Musical instrument shops improvising
The past decade has sent Metro Detroit musical instrument retailers reeling from the Great Recession and the rise of big-box chains, but some are regaining a grip on the market by tapping into the Internet and playing to niche markets.
For some, that means blending their brick-and-mortar operations with the kind of online platforms many competitors had previously used to undercut them. For others, it's just about maintaining the unique customer relationships they've had for years.
Either way, they face a drastically changed market. The city of Detroit, which gave birth to Motown, has no dedicated retail instrument stores, and independent stores have dwindled in the suburbs.
According to the National Association of Music Merchants, industry sales crashed from $7 billion in 2008 to $5.8 billion in 2009. Revenue has risen slowly since then, climbing to $6.8 billion last year — still a far cry from the pre-recession peak of $7.6 billion in 2005. Much of that mid-2000s momentum, though, belonged to chains like Guitar Center — currently the biggest music store in the nation, with 2013 sales of $2.2 billion.
Atam Bedikian, co-owner of A&R Music in Lincoln Park, said he quit carrying top-flight guitar brands like Gibson and Fender a decade ago due to chains consistently undercutting him.
"With Guitar Center and those big-box companies, most United States stores, I can't compete with their prices and their buying powers," Bedikian said. "I don't try."
The Internet has also affected independent storefronts. Online dealers often undercut brick-and-mortars on new instrument prices; eBay and Craigslist cut the middleman out of the used market entirely. Many independents have closed their doors as a result.
But some, like Huber Breese Music in Fraser, are hanging tough. Owner Paul Huber said his store has grossed a steady $3 million to $3.5 million over the past five years. He chalks that up to a number of factors that most chains don't, or can't, provide including instrument repairs, music lessons and personalized customer service.
"If you go head to head or if you talk to people that shop at both places, I don't think we'll have a problem beating the competition in service and reliability," Huber said. "Chain stores have a certain way of dealing with people and that's quite different from what we do."
In some cases, independents are hanging on by grabbing a piece of their new competitors' game.
"Some of the mom-and-pops now are much more technology- and Internet-oriented," said Dennis Tini, director of Wayne State University's music business program. "What they're doing is they're becoming a combination of a mom-and-pop and an Internet-based store."
Gordon Lupo, owner of Gordy's Music in Ferndale, started doing just that 10 years ago.
Lupo used to operate a busy storefront on Woodward in Ferndale, but he's now further east of the city's main drag. As brick-and-mortar business dried up, he focused his energies on selling vintage instruments on Craigslist and eBay. Without the Internet, he said, "I'd be gone like everybody else."
"I'm not ready to close my door yet, but I know one thing: If I did close my door, I'd still survive," Lupo said. "I'd do it by appointment only, instead of waiting on somebody for 15, 20 minutes and then they go buy a dollar's worth of (guitar) picks. I can live without that."
Chris Nunez got into the manufacturing end of the industry three years ago, opening Santo Guitar in Grand Rapids.
The company has been successful thus far, and is on track to double the number of guitars it produces this year over last. The company's business has been done entirely online, and Nunez said he's "on the fence" about signing deals to distribute to retailers — contrary to his personal shopping preferences.
"I've never bought a guitar without going to a store and playing it," he said. "But it's fascinating how the new generation is perfectly comfortable doing the research online, making the phone calls to other players, looking at YouTube videos and then pushing the 'buy' button. I'm kind of old-school, but at the same time it's taking a lot of cost out of it because you don't have all that markup."
Other local retailers have found ways to thrive without leveraging the power of the Internet.
Bedikian said his business has remained strong thanks to long-running relationships with local schools. He opened A&R in 1977, and worked with schools in the music retail business for 13 years prior to that. He said teachers and students from Dearborn to Monroe still come to him for instruments, repairs, sheet music and lessons.
"Even during a down time, there's certain things parents will do for their kids," Bedikian said. "We found that out. If they're in music at all, they will see that the kids get help as much as they can."
Despite the general gloom around the industry, Detroit could soon see a brand-new music store.
Detroiters Jen David and Jeffrey Thomas are making plans to open Third Wave Music in Midtown's Forest Arms building next fall. The partners are readying an Indiegogo campaign to crowdfund the endeavor. David, who works at Evola Music in Shelby Township, said her target markets are students and Detroit's underserved gigging musicians.
"I feel really confident about it being successful because it's a giant city with a lot of musicians in it," she said.
David suspects many other music stores have suffered because of an inability to adapt to changes in the business, something that she aims to avoid. According to Tini, that kind of approach will be key for the industry: not only being on top of current trends, but also ready for what's next.
"There are wonderful possibilities," Tini said. "I think that everybody, including the manufacturers and the retailers and the consumers and the artists and the composers and performers, etc., all have to really be looking forward right now, because it's a do-it-yourself business."
Patrick Dunn is a Metro Detroit freelance writer.