Handicraft business in the UK

Handicraft disdain in the UKINTRODUCTIONThe objective of this report is to study and prepare the profession plan for a handicraft business in UK. This business plan deals with the feasibility analysis, idea gene dimensionn, and manufacturing analysis at both the local and global level to understand the tradeplace place and business factors.The grocery analysis is also done, primarily through the secondary sources to capture the potential demand of handicrafts in the UK grocery and the trends which the customer are sayinging for in this constancy. After analyzing the demand, the technical analysis was done for the business.For the success of any business, it is necessary that the idea or the basis of the plan should be strong. But it is also positive that the plan should condense into account a true picture of financials to maintain a strong foundation on which the business rump be create upon. Therefore in the report, a detailed preparation of cash flow analysis, profi tability analysis and the expected expenditure in the business has been taken precaution of. The report has taken into consideration the risk factor also which the business unavoidably to consider before commencing on the work.Handicraft is a business which ask not only financial capital but also human capital and it is necessary that skilled agitate is available in plenty. The attrition step is low in this industry provided they are provided with adequate support and wages. In the report I have tried to touch upon that issue as well. similarly the manner in which the harvestings would be change and promoted in the market would be taken care of. We would not be opening our own stores for now and would be selling on to other retailers. However the idea of opening the stores is not discarded as whole for now and would be seen as an option at a later(prenominal) stage in the life of the business. Heavy spending is planned to promote the products in the initial phase of the bu siness and various media vehicles would be tried upon to promote the products well in the market. The business as of now focusing primarily on the UK market and later on in the later stage, the business can be expanded further.Handicraft IndustryThe handicraft industry is one of the most productive arenas in the economy. The reason being that this sector not only uses the in the altogether materials but also give employment opportunities to a number of muckle. Thus not only financial capital and raw material is employed but also a lot of human capital is also used in this business (Garrison, 2008).According to United Nations Educational, scientific and Cultural Organization (UNESCO) International Symposium on Crafts and the International Market Trade and customs codification, Manila, Philippines, October 1997.Handicrafts can be defined as products which are produced every completely by hand or with the servicing of tools. Mechanical tools may be used as long as the direct manual section of the artisan remains the most substantial component of the finished product. Handicrafts are do from the raw materials and can be produced in unlimited numbers. Such products can be utilitarian, aesthetic, cultural, artistic and may have a social, religious and symbolic significance (Robertson, 2002).Industry AnalysisUK has been a country with a rich and several(a) culture. Lot of migrant population also resides in various parts of the country. It is because of this that handicraft industry has played an important role in this country. The industry provides stinting advantage much because of the demand from various strata of the population (Mathias, 2001).Handicrafts have always attracted people much because of their cultural importance and it crosses barriers too. The customers in any market look for handicrafts from not only the local market but also from the other countries (Barlow, 1991). Therefore both the cultural and financial evaluates are attached to this ind ustry. This industry by its mass and production scale lies in the middle class as not much finance and manufacturing facilities are needed in this business. The industry is decentralized and is labour intensive. Not many players fight in this market and only small players operate in this area. The sector employs a lot of people and thus acts as a middling of employment for lot of people. The sector has seen an increase in growth much due to the fact that people have been more open to the culture of other countries and are accepting it more often. The era of globalization has helped in the revival of this industry not only in the UK market but also in other markets too (Andrews, 2009).Classification of Handicrafts IndustryHandicraft products can be distinguished into the followingMetal downwoodwind instrument wareHand printed textilesEmbroidered and crocheted goodsShawlsCarpetsEmbroidered goodsBamboo productsZari goodsEar whereforeware and jute productsMiscellaneous handicraftsSWOT Analysis of Handicraft IndustryStrengthsMarket is diversified and has huge potentialPresence of large product variety because of various culturesLow capital investmentFlexibility in production of goods as per market demandLow barriers to the entry of new playersProducts sold are high value ones and have diversified usageWeaknessLack of coordination between government bodies and companiesInadequate information on the current market trendsLack of skilled labourOpportunitiesDevelopment of domestic tourism sector which helps in boosting sales.Usage of internet and other technologies in boosting the market potential insurrection demand because of people becoming more open to culturesThreatsLack of branding opportunities in this sectorThreats from the developing countries worry India and China in terms of resources profession PropositionWe would be dealing in the limited set of handicraft industry as many products come under its purview. Our companionship would come the needs of the c ustomers in only the wooden handicrafts market. The reason for choosing this is that in UK market these products are used almost in every home. Products like decorative chairs, desks, beds, sofas which are made by hand are seen as high value products in the market as customers look for nearthing different. Particularly for the UK customer, they need products which not only inspection and repair their functional purpose but also add something extra. It is with this that we plan to enter in this industry with this specific set of products.Wooden handicrafts refer to a capacious range of wooden items carrying utilitarian and artistic value that are made by hand o with the use of simple tools. They are made by unmatched workmanship, have fine designs and have subtle elegance. The products require low capital investment to manufacture. The wooden handicraft sector provides a high ratio of value addition and has emerged as one of the major sources of foreign exchange in the country too . (Sumption, 2010)Market AnalysisMajority of the current players in the market deal in almost all the product categories in the wooden handicraft industry. (Macleod, 2006)Retailing is not done by them and they deal in slackly the production part. They have retailing contracts with other partners which help them sell the productsMonthly production units are majorly in the range of thousands of units for all the products combinedWooden and methamphetamine handicrafts are majorly in demand in the UK market. (John, 2006)Inventories are usually kept low as these products are sold and produced in lower units in the market. close to all the players in the market hire the labor at a contractual basis rather than on a permanent basis.Many of the players take the route of exhibition to promote their products to the customers. (Mathias, 2001)These products are high margin products as they are primarily value found ones. Hence high margin and medium volume is generally the trend in the indu stryCompetitionThe following players currently operate in the market and sell wooden handicrafts in the market. origination Art and Crafts Ltd.Java ArtElements Ltd.Demand Analysis and ForecastingDuring our study we also analysed the demand pattern for the various products in the wooden handicraft market and it came to around 50000 units per month on approximation. There is a demand supply gap in the market as according to our supply the current players in the market are able to provide close to 30000 units only. Hence we consider a huge potential to be catch up in the market.(Boseley,2009)The market is growing closely at an annual rate of 15%. Hence it is decided that the capacity would be initially 60% for the first year and then it will grow accordingly.Marketing ChannelAs mentioned before, our business involves only manufacturing the products. Therefore we would use a network of retailers called partners to sell our products in the market. These would be mainly big retailers like WalMart, Tesco etc.Strategic Marketing PlanWooden handicraft particularly the furniture part is an unbranded commodity and hence manufacturers generally do not have to spend too much on the promotional part. It is better for them to increase the margin given to the retailers so that they push the company product more in front of the customers.However in order to differentiate our offering and to capture the customer base, it is necessary to have a grassroots strategic marketing plan. The following would be the strategies used by usSteady supply with timely delivery to fulfill the demand in the market thereby providing products with high qualityProducts would be given emphasis on the design front. Designs would be based on several themesOrders would also be taken online from the customers apart from being available in the retailThe company plans to both manufactures the products locally in the UK market as well as import some of it from the Indian market. Indians play a vital role in UK both in terms of trade and demographics and thus there is a market to serve the Indian community.The other reasons to source the products from India areThe demand for Indian wooden handicrafts is evergreen. It is both difficult for the labour in UK to produce these handicrafts as the design in Indian art work is quite intricate. Hence it is decided that some portion of our products would be sourced directly from the Indian producers, mainly based in states like Rajasthan and Madhya Pradesh.Indian being a developing country, both the labour and raw materials are quite cheap as compared to other developed countries. Hence it makes adept to outsource some of the production work.Indian artisans are well known around the innovation. British make a major portion of the people see India every year and hence they come in contact with Indian art and culture too. Thus getting products from market like India helps in grounds the customer taste and keep the product portfolio up to dat e.Some of the Indian players which have been shortlisted and considered for sourcing of the products are as followsKhan Arts IndiaMadnik InternationalGoyal IndiaIndus Trade oversewn CraftsAntiquity HandicraftsAll the products in the portfolio would be sourced from these six major exporters in India. These players have been selected after thorough search of their business and their financials. They enjoy good study in the Indian market and also export to other players in different countries. It is decided to have business with six players as it will help us diversify our risk and help us maintain a steady flow of products from India. These players are from different parts of the country and thus the products served by them would have different designs as India being a vast country has many sub cultures which attract many people worldwide.Technical AnalysisWood carving is a time consuming process as craftsmen take time to make every piece. The process may take a workweek to months d epending upon the level of intricacy in the design. The process use a lot of different tools also like saw, lathes, drills, chain saws etc.Machinery InvolvedThe following railroad carry would be used by the workers in the businessChemical treatment plantSeasoning plantSurface plannerGrinderDrillerGaze machineSanding machineStructure and Civil WorkLabour RequirementsHandicraft is a labour intensive product and thus a lot depends on the kind of labour employed.Financial AnalysisBasic Assumptions underlying the financial projectionsThe construction period will last one yearThe company would work 365 days a yearThe expected capacity utilization will be 60% in first year, 65% in second year and the increment based on past performance.The term add would be re-paid in 14 equal half-yearly installments. The interest rate on the outstanding term loan would be 12%The bank finance for working capital will cost interest rate 12%The depreciation rates for company law of nature purpose would b eBuilding 3.34%Plant and Machinery 8%Misc fixed assets 5%The suppliers for raw material would provide credit for 15 daysThe salvage value is assumed to be 5% of fixed assets.Sales ForecastSales Forecast (units)Year20102011 2012Units95001200015000ConclusionThe business plan has been prepared keeping in intellect all the factors and taking financials to the best of the present picture. It is therefore expected that the actual outcome would represent the true picture of this outlined plan.Finally, my personal interest in this field will lead to establish my own business. These will result in successful and sustainable business.ReferencesAndrews, J.(2009).Handel allinglese, Playbill,. 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