Would like to start a Stereo Club in the midwest.

This is an interesting idea. There could be a lot of advantages to it, including some non-obvious ones. For example, if you got a new piece of gear ever few months to audition just on your own, you've got constant justifications to the spouse. If it's happening because you're part of an auditioning club, you explain it (and the money) once.

Anyway, I have a couple questions as well.

1. Would the club buy used gear, or would it be new gear?
2. Who sells it when it's made the rounds and is not purchased by a club member? The last person to "touch" it, the person who picked it, or the club "seller"?
3. It would be interesting to think about segmentation of this a bit too - for instance, this probably works more efficiently for preamps than it does for floor-standing speakers. Similarly, one of the values of auditioning is comparison, so it might be most interesting to do six preamps, followed by six pairs of speaker cables, etc. or something of the sort.
4. How many pieces are in circulation at any given time?
5. How long does a member get to hang onto a piece to audition?
6. With the answers to 4 and 5, how much of the year would a member be participating vs. waiting on the "sidelines".
7. How often would money have to be "refreshed."? It would seem that over time, the group would lose money buying and selling, and that the cost of auditioning would have to be borne through yearly (?) contributions.

Interesting idea.

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.