbook.
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Jim Sliff


From:
Lawndale California, USA
Post Posted 2 May 2018 1:44 pm     Reply with quote

What Dave said .

Gibson has been in and out of all sorts of financial and distribution trouble for at least the last 20 years. They have made some superb products during that time, but that has absolutely nothing to do with a company's financial position. The industry has seen hundreds of companies make superb products yet be run into nothingness.

Reports that they will be "out of bankruptcy by September" are nothing but guesses/rumors at this point. There are also stories circulating that several major Chinese instrument concerns are heavily pursuing them.
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Barry Blackwood


Post Posted 5 May 2018 8:08 am     Reply with quote

https://www.theguardian.com/music/2018/may/04/gibson-guitar-bankruptcy-ed-sheeran-martin
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David Cubbedge


From:
Toledo,Ohio, USA
Post Posted 7 May 2018 8:21 am     Reply with quote

I used to have a boss who told me that MBA was a four letter word.....
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Ben Elder


From:
La Crescenta, California, USA
Post Posted 10 May 2018 10:02 pm     Reply with quote

A friend of mine is a store owner and warranty repair guy for Gibson (and other brands). A recent experience:

"Gibson sent me a $20 check for a warranty repair and after I deposited it they declared bankruptcy and stopped payment on my check! I'm sure that $20 is going to go a long way to paying back their half billion dollar debt."
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Dustin Rhodes


From:
Owasso OK
Post Posted 11 May 2018 11:20 am     Reply with quote

Donny Hinson wrote:
Sign of the times, I guess. Who needs a guitar when you've got a smart-phone?

Laughing


Go to youtube. There are probably more incredible young guitarist out there than at any point in history. Whether they're playing what you like or not is irrelevant. Bemoaning smartphones and video games is just shouting at clouds at this point.
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Dustin Rhodes


From:
Owasso OK
Post Posted 11 May 2018 11:24 am     Reply with quote

Brooks Montgomery wrote:
Another company that was led astray by focusing on lifestyle and blue sky make-believe equity instead of the hard goods that the logo goes on.


Yep. Henry said himself he wanted to be Nike. If you read all the reports, they say that Gibson is a viable company thats buried under debt.
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Donny Hinson


From:
Glen Burnie, Md. U.S.A.
Post Posted 17 May 2018 4:37 am     Reply with quote

Dustin Rhodes wrote:
(Donny)
Go to youtube. There are probably more incredible young guitarist out there than at any point in history. Whether they're playing what you like or not is irrelevant. Bemoaning smartphones and video games is just shouting at clouds at this point.


Easy now Dustin, it's called "satire". Anyhow, I do appreciate you taking me seriously. (A lotta people here don't.) Winking
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