America’s Top Music Chains (32nd Annual)

As with each of the 31 reports that preceded it, the 2013 rendering of “America’s Top Chains” sees a few departures from the tally due to store closings, a few introductions (or re-introductions) to the list thanks to store openings, as well as a few brand new (or new to us) entries who we welcome to the fold.  Thanks to Guitar Center’s (including Music & Arts) healthy clip of new storefronts (26!), as well as the growth of a handful of other companies – including those aforementioned first-time additions – our store-count is up from 774 in 2012 to the current reckoning of 815.

The most significant changes between MMR’s “Top Chains” of ‘12 and this calendar year would unquestionably be the departure of both storied piano dealer Sherman Clay and electronics retail behemoth Best Buy from the overall mix.

Sherman Clay had been in business for over a century as one of the nation’s foremost dealers of high-end pianos, last year fielding seven locations and doing about $18 million dollars’ worth of business.   Beginning with the April 11^th closing of the operation’s flagship store in San Francisco, one by one, the company shuttered locations throughout the year, with the final store in Seattle closing its doors on September 30^th.  A few of the Sherman Clay outlets were sold to Steinway & Sons – accounting for the uptick in Steinway Hall/Showroom locations from nine in 2012 to the 2013 count of 12. Last spring, Sherman Clay’s chairman of the board and CEO of retail and finance divisions told The San Francisco Chronicle, “It is a very sad thing, a difficult business decision for us to make… [but] we are in a number of other businesses, and this one is a business that takes careful care and feeding… It takes a very special breed to know how to sell pianos.”

The departure of Best Buy is likely the cause of far less sentimental response amongst the industry. Last year we reported that there were just under 100 of the “music store within a store” models throughout the country (though some sources – including Best Buy – sometimes had that number as closer to 120), but truthfully the writing was already very much on the wall by then. Whereas the Best Buy “music stores” of late 2005 and 2006 were often nearly 3,000 square-foot operations offering multiple lines of high-end MI gear, by summer of ’12, most (the ones that we visited, anyway) had been reduced to increasingly smaller departments within a given store, stocking a pitifully random selection of gear that looked, more and more, like the leftover scraps of a failed venture. That view that was confirmed when, in March of 2013, Best Buy alerted key suppliers that it would be ending the “store within a store” experiment; suppliers were given the option of buying back unsold inventory or allowing the company to resell the product to other MI retailers.

As the majority of the dealers represented in this report are privately held, in most cases the data being presented in “America’s Top Chains” was supplied by the companies, themselves. In other instances, MMR made estimates based on data available to our research team.