Case Study: Musical Instruments in India

Music is a universal language, understood and appreciated equally by humans, animals and
plants. Revenue in the Musical Instruments segment amounts to US$4,342m in 2021 in
India. The market is expected to grow annually by 13.20% (CAGR 2021-2026). According to
statistics, in global comparison, most revenue is generated in China (US$7,232m in 2021).
In relation to total population figures, per person revenues of US$3.12 are generated in
2021.

Until a few years ago, India imported most of its share of instruments in the market. Since
more and more people are getting fond of western instruments like guitars, there has been
an uprise in the instrument manufacturing in India but things are still a long way from being
self reliant. This presents an exciting opportunity for new instruments manufacturers to
capture this growing sector

A company E, wishes to start an instrument manufacturing unit focussing on the following

products
P1: Wind Instruments
P2: Percussive Instruments
P3: String Instruments

The company has conducted both online and on-ground surveys to shape its manufacturing
strategies. The data has been tabulated below

We define a preference metric ranging 1-3

1- Low
2- Medium
3- High

The Product Preference: Gender Based

Product\Gender Men Women

P1 2 1

P2 3 1

P3 3 3

The Product Preference: City Based

Product\City Small Large Metro

P1 2 2 3

P2 3 2 2

P3 3 3 3
The Product Preference: Income Based
Product\Income Low Mid High

P1 3 2 3

P2 2 2 3

P3 3 2 2

The Product Preference: Source Type

Product\Source Acoustic Digital Hybrid
Type

P1 3 2 1

P2 3 2 1

P3 2 3 3

Instruments undergo wear and tear and therefore the company also needs to do the
replacement parts for its products.Some instruments also need new accessories from time to
time. However, different instruments have different replacement/repair requirements.

The Product Preference: Replacement/Repair/Accessory requirement based

Product Replacement\Repair Requirement

P1 Low

P2 Fair

P3 High

The Product Preference: Age Based

Product\Age Group 0-10 10-30 Above 30

P1 1 2 2

P2 3 2 2

P3 2 3 2

The Cost of Production are as under

Product Cost

P1 Constant Part + PP Source Type x 10^3 +

 PP Age based x 10^2 + PP City Based x
10^2 + Replacement need x 100

P2 Constant Part + PP Source Type x 10^5 +

PP Age based x 10^4 + PP City Based x
10^3 + Replacement need x 100

P3 Constant Part + PP Source Type x 10^4 +

PP Age based x 10^3 + PP City Based x
10^2 + Replacement need x 100

Questions:

1. Condense the above case into a more presentable format using visual aids or
otherwise.
2. Focussing on the segment : Metros, Stringed Instruments, Adults and Source type
both Acoustic and Hybrid, estimate
a. The total number of prospective consumers and the number of products that’ll
be needed.
b. The production costs for the same.
3. Give an overall scope for the production unit in terms of the type of products and any
new segments that the company should look upto to further expand its reach. How would
you go about marketing the digital section of instruments to users living in small and large
cities ?