Music retailers lament Allans Billy Hyde collapse and struggle with offshore sales, poor industry performance

Music retailers, saddened by the receivership of iconic music chain Allans Billy Hyde, say the musical instrument market is hurting as shoppers either opt to delay purchases or buy cheaper goods from offshore.

The chain was placed in receivership last week just months after receiving a capital injection – although industry insiders suggest it’s a combination of poor retail conditions and missteps by the business itself.

“Any loss of a company in the industry isn’t a good thing,” Cranbourne Music owner Michael Coleman told SmartCompany this morning.

“That would mean there’s less advertising and less stimulation in the market. That’s not necessarily a good thing.”

Allans Billy Hyde’s downfall is blamed partly on the poor retail environment, but also on the growing trend to buy musical instruments and products from offshore websites such as the United States’ Guitar Centre.

“The musical instrument market is retail,” Coleman says. “We all know what’s happening with retail – just look at some of the results of the major companies.”

“We’d also be categorised as discretionary spend, so people question whether they really need to get a new guitar or new keyboard.”

The internet is simply a “fact of life” for all retailers, says Coleman.

“The internet has definitely changed the dynamics of the industry,” he says.

“There are people always buying online, and buying from offshore sites as well. There’s no doubt about that. But it’s simply just a fact of life.”

Mark O’Connor, a former general manager of Allans who started his own piano business with Lindsay Fox in 2008, also told SmartCompany that while there is still business out there, “if you make mistakes, then you lose”.

O’Connor says he’s also been able to expand his online presence by putting more money into AdWords – although admits he’s somewhat sheltered from the effects of online shopping due to the nature of pianos being large and expensive to transport.

For others, he says, it may not be so easy.

“Particularly for wholesalers, dealing with a company that has gone into receivership, it can be very tricky.”

“You go into an agreement thinking it will be fulfilled, then you find out you’ve lost your money. It’s unfair to them.”

Coleman says while there may be some smaller companies welcoming the collapse of the retailer so they will earn more business, it’s not an approach he’s willing to take.

“There will be some people rubbing their hands together, for sure. But I don’t see how you could find any joy in people losing their jobs.”