The More Things Change, The More They Stay The Same

There’s a superb video from violinists Brett Yang and Eddy Chen of TwoSet Violin where the duo takes the bold step of calling out a pair of dubious practices inside the world of string instrument dealers.

Yang and Chen deserve a great deal of credit for speaking out on this topic and while issues run far deeper than their video examines, the topics they focus on are certainly of paramount importance.

Secret Commissions

  • It goes both ways. Dealers entice teachers to send students their way but TwoSet points out that sword cuts both ways where teachers of certain reputations and studio size can leverage that “market share” to force commissions from dealers.
  • Unfair profit. Dealers raise prices by extreme amounts to increase profit margins and therefore teacher commissions. A teacher will tell the buyer that a price is fair even when they know it isn’t because the result puts more money in their pocket. In an ironic instance, the duo relates an account of a dealer that got hit by two teachers with the same student asking for full commission. As a result, the dealer increased the violin price to pay both what they thought they deserved without cutting into the shop’s profit margin.

There’s only one additional item I would add to their list that buyers should be aware of:

  • Second opinion negging. Yang and Chen recommend getting a second and/or third opinion when purchasing an instrument and that is certainly good advice. Having said that, it’s far too common for a dealer to engage in some heavy-duty negging, which is a form of emotional manipulation. The goal is simple: steal the customer at all costs, even if it means fabricating or inflating concerns.

Selling Fake Instruments (Manufactured Provenance)

The duo offers one account where they encountered the practice of manufactured providence. They told a story of a violin one of them owned from a popular living maker. It was discovered that part of their label was cut off, removed, and presumably placed into another instrument to misrepresent its provenance. Real label, wrong instrument.

This is a minefield of rabbit hole conversations but if you want to jump into just how much damage this can cause, you can go all the way back to 2004 in Adaptistration’s archives and begin reading about how the New Jersey Symphony Orchestra got duped by Herbert Axelrod and Dietmar Machold to the tune of $18mm, which is ~$25mm in 2021 when adjusted for inflation.

I’ve written more than a dozen articles on that subject over the years but here are some of the highlights:

In 2005, I was a guest on WNYC’s Soundcheck hosted by John Schaefer to have a frank conversation on this topic. But the real kick in the pants in all of this is fast-forward more than 15 years later and TwoSet Violin’s video makes it clear all the issues that came to light in the NJSO fiasco haven’t changed much.

Solutions

Yang and Chen recommend one of the most straightforward solutions in the form of improved transparency: commissions should be disclosed. It’s an excellent start but in the end, a system is only as good as the people involved and I’ve seen too many instances where manufactured transparency is designed to cover even deeper levels of duplicity.

This is exactly the sort of thing that begs for Federal regulation and licensing. Sadly, it doesn’t impact enough people to warrant attention at the scale of fraud that led to the formation of the Consumer Financial Protection Bureau.

I could go on and on about this topic but instead, you should set aside some time to watch Yang and Chen’s video.

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About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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