Industry Situationer,
Market Opportunities and
Challenges in the GDH Sector
NORA T. TORRALBA
OIC-Office of the Assistant Director
07 April 2015
1
Outline of Presentation
I Industry Overview
A. Product Coverage
1. Giftware
2. Holiday Decors
3. Housewares
B. Composition of the Industry
C. Characteristics of the Industry
D. Direction of Trade
E. Challenges/ Issues
II EMB Programs
2
A. Product Coverage
1. GIFTWARE
HS CODES
Description
9705009009
Collections and collectors pieces of micrometric interest
9705009001
Zoological, botanical mineralogical, anatomical, historical ethnographic
9704009000
Postage or revenue stamps
9702000000
Lithographs/original sculptures and statuary / original engravings
9701909009
Paintings /drawings and pastels executed entirely by hand
9618000000
Tailors dummies and other lay figures, other animated displays used for shop window dressing
9617001000
Vacuum flasks and other vacuum vessels
9602009002
Worked vegetable or carving material/moulded or carved articles of wax, natural gum/resins
9601902001
Worked capiz-shells/ ivory, bone, tortoise-shell, horn, antlers, coral, mother-of-pearl and other
animal carving material
9102190000
Wrist-watches, pocket watches
3
2. Holiday Decors
HS CODES
8539229003
9405300000
Description
Christmas tree bulbs
Lighting sets of a kind used for Christmas trees
9505109000
Other articles for Christmas festivities
9505900001
Articles of Easter festivities
9505900009
Other Festive, carnival or other entertainment articles.
4
3. Housewares
HS CODES
Product Line
6702900003
Artificial flower plants/trees
4602900009
Basketworks/wickerworks
6914900000
Ceramics
7013990000
Glass ( decorative items)
9617001000
Kitchenware/tableware
9618000000
Shellcraft
4421909909
Woodware
8306290009
Statuettes and other ornamental ceramics
5
B. Composition of the Industry
1. Firms in the Industry
Giftware: 2000 enterprises: 700 are exporters
Holiday Decors: 150 enterprises; 55 exporters
Housewares: 174 enterprises; 92 exporters
2. 99% privately owned; the rest operates as livelihood programs of
NGOs
3. 85% are micro and small enterprises; 15% are medium and large
4. Large companies employ at least 200 people
Medium companies employ at least 100 – 199 workers
Small companies 10 -99 people
Micro companies : 1-9 people
6
C. Characteristics of the Industry
1. Sectors are dominated by micro, small and medium
enterprises.
2. Production work is mainly manual and there is substantial
usage of subcontractors.
3. Raw materials used are sourced locally with few imported
components.
4. Inherent creativity and ingenuity of Filipinos particularly in
creative designs;
7
C. Characteristics of the Industry
5. Availability of skilled artisans and superior craftsmanship;
6. Ready access to highly skilled and highly trainable work
force;
7. Language proficiency, adaptability and flexibility.
8. Raw materials: Availability of a wide variety of indigenous
raw materials which are environment-friendly;
8
C. Characteristics of the Industry
9. Industry relies heavily on manual means of production and
not much investment in tools and equipment upgrade including
worker productivity upgrade.
11. Industry relies heavily on participation in trade fair both local
and international.
12. Presence of active industry associations like the various
chambers and associations that enable individual entrepreneurs
to network for information, marketing and training purposes as
exemplified by PCHI, PCCI, CDPEAP, HAPI and PHILEXPORT.
9
C. Characteristics of the Industry
10. Subcontracting is prevalent and quality fluctuates as
these are usually home-based family operations with
insufficient equipment or quality-control systems.
13. Main production hubs are: Manila, Cebu, Baguio and
Bicol region. Each area differs in terms of specialization
based on raw material availability. Natural components and
skilled laborers are abundant in these areas.
14. Government support program – marketing and technical
assistance through various agencies such as DTI, DOST and
TESDA.
10
D. Direction of Trade
Top PH Merchandise Exports
Furniture &
Furnishings
1%
Coconut Products
3%
Motor Vehicles &
Parts
3%
TAFT
4%
0%
2014
Others
24%
Chemicals
5%
Mineral
6%
Total US$61.81 B
Electronics
47%
Food
7%
Primary Source: Philippine Statistics Authority
Processed by: Export Marketing Bureau
11
% Share of Giftware/Holiday Décor, Housewares Exports in 2014
Construction
6%
Total US$ 61.81B
Wearables
1%
Others
23%
Natural/organic
0.82%
Motor
Vehicle Parts
7%
Minerals
7%
Traditional Products
Food
Other Products 5%
Others
Marine/Carageenan
2%
Housewares
0.17%
PEDP Revenues Streams
Electronics
47%
Giftware/Holiday
Décor
0.59%
12
Philippine Exports of Giftwares
Value in US$ Million
300.00
251.95
250.00
189.98
200.00
204.94
150.00
100.00
62.42
66.83
50.00
0.00
2010
2011
2012
2013
2014
13
Export Markets of Philippine Giftwares (% Share)
Others
24%
United States of
America
58%
UK Great Britain
and N. Ireland
3%
Canada
4%
Netherlands
4%
Japan
7%
14
Breakdown of Giftware Exports (% Share)
Other clock or watch parts
2%
Manufactures of
animal shells
2%
Tableware
Ceramic
2%
OTHERS
13%
Statuettes and
other ornaments,
of wood
4%
other wrist watches
45%
Tableware and
kitchenware, of
wood
5%
Worked capiz shells
6%
Original
sculptures and
statuary
6%
Statuettes & other
ornamental articles
8%
With mechanical display
only-watches
7%
15
TMX Phils., Inc.
Robles Heritage, Inc.
16
Philippine Exports of Holiday Decor
Value in US$ Million
60.00
50.68
50.00
40.00
29.91
43.08
34.48
30.54
30.00
20.00
10.00
0.00
2010
2011
2012
2013
2014
17
Export Markets of Philippine Holiday Decor (% Share)
UK Great Britain
and N. Ireland
1%
Russian
Federation
1%
Others
7%
Canada
2%
Japan
3%
United Staes of
America
86%
18
Breakdown of Holiday Décors Exports (% Share)
Articles of Easter
festivities
14%
Other articles
for Christmas
festivities
28%
Other Festive,
carnival or other
entertainment
articles.
0%
Lighting sets of a
kind used for
Christmas trees
58%
19
Takara Arts & Crafts
Everbright Lighting Phils., Inc.
Duru’s Industries Corp.
Takara Int’l. Export Corp.
20
Philippine Exports of Housewares
Value in US$ Million
140.00
113.21
120.00
100.00
136.01
130.64
106.47
87.48
80.00
60.00
40.00
20.00
0.00
2010
2011
2012
2013
2014
21
Export Markets of Philippine Housewares (% Share)
Canada
2%
Singapore
3%
%
others
17%
USA
43%
Japan
30%
Australia
5%
22
Breakdown of Housewares Exports (% Share)
Other wood and articles
wood charcoal
2%
Parts Other Table,
kitchen
2%
Others
13%
Tableware, kitchenware,
other household articles
23%
Wood marquetry and
inlaid wood
3%
Sanitary towels, tampons
and similar articles
3%
Parts for Brooms,
brushes
3%
Baskets and basketware
container Of vegetable
materials
21%
Other Basketwork,
wickerwork and other
articles
7%
Baskets and basketware
containers Of other
materials
7%
Coasters, abaca
16%
23
Juken Sangyo (Phils.) Corp.
C C C P Industries
24
#1 USA
Products
2013
2013
Exports
% Share
(US$
in World
thousand) Exports
USA Imports
from World
(US$
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Giftware
•Animal carving
material (o/t
ivory), and
articles of these
materials
(960190)
12,142
17
32,324
•Original
sculptures and
statuary, in any
material (970300)
5,812
0.2
1,124,892
1.PH (9,817-30.4%)
2.China (5,834-18%)
3.India (5,826-18%)
5.Vietnam
(1,275-3.9%)
6.Indonesia
(1,202-3.7%)
1.France (356,12331.7%)
2.UK (196,871-17.5%)
3. Germany (137,95712.3%)
23. Thailand
(3,638-0.3%)
32.Singapore
(1,935-0.2%)
36.Indonesia
(847-0.1%)
47.PH (422-0%)
#2 JAPAN
2013
Exports
(US$
thousand)
2013
% Share
in World
Exports
Japan
Imports
from
World
(US$
thousand)
•Wristwatches,battery/
accumulator
powerd w
mechanical
display only nes
(910211)
1,574
1.4
713,443
1. China (337,02347.2%)
2. Switzerland
(322,950-45.3%)
3. Hongkong (12,8581.8%)
4.Thailand (11,8231.7%)
8.PH (2,627-0.4%)
11.Singapore (6110.1%)
12.Malaysia (4930.1%)
•Animal carving
material (o/t
ivory), and articles
of these materials
(960190)
757
17
15,192
1. China (4,06626.8%)
2. Taipei (2,65617.5%)
3. Korea, Republic
(1,441-9.5%)
4.Vietnam
(1,177-7.7%)
5.PH (1,1477.6%)
9. Indonesia
(822-5.4%)
Products
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Giftware
#3 Netherlands
Products
Netherlands
2013
2013
Imports
Exports
% Share
from World
(US$
in World
(US$
thousand) Exports
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Giftware
•Animal carving
material (o/t
ivory), and
articles of these
materials
(960190)
•Wristwatches,battery/a
ccumulator
powerd w
mechanical
display only nes
(910211)
373
17
3,726
6,618
1.4
119,959
1. Germany (2,41364.2%)
2. Belgium (3729.9%)
3. PH (261-6.9%)
9. Indonesia (521.4%)
1. China (47,61639.7%)
2. Switzerland
(27,899-23.3%)
3. Hongkong
(22,116-18.4%)
14. Singapore (
410-0.3%)
18.PH (1080.1%)
19.Finland (1040.1%)
#1 USA
2013
Products
USA Imports
from World
Exports
(US$
thousand)
2013
% Share
in World
Exports
(US$
thousand)
7,352
0.3
2,052,719
1,599
0.4
844,287
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Holiday Decor
• Articles for
Christmas
(950510)fs
•Festive,carnival o
oth entertainment
art incl conjurg
tricks&nov jokes
(950590)
1.China (1,902,02492.7%)
2.India (20,836-1%)
3.Taipei (17,909-0.9%)
6.Thailand (14,283-0.7%)
7.PH (13,630-0.7%)
7.Germany (11,468-0.6%)
1.China (783,393-92.8%)
2.Mexico (12,116-1.4%)
3.Canada (6,928-0.8%)
5.Vietnam (5,165-0.6%)
6.Thailand (4,079-0.5%)
8.PH (3,637-0.4%)
#2 JAPAN
2013
Products
Japan
Imports from
World
Exports
(US$
thousand)
2013
% Share
in World
Exports
1,340
0.3
41,183
1.China (37,943-92.1%)
2.Vietnam (603-0.3%)
3.Thailand (558-1%)
4.Germany (268-1.4%)
5.PH (240-0.3%)
6.Estonia (238-0.1%)
806
0.4
14,238
1.China (11,525-80.9%)
2.USA (910-6.4%)
3.Taipei (601-4.2%)
10.France (28-0.2%)
11.PH (22-0.2%)
12.Mexico (19-0.1%)
(US$
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Holiday Decor
• Articles for
Christmas
(950510)fs
•Festive,carnival o
oth entertainment
art incl conjurg
tricks&nov jokes
(950590)
#3 CANADA
2013
Products
Exports
(US$
thousand)
2013
%
Share
in
World
Exports
Canada
Imports from
World
(US$
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Holiday Decor
• Articles for
164
0.3
255,136
1.China ( 231,05990.6%)
2.USA (5,974-2.3%)
3.Austria (4,314-1.7%)
5.India (3,133-1.2%)
6.PH (1,331-0.5%)
7.Mexico (1,070-0.4%)
311
0.4
141,072
1.China (115,201-81.7%)
2.USA (17,469-12.4%)
3.Taipe2 (1,338-0.9%)
5.Indonesia (763-0.5%)
6.Vietnam (655-0.4%)
15.PH (168-0.1%)
16.Cambodia (113-0.1%)
Christmas
(950510)fs
•Festive,carnival o
oth entertainment
art incl conjurg
tricks&nov jokes
(950590)
#1 USA
2013
Exports
(US$
thousand)
2013
% Share
in World
Exports
USA Imports
from World
•Basketwork,
wickerwork and
other articles,
made directly to
shape from
(460219)
8,728
1.4
225,139
•Basketwork,wick
erwork&other
article made up
from oth plaited
materials(460290)
5,380
Products
(US$
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Housewares
1.China (146,323-65%)
2.Vietnam (30,92313.7%)
3. PH (23,919-10.6%)
2.9
185,037
1.China (108,58358.7%)
2.India (27,572-14.9%)
3.Thailand (23,20012.5%)
4. Indonesia
(9,342-4.1%)
4. Vietnam
(15,209-8.2%)
8. Indonesia
(572-0.3)
9.PH (325-0.2%)
#2 JAPAN
2013
Exports
(US$
thousand)
2013
% Share
in World
Exports
Japan
Imports
from
World
(US$
thousand)
•Basketwork,wick
erwork&other
article made up
from oth plaited
materials
(460290)
2,220
2.9
15,586
1. China (14,54493.3%)
2. Vietnam (520-3.3%
3. Indonesia (149-1%)
•Basketwork,
wickerwork and
other articles,
made directly to
shape from
(460212)
2,163
5.2
17,708
1. China (12,28269.4%)
2. Vietnam (5,22329.5%)
3. Indonesia (840.5%)
Products
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Housewares
6. Thailand (700.4%)
7. PH (48-0.3%)
8.Germany (410.3%)
4.Thailan ((580.3%)
6. India (100.1%)
7.PH (6-0%)
#3 AUSTRALIA
2013
Products
Exports
(US$
thousand)
2013
%
Share
in
World
Exports
Australia
Imports
from
World
(US$
thousand)
Competition (Supplying Countries’
imported Value US$), their market
shares, and PH closest competitors)
Housewares
Basketwork,wicker
work&other article
made up from oth
plaited materials
(460290)
166
2.9
4,575
1.China (3,424-74.8%)
2.Vietnam (763-16.7%)
3.Indonesia (97-2.1%)
5. Ghana (47-1%)
6.PH (32-0.7%)
7.Hongkong (26-0.6%)
11.Thailand (12-0.3%)
Basketwork,
wickerwork and
other articles,
made directly to
shape from
(460212)
149
6.7
2,429
Indonesia (1,072-44.1%)
2.China (473-19.5%)
3.PH (420-17.3%)
4.Vietnam (218-9%)
Challenges/ Issues
A. Price competition
B. Stiff competition from other countries producing similar
products (China, Korea, Thailand, Indonesia, Vietnam and
India)
C. Lack of standardization in raw materials
D. Availability of raw materials
34
Challenges/ Issues
E. Companies have outdated machinery and processes
F. Limited volume of productions
G. Lack of organized sources of information on market and
product trends and slow diffusion of available information;
fear of change; lack of vision
H. Lack of financing schemes for SMEs
35
Challenges/ Issues
I. Lack of product research and development initiatives;
knowledge on market trends, environmental, technical, sizing
and global standards requirements
J. Piracy of Filipino skilled labor
K. Entrepreneurial skills of SMEs
L. Downtrend in Philippine exports
36
Challenges/ Issues
M. Since most companies are SMEs, they have insufficient
export promotion funds
N. Availability of manpower since many laborers are not on
regular employment due to the seasonal production
schedule.
O. The present level of materials handling skills is still
insufficient leading to wastage.
37
EMB Programs
A.RIPPLES – Regional Interactive Platform for
Philippine Exporters
B. NEPP – National Exporters Profiling Program
C. DBFTA – Doing Business in Free Trade Areas
D.PECP – Philippine Export Competitiveness Program
E. Business matching
F. Outbound Business Missions
G.Inbound Business Missions
38
Thank you very much!
39