Guitar Center, the world’s largest chain of musical instrument retailers, cut ties with Behringer on May 16th, 2014. This was based on claims of “unreasonable business terms late last year and a continuous history of attempting to force unfavourable changes into agreements.’
Guitar Center’s full statement read, “Decisions like this are never made easily. There are rare occasions where the integrity of the relationships and agreements we make with vendors are challenged, despite the potential impact to the bottom line or overall sales. We can’t speak for anyone else in the industry, but we’d had enough of watching Behringer try to do business this way. It’s not the way we like to work with people and it’s not productive. They made some questionable choices that put us into a position to develop a contingency plan. As we re-evaluated that plan several weeks ago, we found that it would allow us to build better relationships with other vendor partners in the category. When Plan B starts to make this much business sense, it became clear we didn’t need to tolerate this anymore. We’re focused on where we can succeed in partnership with our new vendors and we’re excited about the future.’
What this actually means for the Music Group, Behringer’s parent company, remains unclear. Behringer had a 20 year relationship with Guitar Center and while the retailer points the finger at Behringer as the culprit, they claim otherwise.
Joe Sanborn, senior manager of marketing communications issued a statement on the official Behringer forums saying, “Frankly, it became increasingly difficult to do business with GC as they sought to increase their profits, which would have forced us to increase our prices to you (the consumer). We didn’t agree. 25 years ago, Uli Behringer founded our company on the principle of offering products at “Double the experience for half the price’. Because Uli was a struggling musician himself, he made it his mission in life to offer amazing products at amazing prices, so YOU can fulfil your musical dreams. This will never change.’
Uli Behringer, founder of Behringer and Music Group CEO, issued a somewhat diplomatic statement that seemed to come from a slightly different angle: “We were surprised by a recent public statement issued by Guitar Center. Over the last year, due to Guitar Center’s highly publicized financial situation, we were forced to evaluate their creditworthiness. As a result of their credit rating, it was determined that they were a high risk and we were forced to put them on business hold. We certainly respect Guitar Center’s decision to discontinue business with us and we thank them for our excellent 20-year relationship.’