Al Limberg wrote on Sat, 28 March 2009 10:56 |
It appears Loud Tech is having some serious production problems. NSL pulled the entire Tapco line from their web site over a month ago for lack of delivery on the product and now all Mackie mixer products have been pulled for the same reason with only in stock (at NSL) items being offered in the close out section. They state that speaker products have continued to be readily available but until the mixer situation is corrected they will no longer offer them.
?;o) Al
edited for spelling
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The loss of one of their Chinese manufacturing partners was reported some time ago. What was unresolved in that earlier report is the status of the tooling. It is not even clear who owned the tooling. If tooling was available and portable the outage should have been manageable. I recall dealing with the higher overhead of supporting domestic and Chinese manufacturing for identical SKUs. While this incident suggests some merit to such an approach (in hindsight) it still doesn't make sense on paper (IMO) in price competitive markets.
The Chinese are relatively new to western style capitalism so they don't have the mature and orderly legal structures to deal with the creative destruction of bankruptcy (like chapter 10,11, bankruptcy judges and courts, etc). I'd bet that Loud has feet on the ground in China trying to negotiate these uncharted waters of trying to recover tooling and restart old lines. Sounds like a growth experience for all.
[rant- We seem to have forgotten old lessons here. By bailing out failing businesses that "were" successful (large), we defeat the economic evolution that allows new and better business models to prosper from the opportunity. Instead of some kick ass vibrant new electric car companies, the startups out there will be marginalized by the larger established players. Intervention, while perhaps to a lesser degree, was appropriate for the banking/credit meltdown, to prevent systemic failure but this doesn't extend across the entire economy. /rant]
For LOUD, they need to adopt the oriental philosophy that there is opportunity in chaos... If they must retool, they will only retool their winners and not repeat their mistakes. The digital console business has always been a difficult nut to crack, as is the low volume, high end for all consoles that has it's own maneuvering involved (riders, et al).
I wish them luck in mitigating their current pain. If you must have an inventory shortage, during a weak economy is probably the least worst time for that to happen. They will surely give back hard won market share, but the lost sales is a smaller missed opportunity.
JR