Interesting read if you're into the business of music.
http://www.nytimes.com/2012/09/30/business/fender-aims-to-stay-plugged-in-amid-changing-music-trends.html?smid=fb-share&_r=1&

a very interesting article.

Profound article!

If I were Fender, I'd blow everything out the door this holiday season and start the New Year off with a clean slate. Whatever's leftover, donate it to impoverished countries. Then, fervently build a new economy of jobs through music based on relentless, timeless perfection at an affordable price.

Put a retail custom shop type setup of modular example kits in each retail shop to get low-end custom orders going to make the customers happy *and* avoid over-stocking.

Also, some Do It Yourself Kits by Fender would be way cool! ...bare bodies, necks, etc. Kit contests. Kit Classes.

Accessories made to original specs or with improvements, no penny pinching.

Break into techno small, don't try to dominate that market, rather, make it competitive, set an example for the world to follow -- rebuild Fender's goodwill factor.

Fender should become the grandfather of music -- not our dead, stingy, rich uncle!

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"The individual is handicapped by coming face to face with a Conspiracy so monstrous he cannot believe it exists. The American mind simply has not come to a realization of the evil which has been introduced into our midst." J. Edgar Hoover

With nearly a quarter of a billion dollars in non-amortized debt obligations due in less than two years?

Can you say "undercapitalized basket case heading into receivership and liquidation"?

Because that's what would ensue should FMIC follow your......advice.

Arjay

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"Here's why reliability is job one: A great sounding amp that breaks down goes from being a favorite piece of gear to a useless piece of crap in less time than it takes to read this sentence." -- BRUCE ZINKY

Yes. Undercapitalized basket case heading into receivership and liquidation -- chapter 11 or chapter 7, sorry bankers and investors, yah got too greedy.

It's time to crush the beast and let the music surface again. An IPO would only make things worse with more mouths to feed who sit back and do zilch causing quality to suffer further. The fat's goin' bye bye one way or another. But, I am certain the Fender brand will survive either the bankruptcy or reorganization looming in the balance. Reorganization through chapter 7 and a liquidation seems most logical to me and will benefit the individual first who gives birth to the musician, the community, the company -- the greater good being the individual's needs first, how this whole thing got started, the American way!

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"The individual is handicapped by coming face to face with a Conspiracy so monstrous he cannot believe it exists. The American mind simply has not come to a realization of the evil which has been introduced into our midst." J. Edgar Hoover

If americans would buy american products , don't get me started !

Yeah, unfortunately we're not back in the 60s any more...

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Dennis in CR
Rockin' since 1963

IMO I think alot of this has to do with Fender unwilling to explore new niches... now I know in the 80's when Fender tried to do metal it didn't work, because that wasn't Fender, but geez what do we have to do to get more than a Tele, Strat,P, or Jazz bass??? I think Fender's sales would go up again because I am sure many other guitarists feel this way we try a different sound out, but we can't go to Fender for it so we go to another company. I like the Pawn Shop guitars, BUT HOW HARD IS IT TO PUT 22 FRETS ON A GUITAR???? And Fender's quality isn't up to snuff either, this past year I bought a MIM Tele Nashville, and had to return it because the fret ends stuck out and the nut was cut incorrectly so the open strings buzzed. I also bought an American special strat, and the doofus who drilled the holes for the trem drilled one hole at an angle so the trem would not fit, but instead of filling it, he just drilled another hole so close so that by the time I bought the guitar, the screw had worked its way into the other hole causing the trem to be crooked and impossible to stay in tune. This kind of stuff from both the American and mexican factories kind of turned me off from Fender, even though I am about to buy a Cabronita tele. Asians are making stellar guitars for cheap prices, and Fender needs to raise quality and cut costs in order to compete. I would like to see more MIA guitars though, I mean look at what Gibson is doing right now, they have their tribute line witch is MIA but is only about 700-800 dollars, why can't Fender do that??? Especially now that they just raised the price on the American standard.

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1965 Fender Precision Bass, 1994 Fender '54 Reissue Precision Bass, 2007 Applause Celebrity, 2011 Fender American Special Jazz Bass, 2012 Squier Vintage Modified Jazzmaster, 2013 Fender American Special Stratocaster, 2013 Gibson LPJ

CBS years may make a come back. hope not. my strats are essential at least to me. i'm not planning to buy another strat anytime soon but if i do i would at least like it to be up to par. the two i own are great and i can't complain. my amps are good too. sorry to say(really i'm not) but my next purchace will be an AC30. it's hard for anyone to venture a guess where this economy will end up. hey look on the bright side, if fender goes away all our strats and so on will be more valuable in some cases. imagine your self playing a sold out gig with your old beat to hell strat because that's what you love.

Quality has always cost money. It always will. There's no sense in complaining about quality and also complaining about price in the same breath. That's akin to a mouse complaining it isn't a giraffe. Fender has for the most part done a near miraculous job of temporarily disguising from most people the inescapable fact that quality costs money but they (and we) had to know that eventually the truth of it would out. The simple truth is we are seeing more and more complaints related to QA/QC issues. I don't think it's a co-inky-dink that this trend coincides with the increasing ratio of offshore guitar sales to MIA sales. I'm not saying that's the only factor but I think it is definietly one of the more important factors.

In a world where kids create dance grooves on their home computers and then sell them to rave clubs I believe FMIC is on the wrong track by continuing to try to grow by finding cheaper and cheaper methods to manufacture their instruments and amplifiers. I think it's time to read the writing on the wall and figure out how to survive rather than grow. There is still a lot of money to be made by downsizing the operation to the proportions of Leo's day and concentrating on fewer but higher priced, higher quality instruments and amps. The article made a particularly poignant observation in the comment about accordians once being the most popular instrument in USA. You do still see and hear accordians but they are not very prevalent. Likewise there will always be a market for guitars, especially quality guitars but it won't always be a huge market. I think the market will continue to shrink from now on. A business plan like this would also help with another problem we all face being the increase in outsourcing our jobs and spending our money on imported goods.

Guitar music has had a long run. Longer than anybody ever predicted in the early days. It was made possible largely because of artists who made real music with their guitars. I believe that when the shredders took the guitar and changed it to be about athleticism instead of art it signalled the beginning of the end for the guitar. This was further evidenced by the dark and moody Seattle sound that arose in defiance and protest against shred where artists were actually proud of the fact their songs contained no lead breaks or complicated playing. Fender should be grateful for the resurgance of the blues for the past 25 years or more. I'm sure it saved the company from an early extinction.

Anyway, that's my rambling thoughts on the matter.

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Just think of how awesome a guitar player you could have been by now if you had only spent the last 10 years practicing instead of obsessing over pickups and roasted maple necks.

Yeah maybe instead of making 500 strat and tele variants they can focus on a couple and try to design new guitars... like a modern jazzmaster with jumbo frets and 22 of them at that... design new pickups, bring back that creationism that made Fender such a good company in the first place... And quality does cost, but when I buy an $800 guitar I expect it to be perfect, especially since it is made in America too, but sadly it is not, maybe America truly cannot make anything of quality anymore.

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1965 Fender Precision Bass, 1994 Fender '54 Reissue Precision Bass, 2007 Applause Celebrity, 2011 Fender American Special Jazz Bass, 2012 Squier Vintage Modified Jazzmaster, 2013 Fender American Special Stratocaster, 2013 Gibson LPJ

Fender strikes me as the Harley-Davidson or Jack Daniels of Rock 'N' Roll. It has the undeniable history; the panache, the mystique, and the rude "$@!& Off" attitude. Done right they can take that straight to the bank.

The American Standard Jazz bass I just bought is the highest quality instrument I have ever owned or played. The Custom Shop pick-ups are killer. Leaps & Bounds better than my '76 Precision that I bought brand new. Easily the equal of $4-5K L&G or Lakland. Fender has to decide to go back to being all American made. That's going to cost. A lot.

Upgrade the Squire line and make them in Mexico.

Don't cater to the lowest common denominator. Raise your sights. Look Up. Stand Up. Build Up. Measure Up.

I don't know about you, but make mine a Fender.

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2012 Lefty American Standard Jazz
2017 Lefty American Professional Precision
2018 Rumble Studio 40 Combo
2016 Rumble 200 Combo
One day they shall name a GREAT city after me, and they shall call it LINNINGRAD

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Just think of how awesome a guitar player you could have been by now if you had only spent the last 10 years practicing instead of obsessing over pickups and roasted maple necks.

I'm sure that fact has not escaped them. And a quick review of all the available artist models reflects this -- most of the guitarists immortalized by a signature Fender instrument play the blues. Not metal, not, grunge, not techno-pop, not even country. The blues......

"Three chords and the truth"

Arjay

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"Here's why reliability is job one: A great sounding amp that breaks down goes from being a favorite piece of gear to a useless piece of crap in less time than it takes to read this sentence." -- BRUCE ZINKY

Equating Musical Instrument as Commodities is perilous. Everyone does not need a guitar nor do we really want to hear everyone scratching away at six metal strings....That is really the equivalent of the majority picking up a guitar and attempting to ( cough ) create a musical passage .
This seems to have been a lost message with the Private Equity Firms ( LBO's ). Not everything in this world can only be justified by spreadsheets....People using software programs to make a tune are really not creating music. They are merely punching in a set of coordinates which then releases a software equation with numerous possibilities. This isn't someone figuring out melodies based on chordal structures or various keys. Musical talent potential is unnecessary.

At GC in Warwick RI yesterday, a guy about my age ( 50's ) was just playing heavily distorted lead runs thru a multiple effects rack for at least 30 minutes...All I could think of was Fap...Fap...Fap. Might as well just learn Paganini's 24 Caprices and play them without emotion, structure or any sense of mood which minor or major key changes invoke.....


The NYT article misses the point and only views Fender as a product manufacturer which must cut costs and offer higher quality for a reduced entry fee....
RCB makes a point, but I believe recent history has painfully shown that seeking short term profits at the expense of long term profitability is a fool's errand.
I encounter this in my industry everyday, the customer that wants custom quality/ bespoke quality residential remodeling/renovations at the same costs to be competitive with the offerings from a big box chain.....

Wether Fender has reached the point of supply exceeding demand is a yet to be answered question. Is there really a need for a GC in every corner of the world offering not only Fender but many lower priced competitors products...
I think not but this is IMO and YMMV in your corner.....

I would prefer to hear an occasional musician playing a melodic passage rather than a hundred distorted white noise sequences, many at the same time from opposite corners of the big box.
This is really the answer after the question and it isn't being addressed however sooner or later there has to be the answer as to wether One wants to be a somewhat/realistically downsized fine instrument maker or just a Silvertone manufacturer....

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"C'est parti mon Kiki "