Price Fluctuations

[red7flag]

In another thread I mentioned that in the current market, my Martin C style has gone down in price. What I didn't mention is that my Collings MT2-O and other A styles have gone up. One might think with the virus and Bill passing away that the prices would have come down. Any insight here at the Cafe?

[pheffernan]

Any insight here at the Cafe?

I typically think that as new prices rise so too used prices follow. I seem to recall a recent discussion about price hikes at Collings to allow for their employees to be better compensated.

[sgarrity]

I find vintage prices to be very market driven. Just look at Loars. While a lot of them change hands privately there are multiple examples that have been sitting for a long time at fairly low prices.

Used prices on newer instruments are driven by the market as well as the new/retail pricing. Collings makes a really good and widely admired product. It makes sense that their used pricing would be fairly stable to slowly increasing over time. But buckle up because we're going to see a LOT of instruments for sale in the coming months I'm afraid.....

[yankees1]

In another thread I mentioned that in the current market, my Martin C style has gone down in price. What I didn't mention is that my Collings MT2-O and other A styles have gone up. One might think with the virus and Bill passing away that the prices would have come down. Any insight here at the Cafe?

I would think the opposite ! If a well known maker dies , his instrument demand and prices should rise ! Case in point. I bought a Sergio Peresson violin in 1983 for $12,000. Price remained steady until he died ! That violin is now appraised and selling at over $50,000. The current CV crisis will have a negative effect however in the short term I'm afraid.

[mandroid]

Snake head A's fetch higher prices than Paddle head A styles in the Gibson Marque..

up thru '22 jumps at '23+ It seems.

[red7flag]

I really appreciate the thoughts. The Collings prices that I referred to were the price of their new ones. Bill's death might drive up the prices of the instruments that he was involved with, but not sure that would effect the new ones. The issue of raising prices to improve benefits would explain that change. Shaun your comments on the vintage market seem dead on.

[Mandobar]

The prices increased at Collings mostly due to the no discount policy, which was reinforced by a cut in dealer margins. The other point is that it is easier to resell a Collings mandolin than other builders. As for Loars, I've talked to a few dealers (some telling me that one can be had now for around $50k, although I am quite skeptical on that one) but others have told me the market is soft and there are a lot more individuals selling them than there have been in the past.

I'm not sure that you will see that broad sell off that people are talking about. I think business models are going to change, and you will see some forms of business slide, but there's been so much innovation lately, at lightening speed, that there are probably going to be a surge in manufacturing. I believe that you will see more businesses with "diversified" manufacturing plants. Case in point, there is an outerwear maker here in Maine that makes outdoor clothing. They now make masks and other PPE and are planning on continuing to do that for as long as they are needed, and will eventually go back to making their other products in tandem or in cycles, depending the demand for each product line. It takes a bit to reset up, but it's a smart plan.

The company I buy my fitness equipment from is making face shields and some really innovative respirators alongside barbells, medicine balls, etc. These tool and die guys can do some amazing stuff with the CAD equipment they have invested in, and some of them are just seeing their businesses expand like crazy.

One of the hottest careers you will see is going to be supply chain management, and if you are good at it, you can make a lot of money. I think if Bill Collings were alive during this pandemic you would have seen some really innovative PPE coming out of Austin. He was just that kind of guy. It's a good thing there are a lot of people around who have that same innovative and humanitarian drive.

[Nevin]

A lot of things have an impact on prices. Unfortunately I think the economy is in for a very rough road for a few years. The price of collectibles of any sort will drop, instruments,cars, art etc.

[Russ Donahue]

Mary has made a very good point about innovation responding to times and need. I work with a company in California that has successfully turned its business model 180 degrees and enabled 175 employees to stay in the workforce providing essential services. Without fast thinking over a (very long weekend) we would have just shut down and told employees and clients to "ride it out." I know every company doesn't have that luxury. Truthfully, I didn't think ours did. But when push came to shove it did.

[Mandobar]

Mary has made a very good point about innovation responding to times and need. I work with a company in California that has successfully turned its business model 180 degrees and enabled 175 employees to stay in the workforce providing essential services. Without fast thinking over a (very long weekend) we would have just shut down and told employees and clients to "ride it out." I know every company doesn't have that luxury. Truthfully, I didn't think ours did. But when push came to shove it did.

Russ, you’d be surprised how resilient and innovative people can be when things like this happen. Those who can think on their feet will prevail, and it looks like we may see a hyperdrive forward in some industries. Even L L Bean stepped up and is making PPV right here in Maine. Thalia capos, a high end guitar capo company in California is making medical equipment. There’s a company in Rochester, NH about to start building ventilators. Flexibility will be the key to staying in business. A friend of mine who’s son is a carpenter is now exclusively installing plexiglass enclosures in stores, county administration buildings, and various other sites. I have a feeling that plexiglass is going to be very much a part of the new norm in public places.

So, there will be jobs, and this may help buoy the economy. I saw yesterday in the New York Times that some countries are funding moving companies manufacturing out of China. I’m not sure how that will impact musical instrument manufacturers, but time will tell.

To be honest, at some point, we might see a shortage of new instruments as production numbers will be down due to the current closures.