I saw this in action first-hand. The guy who sold me my R8 had a small storefront in downtown San Diego. He'd sell Gibson Custom Shops as fast as he'd unload them from the truck. He'd beat the fixed GC/MF/SA/Best Buy prices by hundreds of dollars. One day Gibson cancelled his contract. He was no longer an authorized dealer, no longer able to offer warranties on the Gibsons he sold. He sold a handful of other brands but he was essentially a Gibson Custom Shop dealer. In one fell swoop that status was taken away from him. I don't know how his business is doing today. Last I heard, he was struggling.
I think the big-box retailers might've had something to do with this. They don't like the mom and pop stores undercutting their fixed prices and they have the muscle to force companies like Gibson to sever relationships with other dealers who don't play ball. I'm not saying this is what happened, just speculation on my part.
I do have something of mixed feelings about Henry J. I'm not sure I'd like to work under him and he doesn't come across as the most ethical guy but nonetheless, the guitars that Gibson has produced under his leadership are consistently the best instruments they've made since the fabled Ted McCarty era of the 1950s-60s.
Agreed. I have some great Gibson guitars. The quality perhaps isn't up to the standards of Collings and C.F. Martin & Co., but they are wonderful guitars - both electric and acoustic. And I have a two great Gibson banjos and on great Gibson mandolin, all fairly recent.
The Gibson 'attack' on small dealers was two-fold. First, they made small stores commit to contracts to purchase $100,000 (and some stores have told me higher prices) of Gibson. That was impossible for some stores, and in others meant that they couldn't carry Gretsch, Fenders, or other lines if they wanted Gibson.
Second, they TOLD you what you had to sell.
If you had been in business for 40 years and new that in your part of Dallas, you sold 20% LP Studios, 10% SGs, etc., Gibson would instead give you a list of what guitars you were required to buy as part of your $100,000. Didn't matter if your market had been Gibson Custom Shop Les Pauls for years. You may get stuck with several Flying Vs even though you still have three you hadn't been able to sell for four years.
Let's not forget that Martin also put a minimum dollar purchase on dealers about the same time. The difference was that Martin allowed dealers to select the models that they would carry.