Came Perilously Close to a Mortal Sin

Healthy skepticism here, but keep in mind a few things, guys.

1. Our information about Guild's strategy/plans was in flux and evolving when we talked with management last year. They had just contracted a big-ticket marketing firm to help them strategize, and we have not heard anything from them yet about the results of that effort.

2. LMG was over a year ago (i.e., our knowledge is pretty stale now).

3. The Standard Series didn't even make it out to market until the fall of last year, so we don't really have any current information about results or future targets/plans for that line. I have a feeling that the delay of the Standard introduction was probably part and parcel of my next point...

4. Just my opinion, but I do think you guys are making a bit too much fuss about the "boutique" concept... In some sense, this type of positioning was purely a way to spin the fact that they did not feel they could ramp up production to build the Traditional Series instruments in sufficient quantities to supply a big box store (e.g., GC) with inventory. With diifferent product line(s), that could (and probably will) change. And, with the way things have gone with Guild in the last ten years, the brand needs rebuilding (I doubt any of you will argue that point). As we found out, surplus production (think Contemporary Series from Tacoma) in this competitive USA-built acoustic market was not acceptable to Fender.

While it's a ways off, these are the types of questions I'd like to drill down with Guild management in October. Please feel free to add them to our LMG2 questions list.

Chazmo said:

Healthy skepticism here, but keep in mind a few things, guys.

1. Our information about Guild's strategy/plans was in flux and evolving when we talked with management last year. They had just contracted a big-ticket marketing firm to help them strategize, and we have not heard anything from them yet about the results of that effort.

2. LMG was over a year ago (i.e., our knowledge is pretty stale now).

3. The Standard Series didn't even make it out to market until the fall of last year, so we don't really have any current information about results or future targets/plans for that line. I have a feeling that the delay of the Standard introduction was probably part and parcel of my next point...

4. Just my opinion, but I do think you guys are making a bit too much fuss about the "boutique" concept... In some sense, this type of positioning was purely a way to spin the fact that they did not feel they could ramp up production to build the Traditional Series instruments in sufficient quantities to supply a big box store (e.g., GC) with inventory. With diifferent product line(s), that could (and probably will) change. And, with the way things have gone with Guild in the last ten years, the brand needs rebuilding (I doubt any of you will argue that point). As we found out, surplus production (think Contemporary Series from Tacoma) in this competitive USA-built acoustic market was not acceptable to Fender.

While it's a ways off, these are the types of questions I'd like to drill down with Guild management in October. Please feel free to add them to our LMG2 questions list.

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Fair enough Chaz. I believe I had already placed a couple of questions in for LMG2. I would be interested to get a marketing update.

Economics 101 will offer plenty of examples where constraining production or keeping it low will maximize profit or return on capital or whatever measure of economic success is being used. So if you don't understand that I'll be glad to chime in.

If, on the other hand, you have your own personal reasons why you believe that selecting that strategy (even on a short term basis) is bad for Guild then I have nothing new to add to the discussion. We can continue to agree to disagree.

fronobulax said:

Scratch said:

At their current production rate, it would take Fender three days just to provide fifteen guitars to one guitar shop! I don't get it...

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Don't get what? The deliberate strategy to keep production numbers at New Hartford low in order to maintain quality or something else?

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So which is it Frono, to "maintain quality" or to..."maximize profit"? :? Economics 101 tells me to build and sell all you can........while making a quality product. Unless of course, there just isn't a demand for your product?

Why is everone around here so afraid to say they just ain't sellin' guitars? :shock: :?

West

West R Lee said:

So which is it Frono, to "maintain quality" or to..."maximize profit"? :? Economics 101 tells me to build and sell all you can........while making a quality product. Unless of course, there just isn't a demand for your product?

Why is everone around here so afraid to say they just ain't sellin' guitars? :shock: :?

West

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Someone from Fender at LMG 2010 said that quality was more important than volume (at that time) and that they would increase production so long as it did not reduce quality. If I misquoted that or used it in the wrong context, I'm sorry.

Why is Fender in business? My guess it is to make someone as much money as possible. I don't hear much out of Scottsdale about Fender being in the business in order "to make the world a better place". There does not have to be an either/or if a quality product produces the greatest profit.

I'm afraid either my memory is farther gone than I realized or Economics 101 is taught differently in Texas. "Building and selling all that you can" is not the only way to profit and is not always the strategy that will maximize profit. You seem to think otherwise. At this level of discussion one of us is wrong although it may come down to a different set of assumptions that have yet to be explicitly stated. I suppose now I am going to have to find my copy of Samuelson so that I know whether this is about my memory or something else.

I'd be interested in your source for the idea that current NH production exceeds the demand, i.e. "they aren't selling". Given that the production estimates come from a bunch of smart people pulling numbers out of the soundhole and not from any authoritative source, I had kind of assumed that the constant complains about "no NH Guilds in stores" meant the demand exceeded the supply.

I think the answer is that no one around here is afraid to express any opinions but you seem to be the only one who believes "they just ain't selling any guitars". Maybe this will tease out someone else with a similar opinion and we can get some insight int why that is believed.

fronobulax said:

West R Lee said:

So which is it Frono, to "maintain quality" or to..."maximize profit"? :? Economics 101 tells me to build and sell all you can........while making a quality product. Unless of course, there just isn't a demand for your product?

Why is everone around here so afraid to say they just ain't sellin' guitars? :shock: :?

West

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Someone from Fender at LMG 2010 said that quality was more important than volume (at that time) and that they would increase production so long as it did not reduce quality. If I misquoted that or used it in the wrong context, I'm sorry.

Why is Fender in business? My guess it is to make someone as much money as possible. I don't hear much out of Scottsdale about Fender being in the business in order "to make the world a better place". There does not have to be an either/or if a quality product produces the greatest profit.

I'm afraid either my memory is farther gone than I realized or Economics 101 is taught differently in Texas. "Building and selling all that you can" is not the only way to profit and is not always the strategy that will maximize profit. You seem to think otherwise. At this level of discussion one of us is wrong although it may come down to a different set of assumptions that have yet to be explicitly stated. I suppose now I am going to have to find my copy of Samuelson so that I know whether this is about my memory or something else.

I'd be interested in your source for the idea that current NH production exceeds the demand, i.e. "they aren't selling". Given that the production estimates come from a bunch of smart people pulling numbers out of the soundhole and not from any authoritative source, I had kind of assumed that the constant complains about "no NH Guilds in stores" meant the demand exceeded the supply.

I think the answer is that no one around here is afraid to express any opinions but you seem to be the only one who believes "they just ain't selling any guitars". Maybe this will tease out someone else with a similar opinion and we can get some insight int why that is believed.

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Oh I don't know Frono, maybe it's that I'd assume if they could sell more, they'd build more......but I live in a very simple world down here, wouldn't have it any other way? :? Great discussion by the way.

West

This is my take on the situation and of course it is just my opinion/observation. First I am sure that we don't have all of the pieces to their marketing strategy. What I have seen is an increase in marketing through magazines and new brochures . They are getting them to the dealers but it seems to be a hit or miss as to which ones are carrying the brand. I have made a number of calls to various dealers and out of 3 that called back none of them stocked them but I could order through the internet. Two stores mentioned that it was sort of a custom order situation. The store near me does a pretty good business but only through the internet. He does have Gads and nos from Tacoma in his show room but nothing out of N.H. He did however have some NH in his warehouse but refused to unpack them and bring them out for me to play, which I can somewhat understand. He was concerned about player damage once he hung them up in the show room. I did inquirer about the F47 and he said that would be a special order.I have also heard rumors from CA and SA that Fender had a high stocking # which this dealer also mentioned.
I do believe that the bean counters in NH have a LONG term strategy since they have spent a pretty penny getting this thing up and running. I also think they are moving the Gad series in high numbers ( just an observation from the amount of threads on other forums ).
Since I haven't played any NH Guilds I can't make an opinion as to there value yet, but from the prices that they are listing the Traditional series, Fender is competing with higher end builders.
I agree with all posters opinions here, but we just don't know all the facts yet.
One strategy that I can't wrap my brain around is the lack of in house exposure. It's one thing to see ads and another thing to not be able to play them. In my opinion, from the lack of actual in store instruments they are creating buyers frustration which is never a good thing. I am brand loyal but many are not so I think they are actively losing sales.
Can't wait for October

West R Lee said:

Oh I don't know Frono, maybe it's that I'd assume if they could sell more, they'd build more......but I live in a very simple world down here, wouldn't have it any other way? :? Great discussion by the way.

West

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Remember what I said about unspoken assumptions? You are absolutely correct in that if I can only make one type of item then I maximize my profit by making and selling as many of that one type as possible. All my comments refer to a situation where the manufacturer has a choice of which items to make. In the specific case of Guild I am assuming a choice is being made to produce a high quality guitar that is produced in a lower quantity than a hypothetical guitar of lower quality that can be made in higher quantities.

So you are saying Guild should choose to maximize profits by making and selling as many guitars as they can whereas I am saying they have chosen to maximize profits by building a lower volume, but profitable, guitar that competes in a particular niche.

I don't think Fender should hire either one of us to run Guild but I much prefer understanding where the differences are than knowing someone is flat out wrong. :wink: Thanks for your patience.

The answer my friends is blowing in the wind...

Scratch said:

The answer my friends is blowing in the wind...

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8)
That just about says it for any number of discussions, doesn't it?
I like it.

Cheers,
Joe

killdeer43 said:

Scratch said:

The answer my friends is blowing in the wind...

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8)
That just about says it for any number of discussions, doesn't it?
I like it.

Cheers,
Joe

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....but for how much longer Joe.... :shock: :shock: :shock: Steffan
http://www.upi.com/Odd_News/2011/02/01/ ... 296550800/

Sheesh. Even folks in Malawi can't afford gas... :shock:

taabru45 said:

....but for how much longer Joe.... :shock: :shock: :shock: Steffan

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I just knew that as soon as anyone mentioned the words blowing and wind in the same sentence that a predictable veer was inevitable. :roll:

Oy,
Joe

West R Lee said:

Down in the Hill country this weekend for a visit with Scratch and Graham when we decided to take in Hill Country Guitars in Wimberly. On the walls there were everything from Collings to Taylors to Huss and Dalton........but mostly Collings.

I played the Huss and Dalton a bit, then graduated to the Collings guitars, but of all of the guitars in the shop, only one caught my ear.....a 2009 Martin HD28 Custom. Apparently a limited run and a bracing design by George Gruhn, this thing sounded incredible....a great fingerstyle dreadnaught with a 1 3/4" nut, she played like butter and sounded like a band of angels.

We left the store for the return trip to Canyon Lake, and I told Graham and Scratch that I should have bought her. Asking price was $2370 and I mulled over it for a couple of days. On the way home this morning, I told Mrs West we were taking a slight detour......bout 50 miles. I stopped back in Hill Country Guitars with a rock solid offer in mind.......$2000, and I was prepared to buy her on the spot and bring her home. The salesman wouldn't budge off of $2200, so I thanked him for his time. But fellas, this thing sounded just incredible. Just wasn't meant to be, and my Westerly Guild record remains intact.

I would have loved to have brought her home, I came that close to being a Martin owner.

West

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AlohaJoe said:

Oh, the shame! :shock:

But seriously, some guitars just sound better than others. Some magic combination of woods, bracing glue, love... who knows? The name on the headstock can be a clue as to what it might sound like, but in the end its about the sound and some instruments are just stand outs.

I've stretched bucks a few times to get a really remarkable sounding instrument and honestly West, I've never been sorry. They don't come along that often.

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Now you understand why I hold onto My two Brazs so tight. Well, The old '66 D-28 I inheirited from my dad so that is a different issue all togather, but, the D-35V I have is the best sounding guitar I have ever played and until I find something that tops it, which ain't likely, then I will hold onto it. BTW it was also a gift from my parents, Thanks Mom & Dad! Here are a couple of pics of the two:
D-28 on left D-35Von right.

Beauties Jim....guess I'm a sucker for the dark pickguards, or even the black ones.....just me though, I certainly wouldn't complain if either of those came my way...or ones like them I mean....nobody ought to be breaking up that 'family'.... :wink: Steffan

fronobulax said:

West R Lee said:

Oh I don't know Frono, maybe it's that I'd assume if they could sell more, they'd build more......but I live in a very simple world down here, wouldn't have it any other way? :? Great discussion by the way.

West

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Remember what I said about unspoken assumptions? You are absolutely correct in that if I can only make one type of item then I maximize my profit by making and selling as many of that one type as possible. All my comments refer to a situation where the manufacturer has a choice of which items to make. In the specific case of Guild I am assuming a choice is being made to produce a high quality guitar that is produced in a lower quantity than a hypothetical guitar of lower quality that can be made in higher quantities.

So you are saying Guild should choose to maximize profits by making and selling as many guitars as they can whereas I am saying they have chosen to maximize profits by building a lower volume, but profitable, guitar that competes in a particular niche.

I don't think Fender should hire either one of us to run Guild but I much prefer understanding where the differences are than knowing someone is flat out wrong. :wink: Thanks for your patience.

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OK Frono, allow me to shed some light. There is this man, a friend of mine and a dealer who told me a couple of months ago, that late last summer or early last fall, Fender told Guild they were closing the doors, and that only some very fast talk and faster suggestions, ie., the "Standard Series" has kept Guild afloat. That dealer's information came straight from a Guild representative.

Now for obvious reasons, I'd doubt that Guild would be real forthcoming about something like that to a group like LTG when you think of the ramifications. That's what I base my assumptions on. Now sure as shootin', you might be able to find someone at Guild that will tell you that it never happened.....what would you expect them to say? But I know and trust the man that gave me that information.

This is how I came to know what inspired the "Standard Series" and to expect a demise unless things improve for them dramatically.

West

And to be honest, who's that (Guild being no more...) going to affect adversely ? Probanbly not me or most of the members here as there only seems to be a couple of NH Guilds over the whole membership.... I certainly cant ever foresee the situation where I would buy a new one. I dont think most of the guitar buying world would give a toss whether Guild was out there or not, there's a lot of alternatives these days. Be goor for resale and coolness vibe though, just another American brand vanishing into the ether:Indian, Packard et al....

Back to the op though, and has anyone noticed how small those Martin dreads seem compared to a Guild, the're tiny and they weigh nothing.....

Cheers, Ian

West R Lee said:

OK Frono, allow me to shed some light. There is this man, a friend of mine and a dealer who told me a couple of months ago, that late last summer or early last fall, Fender told Guild they were closing the doors, and that only some very fast talk and faster suggestions, ie., the "Standard Series" has kept Guild afloat. That dealer's information came straight from a Guild representative.

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West R. Lee casts his fly into the pool where the big bass lurk. Fronobulax sees the ripples and slowly rises to the surface, circling the twitching insect the whole time. Fronobulax circles and circles and suddenly strikes. He takes the bait! But can West R. Lee set the hook or will Fronobulax throw it off?

Very interesting. It comes down to how we assess the credibility of sources. I don't doubt that your source is correctly reporting what was told, but I have to wonder about your source's source. LTG members have reported numerous instances of misinformation obtained from Fender dealers talking about Guild. We will probably never know whether your source goes back to anyone who has ever set foot in the New Hartford plant or not. We could even invoke conspiracy theory and attribute a deliberate misinformation campaign about Guild from within Fender driven by someone whose financial success depends upon having all acoustic guitars in the Fender family sporting the Fender badge.

I don't consider this actionable intelligence but I would certainly have a different view and understanding of Guild's plans and operations if I did.

Thank you.

I'll see the bet and raise with two Guild-logo'd flatpicks.

The Tacoma Contemporary guitars were priced in between the entry-level GADs and the main-line/high-line balance of the Guild product line. It's hard to go through the fly-speck of the Tacoma collapse but one thing is clear; Guild still needs a mid-price guitar ... :lol: :lol: Ok ... let's all get it out of our system about whether what's being asked for Standards is really 'middle' but the point is that they fill a hole in the price spectrum.

Cynics and conspiracy buffs can say this as an excuse to raise the prices on Traditional models but it's hard to get the impression that they are selling NH guitars by the boxcar. Introducing the Standards is a way to sell less guitar for less money; if they get catalog/internet orders for higher-margin Traditionals, fine ... it's icing on the cake but domestically, they need some income that represents the cake.

Looking at Elderly's Holiday mag ... 5-7 pages of Fender-branded products and a 1/4 page for a GAD or two; as though Fender expects Guild to pay its own way; generate some income and plow it back in the form of ever-increasing advertising/visibility - PTSS - Post-Tacoma Shock Syndrome. Don't know how close they are to the edge; I hope they make it - I wish I could help them. I also hope the nex-gens can look back at a market full of 'vintage' NHs and respect them the way we do our 'previously-owned' Guilds.