This is the second of two parts of an editorial on the price perception gap in the boutique and custom guitar market.

In some of the guitar forums i frequent, i encounter players (or hear stories passed on from other builders) who are looking for the custom-built guitar of their dreams for $800 to $1000, with a laundry list of exotic woods and high-end hardware… and they want it in 8 to 10 weeks.

There’s an old axiom that goes like this…

GOOD — FAST — CHEAP

Pick any two.

Click past the break to read on…

You may be able to find someone good who can build within your budget, but you may have to wait over a year (or more) for it to be completed. You may be able to find an amateur luthier who can build what you want fast and cheap, but the resulting product may be… less than spectacular.

There’s even a small group of elite builders who run small shops, and deliberately limit their production to maintain quality and remain personally involved in the build process where much of the work is still being done by hand. Many of these builders have long waiting lists, command prices well into the five figures, and have no shortage of satisfied customers and eager future customers willing to pay the asking price and wait as long as it takes.

So the bottom line is that if you want a good guitar in a reasonable time frame, you’re going to have to pay a reasonable price for it. And to understand what i mean by “reasonable,” please see Part I of this series.

Probing the price perception gap.

In the last few years, there seems be an increasing number of people in my experience who are looking for “cheap custom guitars”. I’m not sure from where this trend has come, but there seems to be a gross misunderstanding among certain groups of people regarding how much time, energy and effort go into building a good guitar. And conversely, there seems to be little appreciation for the fact that the people committing their livelihood to luthiery (or those who are doing it as a sideline, a second career, or even as an intense hobby) actually deserve to make money at it. If you want to get a very high-level sense of the economics of being a small guitar builder, please read my earlier post on the subject.

Guitar building takes time, money, tools, materials and resources, not to mention skill, creativity and passion. For a small builder to make a “custom,” a selling price of $800 would mean pretty much zero profit for the builder… they’d essentially be building it for barely more than the price of parts and materials only. Not exactly a fair deal, and certainly no way to run a sustainable business.

When is a “custom shop” not a custom shop?

Many people point to Carvin’s “custom shop” prices when questioning why small builders charge what they do for their instruments. Carvin is very much the exception and not the norm in the guitar manufacturing business. They aren’t so much a “custom” builder… they’re a fairly large-scale production operation that happens to have technology and workflow in place to build excellent quality “semi-custom” guitars to order. Profitably.

Even with that, while it is possible to price out some Carvin models for less than a grand, the specs end up being pretty basic. Starting to pick from Carvin’s very attractive options list gets the price up fairly quickly. A well-equipped one can even run $1800 or more, which is getting up there for high end production instruments, but the bang-for-the-buck ratio with Carvin is very good. Carvin doesn’t have a distribution or dealer network to support, so they cut out a lot of layers of profit-taking, allowing the consumer to get their hands on top-notch instruments for less. But as i said, Carvin is very much the exception and NOT the norm in the business, and guitarists need to appreciate that.

The custom compulsion.

Many young players on limited budgets seem to become obsessed with the idea of owning a custom instrument. Years ago, custom guitars were a rarity, and only the most elite of players could afford to commission a completely unique instrument from a boutique builder. Most other players “got by” with modified stock instruments, with slightly modified neck profiles, upgraded hardware, aftermarket electronics, and so on.

What drives this desire for a “custom” over a modified production instrument? Is it sound? Feel? Aesthetics? It seems that modifying production guitars is still happening quite a bit… there continues to be a healthy aftermarket in pickups, electronics, replacement parts and hardware.

Yet with all these options available, some players still become obsessed with the idea of owning an instrument they’ve had a hand in designing to meet their own tastes and needs… and there’s absolutely nothing wrong with that. Sometimes a totally custom-built guitar is the only thing that scratches that itch. But we need to be wary of that obsession potentially leading to unrealistic budgets, expectations and deadlines. Prices aren’t always negotiable. Low-balling on price can come across as disrespectful of the luthier’s time and experience, not just as a bargaining strategy.

Keeping things simple.

Everything i’ve written here is i suppose a long-winded way of communicating my business approach for Decibel Guitars. I’ve given very careful thought to my observation of these issues over the last couple of years, and i’m taking very careful steps to start this venture slowly and build it at a sustainable pace.

Decibel Guitars is currently a sideline… an intense hobby that i’m engaged in fully as something i’m passionate about, something i love to do, and something i’d like to see grow into something more at some point in the future. But it is not currently structured to be my primary source of income, and i think my customers and potential customers need to be aware of that, if only for managing their expectations.

That said, i’m still treating it more or less like a business, and would like to have it be a self-sustaining one that does not require infusion of large amounts of my own personal funds to keep it running. Yes, that does mean that it has to be profitable. If it’s not making money, i can’t possibly afford to keep doing it.

At this time, i have no current plans for Decibel Guitars to become a “custom shop” or even build guitars to order for the foreseeable future. As soon as money changes hands for future delivery of a product or service, i feel there are expectations for deadlines, update frequency, response times, and so on. (And a lot of these expectations are justified… paying customers should be kept up to date with where their instrument is in the build queue and when they may expect to get what they paid for… within reason.) However, even the process of preparing quotes and discussing specs with customers – not to mention managing change orders once a build is in progress – takes up tremendous amounts of time and energy that i’d rather spend on more productive pursuits, like actually building guitars.

Becoming a “custom shop” or being able to engage in a build-to-order process is not something i feel i will be able to do reliably and consistently until i’ve been doing this for a LONG time, and have my workflow down to an exact science where i can accurately forecast production times and delivery dates. Even then, i’m not sure it’s worth the potential risk. As i’ve learned in the last couple of years, both first-hand and from friends and colleagues around me, is that life does sometimes get in the way… illness, deaths, other extenuating circumstances and life events can throw small businesses into turmoil, and not everyone wants to share every intimate detail of their life with their customers and/or the general public. I know i don’t. But as a one-person shop, if you’re accountable to people who have already given you money for a product you have yet to deliver, you almost have no choice. (Again, within reaonable bounds.)

I’d rather produce short runs of instruments i’ve spec’d out, designed and built, then sell them when they’re done… which is exactly what i’m going to do. My business model is essentially this:

I design what i want.
I build what i like.
I take as much time as it takes.
And i only sell completed instruments.

It’s simple and straightforward, customers know what they’re getting, and they can get it as soon as their payment clears.

And i get the satisfaction of knowing that every instrument has been conceived, spec’d out and built by me, without compromise, and without the stress of deadlines or keeping up extensive communication with each individual customer. I can truly pour every ounce of energy and passion into building each instrument, instead of trying to manage all the other day-to-day crap that a “custom shop” would have to go through.

Will it limit my business somewhat? Absolutely. But it will allow me to keep the business small and manageable, and have me not go insane or broke in the process, or worse yet, lose the passion for something i love to do, and hope to keep on doing well into my retirement years.

A big part of what i’m hoping to achieve by using this blog, Facebook, Twitter, YouTube and other social media to interact with customers (past, present and future), is a level of openness, honesty and transparency about the process of designing and building guitars, but also about my business practices and what people can expect from Decibel Guitars now and in the future. I don’t want there to be any guesswork or potential for misunderstanding along the way. And by laying the process bare, i hope to de-mystify it somewhat, and hopefully help people to gain an appreciation for the creativity, passion, skill and process that goes into crafting fine guitars. I also hope to help other small builders to think about their business practices and pricing policies, in the hope of having more small builders survive and flourish. If you have any thoughts or comments, i’d be happy to hear them… please post in the comments section below, or hit the “Contact” link in the top right to send them to me privately. – darren.