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Peregrine Mitchell
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Countries» About» Contact us Nepal Sourcing: Handicrafts & Gifts Industry overview Nepal Nepal Sourcing: Garments Nepal Sourcing: Fashion bags Nepal Sourcing: Footwear Nepal Sourcing: Fashion

1 Countries» About» Contact us Nepal Sourcing: Handicrafts & Gifts Industry overview Nepal Nepal Sourcing: Garments Nepal Sourcing: Fashion bags Nepal Sourcing: Footwear Nepal Sourcing: Fashion accessories Nepal Sourcing: Handicrafts & gifts Suppliers & products Industry overview Export data Product features Supplier survey Trade associations PDF downloads All sourcing countries Philippines Vietnam India Nepal Nepal Sourcing: Handicrafts & Gifts Holiday crafts Promotional crafts Souvenirs & gifts Download PDF of page This section discusses key issues affecting export manufacturers in Nepal, offering insight into industry composition and important supply centers. Sections Highlights Nepal handicraft & gift exports Industry composition Nepal handicraft & gift suppliers Charts Handicraft & gift export value Supplier exports Supplier production Supplier locations map Click charts below to enlarge Stable overseas demand is driving the growth of the handicrafts and gifts industry in Nepal. Shipments over the past three years have been steadily rising despite erratic economic conditions in traditional markets. The expansion of several domestic manufacturers in new markets in the Asia-Pacific region is a key factor behind this development. Shipments to large economies such as the US and the EU also play a part but have slowed slightly over the past year due to financial difficulties in these destinations. Nonetheless, they still account for a considerable part of foreign revenue. Nepal handicraft & gift exports Robust sales in the US and EU propelled Metal craft exports shot up from $928 million to $937 million in Earnings from wooden items plummeted 18 percent to $89 million Local artisans are adept in various labor-intensive processes such as carving and metalwork Ready availability of plantbased materials keep prices competitive Acceptance of small MOQ Heavy reliance on imported fabrics, particularly wool and cotton Thinning labor force Insufficient electricity supply affect production efficiency Industry composition About one-third of supplier base is capable of direct exporting The majority of makers are locally owned Katmandu and Lalitpur are the primary sourcing hubs for handicrafts Nepal handicraft & gift exports The sector is divided into two primary groups: textile and nontextile products. Export data from the Federation of Handicraft Associations of Nepal or FHAN show that revenue from textile goods, which include pashmina, silk and woolen items, grew 4 percent to roughly $2 billion in the fiscal year. This was after the line recorded a 33 percent increase from the previous period. The expansion is largely credited to increasing orders from the West, particularly the US and the EU. Similarly, outbound shipments of nontextile items, which are mainly composed of metal, paper, wooden and ceramic crafts, went up 8 percent to $2.4 billion last year. In , foreign sales reached $1.7 billion, marking an improvement of close to 31 percent from the period prior. The US is the primary overseas destination for handicrafts, accounting for $14.2 million in turnover, down 17 percent from Despite the drop, major retail chains Macy s, Wal-Mart, Kmart and Pottery Barn have been boosting their purchasing activities in Nepal this year. Germany is the second-largest foreign market at $4.1 million. Japan rounds out the top three, absorbing $3.9 million. The sovereign debt crisis in Europe has slowed down exports to some EU members last year. It directly

affected sales of nonessential goods, particularly wooden and paper crafts, which declined 17 and 12 percent, respectively. Deliveries to the Netherlands plummeted 45 percent to $1.9 million.

Despite the negative figures, suppliers are optimistic that the sector as a whole will bounce back in the next 12 months amid recovering demand from the bloc.

2 affected sales of nonessential goods, particularly wooden and paper crafts, which declined 17 and 12 percent, respectively. Deliveries to the Netherlands plummeted 45 percent to $1.9 million. Income from the UK plunged 8 percent to $3 million. Despite the negative figures, suppliers are optimistic that the sector as a whole will bounce back in the next 12 months amid recovering demand from the bloc. The bullish outlook is also buoyed by increasing orders from the Asia-Pacific region, particularly mainland China, where basic and midrange models are popular. This development is favorable to domestic manufacturers as most of them specialize in these price points because of less-strict quality requirements. Other key destinations in the region include Hong Kong, Australia and New Zealand. Enterprises are also looking into alternative markets such as Russia, Chile, Ecuador, Guatemala and Honduras. One of the line s strongest suits is the high degree of craftsmanship of artisans. Because workers have extensive expertise in various production processes, particularly carving and metalwork, suppliers are able to elevate the value of items with traditional designs. The ability to incorporate indigenous materials in modern releases helps local companies generate more overseas orders. One of these is lokta paper, which is obtained from the bark of native evergreen shrubs. Sisal fiber is employed in fashion bags, carpets and baskets. Overseas demand for models made of plantbased inputs has been on the rise because they are perceived as sustainable. The industry also receives ample support from various trade organizations. The Export Promotion Center and FHAN regularly hold exhibitions to help members showcase their products abroad and in the domestic market. They also lobby for laws and policies deemed beneficial to the line, and conduct seminars and trainings. Another edge possessed by the sector is acceptance of small orders. Most companies allow an MOQ of five pieces for larger models such as statuettes and sculptures, and 20 pieces for promotional goods and souvenirs such as keychains, refrigerator magnets and mugs. Rival supply zones require at least 100 pieces for sales to proceed. The heavy reliance on imported materials is considered as the primary hurdle affecting the line. The majority of makers buy fabrics, specifically cotton and silk, from mainland China. Wool is mostly procured from New Zealand, and leather is bought from India. Embellishments such as glass beads, crystal and semiprecious stones are purchased from mainland China and the Czech Republic. Teak is obtained from Indonesia. Because of fluctuations in demand and supply, the costs of these inputs are likewise volatile. As such, some vendors would create an artificial shortage to drive quotes upward, justifying price adjustments. To save on outlay, some makers source raw components in bulk to avail of discounts provided by sellers. Others utilize recycled inputs such as scrap metal and repurposed wood to lessen expenses. The thinning labor force is also cited as a major concern. Makers have been finding it hard to hire skilled and semiskilled workers to expand their businesses as craftsmen seek better pay and opportunities abroad. The Ministry of Labor reported that about 36,000 people leave Nepal every month and pursue overseas employment, mostly for construction jobs in the Middle East.

3 Another difficulty facing the sector is soaring manpower spending. A tripartite committee consisting of employers, trade unions and government representatives has agreed to raise the monthly minimum salaries by about 30 percent. Pending final approval from the national administration, the adjustment will peg basic wages at roughly $90, which is the highest rate in South Asia. Workers in the sourcing hub of Uttar Pradesh in India receive $88 while employees in Bihar get $70 per month. Insufficient electricity supply is also compounding the misery of domestic companies. Frequent power outages, which last up to 18 hours during the dry season, bring down production efficiency in the industry by approximately 40 percent. While the majority of suppliers use generator sets to ease the problem, their competitiveness is suffering because of soaring diesel prices. These temporary energy sources are more expensive to operate at $0.25 to $0.30 per unit. Conversely, regular power is only about $0.07. To cope, manufacturers subcontract several processes to independent shops or areas seldomly experiencing blackouts. Nepal s unstable political environment is likewise hurting the competency of the sector. Tensions among government factions over various issues have often resulted in mass protests and work stoppages. This scenario affects the attractiveness of the country to foreign buyers. A general strike in mid-november forced about 70 percent of export-oriented industries to cease operations, prompting several overseas clients to cancel orders. Manufacturers point to intensifying price competition as another stumbling block. Domestic makers find it difficult to match quotes offered by their foreign counterparts, particularly from China and India, and supply centers in Southeast Asia such as Vietnam. To overcome this hurdle, suppliers are turning their attention to midrange and upscale models, which are popular in affluent nations in the West and the Middle East. Industry composition An official number of handicraft makers in Nepal is not available. There are, however, approximately 600 members of FHAN. More than 250 enterprises, on the other hand, are affiliated with the Export Council of Nepal. The majority of manufacturers are locally owned, with about 10 percent being joint ventures. Roughly one-third of the supplier base is capable of direct exporting. Small companies have two to 50 employees and can assemble up to 10,000 pieces per month. They generate $375,000 or less in total annual revenue. Midsize makers have a workforce of 50 to 200. They roll out 11,000 to 30,000 pieces every month. Yearly earnings are between $375,000 and $1.2 million. Large suppliers have more than 200 staff members. They create over 30,000 pieces monthly. Total income reaches more than $1.2 million annually. Each sourcing center in the country has its own specialization. Ceramic items are mostly fabricated in the district of Bhaktapur in Bagmati zone. The village of Newar is regarded as the home of the earliest-known potters in Nepal. The district of Taplegunj in Mechi zone is popular for products made of dhaka fabric, including bags and scarves. Artisans in the Bhojpur district of Kosi zone are famous for handmade khukuri knives. Supplier Locations Map

Nepal handicraft & gift suppliers Click company names below marked Active to view verified suppliers and products featured on Global Sources Online.

4 Nepal handicraft & gift suppliers Click company names below marked Active to view verified suppliers and products featured on Global Sources Online. Companies marked Listing have basic information on Global Sources Online. Suppliers featured on Supplier Status Holiday crafts Promotional crafts Souvenirs & gifts Bronze House Listing Guide Map International Pvt. Ltd Listing JB Art Center Listing Mandala Art & Kraft International P. Ltd Listing MSA Traders Listing National Handicraft Listing Nepal Crystal Legend Links Listing Nepal Traditional Handicraft Center Listing Newa Decor Listing Nyatapola Crafts Listing Oxford Craft Collection & Export Listing Rajesh Handicraft Listing Sai Baba Paper Craft Listing Siddhi Hastakala Udhyog Listing Sisters Creation Listing The Brave Gurkha Khukuri Cottage Listing Tuladhar Handicrafts Listing Uni-Crafts Pvt. Ltd Listing

Countries» About» Contact us

Countries» About» Contact us India Sourcing: Home decor Industry overview India India Sourcing: Table & dinnerware This section discusses key issues affecting export manufacturers in India, offering insight