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Author Topic: GC Severs Relationship With Behringer  (Read 16525 times)

paul bell

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paul bell

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Re: GC Severs Relationship With Behringer
« Reply #1 on: May 20, 2014, 09:01:09 PM »

he responded
« Last Edit: May 20, 2014, 09:31:03 PM by paul bell »
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Bob Leonard

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Re: GC Severs Relationship With Behringer
« Reply #2 on: May 20, 2014, 09:18:36 PM »

Regardless of manufacturer some brands may appear to be a profitable solution to a companies needs. Better than 50% of the time that is not the case. Returns, failed hardware and customer perception all have a profound effect on the bottom line. A manufacturer can spew facts pertaining to overall sales, but once the manufacturer moves the product from wharehouse to reseller it becomes the resellers job to insure customer satisfaction. I applaud GC for their stance, regardless of reason. GC, MF, and a few others will be effected as will be their customers. Hopefully for the best.
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Tim McCulloch

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Re: GC Severs Relationship With Behringer
« Reply #3 on: May 20, 2014, 09:32:26 PM »

Regardless of manufacturer some brands may appear to be a profitable solution to a companies needs. Better than 50% of the time that is not the case. Returns, failed hardware and customer perception all have a profound effect on the bottom line. A manufacturer can spew facts pertaining to overall sales, but once the manufacturer moves the product from wharehouse to reseller it becomes the resellers job to insure customer satisfaction. I applaud GC for their stance, regardless of reason. GC, MF, and a few others will be effected as will be their customers. Hopefully for the best.

Sounds more like a pissing contest to me, Bob.  Music Group put Guitar Center on COD and left GC with some crow to eat with customers.  GC tries to spin this in their favor, MG says "not so fast."

As for the rest, sure, perceptions are reality in marketing but the apparent numbers to say that MG/Berry is shoveling crap out the door simply don't appear, Bob.  Remember, I'm not exactly a fan boy - far from it - but I prefer to make claims that can be substantiated.
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Jim McKeveny

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Re: GC Severs Relationship With Behringer
« Reply #4 on: May 21, 2014, 07:58:38 AM »

I see this as private equity (Bain Capital and Ares) vs. Music Group.

Private equity typically beats up on vendors with tactics of slow payment and endless renegotiation of terms. They do not "partner" with anyone to deliver product. Music Group is efficient, but low-margin, and needs reliable payment for its business model to work. GC isn't worldwide, MG is.

Music Group survives with or without Guitar Center. Guitar Center will eventually go the way of Circuit City and the like...IMO.
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Bob Leonard

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Re: GC Severs Relationship With Behringer
« Reply #5 on: May 21, 2014, 02:19:30 PM »

Sounds more like a pissing contest to me, Bob.  Music Group put Guitar Center on COD and left GC with some crow to eat with customers.  GC tries to spin this in their favor, MG says "not so fast."

As for the rest, sure, perceptions are reality in marketing but the apparent numbers to say that MG/Berry is shoveling crap out the door simply don't appear, Bob.  Remember, I'm not exactly a fan boy - far from it - but I prefer to make claims that can be substantiated.

I don't beleive I said anything about MG shoveling crap out the door Tim, and my post referenced the industry, not just the Behringer brand. Actually not just this industry, but any industry. It's been proven many times over through the years that low cost hardware will often require more support than the higher priced spread. Why, because entry level and consumer products are for the most part used by consumers who have no training or experience with the product.
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John Roberts {JR}

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Re: GC Severs Relationship With Behringer
« Reply #6 on: May 21, 2014, 02:44:30 PM »

  It's been proven many times over through the years that low cost hardware will often require more support than the higher priced spread. Why, because entry level and consumer products are for the most part used by consumers who have no training or experience with the product.
Proven?

In my experience the "value" business model is to make generic products that perhaps contrary to actual reality, the value customers already think they know how to operate. The reason why designing value products is actually harder than designing high end gear, is because you have to engineer in "user tolerant" functionality. The heavy lifting is making a product that still works as the customer expects it to work, despite misuse and abuse by the inexperienced customers.

Classic examples of this approach are clip limiting, short circuit , and thermal over-load protection in power amps. These features came first to the value segment because it is so much more successful to engineer out bad experiences than educate the inexperienced customers to avoid making those common mistakes, or worse make them pay for blown up gear even when the failure was clearly their fault. The customer is always right, and doesn't appreciate being reminded with a repair charge when they are not.   

There is no margin or budget in value products for hand holding. The shift to big box stores and direct sales, from mom and pop dealers just squeezes even more end user support from the distribution channel.

These days it's all about price, and customer support costs money. 

JR
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Dan Mortensen

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Re: GC Severs Relationship With Behringer
« Reply #7 on: May 21, 2014, 07:38:16 PM »


Music Group survives with or without Guitar Center. Guitar Center will eventually go the way of Circuit City and the like...IMO.

MG is telling its dealers today that GC has tried to get product from MG dealers, and that dealers who sell to them are violating the terms of their dealership agreement and will be terminated.

They also say they've sold over 150,000 units of X32, which I assume includes all members of the family and is an amazing number to me.

I'm believing that MG terminated GC and not the other way around.

Correction: rereading the announcement from Uli, it does indeed say that GC severed, not MG, after MG  "evaluat(ed) their credit worthiness. As a result of their credit rating, it was determined they were a high risk and we were forced to put them on business hold."

I don't really know what "business hold" is, but this seems like good news for other Behringer dealers. If GC is perceived to be not credit worthy, your Circuit City analogy seems apt.
« Last Edit: May 21, 2014, 07:49:55 PM by Dan Mortensen »
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Tim McCulloch

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Re: GC Severs Relationship With Behringer
« Reply #8 on: May 21, 2014, 10:12:06 PM »

Correction: rereading the announcement from Uli, it does indeed say that GC severed, not MG, after MG  "evaluat(ed) their credit worthiness. As a result of their credit rating, it was determined they were a high risk and we were forced to put them on business hold."

I don't really know what "business hold" is, but this seems like good news for other Behringer dealers. If GC is perceived to be not credit worthy, your Circuit City analogy seems apt.
\

Business hold means "before we ship any more product you have to pay your back bill and new shipments are COD or pre-paid."  GC strung Music Group for too long.
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Bob Leonard

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Re: GC Severs Relationship With Behringer
« Reply #9 on: May 21, 2014, 10:30:35 PM »

Agreed, and purely a case of paying the bill(s) that represents the majority of the chains guaranteed highest profit margin. Gibson, Fender, JBL, etc. are product lines that GC must protect. This a rough patch for GC, MF, American Musical and all the other outlets represented under the GC banner. But even though GC has hit a rough patch I'm sure they'll recover. I might also suggest that the X32 count may not be quite as high had the GC conglomorate not been a primary source at the time the product was announced. Like any other product the key to volume sales is distribution.
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BOSTON STRONG........
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ProSoundWeb Community

Re: GC Severs Relationship With Behringer
« Reply #9 on: May 21, 2014, 10:30:35 PM »


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