There might be more air-guitar performances coming if filing for bankruptcy does not help save Guitar Center.
America’s largest musical instrument and equipment retailer filed for bankruptcy as the coronavirus pandemic temporarily muted stores, kept shoppers at home and caused unemployment that slowed sales.
Guitar Center Inc.’s business at about 300 stores across the U.S. will continue as usual, but the bankruptcy filing gives the company a chance to restructure with a break on its $800 million debt. Some Guitar Center locations have reopened after shuttering in March, while others turned to online sales. The business also includes Music & Arts, which has more than 200 stores selling and renting instruments.
Guitar Center tried to get creative once it lost foot traffic, with many locations being in malls that have been devastated by the pandemic. The company turned to musical instrument repair and online music lessons to offset lost business, much of which turned to online businesses such as Amazon.
“This is an important and positive step in our process to significantly reduce our debt and enhance our ability to reinvest in our business to support long-term growth,” Guitar Center CEO Ron Japinga said in a statement. “We will continue to serve our customers and deliver on our mission of putting more music in the world.”
According to Bloomberg, Guitar Center has experienced heavy debt load and financial pressures since it went private in 2007. The court filing showed liabilities and assets each at between $1 billion and $10 billion.
Guitar Center began its business in 1959, when it sold home organs. That is one music source Amazon would probably leave alone. You’re not getting free shipping on those.