Henry Juszkiewicz, the CEO of iconic brand Gibson Guitars, has been discussing the faults that have led to the company being on the brink of bankruptcy.
We’ve been keeping you updated on the sad news relating to the flailing profits of one of the guitar world’s foremost manufacturers. First it was set for closure, then Juszkiewicz assured that the debt was run of the mill and then it seemed that the situation appears more likely a ‘internal coup’ in a bid to wrestle ownership.
Juszkiewicz, who has been the CEO of Gibson since 1992 having acquiring the company in 1986, knows all to well of the difficulties involved in retail, now more than ever before. Gibson, a brand that have been long time favourites for so many musicians, unveiled news last week that the company was struggling to meet its obligations on $375 million worth of debt. According to multiple analysts and investors, the default risk considered high and would likely result in bankruptcy.
Having already explained the battle against online retailers, Juszkiewicz moved to explain that the influence of rock ‘n’ roll and the end of ‘neighbourhood’ style shops has ultimately had a negative effect: “We’ve lost a lot of consumers,” he said. “Women, by and large, aren’t comfortable going to guitar stores.”
Reflecting on a change in direction, Juszkiewicz said in an interview with Billboard: “The issue for Gibson in retail is that the industry has gone into a really narrow customer focus. In the 50s, music retailers were neighbourhood family stores. If Johnny wanted to play an accordion, and Suzy wanted to play saxophone, there were full line stores. They weren’t big, but they carried most instruments, sheet music even. It was a neighbourhood staple.
“Those days are gone, and those stores were in deep trouble when rock and roll came along. When that happened, guitars became extremely popular, and everyone became a guitar buyer if not player. That changed the retail quite a bit; even though it was still mom and pop shops, they also became more “rock” shops, and [the business] became much younger. It also became quite unprofitable.
“As that demand started to decrease in guitar – at this point in time, only people who already played were starting to be the only people actually buying guitars – stores lost their family roots and started concentrating on “real” players. They had to, but they hyper focused on those buyers, and started losing money. They couldn’t pay their rent anymore,” he added.
“I like to say, ‘You know where the good music stores are? Look in a city’s pornography district.’ Sure enough, that’s where [they] are. Well, parents with kids don’t like to go into those areas to shop. Musicians don’t have a problem going into those areas – there are usually a lot of hip clubs around there, too – but this is how the guitar business took a hard left, and left behind a lot of consumers. We’ve lost a lot of consumers. Women, by and large, aren’t comfortable going to guitar stores. If you look around, you’ll see a few, but if they are there chances are they’re already musicians. You’re not going to mom and dad; you’re only preaching to the converted.”