SUSTAINABLE STRATEGIES FOR DEVELOPMENT...Value Chain, broken line indicates skipped functions...
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THE HAITI HANDICRAFTS VALUE CHAIN SUSTAINABLE STRATEGIES FOR DEVELOPMENT Karen Gibbs Ted Barber September 14, 2006
Transcript of SUSTAINABLE STRATEGIES FOR DEVELOPMENT...Value Chain, broken line indicates skipped functions...
THE HAITI HANDICRAFTS VALUE CHAINSUSTAINABLE STRATEGIES FOR DEVELOPMENT
Karen GibbsTed Barber
September 14, 2006
A MARKET-DRIVEN, VALUE-CHAIN APPROACH TOECONOMIC DEVELOPMENT & POVERTY REDUCTION
Based on• USAID Global Market Assessment for Handicrafts • USAID Haitian Handicraft Value Chain Analysis • Haitian handicraft development projects• First-hand market experience
Karen Gibbs• VP Marketing at Aid to Artisans• Co-founder & President of Mélange, an import-wholesale company • Craft marketing consultant
Ted Barber• Small & Medium Enterprise Advisor• Co-founder, Voyageur East Company, an import/trade consulting firm
WHAT THE MARKET WANTS:A GUIDE FOR DEVELOPMENT PROJECTS
• Excellent knowledge of market & customers
• Competitively position a handicraft sector development project
KNOW YOUR CUSTOMER
End consumer vs. direct customer
Price
Quantity
Artisan
Exporter
Importer/Wholesaler
Retailer
KNOW YOUR CUSTOMER’S NEEDS
Products
Design
Materials
Skills
Quality
Labeling/packaging
Services
COMMUNICATION
Product Development
Customer Service
Shipping/logistics
ADDRESS YOUR CUSTOMER’S NEEDS
• Recipe = Identify your customer +Determine what your customer wants + Develop what your customer wants +Deliver what your customer wants
• Success = repeat the recipe• First order: 18 months or more• Relationship: 5 years or more
ONE-TIME PURCHASE OR SUSTAINABLE BUSINESS?
Rwandan Baskets
Original Improved NewColor
New Function
New Line
VALUE CHAIN ANALYSIS: HAITIAN HANDICRAFTS
• Began with a market study
• Homework first!
• Interviewed range of market players
“End markets, particularly if they are outside of the country where the study is based, are often ignored or inadequately investigated.”
MARKET STUDY FINDINGS
• Key trends• What buyers want from suppliers• Market’s advice
Haiti• Can’t compete with China – focus on high-end• Are there qualified agents?• Leverage creativity, handiwork & proximity• Best way to compete: global style
““The only way for the artisan to survive is to tap into his or The only way for the artisan to survive is to tap into his or her own indigenous culture to find what is really unique.her own indigenous culture to find what is really unique.””
VALUE CHAIN ASSESSMENT
• Market side guided supply side
• Interviewed range of actors
• Mapped the sector
• Described roles & relationships
V egetable Oil Consumers
Retailing
W holesaling
P roces s ing
A s sem bly
P roduc tion
Input S upply
E x tens ion
Functions
Small Scale Producers
Medium-Scale and Commerc ial
Producers
V illage Stockis ts
Chimoio Retailers Supermarkets
Processors
LEGEND
= Partic ipant in the V alue Chain = Final Market
Produc tion = Market f unc tions
Input Supply Companies
Oil Processors w ith Cake By Produc t
Producer
A ssoc iations
Engineering Serv ices
Financ ial Serv ices
A gents and Brokers
Machinery and Equipment SuppliersTraders
Wholesalers
A nimal Feed Market
S e rvice P rovide rs
= Partic ipant in the V alue Chain, broken
line indicates skipped f unc tions
P ro ducer A ss o c iat io ns
NGOs
V egetable Oil Consumers
M ozam bique Oils eeds Indus try : B as ic V alue Chain M ap
• Missing actor found – agents exist
• Familiar constraints, from market information to raw materials & financing
• Surprising opportunity – local lamp-maker
• An SME at risk, yet opportunity remains
SUPPLY CHAIN FINDINGS
THE FULL VALUE CHAIN
• Treat customer & market as partners
• A value chain is a chain of relationships
ACCURATELY COSTINGVALUE-ADDED UPGRADES
• Demands of the “luxury” market are higher than the former “ethnic” market
• Costs of value-added propositions must insure margins sufficient for sustainability
MARKET-DRIVEN, VALUE CHAIN APPROACHFOR SUSTAINABLE DEVELOPMENT
• Begin & end with the market – what does it want?
• Assess the entire value chain – raw materials to final consumers
“Bottom line is it has to be business, business, business – a business project with a business frame of mind.”
THANK YOU!
Please visit www.microlinks.org/breakfast for seminar presentations and papers
Karen [email protected]
