Composite Acoustics is officially closed - Page 12

Doubleneck · #**166** 03-05-2010, 11:03 AM

I am sure a lot of money. And more each day as their talented people go off to get other jobs and take their experience with them. To me either a big player wants to take it over or you scale down and have a small shop making custom carbon guitars. But what do I know.
Steve

jwsamuel · #**167** 03-05-2010, 11:09 AM

Quote:

Originally Posted by guitargabor

Just took a brief perusal of the "net".There are no Cargos to be found!

Glad I bought one fromTed last year....

Ted still has them listed on his site.

Cargos at LA Guitar Sales

Jim

dgrolem · #**168** 03-05-2010, 11:13 AM

I love my OX.

As a previous owner of a small to mid size manufacturer, it is nearly impossible to resurrect a company from the dead. There was a lot of talk previously about buying the tooling etc. This is actually not the major cost.

Raw material has to be bought in bulk in order to get a decent price, but the major expense will be cash. Employees have to be paid while inventory is built, shipped and paid for by the dealers (which can be 30-90 days). They will not order new stock until some portion (say 15-20%) goes out their door without a return.

The cost in re-vitalizing CA is in salaries and operating cash. Investors do not like to invest in these things because they are COMPLETELY unrecoverable. Tooling and buildings owned can at least serve to recoup some lost $$. And if you were a previous employee, would you want to risk it with them again?

The real show stopper in resurrecting CA would be the ill will caused with the dealers and fear of it happening again by its customers (us). Martin or Taylor could close shop and resurrect because of their existing market momentum. CA cannot.

It would be a foolish move to try and resurrect CA from an investment point of view. I am sure that they tried everything possible before its demise.

chistrummer · #**169** 03-05-2010, 11:16 AM

Quote:

Originally Posted by Doubleneck

I am sure a lot of money. And more each day as their talented people go off to get other jobs and take their experience with them. To me either a big player wants to take it over or you scale down and have a small shop making custom carbon guitars. But what do I know.
Steve

Hmm, small shop run by Ellis with guitars being built one at a time. Gee, how much would a GX built like that cost??

Hey Jim, one those Cargos is already sold..

chistrummer · #**170** 03-05-2010, 11:22 AM

Quote:

Originally Posted by dgrolem

The real show stopper in resurrecting CA would be the ill will caused with the dealers and fear of it happening again by its customers (us). Martin or Taylor could close shop and resurrect because of their existing market momentum. CA cannot.

I called every CA dealer yesterday looking for deals and I got no impression that there is any ill will. In fact every one of them said they were hoping for a comeback so they could keep selling them again. I see no difference in Taylor or Martin coming back by the way. Although a much smaller following right now, CA fans are just as loyal.

Oh, as for deals, nada! It's MAP for now..

gitnoob · #**171** 03-05-2010, 11:34 AM

Quote:

Originally Posted by dgrolem

The real show stopper in resurrecting CA would be the ill will caused with the dealers and fear of it happening again by its customers (us).

I have nothing against dealers, but they never had the distribution of other brands, and a lot of people bought their CA's sight-unseen based on word of mouth (and youtube).

It's time for somebody to try a Dell-like direct marketing model and keep the margins they gave to the dealers. Seems to me that CA would be the best brand to have a go at that model.

mynameis · #**172** 03-05-2010, 11:43 AM

Quote:

Originally Posted by dgrolem

It would be a foolish move to try and resurrect CA from an investment point of view. I am sure that they tried everything possible before its demise.

Fewer things are possible these days then they have been in the past. With high unemployment and underemployment and decreased business lending, there's not the money available to make the leaps that are sometimes necessary to save a failing business.

If I won the lottery I'd buy up the tooling and spend my time learning everything there is about how they made the guitars and what went wrong. Only after that I would start out with a very boutique product line - perhaps limited to made to order sales. The attempt to go mass market again would only be after the economy rebounds to the point where enough people are willing to spend $2-$3k on a unique acoustic guitar.

mynameis · #**173** 03-05-2010, 11:45 AM

Quote:

Originally Posted by gitnoob

It's time for somebody to try a Dell-like direct marketing model and keep the margins they gave to the dealers. Seems to me that CA would be the best brand to have a go at that model.

They tried that with the electric blade guitar and then abandoned it. One of the reasons I never made the leap is because the only shops that carried CA were several hours away - and that's not because there aren't any good guitar stores around me. The less able I am to try something out or even see it first hand, the less likely I am to spend $2k+ on it.

dgrolem · #**174** 03-05-2010, 11:50 AM

Quote:

Originally Posted by mynameis

Fewer things are possible these days then they have been in the past. With high unemployment and underemployment and decreased business lending, there's not the money available to make the leaps that are sometimes necessary to save a failing business.

+1 There has been a lot of shock and dismay at CA. "Why don't they just..."

But I am sure that any and every alternative anyone could think of was tried: mortgaging homes, cashing out retirement, managers working for free, bank lending, angel investors, etc. None of them were good enough.

whamonkey · #**175** 03-05-2010, 11:56 AM

Bummer for those who don't have one.....I'll never sell mine. Love it.

jwsamuel · #**176** 03-05-2010, 12:51 PM

Quote:

Originally Posted by gitnoob

It's time for somebody to try a Dell-like direct marketing model and keep the margins they gave to the dealers. Seems to me that CA would be the best brand to have a go at that model.

Carvin has been doing that for 60 years.

Carvin

Jim

J.R. Rogers · #**177** 03-05-2010, 12:56 PM

The door....
Has been left wide open.

JR

gitnoob · #**178** 03-05-2010, 03:01 PM

Quote:

Originally Posted by J.R. Rogers

The door....
Has been left wide open.

AGF Guitars, Inc?

Larry Pattis · #**179** 03-05-2010, 03:29 PM

The idea of a guitar company "owned" by a large group of people (especially AGF Posters, myself included!) is somewhat humorous...even if there were a CEO/President, etc., and a structure that would allow actual decision making to occur. The old saw about "herding cats" comes to mind...

I wonder if any one here could actually place a value on CA as a whole (if sold that way), and/or a value simply on the molds. To buy and run the company, of course, you would have to have quite a lot of direct information and supervision (even if existing employees could be brought back) to actually learn the build-process, if you wanted to be able to build the darn guitars.

What is this worth as a "deal" to both the investor(s) and current owners? A million bucks? Five-hundred thousand? Two million?

One would have to see all kinds of privileged information regarding sales, *all* costs, labor materials, insurance, overhead, dealer-network info, advertising, etc., etc....it would be quite a picture that would have to be put together, to get even a hint at the value of the company and/or of the brand name, assets, etc.

In another thread J.R. referred folks to the Blackbird website. Their travel-guitar retails (and sells direct) for $1600. The CA Cargo (a much better guitar, IMO) has variations as low as HALF that price...what does this mean?

One thing is that it could be that CA was simply selling at too low of a price...and then the question is, could they have bumped their prices by as much as 50%-75% (or more) and still have customers. Rick Turner has provided some fairly acerbic comments on the AG Magazine forum in regards to the business side of this, as well as his views of the customer side. There have also been great points made about how most of these carbon fiber guitars are being marketed.

In every other field, such as bicycle frames, auto accessories, etc., carbon fiber is considered the best of the best, and is always more expensive than similar products made from more traditional materials. In the guitar world, we have that sort of upside down...or at least the opposite...carbon fiber guitars are not the créme de la créme of the guitar world...and perhaps for appropriate reasons.

Is this correctable, from a marketing/sales perspective, or will carbon fiber always be considered simply "inferior" to solid-wood product guitars?

I would expect that there may be some interest (as has been suggested here) by other guitar-industry folks, but I think it would take an awfully deep wallet to bring CA back to life, and to have improved quality, improved availability, and to then be able to market and sell the guitars at a possibly *much* higher price.

I have a Cargo on the way, as a personal trial (earlier models had the wrong neck-angle for me...I have this one coming from a trusted source, the Podium), since I have no great hopes that the company will be resurrected, and I know the joys of the super-short-scale world. If the guitar doesn't work for me, I'm sure that it's re-sale-able, for the time being.

It will indeed be interesting to see what value is placed on the existing CA product out there in the "pre-owned" market...and also to see if anyone has the cajones (and wallet) to step up to the plate in an attempt to revive the company.

tbeltrans · #**180** 03-05-2010, 04:04 PM

Interesting comments, Larry. You got me interested in short scale guitars via comments you made in the RMMGA newsgroup some years ago, and it wasn't until the Cargo that I actually checked into this concept.

Personally, for me there would be a HUGE difference between actually owning a part of a company such as CA Guitars and owning stock in the company. I would prefer to own stock and let somebody else handle the business end of things. I think Larry's comment about "herding cats" seems appropriate. I would like to see CA Guitars either resurrected in it recent past form or acquired by a company that would let them continue to innovate. I have often wondered (when I got both my Cargos at $799 each) whether the company was making any money on these sales. After watching the YouTube videos on how these guitars are made, it sure seemd to be labor-intensive to me. Somebody in another forum/thread mentioned the high cost of the raw carbon fiber materials, so apparently, these things are not inexpensive to make. Would a guitar such as the Cargo sell if it cost enough for a company to make a decent margin from it? A "decent margin" would have to include enough to cover ALL the expenses involved in making the instrument and bringing it to market, which involves advertising, delivery, etc.

Interesting stuff that makes my head hurt after a while.

Tony