Baldwin's Woes

[Farrell]

> Upon entering Mr.
> Jones was said to have "gasped in disbelief".  Inside were
> hundreds of brand new Baldwin digital pianos, crated in the
> boxes and ready to ship.  Unfortunately the entire inventory
> was at least five years or older, completely antiquated and
> virtually worthless on the retail market.  Likely
> they will now all have to be destroyed.  Littering the
> market with a product for pennies on the dollar that can't
> be given a warranty will likely damage the Baldwin name
> further while eliminating potential buyers for future
> profitable products.   In today's business world it would be
> a risky move for a manufacturer to try and sell these
> instruments at this late stage no matter how tempting.

True, but what about donating these instruments to non-profit children's
homes, etc. Maybe even qualifying funds-poor churches. Heaven only knows how
bad some need a functional instrument (I know all of you are aware). A
bookeeping nightmare could be turned into a PR opportunity. Think of the
headlines - "Baldwin Puts Music Back in Churches"! It would be a crime to
destroy such an inventory. I would strongly suggest finding this guy's name
and sending him such a message to pass along to Mr. Jones.

Terry Farrell

----- Original Message -----
From: "Robert Goodale" <rrg@nevada.edu>
To: "PianoTech List" <pianotech@ptg.org>
Sent: Tuesday, July 17, 2001 1:48 AM
Subject: Baldwin's Woes


> The PTG convention in Reno proved to be a fertile ground for
> gossip regarding Baldwin's woes.   Throughout the week
> stories trickled along the withering grapevine about the ill
> health of the company.  Several times I caught a hushed
> earful of rehashed news and on rare occasion someone who had
> know idea that there was a problem.  Personally I was
> somewhat surprised to discover that the cashed strapped
> legend managed to make an appearance, although it was
> somewhat encouraging to see.
>
> Of course I heard a great deal of speculation regarding
> "what happens next" and of course the now infamous "I heard
> that Samick is going to buy them" routine in addition to
> other idle chat.  Nothing to stop the presses.  Then I
> stumbled into a unique situation.  At the PTG banquet I
> happened to sit at a table in the company of a gentleman who
> had a little more credibility on the matter.  His name at
> the moment escapes me although if I recall it I would not
> repeat it in respect of privacy of the source.
>
> This gentleman is the rather business savvy type and is an
> acquaintance of Mr. Bob Jones, the new CEO of Baldwin Piano
> and Organ.  In a nut shell the tale goes something like
> this.  A short time ago when Mr. Jones assumed command he
> took it upon himself to physically inspect every inch of the
> Baldwin facilities.  Certainly a wise and appropriate task
> to do as I'm sure you will agree.  As expected his
> inspection yielded a number of items for potential
> improvement, but the biggest shock was when the tour arrived
> at one of the warehousing facilities.  Upon entering Mr.
> Jones was said to have "gasped in disbelief".  Inside were
> hundreds of brand new Baldwin digital pianos, crated in the
> boxes and ready to ship.  Unfortunately the entire inventory
> was at least five years or older, completely antiquated and
> virtually worthless on the retail market.  They had been
> sitting there rotting away for years until all market value
> had deteriorated and with no explanation as to why.  Likely
> they will now all have to be destroyed.  Littering the
> market with a product for pennies on the dollar that can't
> be given a warranty will likely damage the Baldwin name
> further while eliminating potential buyers for future
> profitable products.   In today's business world it would be
> a risky move for a manufacturer to try and sell these
> instruments at this late stage no matter how tempting.
>
> Moving on to another warehousing facility was a further
> unbelievable discovery.  Hundreds of pianos, grands and
> uprights.  These are what is sometimes referred to in
> business as class B surplus.  They are pianos that for
> whatever reason were returned from dealers back to the
> factory.  In some cases they were returned simply because
> they were misordered.  In other cases they may only have a
> couple of minor problems.  Few pianos that have major damage
> ever make it this far.  As a result of poor record keeping
> there was no way of telling what was in there.  A potential
> gold mine of revenue sitting in a warehouse rotting away.
> Every piano will have to be removed to be inspected and then
> repaired as needed.  Of course at the present time even
> these pianos are nearly worthless since Baldwin already has
> a problem with excessive crated new inventory.
>
> These are just a couple of examples of what mismanagement
> can do to destroy a company.  Poor record keeping is largely
> to blame for this unbelievable waste.  I just received my
> July issue of  THE MUSIC TRADES  which contains a feature
> article on Baldwin's bankruptcy after being unable to make
> their May 25th payroll.  Once again Karen Hendricks is the
> focus of the company's failure.  Although I have no doubt
> that Hendricks was grossly irresponsible and deserves a
> substantial amount of the blame, Baldwin's problems are
> clearly rooted deeper than that.  This is a company that
> been buried in waste and mismanagement.  Throughout most of
> the 90s piano sales were soaring yet by the end of the
> decade Baldwin had little to show for it.  Baldwin could
> still potentially turn around with the right management and
> an aggressive move toward leaning down and plugging the
> hemorrhaging waste problems.  With new products, corrected
> manufacturing defects, and an aggressive campaign to restore
> the Baldwin name, the potential is there.  Unfortunately
> what they need desperately more than anything else right now
> is cash.  I didn't hear any stories regarding how that will
> happen.
>
> Rob Goodale, RPT
> Las Vegas, NV
>
>