Phil A -
Your comments about many B&M retailers being on life support are interesting.
When we first began building speakers, we did not have the capability to build that many pairs and were able to sell as many as we could produce. So there was no point in exploring sales through a dealer network. What's more, we realized that we could sell speakers at 1/2 the price by avoiding dealer markups and other expenses related to selling through dealers. We felt that this increased affordability presented the potential of providing better quality sound to more and more people.
I recall, at that time though, people would post comments like, "Why would I purchase from them? They don't even have dealers. How credible can they be?" They would even refer to companies selling direct as "scam artists." But we stuck with the direct sales model anyway as we thought it was the direction things would be heading in the future. And we were right.
At a recent audio show, I was approached by a large, very well respected amp manufacturer who had been around for at least the last 40 years. He spent about 20 minutes grilling me as to how to get started in the direct sales mode. He was crying about how many of his dealers were going out of business and how that impacted his sales volume. But he was stuck in that mode because he couldn't compete with the limited number of dealers he had left. And he didn't feel confident that he could ramp up direct sales fast enough to allow him to dispense with the remaining dealers he had. He was basically stuck.
Now, consumers seem to be more and more comfortable purchasing direct from a manufacturer. Sure, they would love the opportunity to visit a dealer and hear the speakers first. But in many areas of the country, there simply aren't any dealers left. So even if we did sell through dealers, in many areas visiting a dealer would still not be an option.
But the lack of dealers does not mean 2-channel audio is dead...far from it. Each time we attend an audio show, we see a number of new audio companies. And many of them are only selling gear for 2-channel systems. Obviously, they couldn't survive unless someone was purchasing their products.
In the 70's and 80's, stereo stores were everywhere. But as their customers got married, had children and carried on with their life, audio took a back seat to other life demands. So slowly but surely many, if not most, of those dealers folded.
Now, many of those same customers are returning to a hobby they enjoyed in their younger years. And many new consumers are being introduced to high quality 2-channel reproduction for the first time. Sure, 2-channel as a percentage of the overall market may be dwarfed by home theater. In a similar vein, CD sales will probably never be surpassed by vinyl sales even though vinyl is currently the fastest growing segment of the music business. But we are seeing a resurgence in 2-channel interest (and vinyl). Its just that dealers becoming a less and less important part of the equation.
Times change.
- Jim