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New GuitarMaker Has Arrived
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Author:  LuthierSupplier [ Thu Oct 11, 2007 8:01 am ]
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That is an incredible instrument on the front cover. Is that a Fred Carlson? Can't wait to get my copy!
Tracy
Author:  Billy T [ Thu Oct 11, 2007 8:21 pm ]
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Wow! How do you play it?

Beautiful work! Fred's are more zany/swoopy this one has real old school charm!

Does it come with a tuner?
Author:  Todd Rose [ Fri Oct 12, 2007 1:05 am ]
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I haven't received the new Guitarmaker yet, but I got the latest AL recently, and it's great, too. Bruce Creps of Notable Woods has written an exhaustive article about resawing tonewoods. Other great stuff, too.
Author:  Don Williams [ Fri Oct 12, 2007 1:57 am ]
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Judi Threat's article is a real eye-opener, and nicely expresses some thoughts and questions I brought up here on the OLF in a thread going back many months ago, about the state of the future of luthery. I've felt for some time that the market is shrinking by virtue of there being so many new builders out there competing for a limited market of buyers. My thoughts were that it probably isn't helping the folks who are established and making a living at building guitars, and that the more people entering the fray, the less easy it will become to compete.
As price drops due to an increased supply of guitars from newbies entering the market place, the demand curve swings toward a lower price equilibrium point and higher demand for lower cost handmade instruments, which doesn't profit the builder as much as it profits the consumer. Handmade guitars are also a luxury item, so as an increase in the number of suppliers occurs, and as recession is drawing closer, the demand for luxury items will decrease, and with more choices, those who are still willing to spend the money will be shopping around more and looking for bargains. Again, while it might seem that's good for the little guy, in the end, it's not really. Good article...very eye-opening.
Author:  Evan Gluck [ Fri Oct 12, 2007 1:59 am ]
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Anthony took some great photos. My favorite has to be the "Gangsta' luthiers" great shot of Bob Long, Matt Jacobs, and me. That was such a fun time
Best, Evan
Author:  Evan Gluck [ Fri Oct 12, 2007 2:01 am ]
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Don, when Judy gave that presentation it was hysterical. She has such a wry sense of humor. I go to hear her speak even if I am not interested in the topic.
Best, Evan
Author:  Brock Poling [ Fri Oct 12, 2007 3:10 am ]
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[QUOTE=Don Williams] Judi Threat's article is a real eye-opener, and nicely spresses some thoughts and questions I brought up here on the OLF in a thread going back many months ago, about the state of the future of luthery. I've felt for some time that the market is shrinking by virtue of there being so many new builders out there competing for a limited market of buyers. My thoughts were that it probably isn't helping the folks who are established and making a living at building guitars, and that the more people entering the fray, the less easy it will become to compete.
As price drops due to an increased supply of guitars from newbies entering the market place, the demand curve swings toward a lower price equilibrium point and higher demand for lower cost handmade instruments, which doesn't profit the builder as much as it profits the consumer. Handmade guitars are also a luxury item, so as an increase in the number of suppliers occurs, and as recession is drawing closer, the demand for luxury items will decrease, and with more choices, those who are still willing to spend the money will be shopping around more and looking for bargains. Again, while it might seem that's good for the little guy, in the end, it's not really. Good article...very eye-opening. [/QUOTE]


While I certainly need to hold comments about Judy's article until I see it, I can tell you that I completely disagree with this line of thinking.

If your sole production in a given year is 20 units (or less) competitive forces are pretty minimial given the size of the market. Especially from other individual builders.

I think the greater competitive forces come from custom shops, small production firms (Collings, Bourgeois, Santa Cruz, McPherson, RTaylor etc.) and those focusing on the high end market. Clearly their output is much greater and they can "sop up" a lot of domestic demand with a very good product that is built and priced closer to a production guitar.

I think in the long run nicheing is the way to go. Go after a market space that you can claim as your own, develop a good reputation, and exhaust your annual output with.

It just seems like perhaps a lot of the low hanging fruits have been harvested and individual builders will have to reexamine their brands and markets a little more carefully.

BUT... I think there is a big opportunity. The world is smaller than ever before and rather than focusing primarily on a domestic market perhaps the focus should be more global.

What is happening here is no different than any other industry. I think with the emergence of so many economies and the weakened dollar against other world currencies this is a perfect time for US based guitar builders to look abroad for business.

But... as in most things... where others see lemons, I see lemonade.

Author:  Don Williams [ Fri Oct 12, 2007 4:03 am ]
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I KNEW you'd say all that stuff.



Author:  Alan Carruth [ Fri Oct 12, 2007 4:35 am ]
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Brock:
You need to read Judy's article before commenting. She talks about a lot of that stuff. I found her presentation quite thought provoking myself.

Author:  Brock Poling [ Fri Oct 12, 2007 5:24 am ]
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[QUOTE=Alan Carruth] Brock:
You need to read Judy's article before commenting. She talks about a lot of that stuff. I found her presentation quite thought provoking myself.

[/QUOTE]

I was not being critical of Judy's article... Clearly I have not read it yet. Sorry if it appeared that way.

I was mostly responding to Don's comments that as more supply comes into the market that hurts individual builders.
Author:  Don Williams [ Fri Oct 12, 2007 7:34 am ]
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You will definitely have to read Judi's article to get a sense of where we were both coming from. It's a way of looking at things that is more economics than marketing. If that makes any sense. I think there is an assumption that she makes that we are dealing with a very limited market, whereas I know Brock that you believe there are many untapped parts of the market. It's an interesting article...
Author:  Bob Long [ Fri Oct 12, 2007 9:25 am ]
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kudos To Anthony Z. for all the great pics in Guitarmaker. Man, those bring back good memories.

Do we have to wait until 2009 to do it again???

long
Author:  Brock Poling [ Fri Oct 12, 2007 9:44 am ]
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[QUOTE=Don Williams] You will definitely have to read Judi's article to get a sense of where we were both coming from. It's a way of looking at things that is more economics than marketing. If that makes any sense. I think there is an assumption that she makes that we are dealing with a very limited market, whereas I know Brock that you believe there are many untapped parts of the market. It's an interesting article...[/QUOTE]

I read it.

I still maintain my position. The economics are not right. It makes some basic assumptions that I disagree with.

Out of respect for Judy I will just leave it at that. I do very much admire her work, even if I don't share her perspective on economics or the value of the Internet.
Author:  Brock Poling [ Fri Oct 12, 2007 12:42 pm ]
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Well...

I generally get the point she is trying to make, but there are a few basic assumptions that I challenge.

1) She assumes as supply increases this puts a downward pressure on price.

True, in a static market. But I think that with the rise of globalization, for better or worse, world wide demand HAS to be rising. So therefore more supply doesn't necessarily mean that this is causing a downward price pressure.

2) There is an subtle implied point that the goods are interchangable. Again as supply increases there is a downward pressure on price - this tends to suggest that all guitars are in some ways equal. She even uses a complex analogy involving apples. These are commody items. Guitars are not commodities.

I think a more accurate analogy would be that the world could be flooded with yugos, low end honda's, chevy's etc. and that would not influence one iota of demand for Aston Marton, Lamborghini, Ferrari or any other high end custom crafted automobile. Even though they are all "cars" they are vastly different products each with its own value offering.

3) She seems to suggest that older more experienced individual luthiers who make a living doing this are under seige from weekend hobbiests who have full time jobs and benefits. The rationale goes that since that crowd doesn't need to make a living doing this their pricing policy is erratic and confuses the market.

First. While I have no real basis for this opinion (and I think that a well constructed professional survey would be very beneficial to the industry) I suspect that individual luthiers actually "lose business" more often to the small production firms (Santa Cruz, Collings, Bourgouis, etc.) or the custom shops of larger manufacturers. They are capable of turning out very nice instruments from very good craftsman yet employ much of the financial and operational rigor that allows them to bring a product to market at a "near" production price.

The reality is that the entire output of the individual luthier market doesn't even equate to a rounding error of total annual consumption.

4) If your sole output per year is only 20+/- units supply & demand curves etc are not influencing your business all that heavily. You may find that you need to clearly differentiate your product more effectively but there is a sufficiently large enough market out there to move that kind of production capacity.

I suspect that what is at the heart of that is it is getting "harder" to sell in the ways that have worked well in the past. It doesn't mean that the business isn't there, it just requires refinement and new directions in marketing.

4) There also seems to be an assumption that the market is fully aware of the individual luthier and the products available. I would challenge this.

I think that those that DO know we are out here are well informed and at the very top of the market. I suspect that most of the people wandering into Guitar Center, etc. have no idea that we are out here or what a wide range of offerings are available from individual luthiers.

Those that have achieved a bit of a general public reputation (and mind you this is nothing in comparison to Martin, Gibson, Taylor, Guild, etc.) are at the very very top end of the game. This would suggest to consumers that if you want a custom made guitar you need to spend $10k - $30k.

So I think there is ENORMOUS opportunity to find markets that are essentially untapped and unaware.

4) I think much of this assumes selling to consumers in North America (or possibly Japan). I think as more economies move from developing to developed, and with the weaking US dollar that makes our products more attractive than ever with foreign buyers.

My suspicion is that very few luthiers pursue business outside the US. Granted, it might be tough to learn the ropes of international trade, but once you learn it and develop overseas markets this provides a barrier of entry to competitors and you could build an entire career from these markets.

... shall I go on?   


At the end of the day, I respect what Judy is trying to do. She raises a great issue, and I think it is worthy of discussion. I just disagree with her argument... that's all.

Again, where others see lemons, I see lemonade.
Author:  sbrunker [ Fri Oct 12, 2007 4:47 pm ]
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[QUOTE=Brock Poling]
I think that those that DO know we are out here are well informed and at the very top of the market. I suspect that most of the people wandering into Guitar Center, etc. have no idea that we are out here or what a wide range of offerings are available from individual luthiers. 
[/QUOTE]


I must say that just a couple of years ago, as a wanna' be flatpicker, I didn't know you all existed.  And, I'm sad to admit, even if I'd played one of your better sounding, better made instuments, I'd have picked Gibson, Martin, Taylor over you, the small builder.  I hear with my heart and eyes as much as my ears, and their years and years of marketing and production had me convinced that their best was the very best.


I have no idea what tomorrow will bring, but if I can call myself a guitar builder for just a day, it will be one of the happiest days of my life.
Author:  Howard Klepper [ Sat Oct 13, 2007 5:10 am ]
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Haven't read the article. But mostly agree with Brock re the relevance of classical microeconomics (I'm not sure about the emerging markets part, though). The supply/demand curves you saw in Econ 101 are for fungible goods with elastic demand and supply. Luxury goods march to a different drummer. The demand curve may change slope, for example, which is unheard of in the classical model (i.e., demand can rise as price rises). As for supply, for many builders there is no curve. There is a point. I fix the price, I can build only so many, and the buyers can take it or leave it. And as Brock points out, there are many market inefficiencies, such as incomplete information.
Author:  Howard Klepper [ Sat Oct 13, 2007 7:46 am ]
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I meant change slope direction, if that wasn't clear.

Author:  KenH [ Sat Oct 13, 2007 1:20 pm ]
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I just got my issue today, and having just read the article, I can see where Judy could make her assumptions, but I tend to agree with Brock on this one. All small builders are in a "niche" market, which isnt in any way at competition with the factories. My guitars sell them self right now, based on tone, playability, and the fact that they are one of a kind guitars that one cant find anywhere else.  The people that I sell to are those players who want something different. If they can get it at a reasonable price, they will buy it. Most of the people I sell to own a number of guitars also, so this is not part of a "one man, one guitar" mentality.


on a side note, I wonder why my delivery of this magazine is always at least a week behind everybody else?
Author:  TonyKarol [ Sun Oct 14, 2007 1:21 am ]
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I like to tell folks that Taylor will make, and then have to sell, more guitars on Monday and Tuesday than I will make in my lifetime .. that opens a lot of eyes and minds to what we do as a real craft. If someone wants cookie cutter guitars, thy arent going to buy ours anyway. Then of course there are those who feel that 5-600 bucks is an expensive guitar - they have no clue.

I delivered a 7K guitar yesterday, and the new owner never blinked writing the cheque for the balance, and it was about 2K over what he thought he would spend when we started. The thoght of getting a Martin/Gibson/whatever never crossed his mind.

We play in a different league ... but I do feel that there are other top end builders out there who maybe somewhat peeved that we are building very high end stuff for half of what they sell - at the Montreal guitar fest a well known builder whom we all know asked if I was giving guitars away (4K+), and was this charity !!! He then said I should double my prices immediately. I am not saying at all that this builder is worried, but you can see that there are those who feel we price too low as it may affect their ability to justify the prices they ask.
Author:  Brock Poling [ Sun Oct 14, 2007 2:45 am ]
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This is a good discussion. :-)

While Hesh thinks we "DON'T" compete with factories, I on the otherhand think we do... in fact, I think that is our biggest competitor... so much so that I think we can virtually ignore what all other individual makers are doing...

here's why I think that.

If you only produce 20 guitars a year "all" you have to do is find 20 people who want your instruments. Granted this is not always easy to do, but I think that much of the problem is marketing and exposure and not the "lack of a willing market"

Consequently most buyers aren't even aware of us, or if they are, they don't really "get" the fact that they could have an individually crafted instrument for about the price of a high end production guitar.

I think a real research project (not a straw poll) would be very interesting ... I would bet a paycheck that we will find that the most sales lost by individual luthiers go to production custom shoppes, and small shops are our biggest competitors. (Santa Cruz, Collings, Bourgeois, etc.)

They produce a very nice guitar at a near production price.

And with respect to the conversation of "better"... I really struggle with that. I do not think that we can simply state that because a guitar is individually crafted it is automatically better than a production guitar. On balance production guitars from the high end manufactures are pretty decent (I think).

I think the main thing we offer is the "magic" associated with having something indivually made for the customer. It is kind of like having a suit made. Is it better? Maybe (probably) but not a given. But the process of having something made "just for you" is appealing with some consumers. That is our market.

Author:  Billy T [ Sun Oct 14, 2007 4:34 am ]
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    I think the thing that is the utmost importance for specialty market providers, which is what we all are, is getting people to know they can buy from a small builder and get an outstanding product! Most people still don't even know a guy can build an excellent instrument out of his garage.

    I read an article that explained that 20-30 years ago the availabilities of machines like routers was not wide spread, not many had belt sanders or even bandsaws at their disposal.

    The main limitation is a person can't just walk down to a Guitar Center, pick up a Swanson/Kragenbrink/Poling/Heshtone/Kinnaird/Carruth/Chasson .... compare and buy, even against private builders let alone the "Biggies".

    I agree with Poling, just one guitar in the right hands showing enough people can make "the" difference in how a man's building career goes. Much like a peeble in a pond, in a lake it doesn't make much noticable difference, but it sure does if your fishing in a pond!

    I talked to a friend as we walked into a Dodger game. I said to him that if you were in the car market just this parking lot was just a very small part of the market of the US. The market, especially wth the internet is HUGE!

    I tell everybody I can about private builders for the their sakes, not really the builders.
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