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2019 Music Products Retail Market Survey
It seems that the largest concerns for retailers in Japan in 2019 were hike of consumption tax, which is complicated with different rates applied depending on conditions and commodities, and up to 5% pay back system of consumption tax on purchases under the Government-funded cashless payment promotional program. It’s understandable that considerable number of retailers got discomposed to handle these issues.
The consumption tax hike was much smaller and less influential compared to the last time 5 years ago. Accordingly, it didn’t generate last minute sales as expected in general, and sales dip thereafter hit the retail market.
However, the real problem for industries was economic slowdown caused by a series of devastating natural disasters and U.S.-China trade conflicts. Uncertainty in social issues, in particular pension plans affected not only retired senior citizens but also younger generations of thier discretionary spending on luxuries including musical instruments.
Japan hosts Olympic Games this coming summer, and industries are much expecting broad effects they may bring out. However, no one can tell how much the event helps grow business of music products industry. Also, it’s the year that we organize biennial Musical Instruments Fair Japan in Tokyo. We hope all these important events 6 months ahead will bring the industry great opportunities for success and growth.
Japan Music Trades carried out an annual music retail market survey sending a questionnaire to 150 music retailers throughout the country. A total of 107 stores responded. We appreciate very much the cooperation of the music retailers kindly helped us to gauge the pulse of music products retail market.
More than half retailers foretell business slowdown in 2020
As to the 2019 business, 33 retailers reported growth, while 53 retailers replied sales down, and 18 retailers commented no change in their performance.
The retailers reported declined sales of grand and upright pianos, wind instruments, electric guitars, amps and down trend of music school operation for children. No retailers reported items with increased sales.
Presumably reflecting negative view for this year, they just listed acoustic guitars, ukuleles and music school operation for adults as most expectable.
In recognition of limited effects of maximum of 5% cash back campaign on cashless purchases which comes to an end in June, and benefits of tourism generated by Olympic Games is just felt by limited areas, Japanese government announced 1.32 billion yen economic stimulus package, and it will be augmented with additional commercial funding to be a 2.6 billion yen package in total.
Aside from these positive external conditions, it’s obvious that music products industry needs extensive self-help efforts. As part of soliciting music making activities to elderly people, Japan Musical Instruments Association has been promoting “Benefits of Keeping Healthy Brain” project for some time. According to recent research works, music making helps prevent people from dementia and maintain physically and mentally healthy life.
Senior market is apparently important for the industry, but at the same time we should take note that number of newborn children declined under 900,000 level in Japan last year that is 1 third of about 70 years ago.
Coping this quickly aging society, the industry requires upgraded and consistent efforts to provide people of all age groups with much more sophisticated and detailed approaches to advocate benefit of music making, and rich applications and solutions matched to any requirements and stage of their life.