www.ChinaSourcingReports.com

Pampanga

LagunaMANILA

Philippines supplier profi lesDetailed profi les of 21 suppliers with verifi ed manufacturing and export credentials

Product gallerySpecifi cations and full-color images of 179 top-selling export products ranging from Christmas trees to gift boxes

Industry trendsCoverage of current issues, plus insights into supply centers, products and pricing

February 2013US$150

Holiday Decor & GiftsEssential sourcing intelligence

Global Sources is off ering this series of Developing Country Sourcing Reports as part of its corporate social responsibility undertakings in partnership with the Hinrich Foundation, a philanthropic development organization whose mission is promoting sustainable global trade.

The aim is to give international buyers new sourcing opportunities from experienced exporters, generating orders and creating lasting jobs in developing economies.

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HOLIDAY DECOR & GIFTSSupplier capability in the Philippines

Renewed demand from key overseas markets is resulting in steady growth for the Philippines’ holiday decor and gifts industry.

The gradual recovery of the US from the global financial slump and sustained orders from EU members unaffected by the sovereign debt crisis are driving exports. Shipments to new destinations are also pushing up revenue.

The US is the sector’s primary importer as it takes up more than half of output. The EU is the second-largest, accounting for nearly one-fourth.

Although the Philippines is a minor player in the global supply market, it relies on a number of competitive advantages. The most signifi cant of these is the country’s long history and strong artistic capability in designing handicrafts. Access to natural materials not typically adopted by other sourcing hubs in Asia is another strength.

Objective, methodology & scope

1. Suppliers interviewed for this report generally expect to raise product prices over the next six months in response to increasing expenditure for raw materials and manpower. A considerable number, however, plan to keep quotes unchanged to ensure competitiveness and attract repeat buyers.

2. Export revenue in the next 12 months is predicted to increase as a result of rising demand from the US and the EU. A significant number of makers forecast flat growth, mainly due to challenges confronting the line.

3. The most critical difficulty facing the industry is price competition, especially against manufacturers in China. Another roadblock affecting the sector is diminishing sales of Christmas decorations due

Key findings

Executive Summary

In this report• 16 in-depth company profi les• 5 short company profi les• 179 top-selling export products• Supplier demographics• Supplier survey• Industry statistics and charts

This Philippines Sourcing Report is part of a series designed to provide buyers with information on new products from export manufacturers in supply markets that specialize in handmade merchandise.

The Developing Country Sourcing Report series is part of Global Sources’ corporate social responsibility initiatives. It is offered in conjunction with the Hinrich Foundation, whose mission is promoting sustainable global trade. One of its objectives is to help create jobs in developing Asia through export promotion.

To produce this report, large, midsize and emerging manufacturers, all with substantial export experience, were surveyed. The selection of suppliers is designed to reflect the composition of the industry in the Philippines in terms of geographic location, materials used and range of products offered.

For in-depth profiles, our researchers visited the facilities of each company and interviewed senior executives who discussed their recent performance and provided forecasts for the next 12 months. All other makers in this report were either visited or contacted by phone.

In each case, companies were required to answer specific questions designed to verify their manufacturing and export credentials, including a breakdown of exports by product type and market. Suppliers also participated in a survey designed to provide insight into the industry.

This report covers different types of holiday decor and gifts available in the Philippines, including Christmas ornaments, gifts and photo frames. Each product category has its own price guide that describes features of the low end, midrange and high end.

The Industry Overview section discusses key issues affecting export manufacturers. It provides insight on the composition of the industry and elaborates on the important supply centers within the Philippines.

The Products & Prices section details the features and price ranges of holiday decor and gifts. It also examines the design and manufacturing processes, main materials used, and sourcing centers where components are procured.

to changing demographics and customer preferences in key markets in the West, particularly the US.

4. Yuletide ornaments remain as the best-selling product classification. Gifts are a smaller line yet account for a sizeable amount of exports. Design trends in the coming 12 months will emphasize adopting bright colors and intricate embellishments. Continued use of environment-friendly materials is also expected as the popularity of models made of sustainable inputs increases.

5. Most companies are categorized as micro- or small enterprises. Makers are predominantly located in Metro Manila, where various types of holiday decor and gifts can be sourced. Supply zones are also found in several provinces surrounding the metropolis.

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4 Philippines Sourcing Reports

CONTENTS

Disclaimer: Any recommendation contained in this report may not be suitable for all investors or businesses. Moreover, although the information contained in this report is obtained from sources believed to be reasonably reliable, the accuracy or completeness of such information cannot be guaranteed. The author and the publisher of this report (and the publisher’s affi liates, agents, sales representatives and service contractors) do not make any representation or warranty whatsoever (whether express or implied) in relation to any of the contents of this report (including any information, opinion, recommendation or conclusion contained in this report) (collectively, “Contents”), whether as to the accuracy, completeness, quality, fi tness, suitability or reliability of such Contents (or any portion thereof ) or otherwise, and shall not be liable under any circumstances whatsoever for any error, omission, defect or defi ciency in, or for any use of or reliance on, such Contents (or any portion thereof ).

All product images are provided by the companies interviewed and are for reference purposes only. Those product images featuring products with trademarks, brand names or logos are not intended for sale. Products that are not the specifi c topics of editorial articles are shown for illustrative and/or demonstrative purposes only. We, our affi liates, and our affi liates’ respective directors, offi cers, employees, representatives, agents or contractors, do not accept and will not have any responsibility or liability for product images (or any part thereof ) which infringe on any intellectual property or other rights of a third party.

Contents

Copyright 2013 Trade Media Limited. All rights reserved. Reproduction in whole or in part in any form or medium without express written permission of Trade Media Holdings Limited and Trade Media Limited is prohibited.

Published by Publishers Representatives Limited (on behalf of Trade Media Limited)4th Floor, Century Yard, Cricket Square, Elgin Avenue, P.O. Box 32322 SMB, George Town, Grand Cayman, Cayman Islandsc/o 22/F Vita Tower, 29 Wong Chuk Hang Road, Aberdeen, Hong Kong

ISBN 978-988-15980-7-3

EXECUTIVE SUMMARY ............................................................................................................................................................................................... 3 Key fi ndingsObjective, methodology & scope

INDUSTRY OVERVIEW ............................................................................................................................................................................................. 11 Supplier SummaryExport valueExport markets

Products & prices ........................................................................................................................................................................................................ 13 Production & export statisticsPrice guides

Supplier survey ........................................................................................................................................................................................................... 16 Export pricesExport salesExport marketsMajor challengesR&D focus

SUPPLIER PROFILES ................................................................................................................................................................................................... 19 Supplier matrix: Comparison of supplier location, sales revenue & export capability Profi les of 21 verifi ed suppliers

PRODUCT GALLERY ................................................................................................................................................................................................... 61 Christmas trees & ornamentsChristmas lanternsOther holiday decorationsGiftsPhoto frames

CONTACT DETAILS ...................................................................................................................................................................................................... 93

Sample page only...................................................

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.........................................................................................les revenue & export capabilityenue & export capability

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T DETAILSAILS ................................. ......................

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Industry Overview

Industry Overview

Exports of holiday decor and gifts from the Philippines have been on an upward trend in recent years, driven primarily by reinvigorated demand from the US.

Growth has been modest, with annual revenue starting from 2009 increasing by an average of 7 percent. This remains markedly lower compared with precrisis levels but the industry has adopted a cautiously optimistic outlook that it has now emerged from the worst of the slump. Within that period, foreign turnover contracted by about 34 percent.

Between the two segments, holiday decor is the larger earner, accounting for nearly 60 percent of combined sales. In 2011, the most recent period for which statistics are available, the line expanded by 11 percent as it posted $33 million in overseas shipments. The sector’s improvement is primarily attributed to the steady recovery of the US market from the economic slowdown.

Exports of gift items, on the other hand, exceeded $20 million in 2011, equating to a decline of more than 12 percent over the previous year. The weakening is seen as an effect of the sovereign debt crisis affecting the EU. Compared with holiday decor, the gifts segment has a bigger client base in the bloc.

Projections in the coming 12 months indicate sustained moderate growth. Sales of holiday decor are estimated to climb by as much as 7 percent. Revenue from gift items is seen to rise 4 to 5 percent. With the US having an increasingly improving business climate, spending for nonessential goods such as handicrafts is consequently expected to go up. Demand from EU members not significantly affected by financial burdens is additionally a factor toward the industry’s development. Deliveries

to alternative markets, including South Korea, Singapore, Australia, India, Russia and the Middle East, are also predicted to contribute considerably to earnings.

As a whole, the US is the largest importer of holiday decor and gifts from the Philippines as it takes up nearly 60 percent of total exports. The EU is the second-biggest destination, accounting for one-fifth of shipments. Key markets in the bloc include Germany, the UK, France, Belgium, Italy and the Netherlands. Twelve percent of turnover is sent to the Asia-Pacific region.

ChallengesThe Philippines is a minor player in the global market for holiday decor and gifts, contributing less than 2 percent to overall supply. Despite posting growth in recent years, the industry appears to maintain its marginal status as it faces a number of diffi culties.

Intense price competition is the most critical roadblock. Domestic enterprises are generally unable to match low prices offered by China manufacturers. In addition, several sourcing hubs in South and Southeast Asia emphasize products made of natural materials similar to those adopted by companies in the

Philippines. The market, therefore, becomes saturated with items made of plant-based inputs, making it harder for local suppliers to remain viable.

To cope, the Department of Trade and Industry has enacted a number of directives aimed at regulating the amount of natural components that can be exported. These include setting quotas on outbound shipments of bamboo and wood harvested from plantation forests. Furthermore, the agency has banned the sale of timber obtained from natural forests, raw rattan, and seeds, seedlings and root stocks of ramie and abaca.

Another hurdle confronting the sector is the diminished demand for Christmas ornaments, which is the biggest line comprising the holiday decor segment. According to the Christmas Decor Producers and Exporters Association of the Philippines or CDPEAP, a local trade organization, the shifting demographics of

Supplier summary

Data: All surveyed suppliers

Suppliers surveyed 21Export sales $11mnExport ratio 98%Capacity utilized 70%Full-time employees 844

Export valueHoliday decor$ million

Source: International Trade Centre

2009 2010 2011

27.329.9

33.2

Gifts$ million

2009 2010 2011

22.5 23.4

20.5

Includes HS codes 4414, 4420, 6913, 6914 & 8306Includes HS codes 950510 and 950590

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20 Philippines Sourcing Reports

Supplier Profiles

*CompanyIn-depth profile

Year established

Head officelocation

Ownership Factory location(s) Full-time employees Part-time employees

* Benjoy 1992 Quezon City(Metro Manila)

Foreign-invested

Quezon City(Metro Manila)

248

Cagayan de Oro Handmade

1993 Cagayan de Oro(Misamis Oriental)

Locally owned

Cagayan de Oro (Misamis Oriental)

5 125

* CSM 1994 Biñan (Laguna)

Locally owned

Biñan (Laguna)

80

* Danico’s 1997 Taytay (Rizal)

Locally owned

Taytay (Rizal)

10 19

* Decorich 2004 Marikina (Metro Manila)

Locally owned

Marikina(Metro Manila)

6

* Display Heaven 1965 Taytay(Rizal)

Locally owned

Taytay (Rizal)

10 100

* Ethnicraft 2007 Malabon(Metro Manila)

Locally owned

Pakil(Laguna)

4 20

* Faenza 2007 Santo Tomas(Pampanga)

Locally owned

Santo Tomas (Pampanga)

5 50

* Global Model 2011 Las Piñas(Metro Manila)

Locallyowned

Las Piñas(Metro Manila)

8 100

* Heinen Import 2002 Angeles(Pampanga)

Foreign-invested

Angeles(Pampanga)

350 300

Korben 1974 Quezon City(Metro Manila)

Locallyowned

Quezon City(Metro Manila)

25 49

* Medoth 1999 Angono(Rizal)

Locallyowned

Angono(Rizal)

5 15

* Navidad 2011 Muntinlupa(Metro Manila)

Locally owned

Muntinlupa (Metro Manila)

6 6

Philippine Fine 1979 Parañaque(Metro Manila)

Foreign-invested

Parañaque(Metro Manila)

11 100

Precious Ceramics

1998 Bacolod(Negros Occidental)

Locallyowned

Bacolod(Negros Occidental)

6 10

* RH Excelcrafts 1990 Las Piñas(Metro Manila)

Locallyowned

Trece Martires(Cavite)

20 100

* Rolren’s 1995 San Fernando(Pampanga)

Locallyowned

San Fernando (Pampanga)

5 40

* RT 2005 Quezon City(Metro Manila)

Locallyowned

Quezon City,Las Piñas

(Metro Manila)

10 30

* Season of Lights 2010 Quezon City(Metro Manila)

Locallyowned

Caloocan City(Metro Manila)

2 3

Tadeco 1981 Panabo(Davao del Norte)

Locallyowned

Panabo(Davao del Norte)

23 102

* Tavaps 1986 Parañaque (Metro Manila)

Locallyowned

Calamba(Laguna)

5 15

SUPPLIER MATRIX

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AngelesAngeles(Pampanga)mpanga)

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20112011

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24 Philippines Sourcing Reports

Supplier ProfileSupplier Profiles

Capability

Contact details

Benjoy Inc.

Annual sales $10,000 Share of total sales 1%Annual export sales $10,000Total monthly capacity 35,000 piecesAverage monthly output 30,000 piecesCapacity utilized 86%Average monthly exports 30,000 piecesExport ratio 100%Major export customers Johnco Productions (Australia)

Company facts

Year established 1992Head offi ce location Quezon City (Metro Manila) Ownership Foreign-investedFactory location(s) Quezon City (Metro Manila) Full-time employees 248Total annual sales (all products) $1,500,000

Sales & output: Holiday decor & gifts

Business contact MENESES LoyaltyPhone (63-2) 721-1533Fax (63-2) 721-1533E-mail benjoy@mozcom.comURL www.globalsources.com/benjoy.coAddress 6 Manga Road, New Manila, Quezon City, Metro Manila, Philippines

Established in 1992, Benjoy manufactures holiday decor. The company generates $1.5 million in total annual revenue.

The entire output in the line is sent abroad. Australia is the sole overseas destination.

Christmas tree ornaments are the best-sellers. The enterprise also produces baby toys and bedding.

Prices range from $1.20 to $15. Four-inch snowman figurines are offered for $1.76. Models in animal and angel designs are quoted at $2.50 and $2.75, respectively.

Felt is the main fabric used and sourced from the Divisoria market in Manila. Polyester fiberfill utilized for stuffing is procured from vendors in Parañaque city.

A designer creates up to 300 new models every year. Samples are sent within two weeks.

Benjoy operates a 1,200sqm factory in Metro Manila’s Quezon City. The plant is equipped with die-cutting and

sewing machines, which are bought locally. Screen-printing, handstitching and computerized embroidery are farmed out to nearby subcontractors. The rest of the production processes are done in-house.

There are about 250 permanent employees. The peak season is from July to September.

Twenty inspectors conduct QC on all finished items before packing and shipping.

Polybags and cartons are used as packaging. The minimum order requirement is 300 pieces. Delivery usually takes 90 days.

Benjoy regularly participates in the Manila Furnishings and Apparel Manufacturers’ Exchange trade show. The company is a member of the Home Accents Group of the Philippines Inc., Philippine Exporters Confederation and Philippine Toy Association.

The supplier plans to introduce its products to the EU market over the next 12 months.

Materials used Fabric Yes Natural materials No Resin No Metal No Wood No Other No Exports by product Christmas trees & ornaments 80% Christmas lanterns – Other holiday decorations 20% Gifts – Photo frames – Exports by market North America – EU – Europe (non-EU) – Asia-Pacific 100% Middle East – Other –

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www.ChinaSourcingReports.com 25

Supplier Profile Executive Sum-Supplier Profiles

Popular export models

Model: D-163MOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $3.70Description: Hanging ornament; felt body and polyester fiberfill stuffing; cat with hat design; 5.5x4in

Model: D-2873MOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $1.24Description: Hanging ornament; felt body and polyester fiberfill stuffing; snowman design; 4.5x4in

Model: D-2871MOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $1.50Description: Hanging ornament; felt body and polyester fiberfill stuffing; snowman design; 5.5x4in

Model: D-38AMOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $2.66Description: Hanging ornament; felt body and polyester fiberfill stuffing; bear in sock design; handstitched; 4x2.5in

Model: D-3809AMOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $1Description: Hanging ornament; felt body and polyester fiberfill stuffing; snowman design; 5x3in

Model: D-473MOQ: 300 piecesPackaging: Polybag, cartonDelivery: 60 daysPrice: $2.56Description: Hanging ornament; felt body and polyester fiberfill stuffing; pony design; 4.5x4.5in

Sample page only

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Model:del: D-3809A3809AMOQ:Q: 300 pieces300 piecPackaging:ging: PolybagDelivery:D 60 dPrice:P $1Desc

For other inquiries E-mail: service@globalsources.comTelephone Hotline: (65) 6547-2800

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