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Guitar Center
From Wikipedia, the free encyclopedia
| Guitar Center, Inc. | |
|---|---|
| Type | Subsidiary, Bain Capital |
| Founded | 1960 |
| Headquarters | Westlake Village, California |
| Key people | Marty Albertson, CEO Erick Mason, CFO John Zavada, CIO William Deeney, CLO Greg Trojan, COO |
| Industry | Specialty Retail: Musicial Instruments |
| Products | Musicial instruments, Recording equipment and accessories |
| Revenue |  $ 1.78 billion USD |
| Employees | 10,000 |
| Website | www.guitarcenter.com |
Guitar Center is the largest chain of musical instrument retailers in the world and is located throughout the United States. Its headquarters is in Westlake Village, California.
Founded in Hollywood by Wayne Mitchell in 1959 as The Organ Center, a retailer of electronic organs for home and church usage, it became a major seller of Vox electric guitars and guitar amplifiers, changing its name to The Vox Center in 1964. Toward the end of the 1960s, Vox's line—whose sales derived largely from its association with The Beatles, who made extensive use of its amplifiers—fell in popularity as Marshall amplifier users Eric Clapton and Jimi Hendrix captured musicians' imaginations. Accordingly, Mitchell once again changed its name, to Guitar Center.[1]
The popularity of rock and roll in the 1970s allowed Mitchell to open stores in San Francisco and San Diego, as well as several suburbs of Los Angeles. Ray Scherr purchased the company from Mitchell in the early '70s and Scherr owned and operated it until 1996 from its Westlake Village headquarters. Although synthesizer-driven disco and New Wave pop sapped rock's audience in the late 1970s, the 1980s "guitar rock" revival led by Van Halen and a concurrent influx of Japanese-produced instruments brought guitar sales to unprecedented levels. Guitar Center took full advantage of this sales bonanza, and by the end of the decade began an ambitious program of expansion across the entire United States. Using its size as leverage over the musical instrument business, it developed into the largest musical instrument retailer in the country, and made an initial public offering of stock in 1997. In 1999, it purchased mail order and Internet retail house Musician's Friend for $50 million, further consolidating its dominance over the sector, although Musician's Friend remains a wholly-owned, independent subsidiary; Robert Eastman remains as CEO and serves on the Guitar Center Board of Directors. Musician's Friend has increased in sales to over $350 million in the past 7 years. Its position was strengthened further by the 2003 demise of one of its two principal rivals, Mars Music, leaving only Sam Ash as competition. In 2005, Guitar Center Inc. acquired Music & Arts Center, and merged their subsidiary Band and Orchestral chain American Music Group into Music & Arts Center. In mid summer 2006 Guitar Center purchased 4 stores in Texas from the popular South Texas and Central/South American company, Hermes.
Also in 2005, Guitar Center, Inc., started The Guitar Center Music Foundation, a non profit organization that supports music education.[2] In 2007, Guitar Center acquired Victor's House of Music.
In February of 2007, Musicians Friend (a Guitar Center subsidiary) purchased the Indiana based company Woodwind & Brasswind (WWBW), including its sister company Music123. Guitar Center's sister companies/subsidiaries incorporate Musician's Friend, GuitarCenter.com, LMI, Giardinelli, Musician.com, Private Reserve Guitars, and Harmony Central.
On June 27, 2007, Guitar Center agreed to $1.9 billion buyout from Bain Capital, totaling $2.1 billion including debt. The deal was led by Goldman Sachs and amounted to a per-share price of $63, or a 26% premium on June 26's closing price.[1] The deal was approved by shareholders on September 18th, 2007 and closed October 9th, 2007.[3]
The Sunset Boulevard location in Los Angeles hosts Hollywood's Rock Walk, a hall of fame honoring notable musical artists ranging from Chuck Berry and Bill Haley and His Comets to Aerosmith and Iron Maiden.[4] Artists are invited to place their handprints into cement blocks that are put on display at the Guitar Center.[5]. On November 19, 2007, B'z was the first artist from Asia and Japan to be inducted. [6]
Guitar Center has often been criticized by being called the "Wal-Mart of Guitars," or "Guitar-Mart" based on their Guaranteed Lowest Price philosophy and their apparent desire to cut corners by paying their employees very little for the work they perform and pushing only the products that they have a large stock of for promotional reasons. They are also said to have put many "Mom and Pop" music stores out of business in the same fashion as Wal-Mart, although Guitar Center itself was once a small privately owned business.