RED DOG MUSIC IN DIFFICULTIES - hence administration

guitars4you

chris45 said:

@guitars4you - sorry for my ignorance but in the music instrument world, who "owns" the stock in a shop?  Have the shop bought it from e.g. Fender and it's theirs to sell on subject to the pricing agreement with Fender.  Or in some cases do Fender still own it?

No problem with asking Chris but the dealer finances it all - we will get between 7-30 days to pay but a suitable 'settlement discount' is offered to entice you into prompt payment 

I have known the odd 'supplier' loan additional stock at times to assist a promotion, but this is not common ground 

dtr

The high street will lose against the internet in straight-up competition about retail share.  It will win where it provides a service where the internet can't compete.  Music shops are lucky in that there are so many ways they can provide that extra level of service: setups and repairs, tuition, events & workshops, guest performances & Q&A, etc. 

The two nearest music shops to me both already employ techs for their own setups, and staff who are happy to give tuition - I've asked in the shop, got their numbers and arranged things privately because the shops only want to sell stuff (more accurately, they just want people to come in and buy stuff).    

I always buy something whenever I'm through the door (might just be strings, but I've picked up interesting 2nd hand pedals and an impulse purchase bass before), I'm mostly just wanting an excuse to get through the door.

grappagreen

dtr said:

The high street will lose against the internet in straight-up competition about retail share.  It will win where it provides a service where the internet can't compete.  Music shops are lucky in that there are so many ways they can provide that extra level of service: setups and repairs, tuition, events & workshops, guest performances & Q&A, etc. 

The two nearest music shops to me both already employ techs for their own setups, and staff who are happy to give tuition - I've asked in the shop, got their numbers and arranged things privately because the shops only want to sell stuff (more accurately, they just want people to come in and buy stuff).    

I always buy something whenever I'm through the door (might just be strings, but I've picked up interesting 2nd hand pedals and an impulse purchase bass before), I'm mostly just wanting an excuse to get through the door.

I agree with this completely.. differentiation is the only option I feel. Problem is of course that bricks and mortar costs are high as is working capital requirements for stock. A very large customer segment is predominantly price rather than value driven and the cost of pricing data small and widely available. I feel that on top of this some key manufacturers will also attempt to move some of their sales to direct model and cut out opportunities in the VAR channel... there are so many other factors at play as well and we could go on and on..

Perfect storm stuff really.. and I certainly don't have the answers..

Si

crunchman

kt66 said:

Mid range, high volume, low price, high street shops are toast.

In 10 years time High Streets will be homes, places to eat and drink, hairdressers and luxury shops.
I've also heard from a great source that Supermarkets days are numbered too.

Some needs to blow up Amazon

Don't need to blow it up.  Just need a digital transaction tax of 2%, which can be added to VAT.  The small start up craft guy selling stuff made in his shed won't reach the VAT threshold, so won't be affected.

Use some of the money raised from that tax to make a significant reduction in business rates for retail premises based in high street locations.

Seymour1

Red Dog Music website now only showing "In Administration" notice so it doesn't look as though they are trying to sell any of the existing stock

Whitecat

Right on the most inventory-liquidation-happy day of the year too.... shame.

ICBM

Whitecat said:

Right on the most inventory-liquidation-happy day of the year too.... shame.

Probably because it's a bad idea to sell stock off too cheaply, if they're in trouble. Better to avoid the whole stupidity.

shuikit

I'm not a cyclist so have no first hand experience, but cycle shops seem to be springing up that have a little coffee shop type of thing in them which seems to draw in a few people.  Perhaps this is a way that they can build that 'hang out' vibe that you used to get in shops. 

AlexO

Interesting read for me as a owner of a shop/ small business.

One thing I would say is, the idea that its cheap and easier to sell online rather than in-store isn't always correct.

My shop I would say is 80-20 in-store to online. We have a strong website , decent instagram/ social following and have received very kind national press in our sector about what we do. We are in based in quite a desirable area and our social channels definitely bring people into our store but generating online sales can be tough.

You have to remember the online world is the worlds busiest high-street and annoyingly now its controlled by Google and their Adwords police and Shopping sheriff so unless you are prepared to put as much money into their pockets as a months rent your products aren't going to get the exposure they should.

crunchman

AlexO said:

Interesting read for me as a owner of a shop/ small business.

One thing I would say is, the idea that its cheap and easier to sell online rather than in-store isn't always correct.

My shop I would say is 80-20 in-store to online. We have a strong website , decent instagram/ social following and have received very kind national press in our sector about what we do. We are in based in quite a desirable area and our social channels definitely bring people into our store but generating online sales can be tough.

You have to remember the online world is the worlds busiest high-street and annoyingly now its controlled by Google and their Adwords police and Shopping sheriff so unless you are prepared to put as much money into their pockets as a months rent your products aren't going to get the exposure they should.

All the more reason for everyone to start using a search engine like Duck Duck Go

sweepy

My local music shop dropped their guitar/amp/accessories dept a few years ago and went 100% Yamaha Electric Piano and Keyboards as there was no decent margin on Group Gear. Maybe the Distributors need to have a long hard look at their practice and custom if smaller Music Shops are to survive 

jeztone2

Isn’t there an elephant in the room here?

To my mind music retail hasn’t really recovered from the 2008 recession. We’ve had 10 years of public sector pay freezes. Which if you live in the midlands and the north is still the biggest employer. I’m from Derby the home of Rolls Royce, Toyota and Bombardier. The NHS is still the single biggest employer in the town. Why everyone is in denial of this I really don’t know. 

Now with so many retailers going to the wall. I’m amazed the whole retail sector isn’t lobbying the government. I mean how can you have a service economy of people have an ever shrinking disposable income? 

chris45

I wonder if we will get to the point where a guitar “shop” will not actually sell instruments.  Instead a third party will be paid by the manufacturers to display guitars, let people try them etc but the customer will then buy online.  

Paul7926

chris45 said:

I wonder if we will get to the point where a guitar “shop” will not actually sell instruments.  Instead a third party will be paid by the manufacturers to display guitars, let people try them etc but the customer will then buy online.  

might work at the lower end of the spectrum but I can see issues with going to try something then wanting the exact one you played rather than another one straight from a supplier.  would probably kill the impulse buy as well if you want something but are told you have to wait a week or so for delivery of it.

ICBM

jeztone2 said:

Isn’t there an elephant in the room here?

I mean how can you have a service economy of people have an ever shrinking disposable income? 

Don't worry... house prices will go on rising, the City of London will keep on selling each other money, the bankers will still get their bonuses, and everything will be fine.

chris45

Paul7926 said:

chris45 said:

I wonder if we will get to the point where a guitar “shop” will not actually sell instruments.  Instead a third party will be paid by the manufacturers to display guitars, let people try them etc but the customer will then buy online.  

might work at the lower end of the spectrum but I can see issues with going to try something then wanting the exact one you played rather than another one straight from a supplier.  would probably kill the impulse buy as well if you want something but are told you have to wait a week or so for delivery of it.

Agree with all of your points. At some price point guitarists are going to say "I want that one" but then that guitar has to be sold from a traditional store and the cost of that store is factored into the price.

Vinylfan

This is sad to hear, I bought my strat from them in the summer and they were lovely to deal with and bent over backwards to get me what I wanted at a good price.

professorben

I’d honestly say I’m part of the problem. 
I have Amazon Prime, almost everything I buy from cables, strings, t shirts, kids toys, jelly moulds etc. 
Anything non food essentially, is Amazon. 
I pay £79 a year and get free delivery, as much TV as I can watch and all my music. 
I have not visited a high street for months. 

And im cool with that, I know more about gear than any music shop staffer (at least the gear I like) it’s the way the world moves and changes.

case in point, I visited my local Mothercare recently to buy some nappy bin refills, they don’t stock them despite selling the bin itself, ok fine, was informed that they could have them in within a  day,  while I’m waiting for the girl to get a till to take my order, a quick visit on Amazon, ahhh in stock, a quid cheaper delivered in the same time frame ‘to my house’ no brainer really. 

I don’t browse guitar shops and haven’t for years, I see what I want online, I research it, watch the demos, read the reviews, then order it from a shop or get it online, if I don’t like it send it back. 

I dont and never ever have really bought on impulse. 

I think I’m prob quite representative of a lot of people. 

symphonytech

*deleted*

symphonytech

ICBM said:

Whitecat said:

Right on the most inventory-liquidation-happy day of the year too.... shame.

Probably because it's a bad idea to sell stock off too cheaply, if they're in trouble. Better to avoid the whole stupidity.

Or perhaps because most of the stock is quarantined under ROT; the suppliers own it and haven't released the title because bills aren't paid.

As such, the administrators can't sell it (any any price) to satisfy the creditors.

There will probably be a few bones of the carcass to pick over once the suppliers have collected their goods, but if you're expecting to get a US strat for fifty quid then keep walking. Nothing to see here.