Gibson or Bust [Part 2]
Gibson is yet again the topic of conversation following their Chapter 11 bankruptcy filing earlier this week. As explained in my previous article on the subject (which you can read here), Gibson has been faced with an extortionate amount of debt which had to be paid this summer. It is no surprise to see headlines talking about Gibson filing for bankruptcy, however the cause doesn’t lie in what Gibson is renowned for.
There are many who have been blaming the debt that Gibson has found itself in on the consumers. Many argue that guitar sales are going down due to the lack of guitar heroes and interest shown by young people. However, this is not the case, many industry executives believe that the main cause for these recent events is the failure of Gibson’s venture into headphones and home entertainment. In 2014 Gibson bought a headphone and home entertainment business from Philips for $135 million, this is because Gibson’s chief executive, Henry Juszkiewicz, wanted to make Gibson into a “music lifestyle brand”. This never really took off. As a result of the debt, Gibson has decided to liquidate the headphones and home entertainment part of the company in order to focus on making guitars.
I’d love to hear your opinions on this matter, how you think the liquidation of the Gibson home entertainment business will have an impact on the company and what Gibson’s future is. Leave your ideas in the comments!