Canadian Music Trade - In Depth

Profitable Peripherals: Augmenting Sales with Recording Services, Live Stages & More

This article originally appeared in the December/January 2020 issue of Canadian Music Trade magazine.

By Andrew King

In 2015, Gerry Bradshaw – like many business owners throughout Alberta – was facing some tough times.

With the help of their parents, Dennis and Dorothy, he and his brother Jeff had opened The Music Shop in the small town of Rocky Mountain House in 2007. With the large neon guitar protruding from its façade acting as a beacon to musicians far and wide, the store enjoyed several successful years serving residents of and visitors to the picturesque community.

In 2014, Gerry took over the business himself just months before the provincial economy accelerated its downturn – ultimately one of the worst it has ever endured. And since, as the saying goes, “when it rains, it pours,” the recession happened to coincide with a two-year period of construction on The Music Shop’s street that significantly hindered its accessibility at times.

Rather than getting bogged down, though, Bradshaw got busy.

Screen-Shot-2020-01-24-at-2.51.54-PM

Working closely with his partner (and now wife), JoLynn McGillivray, Bradshaw came up with a plan to boost revenue without giving up on the business they were both so passionate about.

“We had to get creative,” he recalls for Canadian Music Trade. “That’s when we brought in light lunches and became a live music venue that brings in entertainers who perform around the world.”

Now, The Music Shop Concert Theatre and SOUP House welcomes musicians, live music fans, and anyone with an appetite through its doors, casting a wider net for potential customers and strengthening its position as a community hub in the process.

“You’d be surprised how many people come in these days for some soup, strings, and a Caesar,” Bradshaw attests, recalling an example from just the day before his conversation with CMT: “There were some folks just wanting some soup but didn’t know where to go. They saw the big guitar outside, came in to ask for some ideas, and noticed we had lunches, so they sat down to eat and, next thing we know, we’d sold a guitar and amp!”

Bradshaw makes it clear that “it’s still a guitar shop at heart,” and the peripheral services they’ve added are meant to continue the store’s initial mission. “It’s about trying to spread and share music; that’s our love,” Bradshaw enthuses. “We’ve got a lot of local folks coming in that don’t even play an instrument; they just want a good place to go for lunch and they’re starting to get used to our small but pretty awesome menu. While they’re here, they’re surrounded by instruments and good music; that keeps music on their mind, so if they have friends or family that play, when it comes time for Christmas and so on, they’re thinking of us, and we’ve had that happen
quite often.”

Screen-Shot-2020-01-24-at-2.53.19-PM

On the live performance side, in addition to hosting local artists – including Bradshaw and McGillivray themselves, who perform as a duo – and community events like the Great Rocky Mountain Talent Contest, they’ve welcomed internationally-touring acts like Shari Ulrich, Lynne Hanson, and Prairie Oyster frontman Russell deCarle to their stage, much to the delight of Rocky Mountain House residents and the town itself.

“We’re getting positive feedback from as far away as Texas, Australia, Switzerland, Germany… We’ve gotten messages from all over the world, really, and we know the town also references our business when trying to attract people to town; they really like what we’re doing.”

What they’re doing is enriching people’s lives through music, which was the goal from the moment The Music Shop first opened its doors; now, they just have more ways to do it, and more ways to earn revenue to boot.

In some cases, retailers are diversifying their businesses out of necessity; in others, it may be a more gradual and organic process, as has been the case at Dorval, QC’s Music Red One. Current owners James and Tommy Ozgur opened the business with their father back in 2011. Store manager and MI industry
veteran Sergio Travaglione joined the team in 2014, and together, they’ve grown the business considerably in both scale and scope.

“When I started here, we were three employees – me and the two owners; now, a
little over five years later, we have 20 to 25,” shares Travaglione, who boasts decades of experience in the MI and pro audio industries preceding his stint at Red One.

Screen-Shot-2020-01-24-at-2.57.07-PM

Much of that growth stems from the company’s expansion into AV system rentals and installations since Travaglione’s arrival. While much of Red One’s business is driven from its expansive webstore, it also boasts a loaded showroom in an industrial park adjacent to Pierre Elliott Trudeau International Airport. Travaglione says that in addition to generating a significant amount of revenue, offering AV rental and installation services gives Red One a unique advantage in the very competitive MI space and gets the brand name out in the local community to draw traffic towards the store.

“That’s the whole concept – brand recognition and local support,” Travaglione states. “We want our local clientele to be confident and know that they can come in here for good service and trustworthy expertise.” The basic idea is that there are a lot of places you can go for, say, a DJ mixer in the Montreal area; however, there are fewer where you can buy a DJ mixer, rent a sound system with or without a technical crew, and even commission a loudspeaker installation in a nearby nightclub where a DJ might perform. Through specific expertise and good service in the more specialized pro audio sector, they can generate brand recognition and loyalty towards other aspects of the business.

“For us, service is everything,” Travaglione reinforces. “There’s no reason for a client to ever be unhappy, and that’s across the board, whether it’s a repair, a sale, an installation… People are trusting you and want to feel good about how they’re spending their money and we want to live up to that.”

He credits the Ozgurs with leading by example to create and maintain that culture of hard work and good service.

“They’re workaholics; sometimes it’s scary,” says the store manager with a small chuckle. “I’ve seen one of my bosses leave his house at 3 a.m. because someone’s rental speaker stopped working. He threw a replacement in his trunk and went out right away. They’re relatively young but have that really strong work ethic. That’s actually what inspired me to come and work here a few years ago.”

He says the audio rental and install services have been key to driving growth throughout the business and show no signs of slowing down.

“I’ll be honest with you,” Travaglione begins. “The rentals are the root of everything. They bring people through the doors, and once they come in and see what we do here, we can make sure they’re well taken care of and will come back for anything they might need in the future.”

For nearly 40 years, The PA Shop has been serving musicians, producers, engineers, and other music and audio pros in London, ON and its surrounding area. In that time, adjacent businesses like Charterhouse Studios, a large-scale commercial recording space, and the MI-focused London Guitars and London Percussion retail operations have cropped up at the PA Shop’s HQ at 46 Charterhouse Cres., all run by the Schroeyens family.

At the end of 2019, they launched Music City Canada – a new parent brand encompassing all of the complementary businesses under its figurative and literal roof.

Screen-Shot-2020-01-24-at-2.55.29-PM

“The Music City transition has been a long time coming for us,” begins Owner Ryan Schroeyens. “We started working on it almost a year ago, and it was a very big undertaking because it’s more than just a new website; it’s operational, it’s branding, it’s our POS system, inventory management… There’s a lot on the back end that the customers don’t see.”

In this case, Schroeyens and The PA Shop already had a suite of complementary businesses; the idea with Music City Canada is to create a better public facing synergy between them in terms of promotion and customer awareness, operational efficiencies, and the like. “From where it started to where we are now, it’s definitely expanded over the years, and as we started to branch off more and more into musical instruments, we realized we needed something that better captured all the facets of what we do,” Schroeyens offers. “Part of the reasoning behind the name is we’re effectively the type of place where you can come in knowing nothing and leave a rock star.”

What he means is that, between Music City’s various sub-brands, someone can get a beginner’s guitar bundle with an entry-level axe, amp, and necessary accessories and take the lessons they need to get started. From there, they can upgrade to high-end new and used instruments and acquire everything they need for a full home studio or pro-level in-ear monitor system. What’s more, they can record in a professional studio, hire the staff and systems needed for a full-scale arena tour across the country, and even rent a tour bus.

“There’s a lot of cross-pollination between the different things we do,” Schroeyens reinforces. “But when you’re a serial entrepreneur [like me] with all of these brands, you’re having to pick and choose where you’re dedicating your attention and resources, and yet there’s a lot of crossover for our markets, so we haven’t changed a lot about who we are or what we do; we’ve just found a way to better engage our customers and have them engage with us.”

Schroeyens says that when it comes to diversification and supplemental revenue streams, you need to be thinking long-term as, in most cases, they represent a significant investment of time and resources, and may take even longer to start paying dividends.

Of course, expanding or building on an existing brand will only be effective if that brand is rock-solid in terms of its operations, reputation, and so on. Schroeyens also notes that there are a lot of variables to consider, and what works for one retailer might not for another even just on the other side of town, let alone in a different part of the country.

“For some people, it’ll be rentals. For some, it’ll be selling records, or for some, it might even be renting parking spaces to the building next door,” he says. “Whatever the stream is that keeps it going and allows you to continue growing in a business you’re passionate about, that’s what you’ve got to do.”

Then, it’s about cross-promoting and leveraging your skills and reputation in one area to develop another. “We realize very few of our guitar customers will become customers of PA Shop Productions for touring needs,” Schroeyens says, “but it gives all of the brands under the Music City Canada umbrella a boost when people know that we work with artists like Keith Urban – that we’re at that level and, by association, they can tap into that even in an indirect way.”

From there, it’s about focusing on your strengths and creating a symbiotic relationship between the various facets of your business that yields rewards for you and your existing customers while making it easier to retain them and attract new ones.

“It’s no secret that it’s getting harder and harder to compete with Amazon or chainstyle stores, so you need to find a way to add value to your offerings,” he says. “A lot of it comes down to the fact that we’re living in an Amazon world. Will mom-and-pop retail still exist 20 years from now? I honestly don’t know, but I know that people still like dealing with people, and we’re good people, so if we can do good business and take good care of our customers and have fun while we’re doing it, I think we’ll be around for a while.”

When it comes to operating a suite of complementary businesses and revenue streams under one roof, it’s hard to find a better example than Richmond Hill, ON’s Cosmo Music. Since opening their 56,000-sq.-ft. “mega-store” in May 2008 – the single largest musical instrument store in North America – Cosmo has been something of a case study in creating a sustainable musical ecosystem that serves a wide swath of customers.

Midway through 2019, the store was formally recognized for those efforts with the Dealer of the Year Award at the Top 100 Dealer Awards presented during Summer NAMM in Nashville. Of course, few will be able to even come close to matching the size or scope of Cosmo’s operations, but emulating and following the example of NAMM’s Dealer of the Year can’t be a bad idea.

“The litmus test for anything we want to add here is, ‘Is it going to add to the customer experience?’ That means, will it add value, or will customers at least perceive it to add value,” says Cosmo Music’s President and CEO, Mark Hebert. “In many cases, even if something might not add revenue from a quantitative perspective, if it will improve the customer experience, we’ll move forward.”

There’s no shortage of things to have passed that test over the last decade-plus. In addition to its various MI departments – from guitars, drums, brass and woodwinds, and the like to pro audio, print music, and more – Cosmo boasts an expansive instrument rental program serving individuals and schools in its surrounding area, a music school catering to over 2,400 students each week, a live event space that hosts everything from clinics to corporate events, and in late 2018, became the only musical instrument store in the world to have an official Starbucks location on its premises.

“That was a brand play,” Hebert discloses about Starbucks @ Cosmo, which replaced an existing café in the store’s massive atrium space. “Being associated with the Starbucks brand is a good thing for us, and elevates our own brand while letting us offer our customers a fantastic experience.”

As with the previous café, the goal is to make the store something of a community hub, and the onsite Starbucks can simultaneously encourage customers to stay in the store longer and give parents and spouses somewhere comfortable to hang out during lessons or shopping. And then there’s the added benefit of simply bringing new faces through the door.

“While it’s more for the people that are already coming here, there are definitely customers that have come in because they see us on the map of Starbucks locations, or maybe they’re on a drive and they wander in after seeing us from the highway, and then we think we’ve got enough to engage their curiosity when they come through the doors,” offers Hebert.

Another benefit to the wider Cosmo ecosystem is that they can now also offer Starbucks catering to clients of the onsite 240-capacity Cosmopolitan Music Hall, which itself helps to bring a wider potential customer base into the store. “A lot of what we do is meant to get people through the door, and there’s kind of a ripple effect from there,” Hebert reinforces.

Screen-Shot-2020-01-24-at-2.58.01-PM

Another example of an initiative that appeals to a new customer segment while also strengthening existing aspects of the business was the decision to start selling vinyl records a few years back.

“That’s an interesting one,” Hebert shares. “We’re selling dozens, if not hundreds of turntables every year, but I don’t even know where else you can go to buy a vinyl record in our area, so it made a lot of sense.”

Wisely, they’ve folded the vinyl sales into their print music department, which not only puts significantly more people in front of those products, but also offers a unique synergy: why just buy Led Zeppelin III on vinyl when you can also grab the official tab book and learn while you listen?

“It draws all sorts of new people into the store, and draws all kinds of people to the website, which is great because it complements the print department and, really, everything else we do. It’s been very successful for us.”

Whether it’s a live venue, vinyl records, or a hot bowl of vegetable soup, there’s no shortage of ways to complement your MI sales with adjacent businesses or services – ones that will boost your bottom line, bring new people to your door, and complement your existing offerings.


Andrew King is the Editor-in-Chief of Canadian Music Trade.

Author image
About Contributor
You've successfully subscribed to Canadian Music Trade - In Depth
Great! Next, complete checkout for full access to Canadian Music Trade - In Depth
Welcome back! You've successfully signed in.
Success! Your account is fully activated, you now have access to all content.