A Classic Guitar Maker Gets a Boost from the Manufacturing Extension Partnership

The legendary Gallagher Guitar Company found its footing with help from a Commerce Department-backed manufacturing incubator.

Gallagher Guitar Company owner David Mathis refers to his luthier enterprise as "a startup company with a lot of history."

Gallagher began making handcrafted acoustic guitars in 1965, but by 2019 the family-owned company closed its Tennessee shop after producing thousands of top-quality string instruments for bluegrass, country, and folk musicians.

The Gallagher family company had not crafted any new guitars for about two years when Mathis stepped in with his wife Reina to purchase the failing luthier shop. In the early days of Gallagher Guitars, the company partnered with flat-picking master Doc Watson and named its most successful model after the blind, grammy-award winning player.

Mathis' objective was to return Gallagher acoustic guitars to the prominence they once enjoyed during the Doc Watson days.

"We are rebuilding the brand," said Mathis. "Interestingly enough, it had functionality, but it had been closed in the sense that they were not really building guitars anymore."

Mathis set out to tackle the problems that led to Gallagher's demise and found an antiquated manufacturing process was keeping the company from sustainable profitability.

"I had visited the Gallagher shop as a young man, so I had this great affection for Gallagher, and I hated to see it become another American company that closes," said Mathis. "We had to set up shop and we were trying to learn how to build great guitars and do it consistently.

"We were boosted by working with the University of Tennessee Center for Industrial Services (UTCIS) through their Manufacturing Extension Partnership program. We learned about lean manufacturing.

"We had onsite training here at the shop and learned about not putting resources into things that the customer didn't necessarily value. We learned to think that way because we had a very, very high bar on every guitar and every aspect of the guitar, and we were investing time that had very little return on our time."

Courtesy Gallagher Guitar Company

Mathis and his staff of seven guitar builders at their new shop in Murfreesboro took the lean manufacturing message to heart and today the company is thriving in a way that seemed impossible just six years ago. Outsourcing some work to domestic suppliers and streamlining work conditions have put Gallagher Guitars on the path to becoming a major player again in the custom-made acoustic guitar marketplace.

"Business has improved every year. We definitely had real challenges to get beyond a small shop mentality and a step more into modern manufacturing ideas," said Mathis. "There was some resistance initially of how it is going to hurt our quality. But we actually found that lean manufacturing promotes quality and helps us maintain quality.

"I think we are best known in the bluegrass community, and the thing about bluegrass musicians is they expect a lot from a guitar because they are such great players themselves. You don't have that same high bar in other genres of music necessarily, like country music. For us to be really growing and becoming more and more popular in bluegrass music is really a positive sign, a precursor to becoming more popular in a much broader way."

The training from the Tennessee Manufacturing Extension Partnership (TMEP) at UTCIS taught the luthiers how to make material flow more efficiently through the shop. They also learned how to identify waste which put them into a mindset that had them thinking about efficiency.

Lee Leonard is a Solutions Consultant at UTCIS who first met Lee Mathis when the center was doing an outreach program to make its services better known to Tennessee manufacturers.

"When I first met David, he was trying to make the company more focused and bring in Toyota principals," said Leonard. "The first thing I did was sign him up to the Made in Tennessee program. We then promoted his company through our social media - Twitter, LinkedIn, and Facebook. We were trying to promote his company with our resources.

"Our focus is manufacturing, and the Center for Industrial Services is all about supporting manufacturing. We are funded by NIST (National Institute of Standards and Technology) and the U.S. Department of Commerce."

Courtesy Gallagher Guitar Company

Leonard and his team at UTCIS try to target small- to medium-sized manufacturers, providing them with expertise they may not be able to afford in-house. Continuous improvement is the facet of the program where Gallagher Guitars benefited from the most.

"We came in and we provided them lean manufacturing implementation assistance," said Leonard. "It was a combination of classroom training and on the floor exercises. It was real-world application.

"We also helped with strategic planning, gave them guidance, and directed them to state and federal resources. We try to connect them to domestic manufacturers that may help reduce wasteful spending."

MEP is a federal program dating back to 1988 that is a public-private partnership between the federal government, state governments, and universities. There is an MEP program in all 50 states and Puerto Rico, which provides U.S. manufacturers access to resources, technologies, and expertise to enhance productivity and foster growth.

TMEP, which is housed within UTCIS, in 2025 has provided 22,633 training hours and engaged with 355 unique clients out of a total consultation with 3,584 projects. The total impact on the Tennessee economy has been more than $1.7 billion.

"The program helped create a significant reduction in the number of hours needed per guitar, which led to a huge increase in the number of guitars they could make each month," said Leonard. "We are trying to show the impact of what we do in this story that hopefully also interests a general audience. Who doesn't love a guitar?"

David and Reina Mathis, co-owners of Gallagher Guitar Company, with Lee Leonard of the University of Tennessee Center for Industrial Services. | Courtesy UTCIS

Gallagher Guitar Company once outfitted numerous pickers on the bluegrass circuit and has begun to make a name with a much younger audience.

"Kyser George is a young man who plays our guitar in a group called ShadowGrass, and at the International Bluegrass Music Association he just won the Momentum Award for the up-and-coming star in the area of instrumental music," said Mathis. "We also have another young man who is a rising star in country music called Ty Meyers, and he is playing our guitars now too.

"We see our guitars more now on the stage like, for example, the Grand Ole Opry. It's encouraging for us to see the positive response we're building in really a short period of time."

The new shop in Murfreesboro is just 30 miles from Nashville.

"We wanted to be much closer to Nashville, which really is Music City," said Mathis. "We have artists that will come down and visit us and maybe sit down in the shop and play for a bit."

The classic Gallagher guitar's starting price is from $4,500 to $5,500 but can be much higher with custom wood and inlays on the fret board. The company has just started making a line of Shelby guitars that are more affordable, with a starting price of $2,700.

"The new guitar, the Shelby line of guitars that we are doing, that is really an effort to try and bring the price down," said Mathis. "We know we can't match a guitar that is built in China in terms of price, but the Shelby is still built in the same shop as our $7,000 guitar.

"We've certainly had individuals tell us the way we can offer more affordable guitars is to have it built in China or Korea or elsewhere. But it's important for us to maintain this company and being uniquely American."

Gallagher Guitars are sold mostly through smaller independent guitar dealers throughout the U.S.

"We are not in any of the big chain stores like Guitar Center or Sweetwater," added Mathis. "We really value the small dealer network that we have. We believe in the value of locally owned, family-owned small shops that build a community and trust within their community."

To learn more and find a list of Gallagher Guitar dealers visit https://www.gallagherguitar.com