Audionaut
Major Contributor
I am curious to see how things will develop here and whether Dayton Audio will survive.
The subwoofers, Reference Line, Epique Line, etc. – it would be a shame if they were no longer available.
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RIP Parts-Express (as we knew it).
- Thread starter Ktacos
- Start date
The subwoofers, Reference Line, Epique Line, etc. – it would be a shame if they were no longer available.
a4eaudio
Addicted to Fun and Learning
While I am not a fan of private equity... If it is profitable, it will survive.
Usually House Brands are more profitable than distributing 3rd party brands. PE is likely the largest speaker distributor in the US. So, I'm trying to be optimistic.
Usually House Brands are more profitable than distributing 3rd party brands. PE is likely the largest speaker distributor in the US. So, I'm trying to be optimistic.
In their never ending quest for more lucrative markets, private equity has been buying up veterinary offices, healthcare offices, heating contractors, plumbing contractors, and every other service they can acquire. Will these services become better for the consumers who need them and better places for the employees who work at them... sure, that why they bought them up, to make our world a better place.
Will Parts Express be profitable enough to satiate the appetite of a hungry private equity firm? I doubt it.
a4eaudio
Addicted to Fun and Learning
We (in the US) live in a lightly regulated, free market capitalist country. The objective of a for-profit company (in particular any publicly traded company or private equity) is to make profits. The services will become better and they will become better places for employees IF that is more profitable. They will become worse for consumers and worse places for employees IF that is more profitable. (I'm not judging this, just stating the fact. For example, Rand Paul and Zohran Mandami severely disagree on how well unfettered capitalism serves the public good.)
I am quite sure a PE (private equity) firm didn't by PE (Parts Express
) if they didn't think it was a profitable venture. Paying millions of dollars for something and then shutting it down isn't usually a good investment. The problem for us consumers is that there WILL be changes, such as the closing of the storefront, where they shut down unprofitable aspects.In the private equity world it's really "if it's acceptably profitable, it will survive". And the threshold for 'acceptably profitable' is generally high and just gets higher over time.
So, generally the value proposition to the customer inevitably degrades. Not instantly, but soon enough.
I was planning to order a Fosi V3 mono shortly - maybe a good idea to pick up some additional TB drivers and maybe Dayton PRs to cover the vague ideas of 'maybe someday' projects. To call my progress on projects 'glacial' is an insult to glaciers, but it would be typical for me to finally move on something only to find that supplies are no longer available.
a4eaudio
Addicted to Fun and Learning
One other thing...IF it is profitable to distribute Peerless, HiVi, etc. drivers and Parts Express decides it is in its best interest to stop...I'm sure some other company(ies) (like Madisound) will be happy to sell profitable speaker drivers. What happens to the House Brands of course is a different story. If the Dayton Audio Reference Series was ever discontinued, that would would be a real shame for the DIY community.
What the buyer does with it was not really my point. They may choose to keep and run it in a similiar manner, or not. Nobody knows.
If they choose to purchase the business, what they do with it is their business.
My point is this is neither good nor bad. It is the free market working. And the free market where businesses and a country where businesses can be started, be run, profit made, services provided, jobs provided should not be thought of negatively as many seem to be viewing this. While I can certainly sympathize that it can be sad that things change but to the hand ringing about “corporate greed” is just a view I don’t share. In fact, I would say the opposite is true from my point of view.
deprogrammed
Active Member
Feeling nostalgic. 52 and grew up in the Dayton Ohio area. Mid late 90s. Day off. What to do? There was Parts Express, MCM Electronics, and a computer company whose name escapes me. All in the commercial area of Springboro Ohio and a mile or so apart. All were companies that were warehouses that shipped globally. All had "showrooms". Always had a couple things I knew I was going to get and check out. Nice to actually interact with things! Always some specials for walk in customers. Fun to discover. Usually the folks working and sometimes customers were enthusiast and friendly. Talk some shop. Learn something. A great afternoon for a young man with some time and some extra money.
G|force
Addicted to Fun and Learning
I hope Parts Express stays the same or improves under the new ownership, sure.
In my "glass half full" point of view, an enterprising individual created a successful business and did well enough with it to be able to sell it and retire. It's a happy ending, at least for him.
In my "glass half full" point of view, an enterprising individual created a successful business and did well enough with it to be able to sell it and retire. It's a happy ending, at least for him.
Philbo King
Major Contributor
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This reminds me of when Bain Capital bought Guitar Center, borrowed heavily against it, and sent it into its current death spiral (Thanks Mitt Romney )
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I feel the urge to quote Cat Stevens' (as he was then known) song Oh Very Young.
I will restrain myself.
I will restrain myself.
Thank you.
Even as an insignificantly small competitor to PartsExpress, I hope that they do not close and I don't believe they will.
They will make changes. They will likely drop some product lines that are less profitable and add others that they think will be more profitable.
It will take time to see what the new owner's strategy is. Are they going to shrink to be more profitable? Are they going to expand their offerings to be more profitable?
I suppose we will all wait and see.
As a small and new retailer exclusively offering crossover parts and assembly services, I will tell you that margins on many of those items can be very small. Shipping fees and transaction fees are all significant pieces of the equation. Some items are even sold near cost without markups just to retain and attract customers, with hopes that profits are made on other items. I wish them luck and hope that the consumer doesn't lose out on product options.
Elon
ezspeakersolutions.com
They will make changes. They will likely drop some product lines that are less profitable and add others that they think will be more profitable.
It will take time to see what the new owner's strategy is. Are they going to shrink to be more profitable? Are they going to expand their offerings to be more profitable?
I suppose we will all wait and see.
As a small and new retailer exclusively offering crossover parts and assembly services, I will tell you that margins on many of those items can be very small. Shipping fees and transaction fees are all significant pieces of the equation. Some items are even sold near cost without markups just to retain and attract customers, with hopes that profits are made on other items. I wish them luck and hope that the consumer doesn't lose out on product options.
Elon
audio home speaker crossover components for sale assembly
Online retailer for home speaker crossovers including resistors ,capacitors, inductors, and internal solid core wiring, 16ga and others
ezspeakersolutions.com
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I've never heard of this vendor!Even as an insignificantly small competitor to PartsExpress, I hope that they do not close and I don't believe they will.
They will make changes. They will likely drop some product lines that are less profitable and add others that they think will be more profitable.
It will take time to see what the new owner's strategy is. Are they going to shrink to be more profitable? Are they going to expand their offerings to be more profitable?
I suppose we will all wait and see.
As a small and new retailer exclusively offering crossover parts and assembly services, I will tell you that margins on many of those items can be very small. Shipping fees and transaction fees are all significant pieces of the equation. Some items are even sold near cost without markups just to retain and attract customers, with hopes that profits are made on other items. I wish them luck and hope that the consumer doesn't lose out on product options.
Elon
audio home speaker crossover components for sale assembly
Online retailer for home speaker crossovers including resistors ,capacitors, inductors, and internal solid core wiring, 16ga and others
I appreciate your mentioning them. EDIT: wait... is this you?'Private equity' firms raise money from investors and from borrowing (debt), to buy a privately-held company (which takes on the debt, the burden to the private equity buyout firm being zero*), with the sole intent of selling it (or its assets) later (as soon as feasible, really, in practice 5-7 years) for big profit.Even as an insignificantly small competitor to PartsExpress, I hope that they do not close and I don't believe they will.
They will make changes. They will likely drop some product lines that are less profitable and add others that they think will be more profitable.
It will take time to see what the new owner's strategy is. Are they going to shrink to be more profitable? Are they going to expand their offerings to be more profitable?
I suppose we will all wait and see.
As a small and new retailer exclusively offering crossover parts and assembly services, I will tell you that margins on many of those items can be very small. Shipping fees and transaction fees are all significant pieces of the equation. Some items are even sold near cost without markups just to retain and attract customers, with hopes that profits are made on other items. I wish them luck and hope that the consumer doesn't lose out on product options.
Elon
audio home speaker crossover components for sale assembly
Online retailer for home speaker crossovers including resistors ,capacitors, inductors, and internal solid core wiring, 16ga and others
This means a short-term focus on 'efficiency' and fast growth, meaning cost-slashing, layoff-making, and generating the stream of cash to service interest on the debt. Focus on the culture of the business, its people/workers, its relationship to its geographic community, its loyal customer base...not so much.
Maybe that all works out, or maybe private equity decides the company's property and inventory is worth more than the company itself, and they strip it into oblivion.
So it goes.
*unless it sells to another private equity firm
[EDITED: replaced 'PE" with 'private equity' to be very clear, since the company in question is also abbreviated 'PE']
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There's solen.ca, but it can be pretty expensive to pay tariffs and ship stuff across the border.
I had a good laugh at that. It describes my efforts to a tee.