Is your local high-end store still able to survive in this economy?

[AMP]

The problem seems to be that IMO, the typical brick and mortar high-end store cannot compete in the main area that most consumers are shopping...namely- PRICE.

This is so very true and a reason why so many specialty retailers and service businesses are having a hard time. We're conditioned to shop for the best possible deal and often forget that the service associated with the sale must be taken into the pricing evaluation.

B&M retail stores need to learn how to compete on the basis of VALUE... which means offering an exemplary level of service along with some other key differentiators. People will spend more dollars on something if they feel that they are getting a better value for that money.

The problem is that most high-end audio retailers just don't understand customer service and the importance of building customer loyalty. On the flip side most consumers don't understand or appreciate the value of their local specialty retailers.

Raise your hand if you ever auditioned a piece of gear at a dealer and then bought it online solely because you could save some money. If you raised your hand and are now lamenting the disappearance of high-end audio stores, then you can partially blame yourself.

 

[vinylphilemag]

Raise your hand if you ever auditioned a piece of gear at a dealer and then bought it online solely because you could save some money. If you raised your hand and are now lamenting the disappearance of high-end audio stores, then you can partially blame yourself.

+1 Well said!

 

[flez007]

I'd be interested to learn how others are coping with the disappearance of B&M stores in their area.

Have you bought any gear since the last store closed? New / used? Did you buy from

a B&M store outside your local area?
On-line?
If on-line did you have a money back trial period?

Did the lack of local B&M stores affect what brands you considered in your purchase(s)?

Bill

In my case:

Turntable - local distributor - 2 years ago
Arm and cart - used market - Internet - 1 year ago
CD player - local reseller - used - 3 mths ago
BR player - used - friend´s system - 6 mths ago
Speakers - local reseller - used - 6 mnths ago
Phono preamp - local reseller - used - 2 years ago
Integrated amp - used market - Internet - 8 mnts ago
RtR deck - used - friend´s system - 2 mnths ago

Used market options are not that large down here, try-at-home alternatives are a must in my case.

 

[RUR]

Raise your hand if you ever auditioned a piece of gear at a dealer and then bought it online solely because you could save some money. If you raised your hand and are now lamenting the disappearance of high-end audio stores, then you can partially blame yourself.

All too true, which is why I don't do this. If a dealer is kind enough to permit me to audition his gear in my home, I will support his business (and, by extension, business model) by buying that gear from him.

 

[ack]

All too true, which is why I don't do this. If a dealer is kind enough to permit me to audition his gear in my home, I will support his business (and, by extension, business model) by buying that gear from him.

Yeap. I have made this clear to my dealer too - if I use his resources the business is his. A case where, for example, I bought online is my turntable - he didn't have it in the store for demo (or the cartridge), I spent no hours auditioning anything in his store, and I knew exactly what I wanted. They seem to have had a tough couple of years, but still doing OK with all the high priced gear they sell.

 

[garylkoh]

Raise your hand if you ever auditioned a piece of gear at a dealer and then bought it online solely because you could save some money. If you raised your hand and are now lamenting the disappearance of high-end audio stores, then you can partially blame yourself.

Or if you have auditioned a piece of gear at t dealer, and then called every other dealer for the brand to seek out a lower price. The problem in the US is that unlike other countries, the sales tax is not included in the MSRP. In Europe, or Asia, the MSRP includes VAT. Here, someone going local to audition a piece of gear then goes out of state to buy robs the local economy (not only the hifi dealer).

 

[DaveyF]

Gary, I do agree that the local store is at a disadvantage in the US as they have to charge sales tax.vs the online out of state Co., which doesn't. OTOH, the impulse purchase is a more likely event with the typical brick and mortar store...problem is I suspect that the days of the walk-in a'phile willing and able to spend big coin on a whim is over.
Personally, I am with RUR as to his dealings with his local dealer. I have the same policy.

 

[Nyal Mellor]

And also to compound the problem for many high end dealers is that some manufacturers are VERY BAD at controlling their distribution, with the result that a customer can find products from an out of state dealer at significantly less than in their local store.

Personally I hope for a contraction in the number of high end audio shops and an increase in quality (better CS, more knowledgeable sales people, more unique lines, better in home setup, better after sales support, more community outreach / events). I think the market is way too small for the number of shops especially in places like the Bay Area. It seems like the market has contracted but the number of retailers has not yet decreased to match that new market size. Hopefully things will even out in a few years and the older, non-innovative, out of date retailers have to shut up shop leaving some space for the new wave.

On the home dealer model mentioned by someone, I totally think that it will go that way in some areas of the country.

 

[arthurs]

Isn't part of the challenge that the consumer in this case really falls into 2 camps? Camp 1 - I don't have much experience or know-how and need a full suite of support from the local dealer, which to some degree justifies the dealer markup applied to equipment. Camp 2 - I have a good degree of experience and not only don't need (or trust) a dealer to install and tune my equipment, but find that to be part of my enjoyment of the hobby/purchase, this makes it more difficult to justify dealer markup and so I search for a dealer willing to compromise points on margin and act mainly as an order source, shipper and point of contact (maybe) if I have warranty issues down the road. This is also made more challenging with the second camp as they will likely be more industry savvy and have some knowledge of the markup system in play from manufacturer through distributor through dealer and will be assessing value gained from those same markups. Not saying they are justified, just trying to understand the dynamics.

The equation has always been Value = Benefits / Cost and if you are seeing a decline in an industry it is usually an indication a component of this is out of balance. These imbalances become more significant in a down economy with people scrutinizing their spending and declines can steepen as a result...

 

[FrantzM]

Hi
I am not even sure that the brick and mortar High End dealer will survive in a better economy ... In the USA at least ... There is a fundamental problem that doesn't seem to be addressed: The market is not expanding .. The customers are virtually the same and their growth rate is very, very small. There is another thread on this very subject I believe it is "how to make Audio cool again " or something similar ... We or our fellow audiophiles are the market and it is contracting not expanding .. (in the USA at least) ... True once in a while a new millionaire will acquire an entire set and pay MSRP for it but how often does that happen to sustain a business? Problem is, running a High End Audio store is more expensive and complicated than many would think (especially with the current price of Audio gears) the rate of closing a sale is very small ... An Audition is not an inexpensive proposition, for example: Think about the AC and HVAC that goes into simply demonstrating a Class A high Power amplifier or the Logistics of correctly treating a room for demo-ing speakers .. Plus the countless auditions that are for "informational purposes" .. I know because I have conducted a few myself ...Actually the more knowledgeable the customer the smaller the probability of closing the sale... Brand Loyalty is not commonplace in High End Audio , yes, there are a few exceptions, Mac Intosh and maybe Wilson come to mind but brand fads and fashions dominate the High End ... The dealer cannot possibly stock all the "in vogue" brands ... So if the brands it carries are not among those in fashion , then he/she would lose sale... The notion of impulse buying exist in high end at the component level, rarely at the system level, where the dealer make the most profit .. So the dealers are facing an uphill battle and we will see them less and less .. What will remain of the High End then? I don't have much answer .. I believe the situation is dire

 

[DaveyF]

"The dealer cannot possibly stock all the "in vogue" brands ... So if the brands it carries are not among those in fashion , then he/she would lose sale... The notion of impulse buying exist in high end at the component level, rarely at the system level, where the dealer make the most profit"

Frantz, I somewhat disagree with that statement.. I think that is where a dealer's ability to Sell the brands that he/she carries comes into play. If the local dealer has the opportunity and can demonstrate a particular brand, then in that sense he/she has an advantage over the online Seller. However, I do agree with your other points.

 

[JackD201]

Who was it that said that the only thing one can control in business is his own costs? Well whoever he or she was, it's true. Brick and mortar is at a huge disadvantage in this regard. Not only is it disadvantaged in terms of volume, it's even at a disadvantage in terms of freight. Add to that the cost of rent.

Like Steve, I fit the from the home model except there is a small difference. We're primarily distributors and not retail dealers. We place our products on consignment or outright purchase in high end retail salons in 4 cities. When it comes to the big ticket items however, where we audiophiles take the cake in terms of picky-ness, you are best served providing an environment your products will show their potential.

Well, the truth is my partners and I got into this as a cover for our wives. I mean, I've got a lot of very nice comments on my room, which I appreciate deeply, but really I would never have gotten a green light from she who must be obeyed if this wasn't a business that sustained itself even if it isn't what puts food on our plates and sends the kids to good schools.

Even from the home, freed from a lot of overhead, stocking up ties up a lot of cash. If being a distributor/dealer was easy everybody would be doing it. People look at the dealer markups on retail and cringe but go to one and haggle a bit on something in stock and I'll be darned if you can't beat the online price even before shipping costs are added. Time it in between model changes and you get an even better deal if "latest and greatest" isn't a driving factor.

Like Steve said, the beauty of it all, what makes it worthwhile, is the opportunity to build relationships with both suppliers and clients. I can't begin to list all the good software I've been exposed to by clients who bring their own material for equipment auditions. That is priceless IMO.

The worst thing a distributor can do is sell a product he himself does not believe in just for profit's sake. The client will see right through you anyway so don't even try to pretend. If you don't believe in the product, you'll also end up with huge paper weights. Our modus operandi is to bring in only products we will be willing to keep if they don't sell. So far so good.

 

[RogerD]

I live in the high desert and I've seen them all come n' go. There's been the Tin Ear,Q Audio,Serenade Audio,Wild West Sound and a store on Wells Ave,back in the early 70's and the owners name was Claus,a real nice guy. All these stores had good product and service,but the recessions just did them in. Most people in Reno by equipment elsewhere. It's not the desert for nothing. There has been some Audio manufactures in Reno also,most notably Quicksilver and Agtron Electronics. Quicksilver moved and Agtron changed there focus to coffee roasting technology.

 

[Ron Party]

Well, the truth is my partners and I got into this as a cover for our wives. I mean, I've got a lot of very nice comments on my room, which I appreciate deeply, but really I would never have gotten a green light from she who must be obeyed if this wasn't a business that sustained itself even if it isn't what puts food on our plates and sends the kids to good schools.

I love it! Great line. The two most important words in any marriage are ..... "Yes dear".

 

[vinylphilemag]

I love it! Great line. The two most important words in any marriage are ..... "Yes dear".

Agreed. BTW, "she who must be obeyed" is a saying that can be attributed to a certain Arthur Daley, a dodger geezer if there ever was one!

 

[DaveyF]

Woody Allen...."I'm the boss...my wife's the decision maker".

 

[JackD201]

Agreed. BTW, "she who must be obeyed" is a saying that can be attributed to a certain Arthur Daley, a dodger geezer if there ever was one!

Nice trivia! I got a good chuckle the first time I heard the phrase as well, never knew who coined it.

I wonder what came first, "She Who Must Be Obeyed" or Rowling with her "He Who Must Not be Named"?

 

[Occam]

Nice trivia! I got a good chuckle the first time I heard the phrase as well, never knew who coined it.

I wonder what came first, "She Who Must Be Obeyed" or Rowling with her "He Who Must Not be Named"?

More likely originating with H. Rider Haggard's 1886 serialized novel She
http://en.wikipedia.org/wiki/She:_A_History_of_Adventure
and popularized by Rumpole of the Bailey the British television series in which the main character refers to his wife Hilda, as
'She Who Must be Obeyed'

 

[vinylphilemag]

More likely originating with H. Rider Haggard's 1886 serialized novel She
http://en.wikipedia.org/wiki/She:_A_History_of_Adventure
and popularized by Rumpole of the Bailey the British television series in which the main character refers to his wife Hilda, as
'She Who Must be Obeyed'

I can't remember when Rumpole of the Bailey was on TV, but I think that Minder, the TV series in which Arthur Daley was a main character, predates it. But he most likely got it via the novel you mention!

 

[vinylphilemag]

Nice trivia! I got a good chuckle the first time I heard the phrase as well, never knew who coined it.

I wonder what came first, "She Who Must Be Obeyed" or Rowling with her "He Who Must Not be Named"?

Definitely the former!

Arthur Daley was a character in the late 1970s/early 1980s British drama-comedy, Minder.