Sourcing Report: Philippines - Home Decor

12 Sep 2011 • by Natalie Aster

Intense competition overseas is pushing home decor makers in the Philippines to change production strategies and shift focus to upscale and specialty markets.

Aware of the industry’s limitations, the government and several trade groups are encouraging local enterprises to move away from low-end manufacturing. Further, greater emphasis is placed on models intended for overseas destinations that have sizeable demand for high-value products.

The sector is supported by a number of competitive advantages, which are seen to play important roles in the upmarket shift. Domestic companies are skilled in turning out distinctive designs. These items are typically made of natural materials and recycled components obtained from local vendors.

The report “Sourcing Report: Philippines - Home Decor by Global Sources covers the main types of home decor available in the Philippines, including handicrafts, home furnishings, outdoor ornaments, and pottery and vases. Each product category has its own price guide that describes features of models for the low end, midrange and high end.

Key findings:

  1. Philippine exports of home decor are on the upswing after suffering heavy losses in 2008 and 2009 due to the global economic crisis. Because of improving business climate in major foreign markets, shipments in 2010 climbed more than 10 percent compared with the previous year.
  2. New destinations abroad are expected to account for an increasingly larger share of revenue as the sector emphasizes the highend and niche segments. These include countries in the Middle East and the EU. Russia is likewise being targeted.
  3. Despite the shift, traditional markets are seen to take up the bulk of overseas trade in the next 12 months. Exports to North America, the EU and the Asia-Pacific region are predicted to represent at least four-fifths of total sales. Suppliers interviewed for this report indicate that established customers in such places will remain the priority even while they expand footholds in new destinations.
  4. Models combining a range of elements will be the emphasis for most manufacturers in the coming year. These include items available in different natural materials, and have both ornamental and utilitarian properties.
  5. Product prices are forecast to stay generally level over the next six months. The majority of enterprises anticipate to adopt this strategy to maintain buyer interest in old markets and ensure competitiveness in new ones.

Report Details:

Sourcing Report: Philippines - Home Decor

Published: July 2011
Pages: 84
Price: US$ 75.00

Report Sample Abstract

Supplier profiles: Alice Blue Candle Inc.

Alice Blue has been producing and exporting scented candles since 2005. The company generated $30,000 in total revenue last year. The entire line is sent abroad. One-half of shipments are delivered to Japan.

Accounting for 45 percent, the EU is the second-largest overseas destination. France and Germany are the biggest markets in the area. The rest goes to South Africa. Aside from scented candles, the supplier manufactures home furnishings such as decorative wax melters, tealight holders, room sprays and air fresheners.

Prices range from $2 to $8. Scented candles start at $2.30 and reach up to $7, depending on the size and fragrance load. Candle holders are offered for at least $4. Soy wax for candles is imported from the US. Essential oils are sourced from Negros Occidental province. Ceramic comes from suppliers in Antipolo city of Rizal province.

The enterprise hires a part-time designer who creates up to five models a month. Samples are usually completed within two weeks. All manufacturing stages for candles are performed in the 300sqm factory in Metro Manila’s Mandaluyong city. Candle holders are processed by subcontractors and transported to the workshop for finishing and QC. There are 10 permanent staff members. They are complemented by four part-time workers when large orders are placed. QC is carried out on all finished items.

Alice Blue can produce as many as 36,000 pieces a month. Customized packaging is accepted. Cartons, however, are normally used. The minimum order requirement is $1,500. Delivery is completed between 30 and 90 days.

The company regularly joins the Manila Furnishings and Apparel Manufacturers’ Exchange trade shows and GIFTEX World in Japan.

More information can be found in the report “Sourcing Report: Philippines - Home Decor” by Global Sources.

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