Professional Documents
Culture Documents
Report On Handicraft
Report On Handicraft
Study on
"Export and Promotion
Of
Handicraft Goods"
Submitted by:
Bikrant Kumar Ranjitkar
Roll No. 10031711
P.U. Registration No. 2009-2-03-0160
Kathmandu, Nepal.
November 2011.
DECLARATION
This Summer Project Report entitled "A study on Export and Promotion of Handcraft
Goods" which is submitted by me in partial fulfillment of the requirement of the award
of BBA degree of Pokhara University comprises only my original work and due
acknowledgement have been made to materials used in the report.
Signature:
Signature Signature
Signature
This summer project is prepared as per fulfillment of the requirements of the degree of
Bachelor of Business Administration (BBA 4th Semester). I believe that this project
will enable the reader to understand in an easy way.
This fieldwork is designed as per the standard format prescribed by our College. All the
topics are based on export and promotion of Handicraft goods. I thought this topic is
interesting and appropriate for studying and writing a report.
This is my first attempt to write such kind of hard fieldwork report. However, while I
was preparing this report at that time I experienced the immense pleasure because this is
the perfect mechanism to acquire Knowledge relating with our study.
I am immensely grateful to all the respective individuals who provided me continuous
encouragement and support to complete this fieldwork report.
I would like to convey my sincere appreciation to my college Faculty members for their
guidance and remarkable suggestion.
Lastly, Apart from my college teachers I would like to express my gratefulness by
thanking friends of mine, who really deserve my praise for the assistance even in their
extreme busy hours.
The main objective of this report is to sum up my summer project job and to be familiar
with practical aspect of the theoretical knowledge gained in a classroom.
This summer project is prepared as per fulfillment of the requirements of the degree of
Bachelor of Business Administration (BBA 4th Semester). I believe that this project
will enable the reader to understand in an easy way.
This is mainly focused on the export and promotion of Handicraft goods. I thought this
topic is interesting and appropriate for studying and writing a report. To deal with these
topics the financial as well as the services provided by FHAN (Federation of Handicraft
Association of Nepal) are included in this project.
To fulfill the summer project report I gained the financial and service related information
from the Federation of Handicraft Association of Nepal. The data consists of the export
of Handicraft, Associates of FHAN, Top ten exporting countries of Handicraft goods
from Nepal, etc. The data are of last five years.
We know that there is great potential of handicrafts industry, but due to various reason
the export of Handicraft goods are not in the great swing. Therefore, with the help of this
report, I had tried to draw the attention towards the problems and the possible alternatives
to solve the problems.
While I was preparing this report at that time, I experienced the immense pleasure
because this is the perfect mechanism to acquire Knowledge relating with our study. In
addition, I had gained the practical knowledge of dealing the financial analysis. Through
this project, I am able to know to use the forecasting tool as a mechanism to forecast the
export of Fiscal year 2068/2069 with the help of trend analysis.
This report actually provides me to know the market status of Handicraft business of
Nepal.
TABLE OF CONTENT
Page No.
CHAPTER-1 INTRODUCTION
1.1 Background of the study 1
Handicraft in Nepal 1
Aims and Objectives of FHAN 1
Functions of FHAN 2
1.1.1 Nepalese Handicraft Products 2
1.1.2 Export Procedure of Handicraft 5
1.1.3 Export Policy 7
1.1.4 Export Strategy 7
1.1.5 Quantitatively Restricted and Banned Items for Export 8
1.1.6 Most of the Exportable items of Nepalese Handicraft 9
1.1.7 List of Handicraft (curio) goods not needed pass by the 11
Archaeology Department
1.2 Problem of Statement 11
1.3 Objectives of the study 11
1.4 Importance of the study 12
1.5 Limitation of the study 12
1.6 Organization of the study 12
CHAPTER-2 LITERATURE REVIEW 14
CHAPTER-3 RESEARCH METHODOLOGY
3.1 Selection of the study area 16
3.2 Research design 16
3.3 Source of data 16
CHAPTER-4 DATA PRESENTATION AND ANALYSIS
4.1 Export of Handicraft Goods (2063/64-2067/68) 17
4.2 Comparison of Export of Handicraft Goods (2066/67 and 2067/68) 19
4.3 Total Export of Handicraft Goods (last five years) 23
4.4 Trend Analysis of Export of Handicraft Goods 24
4.5 Top Ten Exporting Countries of Handicraft Goods (2067/68) 27
CHAPTER-5 SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary 30
5.2 Conclusion 30
5.3 Recommendation 32
Bibliography
Appendices
List of Tables
List of Figures
Handicraft in Nepal
Federation of Handicraft Associations of Nepal was established in 1972 to enhance and
promote handicraft trade and industry. Originally, its name was Handicraft Association of
Nepal (HAN). It is registered under Institution Registration Act of Nepal. It is a service
oriented non-profit organization of private sector business and artisan community. It
helps its members to improve their productivity, explore markets and introduce them to
the international arena. It also works as liaison between its members and the Government
and Non-Government Organizations.
Functions of FHAN
Bags & Accessories Purses, hand bag, travel bag and the like made from cloth and
Leather
Basketry Products Various types of products made from bamboo and cane split,
stem or root.
Contemporary Paintings Paintings using sketch and colors on canvas and other
materials
Craft Paintings Paintings using wheat/ rice bran/ stem, waste thread and other
materials.
Crazy/ Fancy Hats Hats with symbolic impression like flags, animals and other
specially meant for big sporting events.
Ethnic Dolls Dolls & Puppets of Nepalese culture made of cloth, clay and
wood.
Giftware Small items made from different materials basically useful for
offering gift.
Home Furnishing Bed covers, bed linens and the like using block/ screen
printing, Embroidery, crochet and similar skills.
Horn & Bone Products Buttons, cufflinks and other decorative articles
Incense Various circular & square type elongated boxes made copper,
brass and other metals used for storing incenses
Leather Goods Products made of goat skin and water buffalo leather
Metal craft (Statue) Icons based on Buddhism and Hinduism, made of coppers,
bronze, silver and gold as basic raw materials with chisel
works.
Metal craft (Utensil) Utensils and garden articles made through hammering and
casting such as flower vas, singing bowl, bell, cymbals, wine
jars, cups and so on.
Natural Buttons Buttons made from small tree branch, stone, bone and horn.
Natural Fiber Products Apparel and non-apparel products made from hemp, nettle
and similar indigenous plants.
Pashmina Goods Articles made of pashmina (fine goat hair) such as shawls,
mufflers, sweaters
Puzzles & Toys Wooden toys and puzzles for growing children.
Religious Goods Bell, Vajra and other different objects, items used for
religious ceremony of Buddhism and Hinduism.
Wood carving Products made of various types of wood such as door panels,
figures of gods & goddesses, replicas of famous windows,
imitations of temples/ monuments and many decorative/
utility articles, with hand carving.
Note: * If applicable. Document requirement for export could vary with nature
of handicrafts products.
1.1.3 Export Policy
Government makes policies for the betterment of the relevant issues. Export policy of
Nepal states as following for the promotion of the export position of the country.
The production and quality of exportable products will be raised to make competitive
in the international market.
Necessary efforts will be made to increase and diversify of goods and services with
objective of increasing foreign exchange earnings.
Exports will be promoted by rising the producing and quality of traditional as well as
new products, new markets will be identified.
Foreign exchange earning will be increased and identifying and increasing the
production of new products will create opportunities for gainful employment.
Services oriented activities will be given to the export of hydro electricity on a
profitable basis.
For the effective utilization of manpower, stress will be given to the development of
appropriate and potential skill to promote service sector as well as export of skilled
manpower in an organized way.
Appropriate monetary, foreign exchange and fiscal policies will be formulated and
necessary changes will be made in the administration procedures to make them
liberal, simple and dynamic in order to implement above policies on an efficient,
smooth and transparent basis.
This study helps to show the main causes of declining business of handicraft
and also helps to show the possible alternatives of development and
promotion of the business of handicraft.
A. General Background
B. Literature Review
C. Research Methodology
D. Data presentation and Analysis
E. Summary, conclusion and Recommendation
A. General Background:
This chapter contains the Background of the project i.e. Introduction of the Handicraft,
Handicraft in Nepal, Aims, objectives and functions of FHAN, Information about the
goods that are exported to overseas and the list of the Handicraft products made in
Nepal, list of goods which need not to be approve by the archaeology department, etc.
B. Literature Review:
In this chapter, the articles reviewed to prepare the report are presented.
C. Research Methodology:
This chapter contains selection of the study area, Research design, Sources of data,
Methods of Data collection, etc.
D. Data presentation and Analysis:
In this chapter, the data collected from the Annual report of FHAN related to the
different handicraft products at different time intervals are shown and are presented in
tabular and graphic form and are analyzed by using different statistical tools and
comparative study is done.
E. Summary, conclusion and recommendation:
This is the last chapter of the study which deals with summary, conclusion and
recommendation. The conclusion is drawn from the analysis made from the above
chapters. And then the possible suggestions are forwarded for the development of the
handicraft in Nepal.
CHAPTER-2
LITERATURE REVIEW
2. Literature review
There are various sources to obtain the information about the related field. The sources
may be Internet surfing, Books and Articles, previous reports on the related subject
matter, Newspapers, Reports issued by the related company or associations on the
quarterly, semiannually and yearly basis. In order to prepare this report, I had
considered the following sources and articles.
Internet surfing www.handicraftmarket.com
Reports made by the senior students on the respective topic.
The annual report made by FHAN (Federation of Handicraft Association
of Nepal)
Craft News, Federation of Handicraft Association of Nepal
Hastakala Samachar, Federation of Handicraft Association of Nepal
(FHAN)
Various articles on the respective field.
This report writing has been prepared with the help of the information obtained from
www.handicraftmarket.com. This website consideration has helped me to prepare the
report. The information are the associates of Federation of Handicraft Association of
Nepal (FHAN), the information related to the Handicraft products exporters, the
commerce associates and the individuals involved in this business.
The reports made by my senior students on the related field also helped me to make
my report writing comfortable. Through these reports I came to know that how to
present the available data, about the appropriate use of language, well description of
the presented data and the analysis and conclusion of the analyzed data.
All of the data related information are taken from the Annual Report made by
Federation of Handicraft Association of Nepal (FHAN) during various time intervals. I
had considered the data of last 4-5 years. The comparative study of annual report
between the last two years is possible with the help of data I had got from the Annual
report of Federation of Handicraft Association of Nepal (FHAN).
In addition to these, the newsletters issued quarterly by Federation of Handicraft
Association of Nepal (FHAN) also provide some necessary information about the
seminars and workshops conducted by Federation of Handicraft Association of Nepal
(FHAN) to promote this occupation. The newsletters are named as Craft News and
Hastakala Samachar. These newsletters are issued quarterly.
For the further information on the related field, I had used internet surfing as a tool to
gather the information on the National and International Organization's websites
through GOOGLE.com, which are related to the handicraft business worldwide and in
Nepal also.
The review of literature was done with the help of past performance study of
respective students. They had presented the data up to 2064/2065 in 9 month's interval
report. Therefore, my effort is to analyze and present the data up to 2067/2068 with the
full annual report, which will help to show the clear picture of the Handicraft business
in Nepal.
In order to analyze and present the Handicraft business, I use the trend analysis as a
tool to show the status of Handicraft Business in Nepal. I choose trend analysis
because it is one of the best tools for the relevant investigation on the export in
different fiscal years. The trend analysis shows the trend of handicrafts yield being
exported to different volume. This trend will help to know about the increasing or
decreasing trend of export of handicraft products of Nepal to the international market.
And the trend analysis is done with the help of our Business Statistics book. The book
is named as Forth Edition, Business Statistics, A first Course.
CHAPTER-3
RESEARCH METHODOLOGY
Research Methodology
Various types of the research have to be made while preparing this report. To research
or to investigate various tools and techniques are used to gather the information related
to this topic.
From the above table we can know that there are various types of handmade goods which
are exported from the Nepal to various countries. They are textile, Non-textile goods and
other goods. Most of the goods are equally exported to other countries. The most
exportable products are Pashmina, Woolen, Silver, Metal, wood, Beads, stone and plastic
products.
The above data from FHAN can be presented with the help of the following multiple bar
diagram.
Yearly Comparison
Export of Handicraft Goods
(2063/64-2067/68)
The total export of the fiscal year 2063/2064 Rs. 2716384047. And the total export of
2064/2065, 2065/2066, 2066/2067 & 2067/2068 are Rs.2679574412, Rs.3027762312,
Rs.2784221255 & Rs. 3110472610 respectively. With the help of the figure it can be
clearly seen that the plastic items is highly exported and bamboo products are least
exported from Nepal in the fiscal year 2063/2064. But in 2064/2065 and 2065/2066
bamboo product was exported more than other items. Although in the last two years,
bamboo export has declined but the export of other goods are not so much differ in the
quantity.
Yearly Comparison Data of
Handicraft Goods Exported
Fiscal Year 2066/067 and 2067/068
(2009/010 and 2010/011)
Month : (Shrawan-Ashadh)
(Amount in
Nrs.)
Increase Contribution to
S.N. Description F/Y 2066/67 F/Y 2067/68 /Decrease of Total Export
Export (%) (%)
A Textile Products :
The above table shows the percentage change in the export in 2066/067 and 2067/068.
The export has increased by 11.72%. The stone crafts are increased by 106.7% which is
the maximum among other goods. Similarly, Metal craft and bamboo products are
increased by 85.5% and 47.48%. The beads items are increased by 75.25%. The all
increment indicates that there are positive increments in the export of the handicraft
goods. It can be shown with help of following pie chart as follows:
Contribution of export of
Each of the handicraft goods
The above pie chart shows the total contribution of each of the handicraft products to
total export in FY 2067/2068. Metal craft, Pashmina and woolen products are the leading
handicraft goods among them all. Pashmina contributes 10.65%, Woolen products
contributes 15.93% and Metal craft contributes 21.84% of the total export.
Total Export of Handicraft goods for last five years
(2063/064-2067/068)
2064/065 2679574412
2065/066 3027762312
2066/067 2,784,221,255
2067/068 3,110,472,610
3200000000
3100000000
3000000000
2063/2064
2900000000
2064/2065
2800000000
2065/2066
2700000000 2066/2067
2600000000 2067/2068
2500000000
2400000000
years
From the above figure and table, we can clearly see that the export of handicraft goods
has increased in 2067/2068 than that of the remaining four years. So it can be said that
the handicraft goods export may in coming years also.
The growth in the fiscal year 2065/2066 shows the development of the handicraft
industry in Nepal that fiscal year. The decrement of the export in the FY 2063/2064,
2064/2065 and 2066/2067 shows the negative trend in comparison to the FY 2065/2066
and 2067/2068.
4.4 Trend Analysis of Handicraft Exports
Years X Exports (Y) x x2 xy Yc
2063/064 1 2716384047 -2 4 5432768094 2685118131
Forecasted 6 3 3131530118
2068/2069
Total 14318414631 0 10 892823974
Table No. 4.4
∑ y =14318414631
Here,
∑x= 0
∑x 2
= 10
∑ xy = 892823974
n= 5
From the formula of trend line:
∑ xy =a ∑ x +b ∑ x
y c = na+bx
2
or,
We get, a= y =
∑ y = 14318414631
5 5
i.e a=2863682926
∑ xy
Now we have,
∑x
b= 2
or, b=892823974/10
∴ b=8928397.4
Putting the values of 'a' and 'b' in the trend line equation.
y c = a+bx
y c =2863682926+8928397.4x
Here,
Growth rate is 'b=Rs. 8928397.4 per year.
Since the growth rate is positive, so the trend is in the rising situation. The estimated
trend analysis for the year 2066/2067 through this analysis can be get.
For the estimation of total export of Handicraft goods for year 2066/2067:
At last we can say that the secular trend will be in increasing trend as in the year
2068/2069. The highest export of handicraft goods was in the year 2067/2068 which was
Rs. 3110472610. The export is not constantly increasing but the export trend is in the
increasing form.
Top Ten Exporting Countries of
Nepalese Handicraft Products (2067/2068)
S.N. Countries Value in Rs. Rank
1 USA 889,275,508 I
2 Germany 284,310,843 II
4 Canada 189,454,423 IV
5 Tibet 181,403,938 V
6 Japan 160,342,906 VI
7 UK 153,715,062 VII
9 Italy 127,868,751 IX
10 Netherlands 99,935,627 X
Among the top ten importers of Nepalese handicrafts, USA has the first position with
largest share. The second is Germany. USA imports Rs. 889,275,508 amount of
handicraft goods.
The following are the some of the associates of Federation of Handicraft of Nepal:
3.2 Conclusion
This industry has been a substantial asset for the development of the country. However,
there are various pros and cons of these industries. The major finding can be pointed out
as follows:
Most of these goods are not useful to the general people, mainly on this
handicraft industry, fancy and curio goods produced which are infecting
luxurious goods. It will be helpful only to satisfy the wants of riches. There
will be n benefit to the local customers. Due to the low standard of living of
the Nepalese people, they cannot afford for these expensive curio goods. This
industry has fulfilled the needs of the foreigners only and not the local people.
If the foreign demand falls by some cause or other, this industry will suffer a
lot.
By the name of this business, the curio dealers export many antique goods. As
they get money for the antiques the dealers collect it at any cost . They steal
the artistic fitting of the temples and even gods and goddesses directly or
indirectly and they smuggle it to foreign country. That is why; we hear always
the news of stealing of figures or historic temples. Thus, such things of
national and historic importance are losing day by day. The curio business
taught these mal practices. It is harmful to the nation both form national and
religious point of view.
Most of these handicrafts are exported to overseas countries. As an
inducement or intensive for the 60% of the export amount. They import many
comfort and luxury goods which creates unnecessary habits and fashions
among the people. Again as the foreign goods are cheaper that the local one,
the people do purchase the foreign goods only. By this the local industries
suffer, as they cannot compete with the foreign ones. These importers import
mostly the luxuries, as they will get good margin of profit on them. Therefore,
the import in not in the favorable interest of the country.
This business couldn’t yet earn there reputation in the international field. The
cause this is there is no fixed for the sale of these handicraft products. Some
one may be selling same goods at a low price and other at the higher price.
The foreigners are ruthlessly cheated on this business. The dealers of the
curios charge very low price to the local people and very high to the tourists.
The order of foreign dealers cannot be completed in time, due to the slow
method of production, thus most of the orders are cancelled there is no sound
method of finishing too. The quality and the finish of the sample prices and
the goods supplied don’t often tally due to the practical difficulties, because of
the traditional method of production. These products are not made to the
standard in quality and strong then the goods are very fragile and delicate. For
filigrees and figures, there is a great deal of packing problem. Whatever the
good packing may be, the goods reach in poor and damaged condition.
The total export of handicraft product has been highest in FY 067/68, which
are Rs. 3,110,472,610
The total exports are not in the constant growth rate or fall rate because in FY
2063/64 the export rise but in the FY 2064/65, it falls. Again, in 2065/66 it
rise up and then falls in 2066/67. In addition, in FY 2067/68 it again rises up
to Rs. 3110472610.
The latest figure indicates that handicraft business will contribute to increase
the status of Nepal gradually.
The tourists are important for both local sales and export. The more tourists’
visits in Nepal the more will be sale of these goods.
The highest export of handicraft goods was in the year 2067/68, which was
Rs. 3,110,472,610. It shows the increasing trend of handicraft goods export.
Among the top ten importers of Nepalese handicrafts, USA has the first
position with largest share.
Handicrafts are one of the major exportable items of Nepal especially to overseas
market. There are many handicraft industries in Nepal, which are being operated in
household basis, and medium scale industries. Those, which are run in household basis,
have not developed well because of the financial problem. The artisans are enabling to
expand their production. Most of the craft activities are hereditary in nature so they are
producing in traditional style. The Nepalese craftsmen are mostly illiterate and are
unaware of modern technology and in absence of proper training facility regarding
improved. Technology use of new tools and equipment for improved efficiency this
industry is facing problem of quality and price, competition and design modification.
Similarly, medium scale industries of handicrafts have been producing very less
manufactured crafts goods. As its number is limited traditional backwardness in modern
craft manufacture has caused Nepal to face a very hard time to continue its survival and
growth in competitive world market.
There are few organizations, which are trying to promote the handicrafts export of Nepal
to overseas countries. FHAN, TPC are the major organization among them. FHAN has
so the tried to promote handicrafts export by making different study on market
potentially in some overseas countries. Publication of handicraft magazines, trade
directory, regular journals and bulletins, collection of different trade information at hand
for the interested, conducting workshop seminars, making arrangements trade fairs and
exhibition are the major promotional activities conducted by FHAN.
3.3 RECOMMENDATION
Despite the drawbacks, this industry is important from the economical, national and
social point of view the demand of foreigners for these goods is increasing in great
preparation. A special craze has developed among the people of the rich countries for the
artistic craft works and curio articles. In addition, it is but true that craze or the thirsty of
this type of articles is unlimited as such there is a great prospect of this trade to our
country. This is full of rich traditions and traditional arts and crafts. As such, Nepal is
receiving more and more orders for ours handicrafts developed. If it is improved and in
modern way there is a great scope lying ahead of us.
of finishing too should be improved for better market.
Regular and sufficient availability of raw materials at a reasonable price for
the production or handicraft is one of the most important needs. Government
should check their availability and if necessary, should import raw materials
on a regular basis.
For getting successful market in the overseas countries, a product should buy
of attractive design and standard quality of the product should be maintained.
The modern handicraft goods, which are mostly sold in overseas market, must
represent the artistic craftsmanship of the past.
The presences of capital market in the country can make considerable positive
effects on the growth of handicrafts industry and the promotion of its foreign
trade. NG should also monitor the loan provide to this handicraft Industry.
Another important aspect in the promotion of a product is packaging. There
should be consistency of packaging and package size. An attractive and
efficient packaging can be a very good way of gaining popularity and prestige.
Nepal being the landlocked country, the choice of transit and the means of
transportation are limited. The government should come up with new
arrangements to enhance the transportation and communication facilities.
Government policy also effects industry. So the government should
implement effective policy and launch new concrete programs for the
promotion of this indigenous industry and its export.
Organized and attractive publicity and promotional measures of the handicraft
items should receive immediate attention in the foreign market.
Appropriate training centers with modern and sophisticated facilities should
be set up for providing training to the personal associated with the handicraft
industry. The trained craftsmen would exchange would enhance, the design
and quality of the handicraft goods.
A proper and adequate market research can always be a great help for the
Nepalese handicraft to survive in the foreign market.
On the whole, this is the real and traditional industry in Nepal and its development in the
well balanced and organized manner will definitely lead to the improvement of the
economic standard of the people to some extent through new job and employment
opportunities, earning of hard currencies and through the general well being of the artist
and craftsmen of the country.
BIBLIOGRAPHY
Levine, D. M., Krehbiel, T. C., Berenson, M. L., & Viswanathan, P. K. (2006).
"Business Statistics- A First Course" (4th ed.). Patparganj, Delhi 110092, India:
Dorling Kindersley (India) Pvt. Ltd.
Pant, P. R. Social Science Research and Thesis Writing (3rd ed.). Nepal: Buddha
Academic Enterprises Pvt. Ltd.
APPENDICES
Vocabulary
1 USA 889,275,508 I
2 Germany 284,310,843 II
4 Canada 189,454,423 IV
5 Tibet 181,403,938 V
6 Japan 160,342,906 VI
7 UK 153,715,062 VII
9 Italy 127,868,751 IX
10 Netherlands 99,935,627 X
Fiscal Year 2066/067 and 2067/068
(2009/010 and 2010/011)
Month : (Shrawan-Ashadh)
(Amount in
Nrs.)
Increase Contribution to
S.N. Description F/Y 2066/67 F/Y 2067/68 /Decrease of Total Export
Export (%) (%)
A Textile Products :