Market Access Manual for Artisans Rev2 - Caribbean Export ...

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Illustrative Product Examples (2006 estimated market share and total sales in billions) • Baskets • Handbags • Picture frames (of wood and metal) • Wall décor items • Boxes • Decorative accessories • Ornaments • Vases • Candles/Candleholders • Ceramics • Sculptures • Masks • Bowls and dishes • Furniture • Embroidered and sewn textiles • Papier mâché • Jewelry • Musical instruments • Toys Decorative accessories (31%) $22.6 (4.1% growth projection for 2007) Accent furniture (20%) $14.5 (3.6% growth projection for 2007) Portable lamps (11%) $7.7 (3.3% growth projection for 2007) Top U.S. / UK Retail Channels (2006 sales in $ millions and % change from 2005) • Home accent/gift stores ($8,840; up 4.0%) • Direct-to-consumer channel ($4,335; up 6.4%) • Discount stores/off-price retailers ($4,145; up 6.8%) • Lifestyle stores ($2,555; up 5.1%) • Department stores ($670; down 0.7%) • Craft/fabric stores/chain ($585; up 2.6%) • Interior designers ($445; up 3.5%) • Traditional furniture stores/chain ($362; up 3.4%) • Home improvement centers and warehouse clubs ($207; up 6.2%) • Traditional furniture stores/chains ($3,930; up 3.4%) • Discount stores/off-price retailers ($2,735; up 7.3%) • Home accent/gift stores ($2,235; up 2.8%) • Lifestyle stores ($1,880; up 4.4%) • Interior designers ($1,200; up 4.3%) • Home improvement centers and warehouse clubs ($645; up 4.9%) • Department stores ($560; up 2.8%) • Direct-to-consumer channel ($558; up 7.3%) • Craft/fabric stores ($125, up 4.2%) • Discount stores/off-price retailers ($1,890; up 5.0%) • Home improvement centers and warehouse clubs ($1,520; up 7.4%) • Home accent/gift stores ($920; down 0.5%) • Lamp and lighting stores/chains ($900; no change) Traditional furniture stores/chain ($669; up 2.9%) • Interior designers ($470, up 2.2%) Direct-to consumer channel (425 up 6.3%) • Lifestyle stores ($308; up 2.7%) • Department stores ($295; no change) 10 Page 10
Generally, markets for handicrafts are reported to be very attractive as there are low barriers to entry, access to a wide range of consumers and limited market access requirements. The general view of crafts and giftware is therefore that the markets are increasing at a relatively steady rate and hold reasonable prospects for growth in the future. Therefore Caribbean artisans stand a relatively strong chance of successfully penetrating the US and UK market with a comprehensive market penetration strategy. 4. WHAT IS HAPPENING IN THE UK & US MARKETS? In 2006, the global market for home accessories was estimated to be at least $100 billion according to a study prepared by US Aid on the “Global Market Assessment for Handicrafts”. The US was the largest importer of the home accessories and was valued at $67 billion. 3 According to the U.S. Department of Commerce, the United States market has a strong desire for the unique, the interesting, and products with a story. However, the US market is price‐ sensitive, and hence price per unit realised in this market tends to be lower than in other countries. Nevertheless, this is traditionally a strong market, and continues to grow, mainly on the back of multi‐ethnic immigration. The UK is recognized as the 2 nd largest importer for handicraft products in the EU (after Germany). Giftware imports in 2005 by the UK are estimated to be UK£6,480 million –a growth of 2.2 % over the previous years’ estimates 4 . While in 2006 the the percentage of imports into the UK coming from the developing countries was slightly more than 46%. The British market though is clearly divided between people from the South East (basically the London area) who have a higher income and prefer more fashionable products and people from the North, who are very price conscious. The forecasts indicate only a slow rise in population and in consumption over the next few years. 4.1 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS- HANDICRAFT SECTOR We can bring the analysis of the global gift and craft market together with the fair trade handicraft overview as follows: STRENGTHS WEAKNESSES � Some producers have made significant improvements in quality control and product development for the export market, winning commercial contracts. � Women – the most frequent purchasers of gifts in UK and US – have greater financial independence. They may buy more themselves, and also buy for others. 3 The second largest market is the E.U. collectively followed by Japan and Hong Kong. 4 Giftware 2001 Market Report, Keynote Ltd. UK � Handicrafts, unlike fair trade foods, are not repeat products. � Alternative Trading Organizations (ATOs) and fair trade importers have historically lost market share to commercial importers. � Expenditure is very seasonal (dominated by Christmas) � World Shops generally lack professionalism. 11 Page 11
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