Peavey on Undercover Boss--an unexpected ending

[Thundersteel]

I watched Undercover Boss tonight. Anyone who's seen that show knows what usually happens during the last segment of the show: The CEO, or another member of Upper Management, reveals him/herself to some of the employees. After hearing about employees' "struggles" and concerns, the company usually gives them a large amount of money, transfers them to leadership positions, or some other event which gives "warm fuzzies" to all involved.

Well, the same thing happened to Peavey--with a twist. Some employees were promised anywhere from $10k to $15k. One employee, who had given his two-week notice when the show was filmed to take a higher paying job elsewhere, decided to stay with Peavey after a similar gesture was made to him. But about four months after the show was filmed, the plant in Meridian closed their doors. Peavey decided to move more of its production to China to remain competitive. The featured employees all said they felt betrayed. The show ended with something to the effect of "Peavey is in the process of trying to keep its commitments to their former employees."

I always had some respect for Peavey, but it's all gone now.

[Steve Haynie]

I did not watch the show tonight, but have seen past episodes. Undercover Boss is obviously fake. Why would there be cameras for an entry level employee? With all the takes and retakes to make the show someone would have to be suspicious if it was real.

Hartley Peavey held out longer than most manufacturers on selling to the big box stores and mail order companies. He really wanted to support the smaller dealers. Peavey also held out with keeping the production of entry level instruments in the USA as long as possible. Business changed, so Peavey had to change with it.

The local store dropped Peavey in the mid 2000's because all the newest gear would go to GC first. Every new amp was back ordered for six months which was long enough for GC to sell them to everyone who got tired of waiting at the smaller stores. There were other issues that crept in to make the store feel neglected by Peavey. It is sad because Hartley tried to support small shops like his father's shop for most of the company's history.

[Thundersteel]

I realize all reality shows are fake or scripted to some extent. The sad thing is, neither Hartley nor Cortland Gray (who went "undercover") personally told the employees about the plant closing. Most of the complaints were about lack of communication, and the absence of upper management visiting their employees.

[Biz Prof]

They actually did quite well at pursuing Hartley's vision for several decades. Many other fallen flags preceded Peavey's recent decline, therefore it's a good reflection on Hartley that they'd survived and thrived for so long. He's not likely to emerge from his recent changes with the market saturation his brand once had. Peavey's once-unique "Made in USA" tag has been somewhat diluted by the increasing numbers of products he's outsourced. Retail has changed radically, as noted above, in ways that hurt Peavey more than most brands. Last, by not least, Hartley shows symptoms of having entered Stage 4 of "Oldmanitis", which is marked by the unseemly habit of blaming the government for your plight whilst taking handouts from said government. His credibility takes some hits when he postures in such a manner.

[hamerhead]

Not that it matters, but after seeing that I'll never own another piece of Peavey gear.

[FGJ]

Before anyone judges a company for outsourcing (disgusting and frustrating as it may seem), one should watch the documentary, "Death by China". After having worked for manufacturing industries myself, I've realized that we've opened Pandora's Box, and now many (not all) companies (depending on product and/or industry) are forced to move or else go out of business from an inability to match import prices. These days, it's less about greed and more about sheer survival.

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

[bubs_42]

Sad but true, but Peavey is not alone and times are changing. How long before guitarist don't want to pay $200/$300 bucks for a new pedal that will be the old pedal within 6 months. Most of the Manufacturing is going not only to China but now Vietnam.

[MCChris]

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

'Mericuhns in general have too much "stuff." Look around your neighborhood when people have their garage doors open and see how many can actually accommodate cars and how many are packed-to-the-gills storage sheds. In my area it's about half and half.

[Biz Prof]

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

'Mericuhns in general have too much "stuff." Look around your neighborhood when people have their garage doors open and see how many can actually accommodate cars and how many are packed-to-the-gills storage sheds. In my area it's about half and half.

True enough, and I'm also guilty. I guess George Carlin was a soothsayer, after all.

'Murica!!!

[kizanski]

Not that it matters, but after seeing that I'll never own another piece of Peavey gear.

Not that it matters, but I've only ever owned one piece of Peavey gear.

I didn't need to hear this Undercover Boss story to know never to buy another.

[Mitch]

Oh, the irony.

[Studio Custom]

Before anyone judges a company for outsourcing (disgusting and frustrating as it may seem), one should watch the documentary, "Death by China". After having worked for manufacturing industries myself, I've realized that we've opened Pandora's Box, and now many (not all) companies (depending on product and/or industry) are forced to move or else go out of business from an inability to match import prices. These days, it's less about greed and more about sheer survival.

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

It would hurt in the short term, but eventually everyone would get use to the higher prices and wages, BUT the profits sound not be shipped abroad.

[Sugartune]

That's totally lame. My first real amp was a Peavey Classic 50 (my first amp was a PV Rage 158), which I still have and love, but they didn't ever really have anything else that appealed to me. I liked how many of their products continued to be US made, and certainly understand why some went overseas. It's really too bad they're shifting more. What else are they moving? I don't recall them have much US Guitar production, just amps and some sound gear.

The timing of the episode and production shift is unfortunate. I would guess it to be unlikely that it wasn't already in motion. That just straight up sucks.

[stratokatsu]

I always wonder whether companies who ship jobs overseas considered applying themselves to a higher end market and keeping the manufacturing in America, but I can't think of one who has done that.

Once those jobs are gone, they will never return. I'm one of those who feels lost jobs in America should represent much higher import tariffs on the product when it comes back.

[it's me HHB]

Currently use a PV forum. Wanting a first run cruise

[bubs_42]

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

'Mericuhns in general have too much "stuff." Look around your neighborhood when people have their garage doors open and see how many can actually accommodate cars and how many are packed-to-the-gills storage sheds. In my area it's about half and half.

If we only purchased the things we NEED Imagine what our economy would look like.

[velorush]

Before anyone judges a company for outsourcing (disgusting and frustrating as it may seem), one should watch the documentary, "Death by China". After having worked for manufacturing industries myself, I've realized that we've opened Pandora's Box, and now many (not all) companies (depending on product and/or industry) are forced to move or else go out of business from an inability to match import prices. These days, it's less about greed and more about sheer survival.

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

It would hurt in the short term, but eventually everyone would get use to the higher prices and wages, BUT the profits sound not be shipped abroad.

This was an argument my dad presented me when I began buying Japanese cars back in the early '90's. The argument began with 'you should buy 'merican to support

'merican workers.' My response was I should buy the best car on the market and allow my consumer sovereignty to stimulate domestic brands into making better cars. Then came the 'sending profits overseas' argument to which I explained profits go to shareholders. The view that Toyota (at the time) was owned by a couple of Japanese guys was naive. I owned shares of Toyota (ADR) in a mutual fund and he other Americans could too. Conversely, shares of Ford, GM and Chrysler were owned by foreign investors as well as domestic.

Later, as we moved into the '00's my 'foreign cars' actually became domestic cars (got a Honda made in Alabama and a Nissan made here in Tennessee) and his 'merican truck and car actually became foreign (made mostly in Canada and Mexico). These things matter not to me as, again, consumer sovereignty dictates my purchase. The excellent thing is (as I rode to mountain biking trails this weekend in a Ford F-250), 'merican-branded cars have come along by leaps and bounds in terms of quality. Yes, there are notable issues, but there are with other 'foreign' brands, as well. My point is, the quality differences seems to be becoming less and less an issue - it is my firm belief reduced demand is what stimulated the domestic brands to do better.

I always wonder whether companies who ship jobs overseas considered applying themselves to a higher end market and keeping the manufacturing in America, but I can't think of one who has done that.

Once those jobs are gone, they will never return. I'm one of those who feels lost jobs in America should represent much higher import tariffs on the product when it comes back.

So you prefer higher prices? Tariffs simply punish the low-cost producer AND the consumer. They create an artificial bubble in which the high cost producer can continue to exist without modifying their practices. Get the gub'ment out of the way and allow the market to stimulate efficient effective production of all goods and services. The only caveat is it has to work on both sides of the ponds. We can't have a free trade environment here while other countries subsidize their production. If you study the economics of that situation, it does eventually work itself out through trade imbalances and currency exchange rates, but it can take too long to do so.

Just my opinions.

[Dasein]

I don't know why I don't like Peavey -- I just don't.

[Biz Prof]

I second your opinions, Velorush, which explains why I both credited Hartley Peavey for his innovation and dogged determination in the first 40 years of managing his namesake firm AND slagged him for his more recent intellectual dishonesty about government intervention.

Side note: My FIL has, for 20 years, taken me to task for my penchant for driving Hondas and Toyotas, or "Jap cars", as he calls them. "To each, his own", I would counter...until one day, about seven years ago, I realized he had purchased a Chevy that was made in Canada with over 50% non-USA components. When his eventual verbal jab came about during a holiday gorge fest, I was ready with an informed retort: That my "Jap" truck was made in Indiana with ~70% USA componentry, whereas his "American" car was practically all Canadian, Mexican, Korean, and Chinese. The facts won, and he's had a more informed view of consumer products and patriotism ever since.

[bubs_42]

I love this place.

[Steve Haynie]

Watch the episode here.

[django49]

Before anyone judges a company for outsourcing (disgusting and frustrating as it may seem), one should watch the documentary, "Death by China". After having worked for manufacturing industries myself, I've realized that we've opened Pandora's Box, and now many (not all) companies (depending on product and/or industry) are forced to move or else go out of business from an inability to match import prices. These days, it's less about greed and more about sheer survival.

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

It would hurt in the short term, but eventually everyone would get use to the higher prices and wages, BUT the profits sound not be shipped abroad.

This was an argument my dad presented me when I began buying Japanese cars back in the early '90's. The argument began with 'you should buy 'merican to support

'merican workers.' My response was I should buy the best car on the market and allow my consumer sovereignty to stimulate domestic brands into making better cars. Then came the 'sending profits overseas' argument to which I explained profits go to shareholders. The view that Toyota (at the time) was owned by a couple of Japanese guys was naive. I owned shares of Toyota (ADR) in a mutual fund and he other Americans could too. Conversely, shares of Ford, GM and Chrysler were owned by foreign investors as well as domestic.

Later, as we moved into the '00's my 'foreign cars' actually became domestic cars (got a Honda made in Alabama and a Nissan made here in Tennessee) and his 'merican truck and car actually became foreign (made mostly in Canada and Mexico). These things matter not to me as, again, consumer sovereignty dictates my purchase. The excellent thing is (as I rode to mountain biking trails this weekend in a Ford F-250), 'merican-branded cars have come along by leaps and bounds in terms of quality. Yes, there are notable issues, but there are with other 'foreign' brands, as well. My point is, the quality differences seems to be becoming less and less an issue - it is my firm belief reduced demand is what stimulated the domestic brands to do better.

I always wonder whether companies who ship jobs overseas considered applying themselves to a higher end market and keeping the manufacturing in America, but I can't think of one who has done that.

Once those jobs are gone, they will never return. I'm one of those who feels lost jobs in America should represent much higher import tariffs on the product when it comes back.

So you prefer higher prices? Tariffs simply punish the low-cost producer AND the consumer. They create an artificial bubble in which the high cost producer can continue to exist without modifying their practices. Get the gub'ment out of the way and allow the market to stimulate efficient effective production of all goods and services. The only caveat is it has to work on both sides of the ponds. We can't have a free trade environment here while other countries subsidize their production. If you study the economics of that situation, it does eventually work itself out through trade imbalances and currency exchange rates, but it can take too long to do so.

Just my opinions.

Every time I start to get close to buying an "American" car, I get cold feet. Not the least, thinking of the big bailouts (GM, but also elsewhere) that screwed over so many retirees (think small investors) as well as the big money guys that MIGHT have know better. Reflections on who "won" by those maneuvers could tend to get "political".

Being older means having been exposed to the "next big automotive thing" way too many times......Think Corvair, Chevy Vega, Chevy Monza and the recall of God knows how many GM products over having "cheaped out" on parts costing little to put millions of drivers, potentially, in life threatening situations. Not to pick on just GM. The Ford Pinto was a deathtrap and there have been too many duds coming out of Chrysler to try to recall them all.....Start with the inherently unsafe older Jeeps that were prone to flipping on the freeway, admittedly partly due to drivers that did not understand what they were driving.

And the documented "bidness decisions" balancing the small incremental cost of a design change versus the statistical probability that only xx people would die as a direct result and legal settlements would be "acceptable".

I forget the percentage of our Toyota Highlander that is "USA".....A pretty large portion.

[Never2Late]

Before anyone judges a company for outsourcing (disgusting and frustrating as it may seem), one should watch the documentary, "Death by China". After having worked for manufacturing industries myself, I've realized that we've opened Pandora's Box, and now many (not all) companies (depending on product and/or industry) are forced to move or else go out of business from an inability to match import prices. These days, it's less about greed and more about sheer survival.

The thing is, people cannot have their cake and eat it, too. Either we bring jobs back and pay thousands more for a product that may only cost hundreds now, or we can have our cheap goods and live with the lost jobs. But the gross disparity of labor costs between the USA and Asia will not allow for us to have both.

It would hurt in the short term, but eventually everyone would get use to the higher prices and wages, BUT the profits sound not be shipped abroad.

This was an argument my dad presented me when I began buying Japanese cars back in the early '90's. The argument began with 'you should buy 'merican to support

'merican workers.' My response was I should buy the best car on the market and allow my consumer sovereignty to stimulate domestic brands into making better cars. Then came the 'sending profits overseas' argument to which I explained profits go to shareholders. The view that Toyota (at the time) was owned by a couple of Japanese guys was naive. I owned shares of Toyota (ADR) in a mutual fund and he other Americans could too. Conversely, shares of Ford, GM and Chrysler were owned by foreign investors as well as domestic.

Later, as we moved into the '00's my 'foreign cars' actually became domestic cars (got a Honda made in Alabama and a Nissan made here in Tennessee) and his 'merican truck and car actually became foreign (made mostly in Canada and Mexico). These things matter not to me as, again, consumer sovereignty dictates my purchase. The excellent thing is (as I rode to mountain biking trails this weekend in a Ford F-250), 'merican-branded cars have come along by leaps and bounds in terms of quality. Yes, there are notable issues, but there are with other 'foreign' brands, as well. My point is, the quality differences seems to be becoming less and less an issue - it is my firm belief reduced demand is what stimulated the domestic brands to do better.

I always wonder whether companies who ship jobs overseas considered applying themselves to a higher end market and keeping the manufacturing in America, but I can't think of one who has done that.

Once those jobs are gone, they will never return. I'm one of those who feels lost jobs in America should represent much higher import tariffs on the product when it comes back.

So you prefer higher prices? Tariffs simply punish the low-cost producer AND the consumer. They create an artificial bubble in which the high cost producer can continue to exist without modifying their practices. Get the gub'ment out of the way and allow the market to stimulate efficient effective production of all goods and services. The only caveat is it has to work on both sides of the ponds. We can't have a free trade environment here while other countries subsidize their production. If you study the economics of that situation, it does eventually work itself out through trade imbalances and currency exchange rates, but it can take too long to do so.

Just my opinions.

I think you're missing one key point - most purchases made today are based upon one key element ONLY - price-point. The vast majority of the crap on Walmart/Target shelves are not there because they represent the pinnacle of production quality. They are there because of profit margin and price-point. If we remove quality from the discussion, American goods could easily compete with made-in China crap TODAY if prices were aligned. The idea that tariffs are a 'bad idea' is a free-market fallacy when 'free-markets' really don't exist, do they? Asian governments heavily subsidize and 'protect' their business interests through unfair trade practices all-day, every day. Japan does it, China does it, they all do it. Except the USA, however.

[django49]

^^^^

Just to be argumentative, the tendency of folks in the public sector (in the US) to try to pick winners by throwing money at (sorta) private companies that they believe are better (often "politically correct") corrupts the process. Think Solyndra, for just one. Often the folks that are in charge tend to learn how to manipulate the rules (with clever lawyers and accountants).....If not outright buying favors...... rather that build a better product or customer satisfaction. Had Detroit (and other industries) only put as much attention into THEIR business rather than descending upon DC to try to stifle the competition to their "monopoly", we would all be better off today. IMHO, of course.

Not that other countries do NOT game the system. But such as Toyota, Samsung and many others learned they had to work harder to get a foothold by being better. Going back 40-50 years, how many people would have preferred a Mercedes to a Cadillac? Let alone a Huber to a Gibson?

[Biz Prof]

Interesting postscript: One of my faculty (Accounting) saw the aforementioned episode last night and remarked to me just a few minutes ago: "I don't know much about Peavey, but I cannot imagine how they could have made themselves look worse than they did. I was embarrassed for them." He was referring to how they communicated their decisions and handled the specific case of the employee who was flirting with leaving for a better paying job.