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 Success a sweet sound for Counterpoint Electronics


The San Diego Union -Tribune; San Diego, Calif.; May 24, 1994; DIANE LINDQUIST;
Abstract:

Audiophiles in Japan, Hong Kong and China are the biggest buyers of the company's line of
preamplifiers, amplifiers, speakers and other high fidelity equipment. The products also do well inEurope and Mexico. Indeed, export purchases account for 70 percent of Carlsbad-based Counterpoint's $10 million in annual sales.
Laura Hendershot, the company's chief executive, says most Americans aren't in tune with the firm's high quality --or willing to pay its corresponding high costs, which range from $795 for speakers or a power amplifier to $7,500 for preamplifiers.
Because being engulfed by quality sound is an essential part of the home theater experience,consumers seem more willing to pay big money for audio equipment --even Counterpoint's hefty $15,000 price tag.
Company: Counterpoint Electronic Systems Inc. { } Business: Designs and manufactures high fidelity audio equipment { } CEO: Laura Hendershot { } Headquarters: 2281 Las Palmas Drive, Carlsbad, CA 92009 { } Employees: 60 { } 1993 revenues: $10 million
 
Counterpoint Electronic Systems' home-stereo equipment strikes far sweeter notes outside the United States.
Audiophiles in Japan, Hong Kong and China are the biggest buyers of the company's line of
preamplifiers, amplifiers, speakers and other high fidelity equipment. The products also do well in
Europe and Mexico. Indeed, purchases abroad account for 70 percent of Carlsbad-based Counterpoint's
$10 million in annual sales.
Laura Hendershot, the company's chief executive, says most Americans aren't in tune with the firm's
high quality --or willing to pay its corresponding high costs, which range from $795 for speakers or a
power amplifier to $7,500 for preamplifiers.
"They want low, low prices. Unfortunately, they've been convinced there's no reason to spend more
than $300 on a hi-fl," she said.
But a compelling irony occurs in the worldwide home-stereo market.
The U.S. market is largely a discount market dominated by Asian companies. The high-encl exists
mainly outside the United States and is almost exclusively the domain of American companies.
Counterpoint has competed well in this segment where contemporary designs, advanced technology
combine with high aesthetic appeal and a remarkable level of finish.
But now, the company expects to significantly boost its domestic sales, thanks to the emergence of in-
house cinema as one of the next generations of home entertainment.
Because being engulfed by quality sound is an essential part of the home theater experience,
consumers seem more willing to pay big money for audio equipment --even Counterpoint's hefty
$15,000 price tag.

07/09/2001
 
 
Its surround-sound system of audio components and seven speakers operated by a single remote
control is certified to the standards of the Lucas THX system heard in movie theaters.
"It's a smart move. It's one of the fields showing the greatest growth," said Ivan Berger, technical editor
of Audio magazine.
Even other multimedia possibilities materializing on the information superhighway, whatever direction
they take, can well be expected to require a quality audio system, he said.
Counterpoint Electronics is one of the oldest of hundreds of audio companies scattered throughout the
United States.
The company was started in 1977 in Beverly Hills by hobbyists who thought high fidelity equipment,
although measuring better in electronic tests, wasn't sounding better.
Operating out of a closet, they went back to using vacuum tubes, which according to the
preponderance of opinion give a sweeter, more mellow sound in the higher registers.
The firm did about $30,000 in sales until Hendershot and her two partners bought the company in
1982 and moved operations to San Diego County. "We immediately started doing $30,000 a month
" she said.
All admit to being music nuts.
"That's how we got in the business," Hendershot said.
Richard Riccio is chief operating officer. Michael Elliott is the designer. Each owns about a third of the company. A year and a half ago, they relocated to their current 42,000 square-foot building in an office park near Palomar Airport. The facility contains five sound rooms and a home cinema mock-up for showing and testing their equipment.
Manufacturing and engineering have been kept closely linked so products can be constantly improved
and upgraded, Hendershot said. The partners have created four operating divisions that make their own
transformers and chassis and perform their own silk screening as well as assemble the equipment.
"We just couldn't get the quality we needed on time. Suppliers were oriented more toward industrial
markets rather than consumer markets which have the emphasis we needed on quality," Hendershot
said.
In all four divisions, Counterpoint employs a work force of 60, many semi-skilled. All are offered an
employee-stock ownership program to encourage longevity and motivation.
Since its move to San Diego County, the partners have continued to put an even greater emphasis on
design. Vacuum tubes and solid state are combined in amplifier construction to bring out the best of
treble and bass. Chassis are not made of plastic, but copper-plated steel. Interiors are devoid of
spaghetti-like masses of wires, and knobs are reduced to the few essential controls necessary to affect
sound. They now produce a line of24 high-fidelity products that have won 15 design awards, including
the Hi-Fi Grand Prix Award in Japan.
 
Their equipment is well respected. I would stop short of saying revered," said Berger.
QUICK AUDIT
{ } Company: Counterpoint Electronic Systems Inc. { } Business: Designs and manufactures high
fidelity audio equipment { } CEO: Laura Hendershot { } Headquarters: 2281 Las Palmas Drive,
Carlsbad, CA 92009 { } Employees: 60 { } 1993 revenues: $10 million
[Illustration ]
I PIC II CHART; Caption 1 Booming business Laura Hendershot (right), chief executive officer of Counterpoint Electronics Systems, a Carlsbad-based maker
of stereo equipment, listens to a compact disc in one of the company's sound rooms as Rich Riccio, vice president and marketing director, cranks up the volume
2 QUICK AUDIT; Credit" Union­ Tribune / CHARLIE NEUMAN
Credit: Staff Writer
Sub Title: [UNION­ TRIBUNE, 1,2,3,4,5,6, 7,8,9 Edition]
Column Name: THE ENTREPRENEURS
Reproduced with permission of the copyright owner. Further reproduction or distribution is prohibited without permission.
 
07/09/2001
 
 

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