B&O Dealers: The Perfect Storm…Assessing the Challenging Times
It’s a perfect storm of challenges: States are suffering financial crises that are affecting school budgets; gas prices are up, home prices are down; and the federal government’s No Child Left Behind has administrators sweating over the next set of tests rather than making sure students are exposed to the arts.
While many band and orchestra retailers are certainly feeling the pinch and are voicing understandable concern about the immediate future, others are pointing to the cylindrical nature of the times. Some places are worse than others, and California has a situation that’s odd indeed: Retailers in the other 49 states were envious about that $500 million block grant the state received for the arts last year, but now that California’s financial crisis is definitely taking hold, the program is going to be affected. “We find ourselves from time to time in the inane position of delivering brand-new instruments to districts that we now know will be closing their music programs in the fall,” Nick Rail of Santa Barbara’s Nick Rail Music says.
Still, there is good news out there. Some are not only surviving, but thriving. One retailer spoke off the record about his success, though his location and the success of the community contributed to it. The joke around that town is that if you’re driving a Mercedes Benz that’s two years old you’re having a bad year.
Finally, as some old enough to remember the oil unemployment crisis of the 1970s pointed out, no matter how bad things are, they will get better. As for those who want to see those good times get here sooner than later, an Alabama dealer offers some good tips on how to recession-proof the business [page 40].
Dealers Speak Out
We asked retailers for comments on the current state of the band and orchestra market, how school music programs in their area were fairing, and if they were satisfied with the quality of the music programs, and more. Here’s what they had to say …
“The biggest single negative influence on music is the Washington Assessment of Student Learning (WASL), a “no child left behind” style of testing. The entire curriculum is built around these tests and consequently the pullout programs of days past have all but disappeared. There is much more competition for a student’s time with reduced options for elective.”
Thomas Anderson
Music Centers, Inc.
Lakewood, Wash.
Our market is saturated with too many dealers trying to race to the lowest price. School districts are pounding us for lower pricing and loyalty is something that today you only read about.
Bill Labron
Music Plus
Kitchener, Ontario Canada
There are a lot of schools are facing budget and teacher cuts. This is not only happening to the “marginal” programs, but it’s also happening in some of the best areas too. It’s alarming. I think parents clearly want the benefits of band for their kids but school boards and administrators are becoming even more tunnel-visioned about funding and balancing their budgets.
A ground swell of support and demands from the parents at the grass roots level is urgently needed. School boards tend to listen to their constituents, but those constituents have to be taught how to voice their opinions effectively.
Ray Guntren
Ray’s Midbell Music
Sioux City, Iowa
Kids still want to play and if the teaching is good, they find the money necessary to fuel a good/great program regardless of demographics or economics.
Russ Beacock
Beacock Music
Vancouver, Wash.
Our business is doing well in spite of the economic conditions. Our rentals are up and our projections are for a big year this year. I attribute much of our success to the quality of service that we offer. We offer high quality instruments made in the USA or Europe, and only the saxophones come from the Far East. We keep our prices below the competition and work very closely with smaller suppliers, like EK Blessing and EMMC. By dealing with the small guys we have access to great product and the ability to market instruments the competition does not handle. We are also not held hostage by the “big boys” that want to jam hundreds of instruments down our throat while giving “special model” deals to our competition. We sell honest product and let the customer decide between our products and those that the competition sell.
Ray Noguera
Laconia Music Center
New Hyde Park, N.Y.
Educational reform is affecting music more than anything else, and the poor economy doesn’t help.
Ken Anderson
Flesher-Hinton Music
Denver, Colo.
Younger directors look at instrument lines differently than older directors. They are more open to off-brands for their students, but loyal to the one they play.
Linda Young
Wert Music
Erlanger, Ky.
[Schools] buy rubbish and are then surprised that so many kids quit.”
Jan H. van Royen
Gainesville Violins
Gainesville, Fla.
| How are band and orchestra student participation levels in school systems your dealership serves this year? | How would you describe school music budget levels in 2008-09? |
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School music budgets have either been cut or systems have run out of money because of high gasoline prices. As a retailer, the cost of operating my outside road reps has risen dramatically, and for the most part the school band directors are still expecting the same weekly or biweekly service.
Larry Letson
Bibb Music
Macon, Ga.
Budgets are being cut in many schools here, so consequently teaching positions are being cut, or retirees aren’t being replaced. Also, there is much less lesson time for the band students, so overall quality of some bands is deteriorating.
Del Sarlette
Sarlettes Music
Morris, Minn.
We in Florida are experiencing state wide budget trimming. I do know of cuts in programs for the next school year, and fear we may lose our elementary string programs.
The area directors for the Hillsborough County school system moved teachers from most of the elementary programs about six weeks into the school year. Unfortunately the results have been devastating. New teachers requiring different schedules have resulted in the loss of several students. The politicians are still working on solutions, and have a great deal of respect for music booster organizations, so we will have to see what solutions they can come up with.
Mitchel Banks
Don Banks Music
Tampa, Fla.
A few band directors are finally starting to realize that this is a global market and they are learning that the name that is printed on the instrument does not always mean that that is the company who really made it.
The purchasing departments are balking at price increases in relation to everything from supplies to new instruments. Some band directors are looking for alternatives to reeds and mouthpieces that they have been using for years because the prices are escalating at an unprecedented rate.
Joe Fritz
Ridglea Music
Fort Worth, Texas
We need to fund schools better so the teachers are paid more, which will attract better teaching candidates and keep them longer.
Rich Brinkman
Montana Music
Missoula, Mont.
Music teachers are not trained nor interested in the proper care, maintenance, and purchase of their school instruments. Teachers need to be made aware of the importance of maintaining student instruments.
Kyozo Watanabe
Cremona Violin Shop of Los Angeles
Los Angeles, Calif.
California is in a unique position, because while it still has significant funds left to spend from the $500 million one-time block grant, it faces cutbacks and closures of music programs across the state. We find ourselves from time to time in the inane position of delivering brand-new instruments to districts that we now know will be closing their music programs in the fall. Parents and teachers alike are well aware of the benefits of music making, but until it’s made mandatory at the state level for daily inclusion in the school day starting in kindergarten, we’ll continue to see music show up on the chopping block any time there’s a budget shortfall.
Nick Rail
Nick Rail Music
Santa Barbara, Calif.
Because of block scheduling and teaching to state wide test standards, I predict we’re going to lose a lot of good teachers …
We also need minimum bid prices controlled by manufacturers. Why do we reinvent our bid prices with every school we deal with? Manufacturers could refuse shipment if attached school P.O. doesn’t adhere to the published bid price.
Fred Herter,
Herter Music Center
Bay City, Mich.
It seems like more schools are investing in recording equipment and music software, obviously for classes in contemporary music and music production/business. They generally seem to be purchasing higher quality items than in previous years.
Tony Adams
audioMIDI.com
Chatsworth, Calif.
We were beat up pretty bad in the Burbank area by the Hollywood writers strike.
About half of our database of customers works in the movie industry one way or another.
Along with the downturn in the housing market and general economy, this double punch made for the worst January and February we have ever seen. It has picked up the last two months, but it was rough.
Our once loyal school districts have all but abandoned local music dealers. There are still a few loyal band/orchestra teachers, but purchasing departments no longer support local merchants. We get a few accessories or repair P.O.’s but forget the sales of instruments. It all goes to the catalog joints in the Midwest.
It’s nice to see that many of the major manufacturers are pulling out of the big box stores. The down side is that they now are putting more pressure on their independent music dealers to make up the slack.
John Pedersen
Pedersen’s Band & Orchestra
Burbank, Calif.
In the past two years here in Maryland, we have witnessed the demise of three private teaching facilities: The Yamaha School of Music, Keyboard Arts, and Piano Perspectives (doing business out of the Howard County Fine Arts Center located in Columbia,Maryland).
With the economic climate as it is, many schools are having a difficult time meeting their expectations and maintaining profitability.
Kurt Krenzischek
Columbia School of Music
Columbia, Md.
Teacher burn-out isn’t really a problem. Getting qualified teachers to locate to rural areas is. We see lots of first year teachers stay for one or two years and then move on, leaving music programs basically stagnant. Long-term teachers are rare, meaning the “built” programs are even rarer. Meanwhile funding continues to dwindle.
Lou Kraus
Lou Kraus Music
Ogallala, Neb.
I read a few months that China has passed a new law that states that all children from grades 1 to 12 have to take music education in the school system. I strongly believe that music education should be part of every school curriculum just as math or science.
Manuel Berberian
Allegro Music Center
Coral Gables, Fla.
The No Child Left Behind initiative is having a major impact on scheduling. More local districts are adding more time for math, reading, and science, and cuttingarts and foreign language electives. Because of this, more children will be left behind.
Randy King
King Music
Bradley, Ill.
Music is moving out of the elementary school around here, and that will cause a big nose-dive in business. Meanwhile, there are too many non-music choices at the middle school level competing against music there.
Dan Hill
Hill Music Co.
Casper, Wyo.
The general frustration level is higher than I have ever seen, either in my 26 years as a music teacher or my five years as a school music dealer. This is not limited to music teachers, however. Reasons for music teacher frustration include: Schedule inflexibility which limits prep time for concerts and programs; elementary directors bumped from music classrooms to teach in cafeterias and entrance air locks because the rooms are needed for teachers working with students to pass the No Child Left Behind tests; and music teachers made to help teach math and reading to raise No Child Left Behind scores.
That said, I am very positive about the general outlook. School music dealers have an enduring personal relationship with the teachers and students they serve. Their loyalty, earned by good service, will help carry us through an economic downturn.
Ralph Maddox
Music Supply Closet, Inc.
Olathe, Kan.
I feel the quality of the people we are attracting to the music teaching profession is much lower. We just have a weaker group of teachers working right now.
Greg Lyons
Royal Music
Bowling Green, Ky.
School Districts are losing funding (bonds, etc) due to economic conditions. I’ve heard from a reliable source that one of the oldest and largest districts in the metro Phoenix area will be eliminating the band and orchestra program for 2008-2009. The decline in student participation, I believe, is due in part to the districts making many programs available before or after school only, which makes it difficult on parents transportation-wise.
What happened to and arts being part of the core education children receive? In grade school I had to choose between music, band, or art, but it was part of my daily curriculum. I must be getting too old …
Clint Diffie
Boogie Music
Phoenix, Ariz.
I don’t think there is anything the industry can do to try to change [the downward] trend. The economy is [weak], and people are digging to put food on the table, gas in the tank, and keep the roof on the house (or keep the house!). Schools have cut the dickens out of the budgets, and it was just a prop for a style of music that became irrelevant to 10-year-olds about 30 years ago! Show me something that gets a 10 to 14-year-old fired up about a trombone, clarinet, French horn or tuba … then compare that to a drum kit or a guitar.
I don’t want to be a naysayer, but this industry has beaten this nag on borrowed time. This might be the decade where it quietly slips into being a boutique-only commodity. I listen to dudes like Allan Friedman who tell me that the one area of growth that I’m over looking is B&O – and all I see in my market is old-school B&O dealers dying and not being replaced, and school programs doing the same. Prove me wrong!
Andrew Bell
Twin Town Guitars
Minneapolis, Minn.
The market has been healthy for us as a specialty violin shop, but perhaps not as good for others in the marketplace. In some areas we are seeing fewer upgrades to higher quality instruments; in others, the upgrade demand remains strong.
Mark Lisle
Lisle Violin Shop
Houston, Texas
Parents are more careful when it comes to spending money on their children’s music education. It’s hard when the band classes are so overcrowded that there is no individual attention. Many drop out of music within the first few months.
Bonnie Fitch
Bonnie’s Music
Las Vegas, Nev.
Instrument repair budgets are the same number of dollars that they were 12 years ago.
Jeffrey Vovakes
Vermont Musical Instrument Repair
Middlesex, Vt.
Budgets are smaller and teachers are losing time with the students. This makes our job to support our schools and teachers more burdensome. In general, retailing is more challenging. We seem to have to have an ever-changing range of ideas to keep up with trends.
Tristann Rieck
Brass Bell Music
Milwaukee, Wis.
I think a majority of schools do order more over the Internet. But when they find out we offer a better price, they buy from us instead! Also, they know we will service them in any way we can. And we’re glad to do it!! I know the purchasing budgets for schools it way down compared to around five years ago. I think they look to parents and local companies for help.
Liz Hawkins
Skins’n'Tins Drum Shop
Champaign, Ill.
I think one of the biggest challenges in the school music market is that we have not changed how we educate these kids. Most other subjects has changed their teaching styles over the last 50 years, but music education has changed relatively little. I think the latest innovation for music education that has been widely accepted and used is combining CD’s with books, and that’s over ten years old! Some programs use Smart Music, but we still teach the same old tired music in much the same way as we always have. We need to make music education more relevant to today’s student. There is a lesson in the success of Guitar Hero, if someone could just figure it out.
Donovan Bankhead
Springfield Music
Springfield, Mo.
| A Perspective, and a Prediction |
| One Dealer Takes a Step Back to Look at the Big Picture By Randy MillsapThere are several things working against music dealers right now: No Child Left Behind has devastated music budgets in favor of curriculum aimed entirely at achieving higher test scores to avoid losing more federal funding. It is unfortunate that No Child Left Behind has had the effect of dumbing down publicly funded education rather than allowing the best students to discover their strengths and excel. On the other hand, most local band directors here won’t let their students use certain brands due to the fact they cannot be repaired locally. Our local major independent repair shop refuses to even look at most big box brands. It has a significant effect on the buying decisions of parents since they perform the repairs for every school and music shop in this market. And yes, there is a higher than ever “burn-out” rate. The down side is that replacement music educators are ill prepared to educate children. In the last year I have dealt with new directors who have little or no practical knowledge of the instruments they teach. One director I have dealt with is completely tone deaf and has already taught at five schools in three years, yet continues to find new jobs. Still, I think my market has some really great music educators. However, the frustration level is growing over a number of pressures that have developed in this decade. Our former governor, Mike Huckabee, made music education a major publicity issue during his presidential campaign. Yet he supported budget cuts to music programs repeatedly in Arkansas throughout his time in office. The end result of programs like No Child Left Behind is that funding that focus on standardized test subject areas are given highest priority in order to maintain federal funding. All other programs are left to support themselves or face elimination in the next year’s budget. Locally, we have seen a decrease in AP courses, fine arts, and even some sports. The result will be a generation who can do great on a fill-in-the-ovals test, but are poorly prepared for real world workplace problems where common sense and the ability to reason are far more important to success. These important skills are much harder to measure with simple multiple-choice tests. “Still a Cycle” Historically, there has been a pattern of consumers getting comfortable with higher fuel, utility, and food costs. They begin to spend again to reward themselves with lifestyle perks only to face yet another increase in prices. Gas prices will probably be over $4.00 a gallon by Memorial Day, and there is growing talk of $5.00 a gallon gas by late 2008. Fuel price increases adversely affect the cost of everything. This coupled with an extremely weak U.S. dollar value means that all of those cheap goods from China will no longer be so affordable. The Chinese yuan has gone from 14 to the dollar to just under 7 to the dollar in the last year. No amount of bulk purchasing can delay the difficulty ahead. But this is still a cycle. Things will be great again. Those who were alive during the oil crisis of the 1970′s can tell you that conditions looked awful during that time. There was talk of America falling as a world power, and all sorts of dire predictions of a new depression. Sound familiar? Things became better and then worse for several years until interest rates soared out of control and the economy broke down and reinvented itself within the course of two years in the early 1980s. As a result we had an expansion of our economy that was unthinkable during the oil crisis. Look at the innovation that came out of that expansion. The DX-7 was a must-have instrument at any price, guitar players wanted the best playing, highest quality instrument they could find instead of whatever was the cheapest. We did have a handful of minor recessions in the intervening years (including a housing crisis similar to what we face now). Those who can manage to ride out this period will be best suited to profit when the market strengthens. I am really annoyed with all of the misinformation I hear in the industry from people who think this is the end of the world. Stores who are not positioned for this current economy will fail. Manufacturers who will not listen to their dealers and users will fail. This is not limited to music retail, and is a natural part of the process. That doesn’t make it any easier to take on a human level though. Randy Millsap is owner of Millsap Music Company in Sherwood, Ark. |
| NAMM’S Public Relation’s Blitz: Effective or Firing Blanks? |
| Nearly half, 42%, of those surveyed felt that the favorable publicity relating music-making and academic achievement was making a noticeable impression – although a few didn’t necessarily see it translating to the cash register. Here are some comments to the question: Has the favorable publicity relating to music-making and academic achievement made an impression on parents in the communities you serve?
Yes, it’s noticeable but hasn’t helped business. Ken Anderson I haven’t seen any evidence of it. I know NAMM is trying really hard to promote the positive benefits of music making, but I’m not sure if the impact is any more than subliminal or on a small subconscious level. Pete Surowski The parents of students already involved, or already interested in music, are very impressed with the increase in publicity. Otherwise, the campaign doesn’t seem to be making much of a mark in its current form. Randy Millsap Where and when was this publicity? NAMM seems to favor metro areas with populations over one million. They also need to focus on smaller regional markets, like upper Michigan. Fred Herter, Parents, yes … school administrators, no! Clint Diffie Has the favorable publicity relating music-making and academic achievement made an impression on parents in the communities you serve?
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