Consolidation continues in the MI business

Buffet Crampon has announced that they are incorporating the Powell and Sonare flute brands into their lineup.  What does this mean for brass instruments?  Read more past the fold....

Buffet Crampon has been on a careful and strategic buying binge.  Maybe 'binge' and 'spree' are too strong, but the purchase of high-end makers of single instrument lines to fill a missing category in the catalogue means that Buffet Crampon continues to position itself globally as a broad provider of professional-quality wind instruments.  Flutes were a line they needed to cover off, ever since the purchase of B&S from Gerhard Meinl.  Moreover, Powell (and their mid-level brand, Sonare) represent the first American maker among their acquisitions.  There are synergies, as well, since the Sonare brand trumpet is based on the body of the B&S Challenger II trumpet.

Buffet Crampon is not the only conglomerate looking for small makers to acquire.  Recently, Eastman purchased S.E. Shires company, saving that maker from a bankruptcy situation.  An infusion of cash not only acquired the company but also filled in lines for Eastman.  

United Musical Instruments, the parent company of the Conn and King brands, merged into Selmer, which owned Bach, and became Conn-Selmer over a decade ago.  Since then, Conn-Selmer also acquired Holton, which created redundancies in their brass lines, but strengthened the woodwind lines.  There has been a strategic re-alignment of brands within lines, and a winnowing of the weak models, along with bolstering the strong models.

In short, there has been a determined and steady acquisition of small, high-quality makers by larger conglomerates over the past decade and a half.  We may very well see some brands remain on the market through acquisition, and some disappear forever.  In other words, I think we are in a protracted period of "join or die" in the wind instrument industry.  Small makers would do well to shore up the balance sheet and improve marketing if they want to survive on their own. If not, then the only roads open to them may very well to be acquired or to be shuttered.  As larger companies fill out their lines, they will be less and less open to acquiring brands and more well-positioned to compete.  Even being acquired may not be a way forward for some makers.

The final take-away is the word "global".  Small makers need to look overseas for new markets.  A large influx of stencil brands and low-cost imports is placing increasing price pressures on makers.  The best strategy to compete would be on quality, not price, and that means expanding markets overseas to look for more players who will not buy on price alone. 

Your thoughts are welcome!  Please share in the comments.