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Why do piano dealers change brands ?
#2725375 03/30/18 12:07 PM
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In another thread a former Steinway dealer has changed to selling Kawai and another thread has a dealer no longer selling sauter

These are all very good brands of piano so why do dealers stop selling one to change to another ?

If I was a piano dealer I would want to sell all of those pianos and more

do piano manufacturers want exclusivity with some dealers ??

Re: Why do piano dealers change brands ?
Edb123 #2725384 03/30/18 01:09 PM
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I would think there are any number of different reasons. The Steinway dealer in my neck of the woods had been selling S&S forever. The story is that Steinway created some onerous conditions for remaining a dealer, as in forcing them to carry a ridiculous amount of inventory and having unrealistic sales quotas. (see here).

Some other dealers may change for other reasons, like a better profit margin, what their sales area is more interested in, or something else.

I'm not a dealer, manufacturer or rebuilder, but these are just some reasons off the top of my head.


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Re: Why do piano dealers change brands ?
Edb123 #2725441 03/30/18 04:51 PM
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It has been real musical chairs in the Atlanta area and surrounding markets over the last decade, and the story lines may sound like a soap opera to some with at least as much rumor as actual intrigue.

Some dealers grow while others retire or downsize. Some find greater success with some lines, whether that is profit driven or relationship driven. Sometimes dealers dislike policy changes or changes to territory. Quite a few have not adapted to the changing market and manufacturers feel underserved. Sometimes a brand's identity and focus changes, making a once successful relationship into a poor fit. Increasingly, I see factory stores in some markets for Steinway. I see some factory store test markets for Kawai. I've spoken to dealers that had volume but poor profits due to low margin and high fixed costs later opt for more reasonable margin, but lower volume products and feel less pressure and stress. I've seen some dealers lured into brands or chase brands for reasons of ego.

We represent several brands and have had a few notable ones come and go from our doors. I don't think any brand or strategy has it easy in the US market, so I think changes will continue to be common as there are more viable options than dealers prepared to represent them or customers with a clear understanding of brand value vs. comparative performance (i.e. objective value). There are a lot of imperfect market forces in play. wink


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Re: Why do piano dealers change brands ?
Edb123 #2725515 03/31/18 02:02 AM
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Hmm.. what are these "sales quota"? Clearly, if there are not enough buyers - the dealers can't sell them. Is this to force the dealer to decrease their commission to move inventory? If so, that is just nasty.

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Re: Why do piano dealers change brands ?
Edb123 #2725591 03/31/18 10:20 AM
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Manufacturers have franchise requirements. They must offer the same terms to all dealers who qualify or they get in trouble with the law. Each manufacturer will have policies that fit their goals and they will change those policies over time as market conditions change.


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Re: Why do piano dealers change brands ?
Ed McMorrow, RPT #2725629 03/31/18 12:46 PM
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Originally Posted by Ed McMorrow, RPT
Manufacturers have franchise requirements. They must offer the same terms to all dealers who qualify or they get in trouble with the law.


Free market lol

Re: Why do piano dealers change brands ?
Ed McMorrow, RPT #2725650 03/31/18 02:28 PM
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Originally Posted by Ed McMorrow, RPT
Manufacturers have franchise requirements. They must offer the same terms to all dealers who qualify or they get in trouble with the law. Each manufacturer will have policies that fit their goals and they will change those policies over time as market conditions change.


This is true..... but in the real world different dealers have different reps. and get treated differently.


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Re: Why do piano dealers change brands ?
Rich Galassini #2725674 03/31/18 04:34 PM
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Originally Posted by Rich Galassini
Originally Posted by Ed McMorrow, RPT
Manufacturers have franchise requirements. They must offer the same terms to all dealers who qualify or they get in trouble with the law. Each manufacturer will have policies that fit their goals and they will change those policies over time as market conditions change.


This is true..... but in the real world different dealers have different reps. and get treated differently.


On our side of the musical instrument business we see this all the time with Guitar Center. I remember when Taylor Guitars advertised that ALL their guitars came with HS cases but at GC they were charging a couple a hunner for the HSC as a separate item (after advertising the model online at MAP). I asked a Taylor rep about it. He laughed a little uncomfortably and said, Most dealer order Taylors by lots of tens. GC orders in by grosses of each model and sells nationally around a hundred Taylor Guitars a day. Yeah, they kinda get to make their own rules."

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Re: Why do piano dealers change brands ?
Edb123 #2725684 03/31/18 05:17 PM
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Originally Posted by KurtZ
On our side of the musical instrument business we see this all the time with Guitar Center. I remember when Taylor Guitars advertised that ALL their guitars came with HS cases but at GC they were charging a couple a hunner for the HSC as a separate item (after advertising the model online at MAP). I asked a Taylor rep about it. He laughed a little uncomfortably and said, Most dealer order Taylors by lots of tens. GC orders in by grosses of each model and sells nationally around a hundred Taylor Guitars a day. Yeah, they kinda get to make their own rules."

Kurt

I would imagine this would be the case with the larger dealers, whether it be Guitar Center or the larger piano dealers. Sales volume = clout with the distributors/manufacturers (Sam Bennett touched on this a bit earlier in this thread.). I bought my Casio Privia PX310 digital stage piano at Guitar Center and must say it was a very pleasant buying experience. The keyboard guy let me play the demo as much as I wanted, and then he played a bit. I told him I'd take it, but wanted one in a box that was unopened and undamaged. He went to the stock room and retrieved one with the box in pristine condition (I've never had good luck buying something in a box that was already opened or mutilated).

Also, I'm not a dealer, but I would think things can change over time, along with market conditions, dealer personalities, distributor personalities, manufacturer/distributor requirements/policies, and the fact that dealers and manufacturers can change their mind over time regarding a broad range of issues.

The current thread regarding the Sauter distributorship/dealer changes is an example of that; quite often, these changes can end badly, with hard feelings and disgruntled parties on both sides.

Also, FWIW, I've always thought it was rather ironic that some dealers will speak badly of certain brands they don't carry, and, over time, things change and not only are they now a dealer for the brand they previously trashed, but they embrace the brand enthusiastically and it is now suddenly the best thing since sliced bread. smile

Just a few thoughts...

Rick


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Re: Why do piano dealers change brands ?
Ed McMorrow, RPT #2726313 04/03/18 02:14 PM
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Originally Posted by Ed McMorrow, RPT
Manufacturers have franchise requirements. They must offer the same terms to all dealers who qualify or they get in trouble with the law. Each manufacturer will have policies that fit their goals and they will change those policies over time as market conditions change.

I visited a local chain/dealer a while back. The salesman explained that they had previously been a Steinway dealer, but that Steinway had demanded that they sell only Steinway, so they had opted to not sell Steinway. Of course, that may or may not be true.



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Re: Why do piano dealers change brands ?
Rickster #2726314 04/03/18 02:15 PM
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Originally Posted by Rickster
The current thread regarding the Sauter distributorship/dealer changes is an example of that; quite often, these changes can end badly, with hard feelings and disgruntled parties on both sides.

The guy I mentioned above seemed to be pretty agitated about the change.



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Re: Why do piano dealers change brands ?
Rickster #2726315 04/03/18 02:23 PM
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Originally Posted by Rickster
Also, FWIW, I've always thought it was rather ironic that some dealers will speak badly of certain brands they don't carry, and, over time, things change and not only are they now a dealer for the brand they previously trashed, but they embrace the brand enthusiastically and it is now suddenly the best thing since sliced bread. smile

The craziest example I'm aware of was a "new" Baldwin dealer who posted here to complain and request that people not bad-mouth Baldwin online because people might believe it, and a look at his meager posting history showed that he had previously been on PW badmouthing Baldwin after he ceased to be a Baldwin dealer previously!

"Today I sell Baldwins, and they're great! Yesterday I didn't sell Baldwins, and Baldwin was horrible. Before that I sold Baldwins (so they must have been ok...)"

Sorry, I know I've pointed that one out before, but I just never get tired of how flagrantly hypocritical it is! whome wow ha



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Re: Why do piano dealers change brands ?
Retsacnal #2726341 04/03/18 05:25 PM
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Originally Posted by Retsacnal
I visited a local chain/dealer a while back. The salesman explained that they had previously been a Steinway dealer, but that Steinway had demanded that they sell only Steinway, so they had opted to not sell Steinway. Of course, that may or may not be true.

This is true; the biggest dealer in Portland liquidated all of their Steinways and another dealer is now the only Steinway dealer in town.


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Re: Why do piano dealers change brands ?
Edb123 #2726344 04/03/18 06:00 PM
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Originally Posted by twocats
This is true; the biggest dealer in Portland liquidated all of their Steinways and another dealer is now the only Steinway dealer in town.

Well, selling only Steinways can work for a dealer. They'd only need to sell a few a year to make a healthy profit (or not). smile

Rick


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Re: Why do piano dealers change brands ?
twocats #2726507 04/04/18 12:45 PM
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Originally Posted by twocats
Originally Posted by Retsacnal
I visited a local chain/dealer a while back. The salesman explained that they had previously been a Steinway dealer, but that Steinway had demanded that they sell only Steinway, so they had opted to not sell Steinway. Of course, that may or may not be true.

This is true; the biggest dealer in Portland liquidated all of their Steinways and another dealer is now the only Steinway dealer in town.

Thanks for the corroboration. I had no specific reason to doubt it, but one never knows...



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Re: Why do piano dealers change brands ?
Rickster #2726509 04/04/18 12:53 PM
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Originally Posted by Rickster
Originally Posted by twocats
This is true; the biggest dealer in Portland liquidated all of their Steinways and another dealer is now the only Steinway dealer in town.

Well, selling only Steinways can work for a dealer. They'd only need to sell a few a year to make a healthy profit (or not). smile

Hehehe. Maybe so.

I think dealers would benefit from being able to sell anything they want. Steinway would benefit from restricting their dealers to their own lines. For example, If a sale is going to lost to a "lessor" piano, it might as well be a Boston or an Essex. In theory, the dealer is still selling a piano. However, if the customer prefers a different alternative, perhaps something less expensive than a Steinway, but "better" than a Boston, then the exclusive dealer cannot satisfy, and the sale is lost (both dealer and Steinway lose). A non-exclusive dealer may be able to satisfy the customer, and therefore not lose a sale.

Restricting dealers to specific lines would disproportionately benefit the the manufacturer (IMO). Of course, it wouldn't be fair not to point out that being a Steinway dealer probably has a certain value too, so it'd be a tradeoff for the dealer: potentially gain business based on Steinway's reputation, but sacrifice sales of non-Steinway pianos.



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Re: Why do piano dealers change brands ?
twocats #2726513 04/04/18 01:08 PM
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Originally Posted by twocats
Originally Posted by Retsacnal
I visited a local chain/dealer a while back. The salesman explained that they had previously been a Steinway dealer, but that Steinway had demanded that they sell only Steinway, so they had opted to not sell Steinway. Of course, that may or may not be true.

This is true; the biggest dealer in Portland liquidated all of their Steinways and another dealer is now the only Steinway dealer in town.


On balance, and despite whatever desires there are at the corporate/distributor level, this is not always the case. I've known a dealer who had both Steinway and Yamaha, even one during a transition that had Yamaha and Kawai, more than one that have Steinway and Kawai, and a bunch of markets that separate who sells Bösendorfer from who sells Yamaha, even though they're owned by the same entity.


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Re: Why do piano dealers change brands ?
Edb123 #2726519 04/04/18 01:29 PM
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Steinway does not "demand" that our dealers sell "only Steinway". There are those who have chosen to represent only our brands - and there are those who represent brands in addition to ours.


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Re: Why do piano dealers change brands ?
Bob Snyder #2726531 04/04/18 02:14 PM
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Originally Posted by Bob Snyder
Steinway does not "demand" that our dealers sell "only Steinway". There are those who have chosen to represent only our brands - and there are those who represent brands in addition to ours.

Not "only Steinway", but I'm pretty sure the message was "only Steinway as the high-end brand".


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Re: Why do piano dealers change brands ?
Bob Snyder #2726535 04/04/18 02:32 PM
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Originally Posted by Bob Snyder
Steinway does not "demand" that our dealers sell "only Steinway". There are those who have chosen to represent only our brands - and there are those who represent brands in addition to ours.

Thanks for the input.

I otherwise only know what the dealer told me, and, as I said, it may or may not have been true. Salesmen lie all the time. It may be more face-saving, for example, to say "they forced us..." than to admit perhaps they couldn't meet sales quotas, or whatever. Heck, they may have simply decided to quit carrying Steinway, and desired to besmirch the company (FUD takes strange forms).



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