Impact of Internet Guitar Sales on Local Guitar Shops, Everywhere, USA

[jaymarsch]

I used to manage an independent bookstore in the days before Amazon. The independent bookstores that have stayed in business have diversified. They carry cards, gifts, and host events. The brick and mortar guitar shops that I know in my area have also diversified- they have contracts with local schools to buy their band instruments, they have lessons, etc. Some businesses get creative and adjust and others don’t.

I support my local guitar shop as much as I can but if they don’t have what I am looking for, I’ll go elsewhere.

Many factors are at play here and as has been mentioned the online shopping option affects many sectors.

Best,
Jayne

[Manothemtns]

Originally Posted by Mycroft

He closed his store. He had already cut his margins to the bone. So have 2-3 other good B&Ms that use to be in the area when I moved here in 2001 are also gone.

That's what I hate to hear. That's why I wrote the post. Maybe there's still time to raise guitar market consumer awareness. Not everyone loves the post but I'm not driving at individual opinion, only trying to say what needs to be said...because it matters.

[Manothemtns]

Originally Posted by brencat

The internet has been a disruptive force but as others have mentioned, that train has left the station. I'm willing to pay a little bit more for the privilege of buying local, but not 15%+ more for the same item. These days, I'm mostly into the boutiques anyway, and don't have time for road trips with work and family obligations. It's hard enough to find shops that carry a decent selection of high end Martins, even more difficult to try Santa Cruz, Goodall, and Collings without getting on a plane, and as I mentioned I just don't have time for that. The other thing for me, is that I'm super picky about neck profiles and only certain shops around the country often have the things I'm looking for in a custom offering. So buying online from a B&M in another state with an internet presence that offers a return privilege is a great option.

I do agree with another poster about sales tax arbitrage being a major factor in lost sales for local B&Ms. Sales tax should be collected on all online purchases, period.

I'm in the same boat, really. I, too, have specific needs when it comes to neck profiles and I, too, buy regularly online. But I'm fortunate to live in a region that has several great shops with both a substantial B&M and internet presence. I have it good, I guess is what I'm trying to say. I can live my ideal only because I happen to live where I now do. I spent my entire life in rural Colorado so I know how having no shops within driving range can be. I guess I'm trying to make up for all of those internet only purchases I made for years.

[rokdog49]

Originally Posted by Gmountain

It's every business. Anyone who shopped at Walmart help put local stores out of business. Anyone who went to a shopping mall in the 70's and 80's put local stores out of business.

Now it's the internet. Hopefully the internet will put walmart out of business.

Those folks need jobs too.

[AZLiberty]

Originally Posted by brencat

Sales tax should be collected on all online purchases, period.

If I drive to Oregon and buy a guitar, I pay OR sales tax. Why should I pay AZ tax on a guitar bought in OR just because I had it shipped?

The real question is, how can some vendors ship so cheaply. I can buy a guitar case from Elderly and they will give me free shipping, but if I were to ship an empty box back to Lansing it would cost me over $80.

[Guitarbarian]

I didn't read the whole thread. I simply don't care. I do not/will not buy a guitar online. I will support my "Friendly Local Guitar Shop" (FLGS) any day over an online retailer. If my FLGS doesn't happen to be a licensed dealer of a guitar brand that I am interested in, I know that I can find one within a 3-4 hour drive. Yeah, I may be old school but then again, I am getting old, so there's that. Have a nice day.

[Manothemtns]

Originally Posted by Guitarbarian

I didn't read the whole thread. I simply don't care. I do not/will not buy a guitar online. I will support my "Friendly Local Guitar Shop" (FLGS) any day over an online retailer. If my FLGS doesn't happen to be a licensed dealer of a guitar brand that I am interested in, I know that I can find one within a 3-4 hour drive. Yeah, I may be old school but then again, I am getting old, so there's that. Have a nice day.

Nice work...no doubt you'll keep it up!

[Paddy1951]

Originally Posted by Steadfastly

IMHO, the OP's post is akin to "let's all do our little part to save..............." I have never seen a tsunami stopped. The online business world is growing and similar to a tsunami, it won't get stopped. There will always be brick and mortar stores but the Mom and Pop ones are going the way or the dinosaur.

This argument is not unlike what I heard when it was common practice for Walmart to build a store in a small town, and kill local businesses. Because Walmart could dictate prices, they could undersell the hardware store, clothing shops, you name it. Once these stores folded, people who lived in these towns were now at the mercy of whatever Walmart wanted to charge, whatever they wanted to carry, stock wise. And of course, Walmart as an employer.
If you needed something beyond the generic, you were not likely to find it at Walmart. If you needed knowledgible help...

I wouldn't be to quick to just write off mom & pop stores. All of us have at least some power as to how things can go. Where we choose to do business and spend our money can have a positive effect.

[Manothemtns]

Originally Posted by AZLiberty

If I drive to Oregon and buy a guitar, I pay OR sales tax. Why should I pay AZ tax on a guitar bought in OR just because I had it shipped?

The real question is, how can some vendors ship so cheaply. I can buy a guitar case from Elderly and they will give me free shipping, but if I were to ship an empty box back to Lansing it would cost me over $80.

I've wondered the same thing on either their "Free Shipping" which is just shipping charges collectively rolled into guitar sales. I think it the same deal when they offer $30 or even $50 shipping...the collective balance just gets rolled in. Makes it difficult when you're on Reverb and expect to be paid for your true shipping costs...with insurance via UPS is well over $100, continental.

[Gmountain]

Originally Posted by Manothemtns

I've wondered the same thing on either their "Free Shipping" which is just shipping charges collectively rolled into guitar sales. I think it the same deal when they offer $30 or even $50 shipping...the collective balance just gets rolled in. Makes it difficult when you're on Reverb and expect to be paid for your true shipping costs...with insurance via UPS is well over $100, continental.

Companies that do a lot of shipping get different rates than you and I. UPS and FedEx negotiate different rtes for high volume customers, and those rates are much less expensive than you and I pay. In fact, the retail rates subsidize the volume shippers.

[Guitarbarian]

Originally Posted by AZLiberty

If I drive to Oregon and buy a guitar, I pay OR sales tax. Why should I pay AZ tax on a guitar bought in OR just because I had it shipped?

The real question is, how can some vendors ship so cheaply. I can buy a guitar case from Elderly and they will give me free shipping, but if I were to ship an empty box back to Lansing it would cost me over $80.

Oregon doesn't have a sales tax.

[chippygreen]

Reverb, AGF and the Internet helped me get back into acoustic guitar on my time and my terms. I have a fairly hectic work schedule - I leave the house for work at 6.45 am and I am rarely home before 7.30 pm. Weekends are filled with activities for the kids, household chores, errands and family obligations.

I read AGF at night, watch lots of Youtube videos, and correspond by email with dealers, sellers and forum members. The Internet is my lifeline to the world of acoustic guitar.

In the 2 years since I've gotten back into guitar I've:

- purchased (Reverb) and sold (AGF) a wonderful Northwood
- purchased (Internet dealer) and sold (AGF) an excellent Avian
- purchased (AGF) my Carter-Poulsen
- purchased (brick and mortar store in Tokyo) my K. Yairi
- purchased (two different Internet dealers) my Bashkin GC and OM
- purchased from Asia (Internet dealer) my Michaud
- purchased (local Guitar Center) a GS Mini for my younger son
- purchased (local Goodwill) my Yamaha
- traded three guitars that were gathering dust for my Martin M-36 (local shop, but which I located online!)
- located a local luthier who fixed up a '92 Strat with seized electronics from years in storage & dressed the frets on my Carter-Poulsen
- met online, and then in person at Woodstock, Michael Bashkin, and ordered a build from him
- met online, and then in person at Woodstock, Joel Michaud, and ordered a built from him

I like local shops and patronize them when I can. I like the local GC and Sam Ash and have always been respectfully treated there. I like luthier built guitars and that the Internet has made all of them accessible. I like the amazing selection at Dream Guitars, boutique sellers on Reverb, transacting on AGF. I like that Marcus Wong always has time for silly questions about build choices. When I think I might like to try another Martin, I like that Elderly and Maury's are there, but I too fear for my local place and wonder if I need to put in a custom build just to help them keep afloat.

But I cannot imagine how many years it would have taken for me to do this without the Internet and online transactions - not to mention having to bargain for time off and live with the guilt of running to the local store at the expense of a kid's homework or practice.

Nor do I think any store in NYC much less any store in the country, would have offered me the variety, access to luthier-built, foreign production and mainstream brand guitars, and exposure to size, build, style, tone wood, and more as in the modern era of Internet purchasing.

[LiveMusic]

Originally Posted by Manothemtns

I've had a Reverb shop for seven years and closely follow consumer markets for contemporary new, used, and vintage guitar sales. In the third quarter of 2016 the market began to flip from strong, well established retail-type pricing to a huge drop in pricing across all segments, electric, acoustic, new, and used with the exception of vintage guitars. Japanese collectors have cleared the isles on that chunk of Americana. Chicago Music Exchange owns Reverb and attempts to operate the site as a truly separate entity but, what began as a fun member- based buying and selling forum predominantly for individual players, collectors, and a community comprised primarily of musicians has morphed into a place for larger guitar shops and wholesale retailers to advertise their complete inventories free of charge at the expense of the very community that got Reverb off the ground in the first place. Interestingly, while allowing bigger online retailers to list entire inventories for free (Music 1,2,3, Musician's Friend, and Sam Ash) Reverb does not provide advertising space for Guitar Center. I believe this is because Reverb has grown to a point so huge (as has it's parent company, now the largest combined brick and mortar and online guitar "shop" in the world) that they view Guitar Center as its primary competitor. While the area of global economics fascinates me, my little Reverb shop has gone from being a fun and, believe it or not, profitable experience, to something I seldom anymore spend my time on. The reason is because I can't compete with a saturated market. Secondary guitar sales (including thousands of impulse buys from Guitar Center) have literally flooded Reverb to the point of complete market saturation. Subsequently, prices almost across the board have plummeted and Reverb has become a buyer's market...with every Tom, Dick, and Harry advertising their wares combined with providing de facto entry for large retail chains...again, all but Guitar Center who's primary market is in guitars that sit in closets, unplayed, for years until they are (seemingly) unleashed en masse on Reverb, GBase, and eBay. All of this has led to Reverb being antithetical to its own mission statement and charter as written back, I believe, in 2010. To paraphrase loosely "...where individual musicians and guitarists can come together in a forum that charges less than eBay and share a far cooler overall buying and selling experience..."; anyway, something akin to that type of language. Like a runaway train, Reverb couldn't now slow down and reassess itself even if it, as a company, wanted to. These changes have impacted people everywhere, in every facet of the music retail industry, from small brick and mortar operations that have been family run and in business for fifty years to luthiers attempting to launch their own luthieries, to buyers, sellers, and traders alike. There's simply not enough room for everyone to play in the same sandbox anymore. But there is something that can be done about it.

I wonder how many of you on AGF have noticed these pernicious changes and their impact on guitar retail shops located in Everywhere, USA and even abroad. Shops are closing their doors forever because they simply can't compete with online guitar sales. Some of the larger stores have bridged the gap and seem to be doing fine because they've bolstered their "in-house" sales with ample internet sales but, still, the margins are very small affording only companies with a decent amount of staying power to make what is nothing short of a mind boggling shift in their business paradigms. The rest of our country's street corner guitar and Main Street music stores are failing, with more falling victim to change...change that came summarily so fast most were simply unprepared for it...certainly not on its present scale.

I suppose I'm writing this so that the next time you're on Reverb or in a Guitar Center you think twice about the purchase you're about to make. Sure, some of these little stores are of little consequence in the grand scheme of things but, when donning your special "See Reality More Clearly" glasses, go into that little music store and look around. Is there not something in there that you could buy to help out that struggling retailer? Chances are his or her staff's collective knowledge will blow your typical Guitar Center child "salesperson" out of the water and you'll share communion together in talking guitars. However you look at it, knowledge is always a good thing. Why not be willing to pay the extra 5% to 15%, depending, to have a harmonious buying experience while leaving your anonymous self behind to watchover your computer? Our nation's economy relies on better judgement and making "informed" and wise purchases. Who do you want as your neighbor, the "Hey, dude" sales child from Guitar Center or the extremely gifted guitarist who's cobbling together a living as a highly knowledgeable and altogether great guy sales rep for Guitar Shop #12345 by day and gigging at your favorite watering hole by night?

It's time to make a stand a spread business revenue out in a way that helps many and not just the few. It has become a matter of principal.

So, I'd like to hear some of your points of view. I signed-on to AGF because I did my homework and found it to be what I believe is the best, most informed forum out there. I'd love to hear that others feel as strongly about helping out small business owners while starving the corporate giant's at least to a point where regulation need not be the only answer...gosh forbid.

I suggest you break that up into many paragraphs if you want your message heard. It's just too hard to read.

[Denny B]

I've purchased all my guitars both new and used, where I've gotten the best quality, price and customer service at the time...

No one business has a lock on those commodities, whether they're online, Big Box store or local B&M...I've seen the best and worst attitudes in all of them...

But if anyone else would like to give me a blank check for my next guitar, I'll certainly take your opinions under consideration...before I buy it where I want...

[AZLiberty]

Originally Posted by Guitarbarian

Oregon doesn't have a sales tax.

Exactly

For the record, neither does Alaska, Delaware, Montana, or New Hampshire