Would like to start a Stereo Club in the midwest.

An important item you did not address (in your answer to my post) is an important issue. What happens if no one wants a particular gear? Who is responsible for selling the piece, and who determines how much money the piece will be sold for? All I have to say is, that lets say someone in the club bought a digital piece for $3000. They demoed it and thought it was ok but not a keeper. Everone else in the club over 6 months or so demos the piece, and no one decides to buy it. Interestingly enough in those 6 months this digital product is discontinued (or the manufacturer goes under) and is replaced by a product heralded as better and less expensive that sells for $2k new. Well, people start dumping the unit your club bought for $1500 to $2000. Who is going to make the determination as to how much money you guys are going to loose?

I have been doing deals on Audiogon since before the Feedback system was in place. If you think the above scenario does not happen... well it does. It happens much more than you would think especially the longer you hold onto a product. And to not just digital, but almost any component. One could say that whatever loss incurred becasue it is distributed over all of the members, is very little. At say $1200 loss is only costing $100/per member which may be %10 of the yearly fee; however, it is still a loss. And frankly, some members might be a little upset because they are set digitally.

My item #2, you indicate that anyone can get ripped off... Well it is one thing to rip off an individual, and completely different to rip off a group of people. And I relly am not talking about being overtly ripped off. I am mainly talking about if your club sells a product, and say it is damaged in shipping. Have you ever fought for a claim against any of the major shippers? It is not fun and many times it is not fair. Sometimes you even need to get legal representation to win. All I can say is that every shipper I have dealt with will fight tooth and nail against paying any claim unless it is 100% their fault, i.e. they totally lose a box. Even then, they are slow as snails. Who is the club is going to be responsible for claims?

My number #3, you say you have never known anyone who has had a piece of equipment break in their possession... Well you are pretty lucky ot very new to hi end audio. Accidents happen with all sorts of potential causes: deffective gear, internal damage during shipping (difficult to prove for a claim), power surges, young children, pets, tubes eventually go bad (who replaces them during the demonstration phase... especially if you need matched sets), crime, floods, earthquakes, other natural disasters. Basically, there are all sorts of things that can damage gear. And the more gear you go through, the high the chance that something will occur. I once bought a dealer demo Classe CA-100 amp. I hooked it up, and played some music. It immediately blew the right channel of my speaker. Apparently the right channel of the amp oscilated. A CDP of mine (Cary 306/200) display suddenly went out one day. I had an amp that I bought (4 years ago) which was 1 month old start smoking as soon as I plugged it in. I bought a dealer demo preamp whose left channel was 180 degrees out-of-phase. I have bought equipment that was not in the condition that it was promised per se. I have had an amp damaged by water from a leaky roof (in a new apartment which I did not know the roof leaked). I have had an amp damaged by flood water. My dogs have scratched up some pieces of gear I have owned. I once got a remote stuck under my couch and had to move my couch to get the remote; however, the remote got stuck under a steel beam under it which mest up the remote quite a bit.

Anyway, stuff happens... And a lot of it can be beyond your or anyone's control. Who's going to incur the cost of fixing the gear?

My number 4, first choice goes to the person who decided to buy it. Who gets second choice, and third choice, and so on? I guess it could go in a definite order, but I could see that some people might feel slighted by this. ESPECIALLY, if an item is procured at a very very good price.

Anyway, I hate sounding like a pessimist, but if you can get this club to work, I would be interested in how it turns out.

Personally, I think you will have problems and it will come down to money issues, personal responsibility issues, and audio decision issues. Lets say I was in your club, and my turn came up, and I wanted to get a 1M run of Nordost Valhalla pair of speaker cables (I could maybe get them for oh.... $3k new +/-). One thing though... most of the other folks in the club need more than 1 Meter of speaker cable. And the few folks who only need 1M, could not afford Nordost Valhalla or want it. While I am demoing the Valhalla, Nordost replaces the Valhalla with Valhalla II which is a little better and less expensive. People start dumping their Valhalla on the market for 30 cents on the dollar, and we can only get $2k for the Valhalla. What are the other members of the club going to think of me? I bought a speaker cable that really was not viable for anyone else (maybe I did not know this). I bought a cable that depreciated immensly after I bought it costing everyine money. This situation can happen with a lot of gear... Take low powered tube amps for example. SOme people design their systems around low powered tubes. Lets say two members of your club have this kind of tube setup. When it comes to their turn to buy a piece, they could very well buy pieces only they could viably use in their system. Additionally, these two could be really excluded from most of the pieces purchased by others in the club.

One of the underlying assumptions with this club is that any given piece can work in most of our systems. This is relaly not true unless the group has essentially the same or similiar systems. Equipment such as amps, preamps, and speakers must be matched well to get great sound out of them. Moving any of those pieces from one system to another can be problematic. Sources are a bit easier; however, digital sources fluctuate in prices quite a bit.

Anyway good luck in your endeavor. I would just be careful.

KF

HMMMM... nothing ventured... nothing gained...

Tok20000 - you raise a lot of really good points with some excellent examples. It may not be completely realistic, and I'd want to close off as many obvious gotchas as possible, but one would have to go into such a thing assuming they weren't going to get their money back, certainly not in total. There are a lot of ways you could lose money in this type of thing, though almost all of them are possible when you do this just as an individual. So, you'd be more likely than normal to experience some financial pain, since you'd be spreading the risk over many more transactions, but you'd be less likely to experience absolute pain since on any given downside, you'd be sharing the brunt with the rest of the group.

Would it be perfect? No. Would there be hard feelings? Quite possibly. After doing it once, would those who tried it do it again? Likely not. Still, it's an intriguing idea.

Tunes4me - you answered my #6 - if you have 12 members, 12 pieces in circulation at any given time, then there is no down time. Everybody always has a "club piece" that they're using. I was wondering if there would be times during the year that your money would be on the table but you'd have nothing in your system. While it's good that the answer is no, it also makes me think that $1000 wouldn't work then. If you have $12K to work with and buy 12 pieces, you're definitely limiting yourself in terms of what types of pieces you can buy ($1000 apiece). The same money over half as many pieces (or twice as much money) would give you much greater flexibility.

As for refreshing the money - I think you would have to put more in over time if this was a "living" club. Even used gear will, over time, cost you to buy and sell, along with some of the downfalls outlined by Tok2000. A year into it, you're going to need more capital to keep buying gear. That's not necessarily a bad thing, just a fact.

I wouldn't do cables for a lot of reasons, some of which Tok20000 oulined very well.

I wouldn't do large speakers either, but I would have a great deal of interest in monitor speakers, which are not really any harder to move than an amp.

So, let me paint a somewhat different scenario. A group of 8 people all agree to put up $2K and each make a choice of CD players in the $1500-2500 (used) price range. The 8 CD players are acquired, staying within a $16K overall total price (lots to figure out on how to get this accomplished). Everybody starts and finishes with the CDP that they nominated. There is a five week audition period for each CDP, and then a week to ship to the next person.

At the end of the year, you've got the CDP in your possession that you nominated for a final comparison (you hear it first and last). At this point, everybody decides which unit they liked the best, or none at all. At this same point, a price is determined, based on current market prices (used) for each unit at the end of the year, not at the beginning. You add up the agreed current value of each of the eight and compare to the $16K originally spent. Let's say, for the sake of argument, that the 8 players have a current value of $12K.

So, each person has $1500 in "credit". Note that everybody "lost" $500 over the year. I'd actually prefer to think that I spent $500 to audition a series of CDPs in a more exhaustive, but controlled, way than I would have been able to on my own. Anyway, it's not free. All units that nobody wants would be sold. If multiple people wanted the same unit, then additional units would have to be purchased. If you want a unit that costs $2300, you have to pony up another $800. If you want a unit that costs $1500, you should be even.

The mechanics of buying, selling and accounting would have to be worked out, but I'd consider each year a separate entity with a beginning and an end. You could lose your whole $2000, but more likely you'd lose only a bit. There would be a way to "cash out" people who lost interest within a reasonable time frame. If you didn't have 8 people next year, you could stop. If you did, there'd be a clear amount of money you had to put in to join. In the previous example, if you wanted none of the units, and you were doing $2k preamps next year, you'd have to put in only $500 to join for the next year, since you'd already have $1500 credit.

KT, very thorough and very enlightning, you and the others has expanded the thought,, pointed out the shortcomings, and the benefits as well.. I really think it would work..as you stated, if you "lose" $500.00, you have auditioned several pieces, for little money, and then we kick up a new mag... from real music/stereo owners/audiophiles. A workable concept? you bet...

Bye the way, KT, when do we start?? I would love to have you as a charter member...