HIFI Worry

I'm with shin, my gear is either 2nd hand or heavily DIy'd.

I'm not prepared to line the pockets of distributors, and i'm not prepared to pay boutique prices for brands who can't get economies of scale.

 

simon, as and when we met at the show, i highly recomended your loudspeakers, persoanally recomended them as a breath of fresh air to the music lovers who have a very small room and can apreciate a sound stage coming from such a small loudspeaker that masters all kind's of music, WELL DONE, fella.
nando

 

Hi,

I agree. The fear of things going bad, the knock on effect of people spending less does change peoples outlook on thing. A lot of my mates are earning the same but are more wary of things. Falling house prices, credit crunch, recession makes people more wary.


SCIDB

 

This is a bit long but I can't edit to save my life

Is the industry in trouble?


1. People. Whether or not we like it or belong in this category many people in this country have over-reached themselves financially, be that mortgage, credit card, loans etc. The 'lack of cheap credit has merely hastened what has been coming for the last 5 - 10 years. A fair portion of prospective HiFi buyers will be in this group. At the very top end, yes people may still have money but if BMW / Aston / Audi sales are falling then why should top end HiFi not be any different? However, I would agree that the more mid-range companies are at more risk as their customers typically play with less margin and are more at the mercy of general economic conditions.

2. The Industry / Market. The HiFi industry as recognised throughout the 80's and 90's has changed. 2 channel audio no longer sells to passing trade. Enthusiasts may still get into it but are now introduced via a decent AV receiver, vinyl or computer audio. Non enthusiasts I don't think bother too much beyond a denon mini system (some of which are pretty good imho). Unless of course you are rich enough to walk into a store or get your designer to 'get me the best'. I think the fact that major UK brands, Mission, Arcam, Naim, Linn et al didn't bother with the hifi show was pretty disgraceful. Increasingly targeted at a niche market it does seem a bit bizarre to me that they didn't try to get their products into that decreasing pool. Biting the hand that feeds while trying to find a new master doesn't seem particularly clever.

2. Company Size. I don't think it matters too much whether you are big or small, employ 100 people or are a one man band 'boutique' operation. Your customer base is going to shrink for a while. If you are selling items like 2 channel integrated / pre-amps or CD players it might never recover. If you have no overheads, no rental costs, don't have to put a roof over your head or put food on the table for your family you can carry on ad infinitum. If you have all these things then it will depend on how close to the wind your business is sailing and if your profitability can see you through a decline in sales. I would suggest that this in conjunction with the usual cost cutting might just see the likes of Arcam, Quad et al weather the storm.

3. SweatshopsI don't think you can equate a Mission (for example) speaker factory in China with some back-street sewing shop or brickworks in Mumbai. The idea that someone in China is getting paid 25 quid a week doesn't bother me as long as it is enough to live and progress locally. The ethical aspect of my purchase is that I would prefer to buy British because that keeps us going as a nation. After that I would prefer to keep the money in the UK. All of this generally takes second place to getting the right product and value. In this respect I feel most UK manufacturers have let themselves down. The What HiFi 5 star selling on perceived sound quality not manufacturing costs and a desirable profit margin hasn't helped either IMHO.

4. Dealers. I can see more dealers going down the tubes (no pun intended) as the riskiest link in the chain. Their margins are good but volume in most cases is very small. Chuck in higher rental costs, lack of footfall, energy bills rising and it doesn't look good. Due to Brand and Distributor restrictions most of them find it very hard to use the Internet to sell outside their home market. At least the manufacturer can sell worldwide to an almost limitless base of potential customers.

5. The 2nd hand market Ebay is not a total panacea but it has definitely raised awareness of the great deals you can get 2nd hand. And it has shown up the 2nd hand dealers who offer a 3 month warranty while selling 5 year old components for 2/3 of their new cost. I think that a lot of distributors have a lot to answer for. The mark up on many products is just a piss take. Accuphase amps being one example. The fantastic E-213 that is on the classifieds for nearly 1/2 it's new retail of 2500 GBP retails new in Japan for about 1350 GBP.

My Conclusion Given all the above factors of poorer customers, less potential customers a seemingly clueless or anachronistic industry rising costs and rapacious distributors I would say the HiFi industry is in trouble. Does it bother me? Not unduly. The lack of potential options to purchase in the future may well irritate me though. The difficulty in demming things anyway is a bit of an issue. But I have only ever paid full price for my CD player, everything else was 2nd hand, or bought abroad. In each case I have still got a decent warranty and in the case of my new Anatek MC1 got it custom built at 10% discount. It may well be that as customers our increasingly demanding habits are also hurting the 'industry'

 

Hi Guys

scot01 makes some good points and i don't disagree with anything he says.

Is the hi-fi trade/hobby in trouble? Answer, no more than usual. For many years it has remained fractured, bogged down in politics and the reign of overbearing my way is right personalities.
It may be to late, what needed to happen along time ago was for a single trade body to be formed that covered, both the retail,manufacturing and related media. This would have given the focus and power to properly promote the pursuit of quality sound reproduction(by any appealing means), rather than the add hoc,split ranting we see and hear. The reason Sony etc do so well is weight and scale(not product quality alone.) They have the financial clout to promote what they do all over the world. Name me any audio brand that does? They try in their own back yards but mostly its preaching to the converted.

Would a joint approach help in the curent climate? It certainly would not hurt. Broadening your customer base is always a desirable thing(there are billions of peolple who don't know about quality audio, but they do know about Sony). Something individual companies will struggle to do when they are small and lack the clout.

I was not at the London show as i was in the process of loosing my job, however as fewer and fewer people where coming into the show, many small to mid companies would have to ask themselves will i make any kind of return on a big investment? Answer NO. Last year many i talked to indicated that their meagre resources would be better spent elsewhere.

Some comments on cost of the show have been made. Well if less people come you have to raise costs,to cover expenses, both for exhibitors and public alike. This is a chicken and egg issue.

To be honest if the worlds problems are not sorted soon, then playing and listening to music will be the least of our concerns as we try to survive.

Regards D Louth

 

Economically yes, but also on a much broader scale, as a species we don't plan even 30 years ahead. When we've drained this planet of fossil fuels and other resources we are in some serious trouble. I walked through Woolworth's on Saturday and saw shelf after shelf of whimsical unrecyclable seasonal crap it was very disheartening, pound shop the same, Tesco's - how many brands of the same basic thing like shampoo and deodorant do we need?. I feel ashamed to be human sometimes. At least good hifi components are built with longevity in mind and have a resale value!

 

Well said SMEago, well said.

Regards D Louth

 

Hi lads, yes and no... the whole industry "not only hi-fi" is suffering, thank god i am still doing well and i have hope in the light at the end of the tunnel, i just hope that certain distributers of goods from abroad get REAL with their up the wall pricing and arrogant attitude. BRING BACK THE LOW END.
nando.

 

Its not all doom and gloom is it? Remember even in the dark days of 10% unemployment in the 80s 90% of the working population were in work. The upside of a business revolving around enthusiasts is we tend to spend our money on the hobby and give up other luxuries first. I don't know about the hifi industry but highend bikes alsways did well through a recession.

 

Defride.

The healthy interest in HI-FI then, (late 80's early 90's)was down to people switching to CD. What do we have now that people want. I Pod's, Mobile Phones. None of these offer quality sound. CD is vastly better and yet for many is not as good as analogue but had a weight of demand behind it, (like VCr before and Dvd after).

However for the masses, it is good enough(low res I Pods etc). Quality sound is virtually unknown outside of a few of us. The rest of the world can't know about it if they can't see or hear about it.

Dvd and home cinema went balistioc too in the late 90's but not now. When people switch format business is good but i suspect that despite high-def, things will be much tougher for the trade this time round.

Regards D Louth

 

Really? Those that went out and bought new CD players in the
80s are the same people now buying Ipods arn't they? Unfortunately for the Hifi industry there are many more sources for this and other average kit today. Nabbing the odd new hifi convert is more difficult.

Is it not the case that Hifi has and always will be a niche and the preserve of enthusiasts? I would hazard a guess that it is distribution chain (costs/competition) / better communication (anyone can be an 'expert' and access product on the cheap from many sources) that is killing many highend dealers. From here it could be a downward spiral, less dealers, less distributors, less customers...

There seem to be an awful lot more brands / suppliers these days, perhaps its no surprise that some will come and go with the economic winds. Perhaps its also the case that a relatively small pie is spread more thinly than in the days of a Linn, Naim supremecy?

Customers are still out there, its a matter of finding new ways to connect with them and offer a good reason to buy.

What do you think?

D

 

I can't speak for the U.K., but having spoken to dealers that I know in the NYC/NJ area, business is NOT booming. NYC's real estate market has not plunged yet, but that is going to happen soon as Wall Street's pain leads to 00000s of jobs being lost and bonuses not being paid at Christmas. All of the Hedge Fund guys who were expecting 6 and 7 figure bonuses this year, are hoping to have a job on the 25th.

Best Buy has 3 stores by me in nothern Bergen Co. Empty. People are buying low ticket items like music and DVDs. $3,000 televisions? Not this time of year.

Car sales are so low, (if one could even get credit to buy one) dealers are begging customers. The crazy thing is that they are not offering any great deals. They can't get credit themselves from GMAC. It's bad folks.

I use a few NYC stores as a barometer of the market and visited all of them with my wife in the past 3 days. To say that they were empty would be a nice way of putting it. The high-end electronics department in one of them had everything on sale. Pioneer Elite, Linn, Martin-Logan...all on sale.

We agreed to make one purchase for the rest of year. We put off a television for the bedroom for two years. It was more important to pay off any debt and keep our bills current. We found a new Samsung 40" LCD for $450 BELOW the MSRP of 30 days ago in a B&M store here in NJ. They needed to rid themselves of massive inventory sitting unsold. We're not buying any additional big ticket items for at least 3-4 months. Perhaps a new dishwasher in January or February.

High-end audio is in deep here in the U.S.

 

having looked at all the coments made about this thread i have a view about this,
1st: the way that retail has changed over the years in the sense of almost most of high street shops ignored not only the (beguiners) clientel that are were and now lost and forgotten, the future comercial wheel of this industry, so the hi-fi retail as well as manufacturers went where the "BIG" money was, hence loosing all interest in tom dick and harry making themselfes very eagoistic and making few sales for avarice purpose knowing or not knowing that that well will run dry one day, as it is now it has, scratching their heads some if not all are trying to go back to "so called low end" to get back those who where future customers who would have kept the wheel of this industry going now "i hope they realise" that their interest has long since gone because they were ignored so they went the way of new techno and are or may not be happy, maybe a bit sad as to when they visit a friends house and hear audio from the industry and go home , think, and cconvince themselfs that their x-box, i.pod sounds better,sad very sad.
nando

 

A few years ago (actually it was at more than 1 show) at CES, I had a late-night debate with a number of manufacturers about the importance of the iPod and how they needed to see it as a gift. Listening to some of them talk about it, one would think that it was a WMD. They could not wrap their heads around the idea that it was a way of attracting younger customers. One guy called it a "fad".

I'm sure you all remember when B&W introduced the Zeppelin. A number of the hi-fi press raved about it. It was the second coming. Actutally, it sounded rather average. What it did do was introduce the name "B&W" to people who had never heard of them before.

Someone smart at Wadia Digital (will assume it was John Schaffer) decided to introduce the 170 iTransport. It does the job very well. It isn't expensive. It's scary cheap when you look at the rest of the Wadia line-up.

Using lossless files run into a decent DAC or receiver, it makes the iPod sound pretty darn impressive.

I've played it for some of my friends and neighbours who have never spent more than a $1,000 in their lives on a stereo. They all wanted one.

In my opinion, manufacturers making $100,000 speakers in this environment are stupid. Music lovers don't buy $100,000 speakers. People trying to impress do.

We all know that you don't need to spend more than $10-15,000 to have a really great audio system. There are some exceptional products out there that push that price point forward, but for most people, it doesn't need to be that wacky.

Convincing people of that isn't hard.

You just need to give them a starting point that makes sense.

 

I've never heard of the B&W Zeppelin or Wadia. I suspect I'm no different from most people.

 

Hi Simon,

Importance of music will vary from person to person. To some it is very important, others not so. But that has little bearing on whether people buy expensive hifis or not.

You don't need an top notch system to get good sound and enjoyment. Most people I know, who are heavily into music, don't have top notch (&) or expensive systems.

To be honest, it is not a necessity to me at all to own a expensive hifi. I have a house full of kit because I can own a house full of kit. I have had the income to do it and I choose so.

I have enjoyed music on the radio, at gigs, at discos, at clubs, at partys, in the street, on ghetto blasters, in cars, on radiograms, on walkmans, at concerts, at shows, in workingmens clubs, in youth clubs and many other places as well as on hifi systems. I don't really need an hifi to do it. This is not to say better/expensive doesn't make music sound better, it's just to say it's not nessesary to enjoy music.

If push comes to the shove, I could survive on lesser equipment. I can get the joy of music from many things. I would be very pissed off if my record collection disappeared though!

A car is more of a necessity due to poor and expensive public transport. Also I work out of town in my day job, so no car would be a major pain.

SCIDB

 

Sadly, the quality of music has gone down in concert with the rise in popularity of crappy formats.

Music just doesn't have the same level of importance for people anymore. We have other things to distract us and it is not a priority for people.

I would not be shocked to see 20-30 high-end companies vanish in the next 12 months. The $$$$ are not there to sustain it.

 

Dean you are confusing what I said. I don't think I ever said much along the lines that people who find music important will buy hi-fi. I said quality sound.

If you can enjoy music without good sound quality then you obviously wouldn't consider good hi-fi that essential in your life. I however, can rarely enjoy music if the sound quality is poor. Its just noise and distortion to me. I need good music and good sound quality. So for me, I need a good hi-fi as much as I need the music itself in my life.

So for me, even if I don't have much money (which I don't), hi-fi is still one of the things on the top of my list to spend it on, after food and shelter. So to go back to your original post, people like that, like me, even in a credit crunch and having little money will buy hi-fi as ever because it is important to them.

 

I have so far found that there are people out there "most of word of mouth"customers that are very much into two channel hi-fi and they look for hi-fi no matter what cost from little to high and music reproduction to their ears has no price value, it still remains a part of their lives and an enjoiment to their pleasure, specially in this periolus times, it is up to dealers"i believe" to keep a good runing relation with customers even if is just a chat not only a sale but to care and advise,, or some other topic apart from hi-fi they will never loose touch,
nando.

 

wadia need to complete a cheap dac and chip amp design to go with the itransport or it's all for naught other than a PR exercise. They need to offer a turnkey solution for laptop and iPod owners