I recall looking at buying a manufacturer that was in the audio contracting equipment business with a very profitable arm in the DJ market. At this company’s peak, sales were $30 million (USD) annually and it was a darling of the industry. This group decided that the future lay in digital, so they abandoned their analog range and invested all their eggs in the digital future.
A smart move, except for a few problems… First, they underestimated the cost and time associated with digital development. Almost simultaneously, they lost an exclusive license to represent a powerful software package that drove their DJ mixer sales.
To shut the proverbial lid on the coffin, most of the markets outside of big-city America were still using analog technology and when these loyal customers found out that they could no longer buy a simple 4-channel mixer or dual 15-band EQ, they were forced to jump ship. Sales were obliterated overnight. With no money coming in, the engineering team was dismantled and what was once a star performer turned into a skeleton.
For a manufacturer, distributor, retailer or installer, making the decision to jump in is never easy. Early adopters can gain an upper hand yet must contend with far more risk. Slow to the market could mean that you’re left behind.
When I was selling Radial, the buyers asked when I foresaw the death of the electric guitar. My answer was simple: Never. The Fender Strat and Gibson Les Paul have been around for what 70 years, and if you read Music Trades, you find that there are more guitars being sold today than ever before.
Everything comes and goes in cycles. Whoever becomes the next Hendrix, Clapton or Van Halen will spur on yet another generation of blues-shredders. Those that are using technology every day are those that will ultimately win the game.
Oh, by the way, that shop in Ottawa contacted me several years after I left and offered me half the store if I would return. I turned them down; I’d moved on.
My advice? Take care of your top salespeople. They’re the ones that bring in the money and pay the bills!