Prices of Gear

vic

I may have raised this issue before in other threads...this time from another angle.
I am inclined to believe that gear prices (new or pre-owned) in general (especially for the higher end stuff) are not as affordable as some would like to believe....
What is the target group for say (electric) guitars and amps ? What is the average age of this group? Let's suppose it is targeted mainly at the 18-27 yo group (beginners ,intermediate and semi-pros)......Q. would such a person be able to afford say, a Fender US Strat (~R12K pre-owned or ~ R20K new) or a MIM Strat at R7K/12K).?
By afford I mean saving for it and buying it cash when he/she has OTHER expenses such as paying off a car, rent for flat, food and entertainment, etc etc. ☹

Looking at recent Gumtree ads for Gibson, Marshall valve amps, Fender US strats, etc...and the ad prices are MORE than reasonable (in fact some are giveaways) compared to new store prices, these items do not seem to be selling. Why not?
I think the price of gear in general is too high for its target group. Prices for the lower end stuff seem to be more in line. Any thoughts on this?

guitarboy2828

I don't think prices are so high because music shops are making this huge killing, I think instruments are expensive, especially because most of them come from USA.. Hence the high new price..

Gumtree is obviously cheaper, for obvious reasons.. One must remember selling second hand gear means you'll get a lot less than what you paid for it. Bargain for the one buying it.

Also, some guys must have the money to buy the new stuff, otherwise it wouldn't appear on gumtree. ?

Keira-WitherKay

vic wrote ILooking at recent Gumtree ads for Gibson, Marshall valve amps, Fender US strats, etc...and the ad prices are MORE than reasonable (in fact some are giveaways) compared to new store prices, these items do not seem to be selling. Why not?

answer to that question is when one buys 2nd hand except from a pawn shop , one can't put it on the credit card ........... and yeah that strat at 10K is a great deal if they 25K new but few of us keep 10 K just lying around in cash to snap up a deal........... so yeah i think if the seller had credit card facilities 2nd hand gear would sell much quicker cos one thinks twice or more so of withdrawing cash but a card swipe is less hassle and easier ........

as for the rest of the post

well the thing is vic......... for some reason the marked or ticket price of new items in this country are always 30 -40% more than one can settle on if one is doing a cash/credit card deal...........

.for example i was recently offered a R24 000 classical guitar brand new for R16 500 after discount ....... which makes then quite good value for money in comparison.....

and i think if your music store is not offering good discounts for new purchases then find a new music store.

cos from what i see any store can get any product ....

and also i find many south africans don't ask for /or negotiate deals for cash they quite happily accept the sticker price and less 5% or 10 % when if asked i bet most stores would sell it for cost +15% since it's still a sale .but many don't ask and shell out the ticket price......... i

argue like crazy over prices and even the cash converters give me better discounts than the original one when i 1st ask........... cos biz is tough in retail industry so the buyer has the advantage and if one is firm when negotiating a good price is garanteed also ask to speak to the manager not the salesman and you will get a better deal for sure ..........

and yeah as guitar boy said 2nd hand is the way to go........ i would rather buy 2nd hand than new anyday ........ cos the same amount of cash i am spending will buy me at least 30-40% better instrument than i would get new...........

now thats not counting on the odd incredible deal where i pick up things for a fraction of their value in pawn shops............

so yeah if one is "buying wise" one can get awesome gear at a fraction of the cost .............

so i don't think the picture is that dark .............. well not yet anyway

Warren

I think you might be assuming too much about this 'target market' Vic.

When we're talking about affordable instruments, all the major companies have some mechanism for bringing products within range of more budget minded folks. When you start talking about high-end instruments, I think budget becomes far less of a consideration. Such instruments are designed with fewer compromises, for a market that is less concerned with what it costs and more concerned with the spec and design of the instrument and, to a very large extent, the 'value' of the brand.

In other words, your average Joe Soap, saving up amidst all his other costs (like me) is more likely to poke around in the low/mid price range than to try and justify spending R30k on a Strat. Even if I were a pro-muso (and by that I simply mean making a living out of music, not necessarily wealthy) there are still any number of 'copies'/'clones' on the market at very reasonable prices which will enable me to do my job. I don't NEED the Gibson, but I may WANT the Gibson. This makes pricing a very blurry thing. ?

One thing I do find frustrating is this whole store "discount" concept. I find it just gets in the way of me making an informed purchase: if the thing says R10k, then it should be R10k. I shouldn't have to walk around a store trying to figure out what they're "really" charging for that guitar (and having to do lots of mental arithmetic). I'd rather just know the price, and shop accordingly. You're not fooling anybody if absolutely everything on your walls is -15%...so I guess my preferences are different to, say, Keira's. I'm not a haggler (unless it's second hand) - if I like the price I'll pay it.

singemonkey

Vic, I think it's about the size of the market. I imagine that these stores shift very low volumes of instruments above beginner level. I think their way to deal with it is to make big profits out of every higher end sale. Because possibly the extra sales from more reasonable pricing would not be enough to compensate for the reduced profits.

But your feeling, I think, is correct. The second hand prices here are much the same as in the States or Japan. So the gap between new and second-hand prices is huge.

vic

Towards the end of last year I spoke to a manager of a well known store in the Northern Subs about the economic climate and its affect on the viability of music stores....he said they are making their money mostly from sales of PA systems and instruments to church groups and schools ! ? I was not suprised.

Keira-WitherKay

vic wrote Towards the end of last year I spoke to a manager of a well known store in the Northern Subs about the economic climate and its affect on the viability of music stores....he said they are making their money mostly from sales of PA systems and instruments to church groups and schools ! ? I was not suprised.

well i heard from a store that they sell most of their better guitars to executives who are guitar hobbyists and not professional musicians..... pity tho...

AlanRatcliffe

vic wrote he said they are making their money mostly from sales of PA systems and instruments to church groups and schools ! ? I was not suprised.

That's been true for years.

The upper price tag stuff goes fairly cheaply second-hand as there are not as many who know (or care about) it. Those that do buy the higher priced stuff often either have the money for new or, if they don't, buy it new on credit from a store.

Money is tight for many at the moment and that is affecting both the availability of good second hand gear and the value/prices. There's lots of really good stuff available at great prices, but few takers. I could have easily have spent R30K on Cape Town Gumtree alone yesterday, but alas, I don't have much ready cash at the moment either.

Bob-Dubery

Warren wrote I'm not a haggler (unless it's second hand) - if I like the price I'll pay it.

I'm not a haggler by nature either, but there have been a couple of times when I've lost out on something that I thought was beyond my reach but that I could have afforded. So now I ask. And so should you if there's something you like. Just say something like "how much is it REALLY?". The worst that can happen is that they say "that really is the price". The best that can happen is that you find that you can actually afford the guitar/amp/whatever.

vic

Keira WitherKay wrote
vic wrote Towards the end of last year I spoke to a manager of a well known store in the Northern Subs about the economic climate and its affect on the viability of music stores....he said they are making their money mostly from sales of PA systems and instruments to church groups and schools ! ? I was not suprised.

well i heard from a store that they sell most of their better guitars to executives who are guitar hobbyists and not professional musicians..... pity tho...

I think that's the point/issue. I also assume that these executives fall outside of the 18-27 yo group....?

vic

Alan Ratcliffe wrote
vic wrote he said they are making their money mostly from sales of PA systems and instruments to church groups and schools ! ? I was not suprised.
That's been true for years.

The upper price tag stuff goes fairly cheaply second-hand as there are not as many who know (or care about) it. Those that do buy the higher priced stuff often either have the money for new or, if they don't, buy it new on credit from a store.

Money is tight for many at the moment and that is affecting both the availability of good second hand gear and the value/prices. There's lots of really good stuff available at great prices, but few takers. I could have easily have spent R30K on Cape Town Gumtree alone yesterday, but alas, I don't have much ready cash at the moment either.

Welcome to the club ?
There are real bargains out there but few (younger and older) have the dough ready... ☹

vic

Warren wrote
I think you might be assuming too much about this 'target market' Vic.
When we're talking about affordable instruments, all the major companies have some mechanism for bringing products within range of more budget minded folks. When you start talking about high-end instruments, I think budget becomes far less of a consideration. Such instruments are designed with fewer compromises, for a market that is less concerned with what it costs and more concerned with the spec and design of the instrument and, to a very large extent, the 'value' of the brand.

In other words, your average Joe Soap, saving up amidst all his other costs (like me) is more likely to poke around in the low/mid price range than to try and justify spending R30k on a Strat. Even if I were a pro-muso (and by that I simply mean making a living out of music, not necessarily wealthy) there are still any number of 'copies'/'clones' on the market at very reasonable prices which will enable me to do my job. I don't NEED the Gibson, but I may WANT the Gibson. This makes pricing a very blurry thing. ?

One thing I do find frustrating is this whole store "discount" concept. I find it just gets in the way of me making an informed purchase: if the thing says R10k, then it should be R10k. I shouldn't have to walk around a store trying to figure out what they're "really" charging for that guitar (and having to do lots of mental arithmetic). I'd rather just know the price, and shop accordingly. You're not fooling anybody if absolutely everything on your walls is -15%...so I guess my preferences are different to, say, Keira's. I'm not a haggler (unless it's second hand) - if I like the price I'll pay it.

You are right...I have little stats to support my assumptions...it's just a gut feeling. The target group could be widened of course. My point is that gear is not very affordable taken all those other financial committments into account.
Sadly these escalate dramatically once you're married and have a family ! ?

inflames

Looking at recent Gumtree ads for Gibson, Marshall valve amps, Fender US strats, etc...and the ad prices are MORE than reasonable (in fact some are giveaways) compared to new store prices, these items do not seem to be selling. Why not?

The thing about Gumtree is cash in hand. Yes there are so many bargains, but hat still means you need that R10k or R20k in cash.
I also think that the guitar players of today is of a younger age and don't have the financial means to buy expensive gear.

I had so many offers for the Marshall on Gumtree from young guys. Unfortunately their offers is way under the asking price. I do feel for these guys that tells me how much they would like it.

vic

inflames wrote
Looking at recent Gumtree ads for Gibson, Marshall valve amps, Fender US strats, etc...and the ad prices are MORE than reasonable (in fact some are giveaways) compared to new store prices, these items do not seem to be selling. Why not?
The thing about Gumtree is cash in hand. Yes there are so many bargains, but that still means you need that R10k or R20k in cash.
I also think that the guitar players of today is of a younger age and don't have the financial means to buy expensive gear.

I had so many offers for the Marshall on Gumtree from young guys. Unfortunately their offers is way under the asking price. I do feel for these guys that tells me how much they would like it.

Another good illustration of the state of things....that amp and cab is a real bargain. But let's be positive...it will sell ? My guess is that an old rocker will probably buy it. ?

IceCreamMan

I have 4 what i term mega stores within 10km's of my house ,those being

1. Marshall music
2. Tunrkey music
3. Music connection
4. Toms SAndton

Then i have about another 4 smaller stores in the same area:

1. Macgibbons
2. Music MAte (4 ways ) flagship store
3. Music mate cresta
4. Music mate clearwater
(i may have forgotten some)

Then if i go a bit wider lets say 30 km's i suspect there is probably upwards of 40 stores. Its a huge market imho.

all of them make a healthy profit ,all of them survive nicely all of them are stocking nice expensive items which is expensive to hold thus prices need to reflect that. Music connection stocks millions of rands worth of kit , that costs money to stock and must be covered by profits ergo , we pay as consumers. I have quickly learnt who the importers are for various items so go direct to them for best pricing. I assume everyone is negotiation cos if ppl are paying MSRP they are getting fleeced.

(btw i like the situation just as it is gives me a lot of variety and some leverage when we negotiate - i negotiate for a living btw when not a rock star)

The 2nd hand value of musical equipment is terrible , its porbaly the worst investment one can ever make (unless u go exotic etc etc) ..if you take any other durabel product on the market nothing seems to devalue as quickly as second hand musical equipment. its crazy and while i take the credit card/cash argument above i think there is more to it. One aspect is the utility derived from buying something brand new ..being the first ...must be a value in that. Another factor could be initial profit made by the store which does not reflect "value" of the item. (also VAT) .

Musical equipment is bought with heart and not head and when the GAS drive hits it becomes an inelastic desire and u pay whatever it takes to satisfy that need.

a last point ,i have often seen ads on the net and here where the price for the 2nd hand item is more than what i can buy that item for brand spanking new.. the only way i think that happens is that ppl are paying list so when they sell it it gets listed at high price and the owner is already taking a bath on it.

interesting industry this business, it makes no financial sense in the traditional way and one can buy the same item at differnt stores an pay up to 40% more ...

i could write a book on this but will desist.

cheers

Warren

X-rated Bob wrote
I'm not a haggler by nature either, but there have been a couple of times when I've lost out on something that I thought was beyond my reach but that I could have afforded. So now I ask. And so should you if there's something you like. Just say something like "how much is it REALLY?". The worst that can happen is that they say "that really is the price". The best that can happen is that you find that you can actually afford the guitar/amp/whatever.

Yeah, fair point, I realise that it's always worth asking. Recently I was looking to spend R5k or so on an acoustic, and it took me a while to realise that, at Marshall, I could realistically look at guitars with an R8k price-tag stuck on them.

Perhaps in a way this little trick works quite well for the stores, because I suddenly felt inclined to spend "just a little more" than what I wanted to originally, because "hey, you're getting a R10k guitar real cheap!" ?

Keira-WitherKay

i don't understand the logic of "NOT HAGGLING" cos since we started to trade as humans haggling has been a way of life.and should be in our genetic code ?

so yeah haggle cos remember a store knows exactly how much they paid for that article +transport+ import costs and has a figure......... on their pc....... even if they make 5% above that they still making profit and simply replace that stock and make 5% .......... so if they having a slow month they will sell their gear at cut rates ...of course only if you haggle for it ......... cos they know GAS is impulsive as icecream man said........... so they relying on you wanting it so bad you won't walk out the door and try get it elsewhere..........

same with buying 2nd hand....

the market is slow there too so if someone has an article selling for 2 K offer 1.5K cos really the practise is to overprice to allow for still getting your price when you "give a good price" so they mark it at 2K hoping for 1.7K and when you offer them 1.5K they think well it's only R200 lower than what they expected and if the phone is not ringing off the hook with offers they will take it ...... cos i bet they selling that gear to update their own gear .....so GAS is working on them too............. so a viscious circle that the wise can take advantage of and get good deals on gear ...................

vic

Talking about the high prices of gear, have you heard...Music Ground, the giant vintage dealership in the UK has gone bust. These are the guys who bought out almost 90% of Denmark Street, London.
These guys had a real bad attitude...almost like ....we are the biggest, best, most expensive,prestigious,....so stuff you mate..! Pity.