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Music Industry Analysis Essay Analysis on Music Instrument Industry of Bangladesh Analysis on Music Instrument Industry of Bangladesh Submitted to: Mr. Md. Saif Noman Khan Assistant Professor Submitted by: Md. Mashrur Rahman Khan(Zr-11) (Group Leader) Contact No. 01675694513 e-mail:[emailprotected] com Sayeed Shorif Russel(Zr-08) Adib Iqbal Umit(Zr-12) Abdullah Al Muyid(Zr-18) Saif Hasan(Zr-21) Shah Shihab Sadman (Zr-27) Fahmid Shawon(Zr-28) Shamsuddin Muhammad Ishtiaque(Zr-30) Al Imran Bin Khodadad(Zr-46) Nafiz Alam Khan(Zr-47) BBA 18 Institute of Business Administration University of DhakA December 20, 2010 Mr. Saif Noman Khan Assistant Professor Institute of Business Administration University of Dhaka Dear Sir: â€Å"SUBMISSION OF TERM PAPER† It is our distinct pleasure to hand over to you our term paper that fulfills the partial requirement of the Business Communication course (C103). Being the students of Business Administration, it has been more of an opportunity for us to be able to work on this report. The knowledge and first-hand experience that we gained while going out there and collecting relevant data and the networks we made while interviewing different personnel, are undoubtedly going to prove to our advantage once we step into the corporate world. This report, and the investigation behind it, was prepared under your direct supervision. We pledge that under no circumstances will any part of it be reproduced for any reason or be shared with anyone else without your written consent. Furthermore, we pledge that this report has not been submitted to any other faculty member of the Institute of Business Administration We tried to accommodate your invaluable comments and suggestions in our report. In this connection, should you need any further clarification, please feel free to contact us (the contact details are included in the title page). We would like to take this opportunity to express our gratitude to you for providing us with a thorough knowledge base of how to come up with an excellent report while enjoying doing so. We have been very enthusiastic about doing a good job on this report and hence are hoping that it would meet up to your expectations. Sincerely, Md. Mashrur Rahman Khan(Zr-11)| Sayeed Shorif Russel(Zr-08)| Adib Iqbal (Zr-12)| Abdullah Al Muyid(Zr-18)| Saif Hasan(Zr-21)| Shah Shihab Sadman (Zr-27)| Fahmid Shawon(Zr-28)| Shamsuddin Muhammad Ishtiaque(Zr-30)| Al Imran Bin Khodadad(Zr-46)| Nafiz Alam Khan(Zr-47)| Table of Contents Executive summaryvii 1. 0Introduction8 1. 1 Origin of the report8 1. 2 Objective8 1. 3 Scope9 1. 4 Limitations9 1. 5 Methodology9 1. 6 Historical Background10 2. 0 Music Instruments11 3. 0 Industry Structure14 3. 1 Background of the industry14 3. 2 Sales Trend15 3. 3 growth rate16 3. 4 growth potential17 3. 5 Industry composition17 3. 6 product composition18 4. 0 Analysis of Consumer Preferences18 4. 1 Survey Procedure18 4. 2 Survey Results18 5. 0 Analyzing the Market24 5. 1 Market trends24 5. 2 Market share25 5. 3 Market Growth26 5. 4 Market Size29 . 5 Market leaders29 6. 0 Available Products in the Market31 7. 0 Value Chain Analysis35 7. 1 PORTER’S GENERIC VALUE CHAIN ANALYSIS OF THE MUSIC INSTRUMENT INDUSTRY35 7. 1. 1 Core process36 7. 1. 2 Supporting process37 7. 2 Activity analysis37 8. 0 Value Chain System of Music Instrument Industry39 9. 0 Analysis from Investors Point of View40 9. 1 Porter’s Five Forces Industry Analysis40 9. 2 SWOT Analysis43 9. 3 Suggestions for Investors43 10. 0 Conclusion45 11. 0 Bibliography46 12. 0 Appendix47 List of Illustrations Figures: Figure 1: Preference of Music Genre19 Figure 2: Preference of Music Instruments19 Figure 3: Purpose of Purchase20 Figure 4: Consumer Budget Analysis21 Figure 5: Brand Preferenceof Guitar22 Figure 6: Brand Preference of Drums22 Figure 7: Brand Preference of Keyboard23 Figure 8: Acceptance of Second Hand Instruments24 Figure 9: Shop Preference26 Figure 10:Cost-Revenue Overview29 Figure 11: Porters Value Chain Analysis36 Figure 12: Value Chain process of Music Industry39 Figure 13: SWOT Analysis44 Tables: Table 1: Classification of Music Instruments10 Table 2: Price Variation27 Executive summary The rich musical culture of Bangladesh provides a solid base for the music instrument industry to flourish. Bangladesh has 27 genres of cultural music and in recent years modern music has become very popular in this country. Owing to these two factors the music instrument industry, although being small in terms of stature, is quite affluent in nature. The music instruments industry of Bangladesh has been growing at a steady growth ever since its arrival. But since the 90’s the growth rate has been exceptional. The major players in this market are Melody ; Co. Surashree, Sur niketan, Sangita, World Music etc. The characteristics of the market can be attributed to that of oligopoly. The existing major companies hold the major percentage of market share and thus entry of new companies in this industry is faced with various barriers. But there is ample opportunity for new investors to flourish in this market because of the constant flow of the customer. The value chain analysis of the industry also leads to a similar conclusion. The established companies have a widespread supply and distribution chain which helps them to gain cost advantage over other companies. This again bars the entry of new companies in this industry. The survey conducted on consumers has depicted similar findings. Consumers have a special consideration for the established brands and they generally use products depending on their previous experiences or being influenced by opinion leaders (Rock stars, Music Teachers). This hinders the entry of new companies as creating a brand image in consumers mind takes time which can prove to be very costly. In this report, concise description of the music instrument industry is provided for the investors to analyze the market themselves. Some analysis of this market are also included which we have done ourselves. By analyzing the market using SWOT and Porter’s five forces industry analysis, the opportunities and threats of the market were identified. If further investment is taken into consideration, this analysis should help the investors to understand the market trends and invest according to the demands of customers. vii|Page 1. 0 Introduction Entertainment is one humane quality that we possess and music provides the celestial emotions therefore, musicians are acclaimed everywhere. Music industry is growing all over the world and so is the need for professional and high quality musical instruments. Music is a big part of our culture as Bangladeshis. So, our music industry has grown considerably across time. The music instruments industry has met this growth alongside it. In the past decade the both industries have gone through some major changes. This report focuses on the current status of the music instruments industry. - 1. 1 Origin of the report The fulfillment of the Business Communication (C103) Course, taken at the Institute of Business Administration, requires the submission of a report assigned by the course instructor. Thus, by the kind approval and authorization of our honorable course instructor, Mohammad Saif Noman Khan, Assistant Professor, Institute of Business Administration, we, a group of students of BBA 18th batch, have prepared this report on the music instruments industry of Bangladesh. 1. 2 Objective The primary objective of our report is to provide a brief overview on the music instrument industry of Bangladesh. Through the report and its included value chain analysis of the industry potential investors may evaluate the profit prospects of investing in the sector . We will emphasize on the current situation of Bangladeshi music instrument industry and also compare it with previous years to analyze the market trend. We will focus on the key influencing factors of the music instruments industry of Bangladesh. Specific objectives: * State the music instruments available in Bangladesh * Understand the existing market structure of music instruments * Identify the market leaders Provide a value chain analysis of this industry * Determine consumers’ preference towards branded/non-branded products * Implementing our knowledge from this course in the real world scenario and getting a broader perspective * Analyzing the market from an investor’s perspective * Identify specific sectors where investment can be made * Determining the growth prospects of the sector. 1. 3 Scope This report is intended to provide adequate information on the music instruments industry of Bangladesh; the focus will be on both classical and modern musical instruments sector. The paper includes reviews of various literatures that are available and also in-depth analysis of the survey result that we conducted as a part of the report. The scope of the study encompasses the different music instruments shops around Dhaka. 1. 4 Limitations The main limitations faced while working for the report are: * The surveys carried out for the report were based solely on the capital city of Dhaka; other cities or even villages were not considered for surveying because of the geographical difficulties involved. * There were hardly any relevant journals or other secondary information sources on the topic. Some of the local companies were poorly structured and didn’t have adequate recording procedure; so much of the information was not possible to gather. * Some of the information gathered through the internet was backdated and up-to-date information was not available * The main source of information was interviews of owners of different shops. There is a possibility that the information provided by them was partial to their respective shops. 1. 5 Methodology While preparing this report both primary and secondary data sources were used. Personal interviews and informal discussions with individuals associated with the sector, served as the source of our primary data collection. Although formal questionnaires where used for the interviews, we were lenient in adhering strictly to facilitate the gathering of relevant information. * Primary Sources The primary information gathered for the report was basically questionnaire based. Two types of questionnaire served the purpose of gathering information for the report (Market survey questionnaire and consumer survey questionnaire). The methodology used in this report was a survey of 50 people from different walks of life. This wide sample was chosen in order to provide a more comprehensive study of the different music instruments and genre and to gather a broader array of opinions. For the market study our study was limited within the boundaries of Dhaka city. Most of the music instrument industry in Bangladesh is situated in Science Laboratory, Shakharibazar, Gulshan and Bashundhara City. These four locations comprise 90% of the whole music instruments industry. We interviewed approximately 10 different shop owners. The shop owners were highly co-operative. But the poor recording process practiced by those companies stood in the way of our gathering proper information. Secondary Sources Different books, Internet resources and newspapers were used for secondary data collection. Online resources were primarily used to know about the market structure, profit margin, brand names, the distribution system, key manufactures, and suppliers and to get the information provided by the companies themselves to know about the products. 1. 6 Historical Background Bangladesh has a rich music culture. There are over 27 genres of music which are prominent in Bangladesh. Now In keeping with the global growth Bangladesh has also adopted the different music cultures from outside the country. This has opened a new horizon for our music instrument industry as people started to move on to the rock culture. Due to this the market has shifted more to imported product. Classical and cultural music (Rabindra, Nazrul sangeet, Lalan Geeti etc. ) were popular since the inception of Bangladesh. Back in 1995, the underground band culture started growing. By 2001 it became so popular that the big players of the music industry took notice of the growing talents. To take advantage of high profitability of the industry, investors gathered and formed an oligopoly. The veterans of the industry began catering to the modern musicians and slowly moved towards modern instruments. A few companies which failed to change with the times went out of frame. Seeking this opportunity, new music instrument companies emerged. Till now music instrument industry in Bangladesh is in profit and there is practically in no loss. It may seem very profitable to invest in this rising industry, but the big names of the industry make it virtually impossible to attract a user base. 2. 0 Music Instruments Owing to the vast number of the music genres, the types of musical instrument have reached more than one can imagine. The popular musical instruments can, however, be classified in to two major categories: * Classical Instrument. * Modern Instrument. These instruments can be classified again into three major criteria: * Aerophones(Wind Instruments Vibrating air) * Chordophones(Stringed Instruments Vibrating strings) * Membranophones(Vibrating Membrane Instruments) In our report we will try to provide a brief view on different instrument for the potential investors who may not have sufficient knowledge about music instruments. In much of Europe, the term harmonium is used to describe all pedal-pumped keyboard free-reed instruments, making no distinction whether it has a pressure or suction bellows. In South Asia, the term generally refers to a hand-pumped instrument. Tablas: The tabla is a popular Indian percussion instrument (of the membranophone family) used in Hindustani classical music and in popular and devotional music of the Indian subcontinent. The instrument consists of a pair of hand drums of contrasting sizes and timbres. The term tabla is derived from an Arabic word, tabl, which simply means drum. Sitar: Sitar is a Persian musical instrument. It is a member of the lute family. Two and a half centuries ago, a fourth string was added to the sitar, which has 25 27 moveable frets. It originated in Persia before the spread of Islam. Ektara: Ektara literally one-string, also called iktar, ektar, yaktaro gopichand) is a one-string instrument used in Bangladesh, India, Egypt, and Pakistan. In origin the ektara was a regular string instrument of wandering bards and minstrels from India and is plucked with one finger. The ektara usually has a stretched single string, an animal skin over a head (made of dried pumpkin/gourd, wood or coconut) and pole neck or split bamboo cane neck. The various sizes of ektara are soprano, tenor, and bass. The bass ektara, sometimes called a dotara often has two strings (as literally implied by do, two). Dotara: The dotara (or dotar) is a two or four stringed musical instrument resembling a small guitar. It is commonly used in Bangladesh and West Bengal, and dates from the 15th-16th century when it was adopted by the ascetic cults of Bauls and Fakirs. The equivalent as a traditional long-necked two-stringed lute is found in Central Asia as dutar. It has two main forms, the Bangla and the Bhhawaiya. The Bangla form originated in Rahr Bangla where it is still predominantly played. The Bhhawaiya form dotara is almost extinct in contemporary times and has a more primeval beginning than its Bangla cousin. Flute: The flute is a musical instrument of the woodwind family. Unlike woodwind instruments with reeds, a flute is an aerophone or reedless wind instrument that produces its sound from the flow of air across an opening. According to the instrument classification of Hornbostel-Sachs, flutes are categorized as Edge-blown aerophones. Aside from the voice, flutes are the earliest known musical instruments. Electric guitars: An electric guitar is a guitar that uses the principle of electromagnetic induction to convert vibrations of its metal strings into electric signals. Since the generated signal is too weak to drive a loudspeaker, it is amplified before sending it to a loudspeaker. Since the output of an electric guitar is an electric signal, the signal may easily be altered using electronic circuits to add color to the sound. It served as a major component in the development of rock and roll and countless other genres of music. Acoustic guitars: An acoustic guitar is a guitar that uses only acoustic methods to project the sound produced by its strings. The term is a retronym, coined after the advent of electric guitars, which rely on electronic amplification to make their sound audible. Bass guitars: The bass guitar also called electric bass, or simply bass is a stringed instrument played primarily with the fingers or thumb (either by plucking, slapping, popping, tapping, or thumping), or by using a plectrum. The bass guitar is similar in appearance and construction to an electric guitar, but with a longer neck and scale length, and four, five, or six strings. The four string bass—by far the most common—is usually tuned the same as the double bass, which correspond to pitches one octave lower than the four lower strings of a guitar. Keyboards: A keyboard instrument is any musical instrument played using a musical keyboard. The most common of these is the piano. Other widely used keyboard instruments include multiple types of organs as well as other mechanical, electromechanical and electronic instruments. In common language, it is mostly used to refer to keyboard-style synthesizers. Among the earliest keyboard instruments are the pipe organ, hurdy gurdy, clavichord, and harpsichord. Drums and Percussions: A percussion instrument is any object which produces a sound when hit with an implement, shaken, rubbed, scraped, or by any other action which sets the object into vibration. The term usually applies to an object used in a rhythmic context or with musical intent. In a musical context then, the term percussion instruments may have been coined originally to describe a family of instruments including drums, rattles, metal plates, or wooden blocks which musicians would beat or strike (as in a collision) to produce sound. Saxophone: The saxophone (also referred to as the sax) is a conical-bore transposing musical instrument that is a member of the woodwind family. Saxophones are usually made of brass and played with a single-reed mouthpiece similar to that of the clarinet. The saxophone was invented by the Belgian Adolphe Sax in 1841. While proving very popular in military band music, the saxophone is most commonly associated with popular music, big band music, blues, early rock and roll, ska and particularly jazz. There is also a substantial repertoire of concert music in the classical idiom for the members of the saxophone family. Saxophone players are called saxophonists. Piano: The piano is a musical instrument played by means of a keyboard. It is one of the most popular instruments in the world. Widely used in classical music for solo performances, ensemble use, chamber music and accompaniment, the piano is also very popular as an aid to composing and rehearsal. Although not portable and often expensive, the pianos versatility and ubiquity have made it one of the worlds most familiar musical instruments. 3. 0 Industry Structure The Bangladeshi music instruments industry has been a long standing industry in the country. It may not be as big as the major industries, but it has certainly gone through enough expansion and evolution. 3. 1 Background of the industry Bangladesh has always had a culture heavily influenced by music. During the liberation war, music played a big part in rallying up the freedom fighters. So, after the liberation, the music industry suddenly boomed. To cope with the rising demand music instruments companies also needed to change. Pre-liberation, most companies were situated in the Shakharibazar area of Dhaka city. Classical instruments were the instruments of choice. Harmoniums, Tablas, Dhols etc. were popular with the music practitioners. After the war, the companies decided that they need to appeal to the more mainstream crowd, so they shifted to science laboratory, Dhanmondi, Dhaka. The new location offered them a lot of exposure to new music enthusiasts along with maintaining their established customer base. The new location helped the companies and the industry overall. Music instruments industry was on the rise. But the next big change was not far off. As Bangladesh changed with the world, the culture also morphed into a more west influenced one. Music preference was one of the first elements to change. In the 90’s, band music garnered a lot of popularity with the young generation. Underground bands were being formed by groups of young musicians who were ready to leave the old ways behind. Modern instruments such as guitars, keyboards and drums became the standard requirement of any band. Thus, a significant supply was also needed. Established companies saw that the new music mentality was not just a fad. They started making their own acoustic guitars, drums and flutes. However, the real market shift was made by imports. Several brand names were imported from various countries. Some were from nearby countries like India, China and Japan. But the truly expensive ones came from USA and Europe. Band music grew like wildfire and the music instruments industry expanded and changed for good. Soon, bands required more sophisticated and powerful instruments such as electric guitars and keyboards. These came only from imports. The industry became an import heavy industry to cater to the new crowd. So, the companies with import capabilities survived and thrived on the heavy shift while classical only based companies were forced to go out of business. Thus we come to our current status of the music instruments industry. 3. 2 Sales Trend The sales trend of the entire industry market has shifted over the years. Local instruments like harmoniums and tablas were the preferred music instruments. But the market was also smaller in size. Professional musicians and a few newcomers made the whole of the market. But with the transformation of the industry, the market has a much different scenario. Modern instruments take precedence over classical ones. The sales trend suggests that the newer instruments, especially the electric variations, are the big sellers. In the generation of frequent concerts, accessories like amplifiers and sound boxes are also a must. The modern instruments are very import heavy. So, the prices are also much higher. In the cases of customized guitars, the price of one guitar can be unlimited. Instruments from faraway countries such as USA, Germany etc. can be even more costly. For example, a piano form Germany can cost up to 8. 5 lac taka. The prices of the imported instruments maybe high, but that does not mean that customers will be discouraged to continue buying from this sector. In fact, it’s quite the opposite. One must not overlook the fact that the companies themselves are buying the instruments from abroad and then selling them here. They need a substantial amount of capital themselves to maintain their supply. So, the companies spend a lot of money in this regard. But that does not mean the cost outgrows the profit. The profit of the music instruments industry comes from the sheer quantity of the products sold. Bands are consistently buying the modern instruments for their use. Young people with an interest in music also want the best music instruments to fuel their passion. The band music scene is so large that the companies may not make a great profit on each of the sales they make, but the cumulative total of the instruments sold more than makes up for it in the end. So, it is safe to estimate that the sales trend will continue to grow in the same direction. The imported instruments will be the heavy sellers of the industry, but the local manufactured products will not be far behind. 3. 3 growth rate The growth rate of the music instruments industry overall has been quite substantial. From the early 70’s classical music era to the present band music era, the industry has grown multiple times in size. The big players of the industry have invested heavily on imports which continuously expand the market. The slightly less equipped companies are making the transition from classical to modern instruments to keep up with the trends. Some companies are trying to be entirely focused on modern instruments instead of classical. All of these companies keep adding to the industry. The customer base is also on the rise. Since the 90’s music has become quite popular as a profession. Many music enthusiasts try to become a part of the industry by either pure talent or raw passion. Some just want to keep playing music as an added skill. The young generation is not the only user base though. Veteran collectors may even buy music instruments just for adding them to their repertoire. People have many choices when it comes to music. So, their reasons for buying an instrument can be equally diversified. And all this is without counting the established bands and celebrities who will continue to purchase the high quality instruments for further advancement of their own carriers. 3. 4 growth potential The potential for this industry is variable. The big players of the industry have an oligopoly in place for the market in Dhaka. But the market outside of Dhaka is still fair game. People order via courier from outside Dhaka. A music instrument company with a big capital may seize on this opportunity to establish a brand name which will enable the company to pose a threat to the players of the industry. Another aspect to consider is the foreign market. Bangladeshi musical instruments have demand in the outside world as well. But no big company makes the effort to spread the music abroad with the help of instruments. Some foreign buyers come to Bangladesh and buy locally manufactured instruments which are relatively low in price. If a company exports local music instruments, the travel cost for the buyers may be added to the instruments’ pricing. This can garner a hefty profit. The number of customers from abroad may be low compared to the user base of the country, but it is large enough to give it growth potential. 3. 5 Industry composition The music instruments industry at its current state is situated primarily in Dhaka. Areas like Dhanmondi, Gulshan and Shakharibazar are the prominent locations. The center of the entire industry is in Science Laboratory, Dhanmondi. The well established shops like Melody Co, Surasree, Sur niketan etc. have been there for decades and the majority of the market is in their grasps. A lot of medium and smaller size shops are also included there who use lower pricing to attract customers. Other notable locations include Bashundhara City Shopping Complex, Panthapath, and Dhaka which has World Music and Golden Music for a more modernized shopping experience. The big companies at Science Laboratory have their showrooms at the ground level and manufacturing factories on the floor above. Simple and local instruments like tablas, harmoniums and dhols etc. are made there. Complex instruments like guitars are made in a different factory. These factories are mainly situated on the opposite side of the river, outside of Dhaka, like Keraniganj for example. Imports are made through contacts for individual companies. Some companies use direct links abroad to ship instruments into the country. The others use third party importers to import their products. Most of the down payment is done by e-mail. Orders from outside Dhaka are taken via e-mail or telephone and the supplied through courier. The bigger companies of the industry also take responsibility for organizing stage shows for both the Government and NGOs. All of these activities amount to a flowing industry that has quite a profit margin. To top it all off, the big players of the music instruments industry claim to have no loss. The sales never decline and the user base keeps growing. The only drawback is that the cost of raw materials may increase over time, but that can be easily overlooked by the profits. 3. 6 product composition There are two types of products in the market-local and imported. Local products are manufactured by the companies themselves and are sold at a much lower price compared to the imported ones. The imports are much more costly and have a lot more variety. Renowned brands such as Ibanez, STK, Yamaha, Fender, Tama, Paiste, Pearl, Maxtone, Roland, Gibson, TGM, Korg, Kurzweil etc. are available in the market. These brands attract customers on a regular basis. 4. 0 Analysis of Consumer Preferences To understand the industry one has to understand the consumers. Consumer’s insight is critical when determining business strategy. This report contains first hand consumer opinion gathered by individual surveying. . 1 Survey Procedure The consumer survey was done through both online and direct method. A consumer questionnaire that contained questions about general consensus of the music industry was created. Customers at the various music instruments shops were asked to take part in the survey. Online surveys were taken by creating the questionnaire in on line form and conducted anonymously through the internet. Various contacts were used to conduct the online survey. We interviewed 50 people, some of them are professional musicians and the others are non-professionals. 4. 2 Survey Results The primary source of data used in the report was a questionnaire filled-up by a representative sample of participants. The representative sample was picked from different occupations, ages and educational attainment. The participants were asked to respond to a set of simple questions. The questions were designed to get raw data. The raw data on analysis were used to get an insight into the general structure and consumer behavior within the music instrument industry. The survey findings were concluded in different sections by relating the collected data with the demographic characteristics of the interviewees. A detailed analysis of the findings is explained below: * Preference of Music Genre: We surveyed a total of 50 individuals from different segments of the social strata and also conducted an open online survey to get greater response. The core decision characteristics which guide the buying behavior in this market are the preference of genre by the buyers. Through our analysis we get to know that majority of the buyers are still guided by the classical taste. This segment is mainly occupied by female customers who still have a heart for the classical music. Almost 50% of the users are aligned to classical genre. But we also observe that the modern genre is just tailing classical with a percentage user of 46% and there are few passionate users who have a taste for both genres and it comprises of a minute figure of 3% of the market. Figure 1: Preference of Music Genre * Preference of Music Instrument: Analyzing the market we can observe that the most desirable instrument is acoustic guitar followed by electric guitar. Together they occupy almost 60% of the market. There is also high demand for keyboard (19%), flute (19%), drums (18%) and bass guitar (17%). So observing the instrument preferences we can conclude that the modern instruments are in high demand and to be precise the imported instruments. Figure 2: Preference of Music Instruments * Purpose of Purchase Most purchases are made for personal use which is an astounding 98%. But still some purchases are made for commercial use like buying of sound systems and also there are many small business providing jamming facilities. These people make commercial purchases. Moreover many government institutions and NGO’s also make large scale purchases. But as we can observe from the survey results music instruments are still out there for the common to take pleasure in. Figure 3: Purpose of Purchase * Consumer Budget Analysis: As most of the purchases are related to personal use so the budget for buying instruments in not that high. The major portion of the budget is around TK. 4000- Tk. 10000 almost 45%. There are very few high rollers in the budget list who tend to spend lacs on instruments. But even then professional artists and few passionate collectors buy the real deal worth more than 1 lac. But even then as the survey shows the market is steady at around Tk. 000 -25000. Figure 4: Consumer Budget Analysis * Analysis of Brand Preferences: 1. Brand Preference of Guitar: As we can see the imported brands from china and Indonesia hit the chart at top. Brands like Ibanez and Gibson are in a high demand among consumers. Figure 5: Brand Preference of Guitar But still some influence is also made by Indian brands like Givson and Signa ture who also occupy a respectable share in the market. And for other brand there is very little demand for them but still due to specific brand preference from customers these brands are still available in the market. . Brand Preference of Drums: Analysing the market trend and through our survey we could conclude that there is a very tight margin between prefernce for brand while buying drums. This segment is leaded by two leaders Tama and Yamaha which are very popular brands worlwide and prefered by renowned musicians around the world. Others brands like pearl is also in the customers list. But other brands like paiste , maxtone and local brand like Bappi are still a bit less desiarble to customers. Figure 6: Brand Preference of Drums 3. Brand Prefernce of keyboards: As they results speaks this segment is ruled by yamaha and roland. This two are Figure 7: Brand Preference of Keyboard undoubtedly the most popular brands and also highly suggested by users and professionals. Yamaha with an astounding 50% on preference and Roland with 34% have captured the market. For others brands its still a long way to go and more customers to capture to overdo these two giant brands. * Acceptance of Second Hand Instruments: Observing the market trend and consumer behavior we can conclude that most people are for this second hand selling nearly 54% and 34% has no negative notion towards it. It’s quite clear that the market is open for second hand selling and customers are satisfied with this kind of activity. Figure 8: Acceptance of Second Hand Instruments Though this is not a recognized act but due to high prices and tax on imported musical instruments people fail to avail the original one. So when they get the almost new thing at a very cheap price they can’t resist it. So it is quite evident that unless there is a serious price cut this selling of second hand instruments will continue. 5. 0 Analyzing the Market It is better for both the consumers and the sellers to understand the premise of the music instrument industry. Market and consumer behavior is important for analyzing the industry. The study contains consumer and market opinions which were found through a survey in the market. It is crucial for the new investors as well to know the facts that control its consumers’ and competitors’ behavior. By analyzing the market is not a short process. The analysis of current market trends, market share, market growth, market size and analysis of the market leaders come into the procedure. 5. 1 Market trends The current situation at the music instrument industry offers a wide range of products to its customer. With the revolutionary change in the music industry last decade, the instrument industry also claimed its share of customers. Consumers are now more involved in choosing brands that they would buy. People don’t mind paying higher to attain a better performed and of desired outlook music instrument. Even a few days ago consumers were confined in buying basic instruments like guitars, harmonium, tablas etc. But with a change in music trend, consumers now look for dj turn table, multi-functional amplifier, upgraded accessories and many other modern instruments. This massive use of instruments results in more repairing work for the mechanics. This often leads customers towards using wireless electrical instruments. This allows the importer to introduce newer editions of product in the market. Thus the major trends currently observed are: * Tendency of buying brand As the music industry is growing at a rapid speed, it started a new era in the music instrument industry. Now –a –days people move toward hassle free products for which they won’t have turn to mechanic shop. So they are now more interested in buying big brands. The big brands offer guaranteed service and better performance. With differentiated products in the market musicians can choose their desired instrument outlook. * Selecting performance over price With number of brands in the market buyers get to choose theirs from a variety of products. Among these people are more prone towards choosing high performance instrument while caring less about the price. Another reason for such behavior in the consumers is their social status. This very sector has most of its customers either from the music world or from the well off class of the society. This enables these selected consumers to choose performance over price. * Use of the upgraded accessories and technology Marketers have brought upgraded accessories as the demand for it rose with the massive use of modern instruments. Consumers want the best for their instruments and always look for the upgraded versions. Moreover, the passionate young musicians are extensively using these products that consequently making this a prominent sector of music instrument industry. * Using modern technology With the world moving towards technology this sector is also having the touch of it. From the music makers to the music editors, all now depend on the newly added instrument to the industry to cope with the world. The wireless instruments, multi functional mixers and customized sound systems are essential for them to meet the standards that had been set across the world. Alongside the rise music industry, instrument industry is now heading for bright future. The current trend of the market makes this sector more promising 5. 2 Market share Market share is the percentage or proportion of the total available market that is being serviced by a company in comparison of the whole industry. According to the consumer survey, consumers tend to go the old names mostly because of their brand value. In the music instrument industry the majority of the market share is captured by Melody Co. the company demanded that it is the trust and faithful service that they provide to keep their customers satisfied. World Music, among the new companies, also holds a significant proportion of market share. The rest are shared by the other existing companies in the market. Though the companies declined to provide their exact financial information regarding their market shares because of their company policy, we were able to assume the current state through surveying the market and the consumers. Figure 9: Shop Preference . 3 Market Growth The music instrument industry is going through a rapid growth. This is because of the change in the music scene in the recent years. Reasons including young generation being more involved in the music industry and the trend of using newer version of big brands when performing in the public. Musicians now use instruments that have better sound quality and als o can be harmonized easily. Today the instrument industry offers choices in front of the buyers to select from. The increasing number of musicians is buying more and more instruments which are fueling the industry to grow larger. As there is no structured association of the music instrument industry, and many of the companies are independent ones, no up-to-date statistics on current market growth was found. But after studying the available market shares over the years it can be understood that this industry is expanding at a high rate and there is still scope for further expansion. Again surveying the market gave us an overview of the industry. As the number of consumers rose the demand for the instruments reached a certain level that made the marketers to increase the prices over the years.