Jordan-Kitt Music Inc.

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Jordan-Kitt Music Inc.

9520 Baltimore Boulevard
College Park, Maryland 20740-1322
U.S.A.
Telephone: (301) 345-3310
Fax: (301) 474-3648
Web site: http://www.jordankitts.com

Private Company
Incorporated: 1912
Employees: 300
Sales: $52 million (2006 est.)
NAIC: 451140 Musical Instrument and Supplies Stores

Based in College Park, Maryland, Jordan-Kitt Music Inc. is the parent company for the Jordan Kitt’s Music chain of a dozen retail stores in Maryland, Washington, D.C., Virginia, Delaware, and Georgia, as well as for its interest in The Beautiful Sound music store in Chicago, Illinois. Jordan-Kitt is the largest piano and keyboard retailer in the United States, offering a wide variety of acoustic and digital pianos. It also buys pianos and sells used and reconditioned pianos and offers a piano rental program.

The company’s institutional program sells pianos as well as digital organs and pipe/digital organs to churches, synagogues, and educational institutions. In addition, Jordan-Kitt offers tuning and repair services for both pianos and organs, and will retrofit pianos to make them into electronic player pianos. The company’s Concert & Artist department provides pianos and maintenance services to such high-profile clients as the White House (supplying pianos for virtually every artist performing there), the Kennedy Center, and Wolf Trap. The stores also provide piano and organ lessons to all ages through subsidiary Keyboard Learning Centers in order to spur sales. Jordan-Kitt is owned by its chief executive officer, William J. McCormick, Jr.

COMPANY FOUNDED: 1912

The men behind the Jordan-Kitt name were Arthur Jordan and Homer L. Kitt. Jordan was a successful businessman in Indianapolis in the late 1800s, involved in the poultry, egg, and butter business, and, according to lore, was the first man to ship a trainload of poultry from Indianapolis to New York City. At one point he owned scores of packing and cold storage plants in Indiana, Illinois, Kentucky, and Ohio, before selling out in 1903. He then became involved in a number of other manufacturing, retailing, and life insurance ventures, while also investing in Washington, D.C., real estate, including a building on the corner of 13th Street and G Street, home to the Juelg Piano Company.

In 1912 Juelg was on the verge of going out of business, and when Jordan acquired it he renamed it The Jordan Piano company. In 1916 he persuaded a friend, Homer L. Kitt, who had his own music business in Chicago, to move to Washington, D.C., to become general manager and run the retail store. Kitt was soon taken on as a partner. In addition to pianos, the store’s merchandise included reed organs and other musical instruments as well as sheet music and the phonograph, still in its infancy.

Jordan Piano would also ride the wave of popularity of the player piano, which enjoyed booming sales in the 1920s and prompted the company to open branch stores, including one in Richmond, Virginia. Jordan and Kitt also expanded their operations to another corner of 13th and G streets. In August 1922 they acquired Knabe Warerooms, Inc., which primarily sold Knabe pianos, a venerable German brand, as well as other high-end instruments. Officially, the buyer of Knabe was the newly formed Homer L. Kitt Company. Jordan’s involvement was kept from the public, the newspaper reporting that the firm had $200,000 in capital supplied by Kitt and his partners, prominent area businessmen C. N. Hopkins and H. R. Appold. In addition to carrying Knabe pianos as its main line, the Homer L. Kitt Company also indicated that it planned to add “talking machines” to its inventory.

For more than 60 years Jordan Piano and Homer Kitt Piano operated independently, though covertly joint-owned. They carried different lines of instruments and operated under separate management, and their salespeople became fierce rivals, loathe to lose a sale to the business across the street. Both suffered through the Great Depression of the 1930s, cutting costs and adding any products that might bring a sale, including radios and refrigerators. In the meantime, Arthur Jordan created the Arthur Jordan Foundation in 1928 to administer his philanthropic endeavors, and when he passed away in 1934 his interest in both piano companies was transferred to the charitable foundation.

The 1930s also saw the Kitt store a victim of arson. In the early morning hours of September 14, 1938, fire trucks were called to the scene to put out a blaze that a subsequent investigation revealed had been set separately in the basement and the first two floors. Two earlier attempts, according to press reports, had been made to set the building on fire. The blaze caused $50,000 in damages, including $15,000 worth of sheet music, most of which was covered by insurance. Some of the firemen who responded to the call, however, were injured. One man had a hand cut by falling glass, a battalion chief was briefly overcome by gas in the basement, and a firefighter named Buck Wright reportedly lost his false teeth. The store reopened for business a day later and eventually its damaged Spanish facade was replaced by an art deco design that was in vogue.

Kitt died in 1943, and the Arthur Jordan Foundation became sole owner of the cousin piano companies, both of which barely scraped by due to World War II, when supplies of pianos were disrupted as manufacturing focused on the war effort. Before his passing, Kitt had in fact done his part in the war effort, opening a Music Canteen, as well as offering free repair services and practice space to instrument-playing servicemen. Replacing Kitt as general manager was his secretary, Frances Jones. Business picked up following the war as the economy soared and returning servicemen raised families and bought homes, many of which included a piano.

While the Jordan and Kitt stores had become the leader in Washington, D.C., they also grew staid with time. In the 1960s when electric guitars became highly popular with young people, Kitt’s carried the Gibson line and Jordan’s the Fender, but neither offered discounts and were soon overshadowed by Washington Music Center, which sold guitars at a discount. In 1968 the two stores were finally united when the Arthur Jordan Foundation merged the operations, creating Jordan-Kitt Music Inc. A year later Checci Corporation, a diversified consulting firm, bought the business.

WILLIAM MCCORMICK, JR., NAMED PRESIDENT: 1971

Jones retired in 1970 and soon the seven-store chain was on the verge of folding. In 1971 Checci’s chief executive office, Vincent Checci, installed a new president, William J. McCormick, Jr. McCormick was a 1959 graduate of Holy Cross College, where he received a degree in English, as well as Harvard Business School, where two years later he earned a master’s of business administration. While he lacked musical training, by the time he joined Jordan-Kitt McCormick was a seasoned executive familiar with business turnarounds. After he had graduated from Harvard, Checci had put him to work at a floundering sugar mill in the Philippines, and he played a key role in reviving that business. After five years with Checci, McCormick took a position with Glendinning Companies, a Connecticut firm that at the time was the largest marketing consulting company in the United States. There he gained experience in several consumer products companies.

COMPANY PERSPECTIVES

At Jordan Kitt’s Music, we do all we can to help you get the most musical satisfaction possible from the world’s finest keyboard instruments.

Checci had acquired Jordan-Kitt because he believed American workers were on the verge of gaining expanded leisure time and that many of them would use that extra time for pursuits such as music. Although McCormick was skeptical of this view, he agreed to take the helm of Jordan-Kitt as well as a pair of sporting goods companies because he thought there was a good chance he might eventually acquire the music business, and owning his own business was an important personal goal. In Jordan-Kitt he recognized a company that had sold brand recognition and at its core a strong management team. All the company lacked, he believed, was more of strategic vision.

Before McCormick made any major changes to the operation, however, he took time to learn the business from the experienced hands at the company, other retailers, and from suppliers. He then began to invest more money in advertising and promotions while over the course of three years closing six of the seven stores he inherited and opening nine new units, spreading into the nearby Baltimore market. The home organ market was beginning to boom at this time, and most of the new stores were located in shopping malls where organ salesmen did well by playing music in front of the store to attract mall traffic. Prospects were then invited inside for a more extensive demonstration, and the sales staff would seek to close the sale. In 1976 McCormick acquired a controlling 51 percent interest in Jordan-Kitt, and then in 1983 he bought the rest of the company.

The organ business peaked by 1981 when Jordan-Kitt operated 21 mall stores in D.C. and Baltimore, generating annual revenues in excess of $12 million. The company had not neglected pianos during this period. In fact, in 1977 Jordan Kitt’s became a Steinway dealer, as McCormick sought to establish strong ties with the venerated piano manufacturer. As the market for home organs began to recede in the early 1980s, McCormick was forced to refocus. In July 1983 the Washington Post reported that Jordan Kitt’s would begin marketing higher-end personal computers, particularly at its mall locations, which were not conducive to piano sales; people in the market for a piano generally did not come to that decision while strolling through a mall. They were ready customers, willing to pay a visit to one of the company’s freestanding stores that had the room to showcase a large number of models. An accompanying photograph showed McCormick posing with a PC resting atop a Steinway grand piano. As it had done with organs and pianos, the company hoped to spur computer sales by offering instructions on how to use the machines. The computer-and-music store concept was launched on an experimental basis at three stores, the trial to last a year before a decision was made to convert the other stores in the chain.

Needless to say, Jordan Kitt’s flirtation with the PC business was short-lived. The computer revolution did provide the company with a new and important product line, however: electronic or digital pianos, which were better suited to the mall environment. The new line was introduced in 1984 and soon accounted for 30 percent of all sales volume in mall locations. At the freestanding stores, on the other hand, they provided just 10 percent of revenues.

The company was able to use the same sales techniques it had perfected in selling home organs. Salespeople demonstrated the new electronic pianos outside the stores to prequalify buyers, then brought in the “live” prospects for a more concerted pitch. A large percentage of these customers represented a new customer base: those who had not necessarily been in the market for a piano. Such consumers were willing to consider the piano because it was more compact and easy to use and because it was electronic and did not require tuning. The offer of piano lessons was often the final inducement in closing the sale. Electronic pianos represented a developing field, however, that presented its own problems. Manufacturers introduced new keyboards at a dizzying rate, creating challenges for the sales personnel who had to develop effective demonstrations for them.

KEY DATES

1912:: Arthur Jordan founds Arthur Jordan Piano Company in Washington, D.C.
1916:: Homer L. Kitt becomes partner.
1922:: Jointly owned Homer L. Kitt Company established.
1968:: Two units merge to form Jordan-Kitt Music Inc.
1971:: William J. McCormick, Jr., is named president.
1976:: McCormick gains a controlling stake.
1984:: Digital pianos are introduced.
1997:: Acquisitions expand the company in the Mid-Atlantic region.
2005:: Co-ownership of The Beautiful Sound music store is acquired.

In 1984 the Homer L. Kitt store location at 13th & G Street was closed. Jordan-Kitt moved its headquarters to College Park, Maryland, consolidating it with the warehouse operation. McCormick was also ready to abandon malls in 1984 and focus on freestanding stores, but the introduction of digital pianos changed his mind, at least temporarily. As was the case with all electronics, the price of digital pianos decreased as did the profits they provided. Hence the company was ultimately unable to save the mall stores as home organ sales continued to deteriorate. By the end of the decade, Jordan-Kitt generated about $25 million in sales from five freestanding stores and the 13 remaining mall locations.

STRATEGIC ACQUISITIONS: 1997

In the 1990s Jordan-Kitt gradually shuttered the remaining mall stores. The company concentrated on its strength, acoustic pianos, opening large warehouse-style freestanding stores where there was plenty of room to show off grand pianos to better effect, creating settings that gave customers a sense of how a piano would improve their home environment. At the same time, Jordan-Kitt expanded into new markets in the Mid-Atlantic area through strategic acquisitions. In 1997 it acquired Wilmington Piano Company in Wilmington, Delaware, giving Jordan-Kitt a toehold in the Delaware Valley market that included Philadelphia. Temple of Music in Virginia Beach, Virginia, was also acquired that year, as was Steinway Piano Galleries in Atlanta, Georgia.

By the end of the 1990s, Jordan-Kitt operated a dozen stores, seven less than at the beginning of the decade, but sales had doubled to about $50 million, this occurring during a generation of declining piano sales. More than 280,000 new pianos were sold in the United States in 1978; after 1983 that figure never exceeded 200,000. In 2005 that number would dip to 95,000. Only grand pianos, the kind that Jordan-Kitt specialized in, enjoyed significant growth: 20,000 were sold in 1983, compared to 50,000 in 2005. Jordan-Kitt looked to fully exploit this niche in the market in the new century. In 2000 it opened a new three-story, 10,500-square-foot store in Lutherville, Maryland, that featured a large showroom as well as a complete Keyboard Learning Center with five private teaching studios, a group digital piano classroom, and a 120-seat recital hall. A year later the company opened a new 5,000-square-foot showroom in Sterling, Virginia, which also included a Keyboard Learning Center and a 100-seat recital hall. In 2005 Jordan-Kitt became involved in the Chicago market by teaming up with Minneapolis-based Schmitt Music Company to acquire the assets of The Beautiful Sound, a major piano retailer in the Chicago area for more than 50 years.

After spending more than 30 years running Jordan-Kitt, McCormick began fashioning a succession plan in the 2000s, grooming his son, Joe McCormick, to take over, as well as younger executives in the organization such as executive vice-presidents Ted Ochs and Chris Syllaba. The younger McCormick was a Holy Cross graduate like his father. He joined the company as merchandising manager three years after graduating in 1995, and in 2002 he was named distribution manager. Making a successful transition to the next generation was extremely important to William McCormick, who told Music Trade, “If I don’t get a solid succession plan in place, then everything else I’ve done will have been a failure.” There was every reason to believe that when the time came for him to step aside, Jordan-Kitt would be well prepared to carry on without him.