Re-Tales

Stereophile readers are surely aware of the tariff situation under the current administration—a situation that has changed rapidly, often daily. The tariff penalty—and arguably even more, the lack of economic stability resulting from tariff volatility—has a major impact on buying, pricing, and corporate strategy in the hi-fi industry. Hi-fi is just one of many industries experiencing the impacts of increased costs and uncertainty.

Often in these pages (and in Industry Update), we have reported ways various brands have experimented with the traditional hi-fi–retail formula. An example: the single-company dealership, adopted most recently by the Vervent Audio Group, parent company to Focal and Naim.

The latest to set up a single-brand dealership is Gryphon Audio Designs, which is preparing to open a "mono-brand" showroom in Los Angeles. Gryphon's implementation, though, is a radical departure from previous experiments in one respect: It's in the Pacific Design Center (PDC), a large (1.6 million square feet) multiuse facility that caters to the design community, including professionals in interior design, architecture, and the arts, as well as design enthusiasts. The idea is to give Gryphon products more exposure to architects, designers, and design enthusiasts. The PDC is not accessible to the broader public. Assuming all goes well, the Gryphon store will be open by the time this issue hits newsstands.

Steve Jain, cofounder and managing director of Fidelity Imports, has been busy since launching the company six years ago in the Philadelphia area. In recent months, Fidelity has added two brands to their roster; they now represent 16 high-performance audio companies. Maintaining his early passions helped fuel his drive to start a business and continue its expansion and innovation—aspects Jain believes differentiate Fidelity Imports from the competition. "I constantly want to keep trying to innovate and keep us ahead," Jain told me in a recent conversation over Zoom.

The hi-fi industry is evidently experiencing a shortage—not of parts or materials as during COVID and just after, but of qualified salespeople. As this column has pointed out, some hi-fi shops have closed, for various reasons, while some new ones have opened. Meanwhile, not just dealers but also manufacturers and distributors have reported difficulty finding qualified salespeople. Michael Manousselis, president of Americas for Dynaudio, stated as much in emailed responses to my questions. "I have heard more from dealers having a hard time finding experienced salespeople, that is for sure," he said. "We've seen some hire former customers, to groom them for sales."

What's going on? If people are passionate about this hobby, wouldn't they jump at the chance to get more involved in it professionally?

Hi-fi dealership Big Kids Toys, in Greensboro, North Carolina, is aptly named. Since its 2002 inception, fun has been at the center of its ethos. At the outset, company founder Michael Twomey established a mantra: "Life is short. Enjoy yourself." It might not be all that original, but it's apt.

In the third quarter of 2024, Big Kids Toys began expanding to the Midwest: The dealership's sales manager, North Carolina native Luke Sumerford (above), opened a home-based dealership in Fort Wright, Kentucky, about five miles from the Ohio River and Cincinnati, Ohio. That's a long way from Greensboro.

Sumerford, at 29, is part of hi-fi's youth movement. He hopes to instill—or reinforce, or bring back—musical enjoyment as the central pillar of the hi-fi hobby.

Myriad distribution factors drive and affect the hi-fi marketplace. Ultimately, these can impact end customer purchasing choices. Recently I've written—including in the December 2024 issue—about evolving new distribution models and how the term's meaning has shifted somewhat: Some companies have been expanding (or in some cases reducing) the kinds of services traditionally provided to exporting international manufacturers.

That made me curious about how business is going for "traditional" distribution companies. That is, companies whose services typically include handling importation, warehousing, shipping, and working with retailer partners and dealers in other capacities. They support retail dealers with the inventory they need.

Traditionally in hi-fi, "distribution" refers to importing and warehousing audio equipment then delivering it as needed to a network of domestic dealers. In recent years, that model has evolved. Distributors have expanded the range of services they offer, and an increasing number of companies are skipping the distributor step altogether: dCS and T+A, among other companies, have established wholly owned subsidiaries in the US to handle importation, local warehousing, and other domestic duties. They and others have hired full-service sales and marketing agents, sometimes called "brand ambassadors." The goal, of course, is to make the practice of getting a product into the country and on the radar of dealers and customers as efficient and effective as possible.