gyuu | Exports | Strategic Management

India has a vast production base for handicrafts (including carpets ), handlooms, jute and jute products etc. The growth in these sectors has been phenomenal in terms of employment and foreign exchange earnings. The Handicrafts, handloom and jute sectors have contributed substantially to the foreign exchange earnings. The growth of these sectors for the last five years is significant. The Indian Cottage sector has seen rapid growth in the past and is currently a Rs.60,000 crores plus industry.

In-spite of a vast production base in the above sectors, the opportunity for international marketing of these products is not adequately available to the Indian manufacturers / exporters.

Because of the higher marketing cost involved for introduction of any new product in the foreign market, exporters are unable to undertake aggressive marketing. Besides, the cost of participation in an international event abroad is very high. It has also been observed that these events give opportunity only to a handful of exporters who can spare substantial foreign exchange.

The total World trade in Handicrafts, Gifts & Decorative is estimated at US$ 235 billions of which China accounts for 71 billion whereas India at 3 billion.

Currently, marketing efforts of Indian exporters are driven by individual relationships and an India-specific integrated approach is lacking, which can be substantiated from the facts that individual exporters take part in international events and fairs establishing contact with the importers and are increasingly using the Internet for establishing new contacts.

The need for an India specific cottage sector initiative was felt that could attract leading importers and stores to India.

Most of the developed nations and even developing countries like China have set up national level, wholesale trade Marts to provide a fillip to the cottage sector exports. Epch.1

The world economy is no longer monopolized by the developed countries. The Western world has now realised that without Africa, Asia there can be no globalization. Since economic growth in developing and transition economies remains higher than growth in advanced countries, it is probable that within the next two decades the global economic map will change more than it has done over the last 20 years. Business firms in Brazil, China, India and Poland continue to gather momentum and they will gradually become major players in international markets. This will mean a fundamental change in the global corporate landscape.

An important aspect of the globalization process is the rapid change regulations affecting the international marketing environment. The world trading system is constantly spinning over new opportunities and creating new threats. Certain tariffs and quotas are removed but new technical norms, phytosanitary measures and anti-dumping actions are rendering the export trade more difficult for companies in emerging economies. While numerous subsidies are being eliminated and the bureaucracy of customs procedures curtailed, new rules on intellectual property rights, certification requirements or complex domestic regulations require export managers to respond to new regulatory challenges. The positive aspect of globalization is that the trend boosts productivity and living standards is most countries. It is often considered the force that enabled the world‟s poorest nations in the 1950s to rise to their place today among the more advanced economies.

It is in this backdrop that strategies for the export sector at macro level have been formulated for the next 5 years which would be co-terminus with the 10th Five Year Plan period. These strategies are in the nature of board directions giving a road map for the export sector in the Medium Term.

Policies and programmes specifying step-by-step sequence of action necessary to achieve the major objectives will have to be formulated based on this Strategy Document.

The Medium Term Export Strategy outlined by Government of India also provides attempts to provide this direction by focussing not only on products in which we have a revealed comparative advantage, but also identifying products which have

importers. jute and carpets has over the years contributed significantly to the employment and foreign exchequer of the country. not only from the functional point of view but also from the perspective of many opportunities that focussed marketing offers its users for participating in growing world trade. The value of International Marketing Tools for the small scale sector in general and cottage sector in particular is becoming increasingly manifest. The biggest constraint which the sector faces is the marketing of their products. It is an attempts to provide a realistic mix of macro policies with sector specific policies and provides attainable goals with appropriate checkpoints. especially in this era of globalization of information technology which has major influence.2 The cottage sector including handicrafts. the large-scale use of international marketing techniques is revolutionizing the way the world does business. The proposal primarily aimed towards Aggressive Launching of Indian Cottage products by way of organzing Theme Shows throughout the year and motivate major overseas buyers. leaving few niches of protection for the inefficient. The basic reason is lack of focussed and aggressive international marketing network. However. chain stores and prominent .real comparative advantage based on the potentialities. It is in this environment that small and cottages sector have an increasingly critical role to play. departmental stores. Epch. The forces of globalization have created an environment of international competition throughout the world. In view of above background EPCH has envisaged a integrated international marketing initiative to launch an Aggressive Focussed Export Promotion Measures for quantum jump in the export earnings from the handicrafts sector which is the largest provider of employment in the country. At the same time. despite the large production base the market at international level is still unexplored. silk.

Focused Countries & Focused Products. Deco Festive India. A proposal under title “International Marketing Linkages for Handicrafts and other allied Products through Reverse BSM & Publicity Campaign“ has been envisaged for providing a platform for round „O‟ clock international marketing of handicrafts.3 The Empowered Committee of Ministry of Commerce in its meeting held on 24th January. Indian Fashion Jewellery & Accessories Show 3. Floorings & Textiles Expo (IFFTEX) 2. Indian Furnishing. silk.journalists. Today Indian Handicrafts & Gifts is a general terminology which includes thousands of product categories and overseas buyers are not able to source the products as per their requirements and choice. Govt. The reason behind is that the Indian Handicrafts & Gifts .06 The basic objective of launching of this specific project is to target Focused Buyers. 2005 has approved the proposal under Market Access (MAI) scheme for 100 buyers for each BSM in 1st year for following 4 Buyer Seller Meets: 1. Stationery & Paper Products 4. Epch. carpet and other synergy products and submitted to the Ministry of Commerce & Industry. of India. jute. editors of specific trade magazines to attend these shows.

small scale and SMEs engaged in exports in their marketing efforts through long term planning and creation of support facilities. The broad objectives of the proposal is to provide institutional support to cottage. . 5. Creation of new and improvement in the existing international marketing techniques / export opportunities of the cottage sector and SMEs exporting units. India Expo Mart which is the first State-of-Art infrastructure facility created for the cottage sector in the international markets.Fair being organized by EPCH for 4 days is not able to cater participation of large number of the products and similarly the overseas buyers are also not able to source in a short period due to the multi complexity of the product groups. The need of today is to organize shows on product specific themes on regular intervals and target the specific buyers from different countries. To bring together buyers and sellers around the world through out the year with focused publicity. trend-setters etc. Epch.e. Efficient utilisation of present potential of exporting small scale sector by creating a new concept of export marketing. 2.4 4. 6. To create a link between Indian craft industries which have limited international marketing facilities and the consumer market of Europe & USA and other developed nations. The priority areas will be: 1. Development of international network of marketing and product development expertise with the help of international product designers. Creating an atmosphere of awareness of the concept of round “O” clock international marketing through permanent contact point i. 3.

carpet and other synergy products. Opportunity for exporters located at remote places of these states to met International buyers. Reliable source of supply. Opportunity to meet a large number of overseas buyers at a single location throughout the year. silk. To promote new products and languishing crafts. Ability to visit as per buyers' convenience. Efficient utilization of limited time of the buyers. jute. ADVANTAGES FROM INTERNATIONAL BUYERS POINT OF VIEW - A permanent contact point for buyer seller interaction. ADVANTAGES FROM EXPORTERS' POINT OF VIEW - Cost effective utilization of international marketing expenditure. To promote new exporters / entrepreneurs and small & cottage exporters. Opportunity to source a large assortment of products and meet a large number of sellers at a single location.  ADVANTAGES FROM GOVERNMENT'S POINT OF VIEW - To achieve higher exports of cottage sectors which includes handicrafts. . Preference to buy from the country of origin.

buyers etc. To increase employment opportunities. . To promote design development. Increased share of export earnings from the sector which have tremendous potential but due to lack of focussed export promotion measures can not be substantially achieved.5 To improve the level of livelihood of craftsmen. departmental stores.- To promote new craftsmen. No such effort have been made till date by any Governmental agency for the international marketing of the cottage sector with a definite business plan and an objective to increase the share of Indian Exports through state-of-art infrastructural international marketing hub. To launch Indian cottage sector in the world market for the first time in an integrated manner among the leading importers. from the exports. - Urgent need for specific cottage sector initiative that would attract leading importers to India which otherwise have China as a major destination point since no such facility is available in India where an overseas buyers can source their requirements round “O” clock. To benefit the artisan. -  OTHER OBJECTIVES - To establish specific integrated approach for cottage crafts which is lacking and currently marketing efforts of exporters are driven by individual relationship. the actual manufacturer. - Epch.

provide a greater opportunity for a large number of foreign buyers to visit and meet a large number of exporters at one place. Based on the above issues and theme of upcoming centralized export marketing centres as already been incorporated in Dallas . the future of international trade fairs in India has to undergo a change. Buyers prefer to visit the country as per their own convenience and they cannot coincide their visit every time with the dates of trade fairs in India. Epch. - To achieve a quantum jump in the export earnings with the enhanced flow of trade. However. - To fill the gap of inadequate infrastructure specially in the remote craft pockets. - To create aggressive international marketing strategy. This kind of permanent contact point can create a window for our products by ensuring: a) b) c) d) Permanent contact point throughout the year Reliable supply Quick turn-over Capacity to absorb new techniques and designs. VENUE FOR THE REVERSE BUYER SELLER MEETS – INDIA EXPO MART & CENTRE The international trade fairs in India being organized by EPCH etc. there is a need for a permanent contact point throughout the year where all potential importers or wholesalers can visit any time during the year and look for supplies which dispenses their needs for carrying high inventory.6 As such.- To bring buyers from round the world throughout the year and create new marketing opportunities for cottage sector.

silk and similar product groups which are basically small and cottage level in general is not equipped with inherent expertise for Export Marketing and Development to respond to the changing trends. The Netherlands. handicrafts. The sector especially the target product categories i.e.000 in number.(USA). handloom. Utrecht. organising Indian Handicrafts & Gifts Fair and various and feed back from the member exporters which are approximately 25.  It is this background that India Expo Mart (IEM) has been conceived. Shanghai etc. Japan.7 .  IEM is thus envisaged as a nodal point where foreign buyers can meet cottage sector exporters round the year and where periodic exhibitions fairs could be organised. The India Exposition Mart has been conceptualised as a permanent display point for exporters in the cottage sector. the idea of setting up India Expo Mart came into existence. This mart is a unique way of bringing together buyers and sellers from around the world throughout the year and would fulfill the following key objectives:    New marketing opportunity for the cottage sector – nodal point of contact thereby reducing the effort involved in establishing contacts Epch. there was strong justification for setting of this ambitious project. On the basis of the analysis of participation in various international fairs. jute.

 The exclusive presence of cottage crafts & synergy products at such a nodal point will be able to get a focussed export marketing opportunities without any substantial efforts as India Exposition Mart is supported to be future hub of sourcing from the buyers all over the world. which have shown robust growth in the recent past. The mart would help eliminate a key infrastructure bottleneck and will help improve the competitiveness of Indian exports.16 crores to Rs.  It would more importantly help sustain the exports of Indian Handicrafts. In the span of five years since 2000-2001 export of handicrafts grew from the level of Rs. Brussels and Shanghai. hand-printed textiles and artmetalware which. account for over three quarters of India‟s export turnover of handicrafts.13032. embroidered goods.2005. Benefit of smaller exporters who find it difficult to participate in international fairs  Promoting Indian cottage sector & artisans by arranging special events  India Exposition mart has been conceived along similar lines are trade marts in cities such as Dallas.70 crores in the year 2004 . . in themselves.8490. TARGETED COUNTRIES FOR INVITING OVERSEAS BUYERS / IMPORTERS / JOURNALISTS FOR REVERSE BUYER-SELLER MEETS The product groups accounting for a major share of exports are carpets.

. U.A. The prominent EU countries listed above together accounted for another 30 per cent of the export value..The principal export destinations for handicrafts (including carpets) are U.K..8 . Epch.S. As single country destinations.S. U. France.S. Canada and The Netherlands with over 31 per cent of export value in 2003-2004 being accounted by the U. among themselves. Italy. accounted for one half of exports by value.A. Germany.A.. alone. Japan.K. Germany and U.

Malaysia. Taiwan. Japan and Hong Kong is very low. Turkey. Switzerland. Bangladesh and Vietnam. Korea. U. Indonesia.A. COUNTRYWISE SHARE OF EXPORT OF HANDICRAFTS FOR THE YEAR 2004-2005 . S.K. India. Philippines. explore and develop new international markets.S. Italy. Mexico. In view of above it can be analyzed that limited Indian Handicrafts products caters to a particular segment of market and hence there is a urgent need to identify. These countries are other sizable markets and there is no reason why Indian handicrafts cannot penetrate these countries when they do so in the others. Iran. Sri Lanka. India‟s export penetration of handicrafts in France. Canada. beside providing a push in the existing markets by broadening the product base. Pakistan.The exporting countries are wider in numbers and prominently include China. The analysis of country-wise share of handicrafts exports reveals that Indian handicrafts are excessively concentrated in 3 markets: U. Netherlands. and Germany..

9 .Epch.

Epch. A. the U. Consumers in U. including Indians and other South Asians. The U. with retailing controlled by large-sized chains. The U. Unit Value Realization (UVR) in this markets trends to be lower than in other countries.S. market keeps growing in population size unlike Japan and European Countries and multiethnic immigration continues.A. Largest market as it is the U.S.S.A. Hence. Owing to its multiethnic composition with a large presence of Asians.10 . market is well integrated across the whole nation.A.S.A. price ranks above quality in consumer considerations. are very price conscious or price sensitive.U.S.S. Marketers consider it to be a valuable destination for low and medium value items. market has scope for traditional decorative items. is principal destination for gifts & decorative produced in various developing countries of Asia.A.

K is relatively smaller markets in total size. But UK features amongst top 5 end markets for 8 items out of which Indian scores as a major supplier in the case of 3 items in UK and France do not import from India decorative in such quantities as they do from else where.K.U. U. In U. Compared to the previous two (USA & Germany).K there is a good degree of import taking place from European Countries. GERMANY .

Such as handicrafts wares.Once the thriving economy in Europe. All said and done markets for such goods are tending to decline. Epch. Thus this market has turned to Asian providers for cheap goods. the German market tended to be very sophisticated but recession and costs of unification have depressed consumer aspirations and spending. Quality is the key of German consumer consideration.11 FRANCE . There is emphasis on articles that are natural and authentic. Wall decoration are very popular amongst Germans so also statutes and figurines.

Epch.12 .

THE NETHERLANDS ITALY .

Epch.13 AUSTRALIA .

JAPAN .

14 .Epch.

etc. Commercial channels comprise different types of stores. Malaysia. But in present scenario the new and newly develop items by our neighboring competitors countries like. Thailand. with exclusive and nonexclusive features such as department stores. Taiwan. Philippines and Malaysia etc. specialty stores. Korean. They deploy a commercial bridge to help craft organisations in developing countries to sustain themselves financially by creating markets for them in developed countries. and Taiwan participate in almost all the international fairs and also big in numbers. Whereas Indian participation in international fairs is very less and always very small in number. whereas alternative channels comprise organisations with idealistic attitude towards handmade goods from developing countries. Philippines. Chinese. These competitor countries unlike India are also extremely active in promoting their trade. China. most of the South East Asian Countries exporter have their counterparts in these importing countries who have either showrooms or warehouse and are in position to supply the goods on immediate delivery basis. are gradually replacing the traditional Indian handicrafts. Beside this. commercial channels and alternative channels. Due efforts have been made in this direction and the liking of Indian cottage products is continuously increasing in the world market and the sector is witnessing a average growth of around 15% since last 10 years. There are mainly two types of retail channels in operation.NEED FOR ORGANIZATION OF MEETS REVERSE BUYER SELLER The Indian handicrafts are sold in the international market due to its unique artistry work and traditional work. independent retailers. The proposal envisages organization of 4 Buyer Seller Meets in 1st year targeting 11 major countries and motivating .

Epch. Deco Festive India. consulates. vigorous publicity campaign has been launched in all these markets for backward linkages for creating an environment of awareness in those targeted countries so these theme shows can be projected as a hub of sourcing among all the buyers in the years to come. advertisements at strategic locations. Greater Noida in first year. 2006 at India Expo Mart & Centre. Prominent Buyers / Journalists have been invited from the targeted countries. procurement of database. organization of seminar.06 .15 Further. However. embassies. strong & urgent need has been felt to organize the buyer seller meet through organization of product specific shows to support the manufacturer and exporters of the cottage sector. road shows in major markets. 1. workshops for foreign media. Four Reverse Buyer Seller buyer meets on the following product groups have been organized from 19 – 22 January. video films. Indian Furnishing. Indian Fashion Jewellery & Accessories Show 3. The publicity campaign mainly comprises Development and mailing of corporate fliers to the major importers. development of websites.approximately more than 100 products specific overseas buyers / journalist for each show. Floorings & Textiles Expo (IFFTEX) 2. Stationery & Paper Products 4.

Japan. Effective business development and efficient utilization of marketing expenditure.16 Four product specific shows have been organized from 19 – 22 January. Following good responses have been received:  The leading importers of the world got the option of sourcing variety of product range from a single nodal point which otherwise was not feasible. carpet. The more export orders means better livelihood opportunities to the craftspersons. handloom. Epch. USA. The entire cottage sector of India including small and medium manufacturers. Enhanced export earnings due to international marketing facility.    . Canada. exporters of handicraft. artisans. Increased foreign exchange earnings to the country which have negligible share of exports in the world imports despite vast production base. jute. France. silk and other similar product groups through increased export earnings which means more livelihood to the rural based craftsmen who are in-fact the backbone of the entire sector. 2006 at India Expo Mart & Centre and number of buyers / importers / journalists have been invited from the targeted countries viz. UK. Italy. The Netherlands. craftspersons. Germany. No such focused effort have been made to project Indian cottage sector in the world market in a systematic manner by motivating major players in the world market to visit India to source their requirements from the hub which is open 365 days.

Epch. Floorings & Textiles Indian Fashion Jewellery & Accessories Stationery and Paper Products Festival decorative products AREA An area of more than 10. mtrs was covered by the exhibitors.000 sq. PARTICIPATION IN REVERSE BUYER-SELLER MEETS (RBSMs) More than 600 Number of manufacturers.17 . Increased flow of overseas buyers (Who prefer to shop at the country of origin) who will have the time and effort of reaching the handicraft production centres scattered all over the country. exporters participated in the RBSMs on following product categories: 1) 2) 3) 4) Indian Furnishings. PRODUCT CATEGORIES A wide range of product categories were exhibited by the exhibitors which was displayed in a tasteful manner receiving an encouraging response from the overseas buyers.

OVERSEAS BUYERS More than 2000 overseas buyers from various countries like USA. Span. BUYERS VISITED UNDER MAI ASSISTANCE More than 600 buyers were identified and recommended to visit the product specific RBSMs under MAI scheme and were provided air tickets and hotel. Argentina. Turkey. Australia. COMERTEX / COLOMBIA 4. CARREFOUR/ COLOMBIA. these buyers were provided air tickets as well as local hospitality. Portugal. Poland. Germany. Colombia. These proformas were further scrutinized by a team comprising trade and industry and on the basis of recommendation. France. URBAN OUTFITTERS (200 STORES) / USA . South Africa. UK and Russia visited the product specific RBSMs. OLIMPICA / COLOMBIA 3. Netherlands. China. Canada. 2. These buyers have been identified through the established consultants from all over the world and screening has been made on the basis of performance and obtaining details of the vendors with whom they are working. Brazil. IMPORTANT BUYERS Some of the top buyers who visited RBSMs are listed below : 1. Venezuela. Italy. Uruguay. The components of the air tickets has been from the MAI and hotel were given by EPCH so as to make the event successful.

ROOTS (160 STORES) / USA 7.5. ABC CARPETS / USA Epch. LOBLAW STORES (100 STORES) / USA 8.18 . WISTERIA (MAIL ORDERS)/ USA 6.

COSTCO / USA 11. GUNTHER LAMBERT GMBH / MONCHENGLADBACH / GERMANY 13. KG / SCHOENFELD GERMANY 18. INESS CONFECTION SA / TUNIS 15. OVERWAITIA GROUP /USA 10. MUDO CONCEPT / TURKEY 12. KRIEGER HANDEL GMBH & CO. GUNTHER LAMBERT GMBH / MONCHENGLADBACH GERMANY 14. LAMBERT FLAGSHIPSTORES GMBH / MUCHEN / GERMANY .9. KANGAROO GMBH / BAD OLDESLOE / GERMANY 16. KRIEGER HANDEL GMBH & CO. KG / SCHOENEFELD / GERMANY 17.

19 .00 crores business generated during the shows. Approximately 2200 foreign buyers visited the shows. Approximately Rs.19. Epch.428. LAMBERT FLAGSHIPSTORES GMBH / MUCHEN / GERMANY 20.    SCOTTOS OF STOW LIMITED / LONDON / UK More than 600 prominent buyers / importers / journalist have been invited for the shows.

The assistance for inviting buyers may also be considered for the professionals on various subjects on exports strategies. journalists to the shows enlighten them with the culture. 3. nonfocused countries. 5. The assistance provided towards air fare. To motivate and invite potential buyers from the focused. . The assistance has increased the visit of buyers including top importers from the traditional as well as non traditional markets. such incentives is important in order to increase the share in exports. consumer preferences for education of the exporters. In this competitive world and when other countries are providing assistance for visiting the potential as well as established buyers. availability of skill in the country which ultimately induces for import. 2. financial assistance for Reverse Buyer-Seller Meet is essential. 4.e. The visits of buyers.1. tradition. hotel may also be provided for the extra days i. The assistance should be provided for a single event to the maximum 200 buyers for one show in order to attract large number of buyers for larger business 7. 6. before and after the event which enable the visiting buyers to visit the units and understand about the products and can add new to the ideas.

The assistance to invite persons from trade organizations.entrepreneurs with the view to produce the products as per the requirement of the consumers. importers. ********************** le='mso-next-textbox:#_x0000_s1109'/> ITALY . 8. journalists may be provided for brand promotion of the product.

13 AUSTRALIA .Epch.

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