Post on 01-Dec-2014
ACKNOWLEDGEMENT
I feel deeply indebted and grateful to my esteemed course
Mentor and Guide Prof. Amalendu Jyotishi and Prof. Girish.M for
the Guidance and Encouragement provided to me during the
Course of my project.
I wish to express my gratitude and sincere thanks to esteemed
Project guide and Mentor Mr. K.K. Sinha (Chairman & Managing
Director), Mr. Nirmal Sinha (General Manager), Dr. B.M. Prasad
(Manager – P&A) and Smt. Annu Bhogal (Company Secretary)
for their exemplary and encouragement throughout the making of
this project.
In the end I will thank my parents who gave me all the required
support while making the project.
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THANK YOU
Hanish Goswami
DECLARATION
I declare that this project on “THE HANDICRAFTS AND HANDLOOMS EXPORT CORPORATION OF INDIA LIMITED” is a record of my own work, which was carried out by me under the guidance of Prof. Amalendu Jyotishi and Prof. Girish.M. I have prepared this report during my internship programme (12th March to 19th April). It is a partial fulfillment of the requirements towards the award of Masters in Business Administration, Ohio University, Athens, USA.
I also declare that this project is the result of my own effort and that it has not been submitted to any other university for any other degree.
Place: Bangalore Hanish Goswami
Date:
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CONTENTS
The Background………………………………………………………………………5
The Organization……………………………………………………………………..9
Main Products………………………………………………………………………..13
Financial Analysis……………………………………………………………………21
Marketing Strategy…………………………………………………………………38
Financial Problems………………………………………………………………….40
Scenario Analysis……………………………………………………………………42
Perspective Planning……………………………………………………………….44
Identified Problems of Research………………………………………………..48
Conclusion…………………………………………………………………………....52
Recommendations………………………………………………………………….55
Bibliography………………………………………………………………………….59
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EXECUTIVE SUMMARY
The Handicrafts and Handlooms Export Corporation of India Limited
Is a Central Public Sector Undertaking under the administrative control of the
Ministry of Textiles, Government of India. Its objective is to undertake
exports of handicrafts, handlooms products, khadi and products of village
industries from India as supplement to private voluntary effort. The
Corporation brings to us the masterpieces with finesse of human creativity in
authentic and rarest forms.
The main objective of the internship is to have a good corporate exposure.
This report describes the Corporation in general and consists of various
sections. I have started by describing the history of Art, Handicrafts &
Handlooms in India which gives a brief idea about them. After that, I
continued with Company profile which includes the mission, vision,
objectives, liaisons and their products profile. Then, I discussed the Financials
with the help of certain charts, graphs and tables which is followed by
marketing strategy, current scenario and its future prospects. In the end, I
gave my own conclusions & recommendations by interpretating the available
data and internal scanning of the Corporation.
While working in the organization, I saw how the things worked
systematically in a Government organization, how people respond to tough
situations and how efficiently the management takes important decisions. I
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was given the opportunity to work in different departments where I came to
know about the certain departments in detail.
During the internship programme, I found out that overall the corporation is
doing well, however, there are some areas which needs proper attention.
There are some marketing problems which need to be looked upon. The
Corporation is taking certain steps to fix these problems.
BACKGROUND
Art and Crafts comprises of a whole host of activities and hobbies that are
related to making things with one's own hands and skill. These can be sub-
divided into handicrafts or "traditional crafts" (doing things the old way) and
handlooms. Some crafts have been practiced for centuries while others are
modern inventions.
The ground of art history was developed in the West. The oldest existing art
forms include small sculptures and paintings on rocks and in caves. The
earliest examples of ancient art developed from Mesopotamia and Egypt.
Art is basically an outward expression of one’s creative qualities and is an
outcome of our hidden talents. It is a medium of creating beautiful and
momentous qualities. Though art and artistic excellence is something
acquired and inborn, it can still be learnt by regular practice and minute
observation. It always stimulates our emotions, beliefs, thoughts, and ideas
through our senses.
Craft refers to the products of artistic production or creation that require a
high degree of tacit and technical knowledge. Most crafts require a
combination of skill, speed, and patience.
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Indian Crafts have an importance of their own. They express the great
tradition of our cultural heritage. In India, it is believed that
Craftsmanship=Plato’s idea of specialization onto which the lower society has
a specific job in society. In India, craft is always associated with art.
The traditional characteristics are very much predominant in Indian
Craftsman. A Craftsman inherits his technical skill generally from his father or
grand father who may have inherited their technical skills from their
forefathers. The process of transmission of skill from generation to generation
is a very important factor in the history of Indian Craftsmanship. The
Craftsman is considered as an organic element in the national life of our
country.
HANDICRAFTS
Handicrafts occupy an important place in the country’s economy as they
contribute significantly to the Employment generation and Export earnings.
India has a rich history of handicrafts that has evolved over the centuries.
The entire wealth of timeless Indian handicrafts has survived through ages.
The legacy of Indian culture promises everything- Beauty, Dignity, Form and
Style.
Handicrafts are described as the craft of the people. In India, it is not an
industry but it is a creation symbolizing the inner desire and fulfillment of the
community. While handicrafts i.e. Metal ware, pottery, mats or wood-work
serve a positive need in the daily life of the people, they also act as a vehicle
of self-expression.
The handicraft tradition in India has revolved around religious beliefs, local
needs of the commoners as well as the special needs of the patrons and
royalty, along with an eye for foreign and domestic trade. These handicraft
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traditions have withstood the ravages of time and numerous foreign
invasions and continue to flourish till date.
During the Indus Valley Civilization, India had a rich craft tradition as well as a
high degree of technical excellence in the field of pottery making, sculpture
(metal, stone and terracotta), jewelry, weaving etc. The craftsmen not only
catered to all the local needs but surplus items were sent to ancient Arabian
cultures. In the Vedic Age, there were numerous references in the Vedas on
artisans involved in pottery making, weaving, wood crafting etc. The Rig Veda
in particular refers to a variety of pottery made from clay, wood and metal. It
also refers to weavers and weaving.
The Gupta Age witnessed the classical period in Indian history which includes
the rock cut temples of Ellora and the Ajanta murals. These murals gave us a
realistic view of the lifestyle of that time. The craftsmen of that period
excelled in jewelry making, woodcarving, sculpture, stone carving and
weaving.
The Golden period in the history of Indian Art, Craft and Culture was the
Mughal Era. The Mughals not only invaded India and ruled it but also brought
with them a rich heritage. They introduced new techniques like inlay work,
glass engraving, carpet weaving, brocades and enameling. The famous
Peacock Throne of the Mughals is one of the finest examples of gem inlay
work and metal craft, having few parallels in world art. They also laid the
foundation for the famous Mughal miniature painting, Petra dura or inlay
work, enameled jewelry and a host of other craft traditions, many of which
continue today.
The artisan was an important factor in the equation of Indian society and
culture. By performing valid and fruitful social functions for the community,
he earned a certain status and a responsible position in society. The bold
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local styles that the village artisans evolved operated as a great lever in the
evolution of Indian art adding to the wealth and variety of color and design.
The craftsman was the unbroken link in the tradition that embraced both the
producer and the consumer within the social and religious fabric. Art was
deeply rooted in them. Thus, Indian handicrafts express a great national
heritage.
HANDLOOMS
Handloom constitutes a timeless facet of the rich cultural heritage of India. As
an economic activity, the handloom sector occupies a second place after
agriculture in providing livelihood to the people. The element of art and craft
present in Indian handlooms makes it a potential sector for the upper
segments of domestic as well as global markets.
Handlooms are an important craft product and comprise the largest cottage
industry of the country. Million of looms across the country are engaged in
weaving cotton, silk and other natural fibres.There is hardly a village where
weavers do not exist, each weaving out the traditional beauty of India’s own
precious heritage.
Handloom also forms a precious part of the generational legacy and
exemplifies the richness and diversity of our country and the artistry of the
weavers. The strength of handloom lies in introducing innovative designs,
which cannot be replicated by the Power loom sector.Tradition of weaving by
hand, is a part of the country’s cultural ethos. Handloom is unparalleled in its
tradition and versatility, permitting experimentation and encouraging
innovation. Innovative weavers with their skillful blending of myths, faiths,
symbols and imagery provide their fabric an appealing dynamism.
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In the world of handlooms, there are Madras checks from Tamil Nadu, ikats
from Andhra and Orissa, tie and dye from Gujarat and Rajasthan, brocades
from Banaras, jacquards from Uttar Pradesh and phulkari from Punjab.
Despite this regional distinction, there has been a great deal of technical and
stylistic exchange. The states of Kashmir and Karnataka are known for their
mulberry silk. The Kashmiri weavers are known for Pashmina and Shahtoosh
shawls all over the world. These shawls are of fine quality, unbelievably light
and warm.
India also produces a range of home furnishings, household linen, curtain
tapestry and yardage of interesting textures and varying thickness. Since we
know the wide and exciting range of handloom, it is not surprising that the
rich and beautiful products of the weavers of India have been called
“EXQUISITE POETRY IN COLORFUL FABRICS”.
THE ORGANISATION
THE HANDICRAFTS & HANDLOOMS EXPORTS CORPORATION OF INDIA LTD. Is
a Central Public Sector Undertaking under the administrative control of the
Ministry of Textiles, Government of India.
It was established in the year 1958 as Indian Handicrafts Development
Corporation Ltd (IHDC) and Incorporated as a Private Ltd. Co. in June 1962 as
a subsidiary of State Trading Corporation (STC).In May 1991, it De-linked from
STC and made an independent PSU under the Ministry of Textiles.
HHEC is a trading house in the export of Handicrafts and Handloom products
(including Hand knotted woolen carpet and ready made garments) besides
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undertaking export of Gold and Silver Jewelry articles. In the year 1997-98,
HHEC along with ten agencies was nominated for import of bullion under
OGL, and sale in the domestic market. In keeping with its plan for
diversification, HHEC also undertook import of mulberry raw silk.
MISSION
To develop, promote and aggressively market the products of Indian crafts
and skills abroad thereby providing a marketing channel for craftsmen and
artisans.
VISION
Endeavor to promote India aggressively in the world arena and create
demand for craftsmanship products by continuously adapting supply to the
changing consumer habits of the demand countries.
On a continuous basis, allocate resources to help new products in India and
market them to the world, thus creating opportunities for manufacturers
/craftsmen and other private players in India.
Act as a marketing arm for exports from manufacturers/ craftsmen who
cannot afford having their own marketing set-ups.
Consistently supply buyer’s products of high quality, right price and on
schedule thus keeping up the image of Indian products in the world market.
OBJECTIVES
To undertake exports of handicrafts, handlooms products, khadi and
products of village industries from India as supplement to private voluntary
effort.
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To undertake special promotional measures in countries whose import
potential for Indian handicrafts products, khadi and products of village
industries has not been adequately tapped.
To trade in and carry on business in goods of the nature which may seem
to the company capable of being conveniently and profitably carried on by
the company.
VALUES Buyer’s satisfaction.
Transparency and courtesy.
Prompt and professional service.
Compassion and better business sense.
COMMITTMENTS
They are committed
To provide quality merchandise to foreign buyers within the stipulated
delivery schedule.
To provide avenues for better prices to the artisans, weavers and craft persons. To provide technical, financial, marketing and other assistance to the
artisans, weavers, crafts persons and foreign buyers.
To improve the profitability of the Corporation and to give the
Government better returns for the money invested by it.
To ensure original handmade/ crafted products of Indian origin.
To ensure revival of languishing art & craft of India.
BRANCHES IN INDIA
HHEC Offices are located in different parts of India. The main branches are in
Registered Office in New Delhi
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Corporate Office in New Delhi
Chennai Regional Office
Mumbai Regional Office
Kolkata Regional Office
Bhadohi Branch Office
Ahmedabad Branch Office
Srinagar Branch Office
ORGANISATION HIERARCHY
BOARD OF DIRECTORS
Chairman and Managing Director Shri K.K. Sinha
Directors Shri Jamini Kumar Sharma, IAS
Smt.Sarita Mittal Shri B.P.Singh, IAS General Managers Shri Apurva Verma, IAS
Shri Nirmal Sinha
Company Secretary Smt. Annu Bhogal LIASONS
Ministry of Textiles
Ministry of Commerce
Standing Conference on Public Enterprises
Office of the Development Commissioner (Handicrafts)
Office of the Development Commissioner (Handlooms)
All PSUs under the Ministry of Textiles
Indian Trade Promotion Organization
Export promotion Council for Handicrafts
Wool & Woolen Export Promotion Council
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Carpet Export Promotion Council
All State Emporia
Various Councils in India and Abroad
Foreign Missions- Indian Embassies etc.
MAIN PRODUCTS
The organization deals in
HANDICRAFTS PRODUCTS
HANDLOOM PRODUCTS
GARMENTS
FLOOR COVERINGS
CARPETS
LEATHER
HANDICRAFTS13
Handicrafts occupy an important place in the country’s economy as they
contribute significantly to the Employment generation and Export earnings.
India has a rich history of handicrafts that has evolved over the centuries. In
India, it is not an industry but it is a creation symbolizing the inner desire and
fulfillment of the community. While handicrafts i.e. Metal ware, pottery, mats
or wood-work serve a positive need in the daily life of the people, they also
act as a vehicle of self-expression.
HHEC has been involved for the past four decades in development and
exports of handicrafts utilizing the crafts skills from all over India to create
visually appealing and economically suitable products for the world markets.
The main products of HHEC are Wooden, stoneware, metal ware, glassware,
papier machie, glassware, clay, terracotta, ceramics and their various blends
as objects of art and utility.
HANDLOOMS
Handloom constitutes a timeless facet of the rich cultural heritage of India. As
an economic activity, the handloom sector occupies a second place after
agriculture in providing livelihood to the people. The element of art and craft
14
present in Indian handlooms makes it a potential sector for the upper
segments of domestic as well as global markets. They are considered as an
important craft product and comprise the largest cottage industry of the
country.
HHEC has an exhaustic range of fabrics for dress ware and home furnishing in
cotton, silk, wool and various blends. This range includes woven, checks,
stripes, textures, dobbies, jacquard, prints, embroideries, Tie & Dye and other
embellishments.
Design Style-Printed, Woven, Embroidered, Other embellishments & Mix
Media.
GARMENTS
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The term “Textile” is a Latin word originating from the word “texere” which
means “to weave”. Textile refers to a flexible material comprising of a
network of natural or artificial fibers, known as yarn. Textiles are formed by
weaving, knitting, crocheting, knotting and pressing fibers together.
Indian textile enjoys a rich heritage and the origin of textiles in India traces
back to the Indus Valley Civilization. The textile industry is the largest
industry of modern India. It accounts for over 20 percent of industrial
production and is closely linked with the agricultural and rural economy. It is
the single largest employer in the industrial sector employing about 38
million people. The contemporary Indian textile not only reflects the splendid
past but also cater to the requirements of the modern times. Knitted
garments are extremely popular in the modern fashion scene. Modern design
has a major impact on knitwear and made it an exciting area of modern
fashion trends.
HHEC has state of art production based in Chennai and Delhi. They have
exported to some of the leading designer houses and garments importers in
the U.S.A., Europe and Japan. Their range includes sports wear, casual wear
and formal wear in Cotton, Rayon, Silk, Wool and other blended fabrics. The
fabrics used to manufacture garments include all type of fabric used for
exports markets mainly using georgette , moss crepe, cotton crepe , rayon ,
voile and terry voile, polyester fabric for prints and solid colors.
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FLOOR COVERINGS
Pleasing to the eye and soothing for the mind, the floor coverings of India are
heart-winners. India offers a wide range of floor coverings that have evolved
over the centuries to suit a variety of tastes, climates and budgets. Being
mostly export- oriented, the weavers can produce almost any design.
HHEC offer a vast collection of floor coverings from every part of India,
comprising of:
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Dhuries- Cotton, Wool, Jute (In woven, printed, and tie & dyed designs)
Floor Mats- are available in cotton chenille and jute blends.
Chain Stitched Rugs- are available in wool on cotton base floral, kelim and
contemporary design.
CARPETS
Woolen carpets were known in India as early as 500 B.C. References to
woven mats and floor coverings can be found in ancient and medieval Indian
literature. But the most famous type of Indian carpets, pile carpets came to
India in the reign of Akbar in 16th century. The Indian carpets are considered
most technically accomplished classical carpets. The carpet weavers over the
time have grown artistically. Indian Carpets are renowned for their exquisite
designs, elegance, attractive colors and workmanship.
HHEC is the pioneer export house which introduces Indian hand woven
carpets to the world markets. Their range includes a vast array of designs:
Traditional- (in wool and silk)
Tribal- (Gabbech)
Tufted- (An Indo Nepal Variety)
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LEATHER
Leather tanning as art form reached its zenith in India by 3000 B.C. The
earliest skins used were of tiger and deer. This is an old hereditary craft and
is probably as wide spread as earthenware. Because of its wide prevalence in
the rural areas, much of the tanning is locally done by indigenous methods
which are pretty laborious. HHEC range comprises of Gift-ware, Furniture,
Office table and Fashion accessories in plain, printed, painted and embossed
leather.
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SEGMENT ANALYSIS
The key business segments of the Corporation comprises of Handicrafts
(including carpets), Handlooms, Gold Jewelry, Bullion and Others. The
geographical segment comprises of inside India and outside India.
Rs. In crores)
Products 2005-06
2004-05
Handlooms 33.39 35.11Handicrafts 5.27 8.09Garments 7.86 6.46Carpets 0.09 0.16Sub total 46.61 49.82Jewelry 12.02 28.36Total 58.63 78.18
Table no.-1
The above table depicts the Product wise export sales for different products.
In the year 2005-06, direct exports amounted to Rs. 46.62 crores as against
Rs. 49.82 crores last year and indirect exports amounted to Rs. 12.02 crores
as against Rs. 28.36 crores last year. Total exports amounted to Rs. 58.63
crores as against Rs. 78.18 crores.
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The Corporation also Import goods from different countries. The two main
import products are Bullion Bars and Gold Coins which accounts for Rs.
1004.17 crores in the current year as against Rs. 1221.05 crores.
LIST OF MAJOR SUPPLIERS
PRODUCTS NAME OF SUPPLIERS
HANDICRAFTS
Needa Handicrafts , Agra Verma Handicrafts, New Delhi New Jan Khan & Co., Srinagar Ganpati Creations, New Delhi Adivasi Shilp, New Delhi Raghunath Prasad Creations, New Delhi Hansraj Handicrafts, New Delhi Ibrahim & Co., Srinagar Shameem Handicrafts, Uttar Pradesh Asian Art & Handicrafts, Agra
HANDLOOMS Salman Handlooms, Uttar Pradesh Alfa Handlooms Weavers Industrial Cooperative
Society, SrinagarBULLION MKS Finance Limited, Switzerland
M/S NATEXIS Commodity Markets Limited, England Bin Sabt , Dubai
FLOOR COVERINGS
Bhat Cottage Collections, Srinagar Variety Creations, Uttar Pradesh
SILVER Gadhecha Trading Private Limited, Ahemadabad AaryaVart Impex Private Limited, Ahemadabad Satlon Investment Private Limited, Ahemadabad Solar Trading Private Limited, Mumbai Rukma Industries Limited, Chennai
LIST OF MAJOR BUYERS
COUNTRY NAME OF BUYERS
FRANCE
Naf Naf Boutiques La Petite American Retro Index International Sa La Redoute Sner 3 Suisse’s
HONG KONG Tolani & Associates Best Seller Wholesale A/S
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DENMARK Veromoda Vila A/s
AUSTRALIA Rockman’sSPAIN Bershka
ZaraITALY Modafil; Sas
UNITED KINGDOM
Top Shop Dorothy Perkins The Burton Group Plc T/A
UNITED STATES OF AMERICA
Kiko Clothing Provence D’amour LLC Gunther By Nash & Sarin
NORWAY Best Seller A/S Vila A/S
FINANCIAL ANALYSIS
CAPITAL
The Authorized and Paid up Capital of the Corporation remained unchanged at
Rs. 20.00 Cr. and Rs. 13.82 Cr., respectively during the year 2005-2006. The
entire Paid up Capital has been subscribed by the President of India.
TURNOVER
The Corporation achieved a turnover of Rs. 1065.13 crores in the year 2005-
06 as against Rs. 1302.17 crores in the previous year showing a decline of
18.2%. The decline in the turnover is mainly due to the steep price spurt in
international market of bullion imports and also due to spot delivery being
desired by local buyers wherein the designated banks have an edge.
(Rs. In crores) YEARS 2003-04 2004-05 2005-06 TURNOVER 1065.13 1302.17 1784.36 NET PROFIT 0.64 1.3 1.52
Table no-2
During 2004-05, the Corporation achieved a turnover of Rs.1302.18 cr.,
22
against Rs. 1784.36 cr. in the corresponding period last year, showing a decline
of 27.0%.The turnover of the Corporation was adversely affected
a) In the core thrust area of exports -due to the closure of its Tokyo and
New York Offices. During 2003-04, the Corporation had been placed in the
Disinvestment mode .This resulted in some of the major buyers leaving the
fold of HHEC. The decline in jewelry sales was due to the change in
policy of the local Government.
b) In the opportunity driven business of Bullion Imports - due to bullion
imports being placed under OGL.
However, direct exports of crafts and textiles, which is the core business
of the Corporation; have increased from Rs.47.78 cr. in 2003-04 to Rs.49.82
cr. during the year, registering an increase of 4.25%.
Figure -1
EXPORTS
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In the year 2005-06, direct exports amounted to Rs. 46.62 crores as against
Rs. 49.82 crores last year and indirect exports amounted to Rs. 12.02 crores
as against Rs. 28.36 crores last year.
The exports have declined from Rs. 78.18 crores in 2004-05 to Rs. 58.63
crores during the year showing a decline of 25%. The decline is mainly due to
Reduction in jewelry exports from Rs. 28.36 crores in 2004-05 to Rs.
12.02 crores during the year, having a decline of 57.6% because of the
postponement of the jewelry exhibition and
Reduction in direct exports from Rs. 49.82 crores in 2004-05 to Rs.
46.62 crores in 2005-06 because the major buyers of USA was shifting
their business to China and Pakistan due to competitive prices offered
by exporters from these countries.
(Rs. In crores)
YEARS 2001-02
2002-03
2003-04
2004-05
2005-06
EXPORTS 82.8 103.83 80.88 78.18
58.63
Table no.-3
The major portions of exports have come from the Handloom sector.
However, the Corporation is focusing on other segments as well.
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Figure -2
IMPORTS
The Corporation mainly imports two products – Bullion Bars and Gold Coins.
The imports have declined from Rs. 1221.05 crores in 2004-05 to Rs. 1004.17
crores in 2005-06, showing a decline of 17.8%. Moreover, the retail sales
have also declined from Rs. 2.94 crores to Rs. 2.33 crores.
(Rs. in crores)
PRODUCTS 2005-06 2004-05BULLION BARS 1001.27 1221.03GOLD COINS 2.9 0.02 TOTAL IMPORT SALES 1004.17 1221.05
Figure-3
NET PROFIT
The performance of HHEC from 2001-02 to 2005-06 showed that the
Corporation has earned a highest profit of Rs. 301.21 lakhs in the year 2001-
02.
(Rs. In Lakhs)
YEARS2001-02
2002-03
2003-04
2004-05
2005-06
25
NET PROFIT 301.21 250.26 152.03 130.39 64.18
Table no.-5
Figure -4The Company earned the highest net profit in the year 2000-01 because the
sales were increased to a greater extent as compared to the cost. However,
the Net Profit of HHEC has declined from Rs. 130.39 lakhs in 2004-05 to Rs.
64.18 lakhs in 2005-06 which is mainly due to lower turnover and the high
costs.
To increase the Net Profit, the Corporation has already initiated a series of
activities to re- orient itself to improve performance by development of new
samples on traditional crafts and textiles and cutting costs.
Moreover, the Corporation should also focus on efficiency improvement of the
employees and adequate aggressive marketing policies should be adopted in
order to achieve a high turnover which ultimately will increase the net profit.
DIVIDEND
26
Dividends are declared by the Board of Directors on the basis of the net profit
in the current year. The company has started paying dividends to the
stockholders in the year 1997-98 when it earned a net profit of Rs. 204
crores.Though the Corporation has earned a net profit of Rs. 64.18 lakhs, the
Directors has recommended a dividend of 5% (previous year 5%) on the paid-
up Equity Share Capital of Rs. 13.82 crores.This will absorb Rs.69.1 lakhs
including dividend tax and surcharge thereon (Rs. 69.10 lakhs in the previous
year).
(Rs. In lakhs)
YEARS 2001-02
2002-03
2003-04
2004-05
2005-06
DIVIDEND 276.4 276.4 69.1 69.1 69.1
Table no.-6
Figure -5
Figure-5
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GROSS SALES
During the year 2005-06, the corporation has achieved gross sales of Rs.
1065.13 crores as against Rs. 1302.17 crores in the previous year. The
following table shows the Gross Sales from the past five years.
(Rs. in Crores)
2000-012001-02
2002-03
2003-04
2004-05
2005-06
EXPORTS 81.83 82.8 103.83 80.88 78.18 58.63IMPORTS 342.24 247.89 284.41 1701.01 1221.06 1004.17DOMESTIC 2 3.25 2.27 2.47 2.94 2.33
TOTAL 426.07 333.94 390.511784.3
61302.1
8 1065.13
Table no.-7
Figure -6
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FINDINGS IN FINANCE DEPARTMENT
While working in the Finance Section of the Corporation, I found out
that the Corporation is doing well in general. This can be further
explained on the basis of the following ratios:
FINANCIAL ANALYSIS FOR HHEC ON THE BASIS OF RATIOS
RATIOS 2005 2006CURRENT RATIO 1.0247 1.189QUICK RATIO 1.0182 1.1425FIXED ASSETS TURNOVER RATIO
136.645
105.715
TOTAL ASSETS TURNOVER RATIO 1.28%
11.32%
TOTAL DEBTS TO TOTAL ASSETS 1.1061 0.1493PROFIT MARGIN ON SALES RATIO 0.4737 0.5606INVENTORY TURNOVER RATIO 201.43
328.926
CURRENT RATIO
Current ratio is calculated by dividing Current Assets by Current Liabilities.
The current ratio is more in the year 2006 as compared to 2005 because the
company has purchased a lot of inventories in 2006.High current ratio
indicates that the liquidity position of the company is very strong. The
Corporation continues to be adequately liquid and expects that this will help
them to achieve its growth objectives.
From the point of view of supplier, this is good for the company because the
greater the current ratio, the greater the company is in a position to pay off it
creditors. The Current ratio provides the best single indicator of the extent to
29
which the claims of short-term creditors are covered by assets that are
expected to be converted to cash fairly quickly.
Figure -7
QUICK RATIO
Quick ratio is calculated by deducting inventories from current assets and
then dividing the remainder by current liabilities. Inventories are typically the
least liquid of a firm’s current assets; hence they are the current assets on
which losses are most likely to occur in a bankruptcy. The company has a
high quick ratio as compared to the previous year. This is good for the
company because it means that the company can liquidate its inventory and
can pay off its current liabilities easily. The company is disposing off its
inventory efficiently.
30
Figure -8
FIXED ASSETS TURNOVER RATIO
The fixed assets turnover ratio measures how effectively the firm uses it
plants and equipments. HHEC has a fixed assets turnover ratio of 105.715 %
which means that the firm is not using its fixed assets as extensively as it
was using in the previous years. One possible reason for low fixed assets
turnover ratio is that the company has purchased a lot of fixed assets in this
year. Therefore, the company has to take appropriate necessary steps to
increase the fixed assets turnover ratio.
31
Figure -9
TOTAL ASSETS TURNOVER RATIO
The total assets turnover ratio measures the turnover of all the firm’s assets
and it is calculated by dividing sales by total assets. HHEC ratio is more than
the previous year which indicates that the company is generating a sufficient
volume of business given its total assets investment. This is actually good for
the company because the company has purchased a lot of fixed assets in the
current year and still, the company is generating a sufficient volume of
business.
Figure -10TOTAL DEBTS TO TOTAL ASSETS
The ratio of total debt to total assets, generally called as the debt ratio,
measures the percentage of funds provided by creditors. The debt ratio is
very low as compared to the previous year because the company has paid off
its debt Creditors prefer low debt ratio because the lower the debt ratio, the
greater the cushion against creditor’s losses in the event of liquidation. This
is actually good for the company because it can borrow additional funds
32
without raising its equity capital and creditors may be reluctant to lend the
firm more money.
Figure -11
PROFIT MARGIN ON SALES RATIO
The profit margin on sales ratio is calculated by dividing net income by sales.
HHEC profit margin is more than the previous year which means that the
company’s cost was not too high in relation to sales. This shows that the
company is operating efficiently and is utilizing the resources very well.
Moreover, the firm with a high profit margin might end up with a low rate of
return on its stockholder’s investment. Therefore, high profit margin is
actually good for the company.
Figure -12
33
INVENTORY TURNOVER RATIO
The inventory turnover ratio is calculated by sales divided by inventories. The
HHEC turnover ratio is more in the current year as compared to the previous
year which indicates that the company is disposing off it inventory very
effectively. Though the company has purchased inventory in 2006, still its
inventory turnover ratio is high which means that the company is not holding
too much inventory. Excess inventory is unproductive and it represents an
investment with a low or zero rate of return. This shows that the company
can easily liquidate its inventory and can pay off its creditors easily. This is
actually very good for the company.
Figure -13
Thus, on the basis of the above ratios, we can conclude that overall the
Corporation is doing well. However, there are some areas where the
Corporation should focus on and should take appropriate steps in order to
increase the total turnover and net profit.
34
S.W.O.T ANALYSIS
The Strengths, Weaknesses, Opportunities and Threats (S.W.O.T) of the
Corporations are as follows:
STRENGTHS AND WEAKNESSES
STRENGTHS
INFRASTRUCTURE
Six branches in India and 18
agents in foreign countries.
Offices and retail outlets at
premium locations in Delhi,
Mumbai, Chennai and Kolkatta.
Procurement centers all over
India.
TRADE RELATED SKILLS
Control over sampling,
competitive procurement,
production monitoring and
quality inspection in
handlooms through the
procurement centers.
Range of sample collections of
the past in handloom fabrics &
made-ups.
Control over manufacturing in
35
garments.
Over 45 years in the trade of
development & exports.
Customer base who have been
dealing for many years.
BRAND EQUITY
Brand name “Sona” –
registered in Italy & applied for
in India.
Glorious past – associated in
bringing names like Pashmina,
Carpets, Moradabad brass to
the world map.
WEAKNESSES
BUSINESS OBJECTIVE
Selectivity & focus is needed –
the focus attention continues
to be on “locations” rather
than “products / markets”
36
UNSKILLED MANPOWER
Lack of professionals in the
strategic areas of design
development, technical,
marketing and finance.
Motivation of staff – Revised
Performance Linked Reward
Scheme under implementation.
Need for rationalization of
manpower across its trade
activities through training &
redeployment.
LACK OF CONTROL OVER
MANUFACTURING
No direct control on
manufacturing in handicrafts.
Lack of built-up facilities for
manufacturing / finishing high
value items like made-ups,
fashion accessories etc.
OPPORTUNITIES AND THREATS
The various opportunities for H.H.E.C are as follows:
GLOBAL MARKET
Export markets are showing
signs of revival.
Quotas on textile items
dismantled w.e.f. 1.1.2005
37
thereby providing wide
opportunities for export of
textile and garments.
MANUFACTURING UNITS- GARMENTS
Setting up of a new unit at
Noida, to capitalize/ reverse
the decline in growth and tap
the opportunities available on
dismantling of quotas.
BUYING AGENTS
Appoint buying agents who
has the In-house skills to
perform in product lines like
Carpets, Jewelry & Furniture.
OPPORTUNITY DRIVEN BUSINESS
Sustain the opportunity
driven business available
under the EXIM Policy, viz.,
imports of bullion and exports
of jewelry.
THREATS
GLOBAL COMPETITION
Different countries are
positioning themselves in
specific product-lines and
38
imitate machine made
products of crafts.
INDUSTRY STRUCTURES
Competition from
manufacturer/ exporter who
have control over
manufacturing / finishing.
Competition from private
players who have a lean
structure and flexible policies.
MARKETING STRATEGY
The most important component for every organization is the marketing
strategy which may be defined as the pattern of plan that integrates an
organization’s major goals, policies and actions sequences into a cohesive
39
whole. A well formulated strategy helps to allocate the organization’s
resources into a unique and visible posture based on its relative internal and
core competencies.
The target market for HHEC are the group of people towards whom the
corporation intends to market its goods, services or ideas with a strategy
designed to satisfy their specific needs and preferences. The special
emphasis in its effort remains primarily on the development of strategies that
will best match the product offering to the needs of particular target
segments. An appropriate match between such offerings and needs is vital to
the firm’s success.
The Marketing Mix is the blending of four strategic elements – Product, Place,
Price and Promotion to satisfy chosen consumer segments. It is one of the
most fundamental concept associated with the marketing process and is well
understood by most modern marketers. A firms marketing effort must always
aims at providing customer satisfaction. If a firm offers the right product at
the right price, right place and with right promotion, then the marketing
programme is bound to be effective and successful. The firm must design an
effective coordination of these four basic elements keeping in mind its
available resources.
HHEC has been working since four decades to nurture and organize the
different schools of craftsmanship. It’s creations comes in ethnic vibrant
colors and has been expanding its resource base by connecting itself to more
and more artisans, weavers and master craftsmen in rural areas. It offers a
wide range of products like Wooden / Iron Furniture, Metal-Bronze, Iron,
Brass, Copper & Silver, Stone-Marble, Soap-Stone, Granite, Jewelry- Gold,
Silver & Costume, Paper Machie, Glassware, Leather Garments, Carpets, Rugs
and Durries.
MARKETING PROBLEM
40
In the marketing department, I found out that the major marketing
problem for the corporation is that it does not get enough buyers for
its products. HHEC act as a middleman between the manufacturers and the
buyers. They are treated as traders because they manufacture only
Garments. They do not manufacture the other products. As a result, the
buyers prefer manufacturers because of two reasons:
a) They can get the products at a cheaper price.
b) They can purchase in bulk and will be assured of its quality.
For these reasons, buyers travel to remote areas in search of manufacturers.
However, to solve this problem, HHEC has been making special efforts in
order to satisfy the buyer’s needs and demands.
MY RECOMMENDATIONS
Apart from this, I would like to recommend the Corporation to adopt
aggressive marketing strategies of market penetration. It should
Participate in leading fairs and exhibitions in India & abroad in order to
advertise, create new buyers and strengthen relationship with existing
buyers.
Organize “Stand Alone Exhibitions” and events abroad to promote
the HHEC’S product lines.
Generate tremendous demand, response and win confidence of foreign
buyers through its fairs and exhibitions abroad which will ultimately
provide a synergetic platform to various production houses to
showcases their masterpieces.
41
FINANCIAL PROBLEMS
The Handicrafts & Handlooms Exports Corporation of India Ltd. Is a Central
Public Sector Undertaking under the administrative control of the Ministry of
Textiles, Government of India. It does not have any financial problems as
such because all the funds are being generated by the Government of India.
However, for certain products, it takes orders from buyers and purchase
products from different manufacturers on either credit or consignment basis.
However, the pricing strategy of the Corporation is very significant. Pricing is
a very critical decision in every organization. After meeting all the costs
involved, the sales revenue generated must yield a surplus before there can
be profits. The sales revenue figures is however, materially affected by the
price charged. If the price is too high, the sales generated are likely to be low.
Therefore sound-pricing policies must be adopted to ensure that the
organization secures satisfactory profits. However, in pricing decisions,
economic concepts are useful. One has to consider various factors which
influence pricing apart from costs such as competitive environment and
governmental control where applicable.
The price of the product materially affects the demand for product planning.
For example, if the quality of the product is to be improved, this may be
possible only if the customers are willing to pay a higher price for it. While
setting the price, the organization keeps in mind the following points:
Objectives of the organization
Customer characteristics
Economic product characteristics
Competitive environment
Distribution channels
42
Cost of profitability
MY RECOMMENDATIONS
Since the entire funds are being generated by the Government of India, the
organization does not have any financial problem as such. However, based on
my findings, I would like to recommend the organization to bridge the
information gap between the buyers and sellers which will ultimately shift the
Corporation’s emphasis on profitability of operations. It should also
Have a positive approach to pricing and should make all possible
efforts to get orders
Adopt the marginal costing policy for pricing
43
SCENARIO ANALYSIS
The Scenario Analysis exhibits the Current position of the
Organization and tells us about the future goals of it. It also shows
how effectively and efficiently the Organization is moving towards its
goals.
Currently, the focus of the Corporation continues towards maintaining a
harmonious blending of its developmental role with commercial activities.
As in the past, the Corporation continues to play a vital role in the
promotion of Indian Handmade Textiles and Crafts including textiles based
crafts like fashion accessories.
As part of innovation and to provide inputs, training and marketing
support to artisans/weavers, the Corporation had undertaken the
following projects for development of silk and silk blended fabrics for
dress material and home furnishing
Development of craft clusters at Saunsar (Chindwara, M.P.) and
Baraseoni (Balaghat, M.P.).
Development of the craft cluster at Sonepur and Bhubaneshwar
(Orissa), for the development of Tie & Dye Ikat fabrics in designs
acceptable to the international market, thus moving away from the
traditional Iket motifs.
Development of the craft cluster of Vanya Silk and Bivoltine Silk in
Uttaranchal.
With a view to marketing of new samples developed on traditional crafts and
textiles and its policy of upgrading knowledge on designs and fashions
abroad, the Corporation participated in a number of International fairs,
viz.., Heim- Textile (Frankfurt- Germany), Indian Home Furnishing Fair
(Osaka, Japan), India Garment Fair (Osaka- Japan), Formland Fair (Denmark),
44
International Autumn Fair (Birmingham) and India Trade Fair (Mauritius). The
Corporation has participated in domestic fairs like Textile India, IHGF, India
Pavilion at Aichi (Japan) and displayed jewelry, handmade crafts and textile
items. The Corporation also organized a “Stand Alone Exhibition” at Sydney
(Australia) wherein wooden crafts and furniture, carpets etc. were displayed.
Moreover, the Corporation has been practicing the principle of good
corporate governance and focusing on in the future also. The Board lays
strong emphasis on transparency, accountability and integrity. The Vigilance
Division also continued to perform the function of creating consciousness of
the Vigilance requirements among the employees. During the year, the
corporation observed Vigilance Awareness Week from 1st November to 6th
November 2006 and conducted seminars to highlight the harmful effect of
corporation.
The Corporation has also focused on the Personnel and Industrial Relations.
With a strong commitment to the organization and willingness to work whole-
heartedly towards achievements of the goals, the HHEC team has played a
pivotal role in its success. The Directors wishes to place on record its
appreciation to the contribution made by all employees in achieving the
performance during the year.
The Industrial as well as employee relations during the period under review
continued to be peaceful and harmonious. The Corporation lay due emphasis
on all round development of the human resource through training, re-
deployment and motivation. There was no employee of the company who
received remuneration in excess of the limits. The Corporation also follows
the Government directives relating to reservation of posts for the Scheduled
Castes, Scheduled Tribes and other Backward Classes. As per the latest
orders, the Corporation maintains the post-based roasters. During the year,
any post meant for these categories has not been de-reserved. Moreover, the
Corporation still continued to promote progressive use of the official language
45
“Hindi” for official work and to ensure implementation of the official
language. In order to motivate the employees to use “Hindi” in official work,
various incentives in cash and kind are granted. The Corporation organized
City level “Chitra Abhivyakti Hindi Competition” on 26th October 2006 under
the banner of NARAKAS. The competitors from twenty five Public Sectors
participated in the event. The Corporation was also awarded “shield” as
organizer Corporation. The Corporation observed “Hindi Pakhwara”to
encourage the use of Hindi by every employee in the day-to-day working of
the Corporation.
PERSPECTIVE PLANNING
HHEC is a Government based organization whose main aim is to market the
products of Indian Crafts and skills abroad which ultimately provides the
marketing channel for craftsmen and artisans. In order to fulfill its aim, they
are planning to take the following steps:
In order to increase the Exports of Handicrafts and Handlooms
products, the Corporation has been making efforts to rein in new
buyers from the existing markets as well as from the untapped
markets. Besides participation in major international and local fairs,
the Corporation has also proposed to organize “Stand Alone Exhibition”
in USA, Kuwait and Brussels.
With a view to provide design inputs, training and marketing support to
artisans, the Corporation has proposed to undertake projects on
Design and Development of cane and bamboo from North East and
ornamental crafts including jewelry items from North East.
After the closure of New York and Tokyo offices, in order to retain their
presence in these markets and further development of business in
46
other potential areas, General Sales Agent have been engaged during
the year for USA, Japan, Germany and Canada markets.
The Corporation has also proposed to set up a manufacturing unit at
Noida complex with CAD/CAM facility in order to focus on hi-fashion
garments, fashion accessories and made-ups developed through free
lancer designers for value turnover.
During the year, the Noida complex was inaugurated in order to affect
economies on the operational activities, marketing division of
corporate office including the Showroom and Delhi branch have been
merged and started functioning from the Noida complex.
Apart from the following steps, since, imports accounts for the majority of the
total income, the corporation is emphasizing more on the major segments
like Handicrafts, Handlooms, Garments and Jewelry. The basic strategy of the
corporation is to develop new and innovative products.
They have planned
To increase the contribution of Handicrafts in the total exports i.e. from
8.98 % to 10% by the year 2007-08.
To increase the contribution of Handlooms from 56.98% to 80% by the
year 2007-08.
To increase the contribution of Garments from 5 % to 7.3 %.
HANDICRAFTS SEGMENT
In order to increase the contribution of Handicrafts, the Corporation is
planning to
47
Enroll associates of Master artisans & Craft persons in order to develop
a new supplier base.
Establish warehouses in various foreign countries and to open up more
display showrooms in Noida in order to operate on consignment basis.
Concentrate more on the European, South East Asian, and Australian
markets.
Focus adequately on other growing categories like fashion accessories,
gifts and utilities, furniture etc.
HANDLOOM SEGMENT
In order to increase the contribution of Handlooms, the Corporation is
planning to
Diversify range in made-ups to enable focused marketing of table
linen, bed linen, floor coverings, etc.
Shift its focus from cotton fabrics for apparel end-use to designing
dress materials in silk, blends etc.
Utilize efficiently on the opportunity available on dismantling of quotas
by product development, cost, quality and time performance.
Diversify market coverage from USA, Japan and France to Germany,
U.K., Latin America and Australia.
GARMENTS SEGMENT
In order to increase the contribution of Garments in the total exports, the
Corporation is planning to
Explore the possibility of entering into a Joint-venture with a Foreign
Collaboration.
48
Focus mainly on simple garments like shirts, shorts etc. for volume
turnover.
Increase the focus on USA and Australian markets.
The Modern unit at Noida (U.P.) should focus primarily on Hi-fashion
garments for value turnover – selectively work with free-lancer
designers from India and abroad, collaboration with NIFT, etc.
JEWELRY SEGMENT
The Jewelry segment plays a vital role in the total turnover of the
Corporation. In order to increase its contribution, the Corporation is planning
to
Sustain the opportunity driven business of Jewelry Exports & Bullion
Imports.
CARPETS SEGMENT
The Carpet segment also plays a major role in the total turnover. In order to
increase its contribution, the Corporation is planning to
Sell the stock on consignment basis especially in the proposed
warehouses of U.S.A. / Canada & the display showroom located in
Noida.
Evolve its role in the carpets to that of buying agent over the next few
years.
The Corporation is also focusing on the other growing categories like fashion
accessories, Gifts and utilities etc. They are also planning to establish a
domestic warehouse at Noida and operate on consignment basis for retail
sales of items like furniture, carpets etc.
49
IDENTIFIED PROBLEMS OF RESEARCH
After studying the Corporation in detail, I identified two main
problematic areas
1) The National Museum Shop &
2) The Crafts Museum Shop
However, the HHEC Souvenir Shop acts as a major strength for them in order
to cover up these problems.
THE NATIONAL MUSEUM SHOP
50
The National Museum Shop in New Delhi is the largest museum in India. It
holds variety of articles from pre-historic era to modern works of art. It is run
by the Ministry of Culture, Government of India.
The National Museum displayed the excavations of the different
civilization.The museum has in its possession over 200,000 works of art, of
both Indian and foreign origin, covering more than 5,000 years of Indian
cultural heritage. Their rich holding of various creative traditions and
discipline represents a unity amidst diversity, an unmatched blend of the past
with the present and strong perspective for the future.
The HHEC Shop at National Museum is built in a very strategic and prominent
location. However, I found out these following problems.
a) The shop is in an ideal location but it is very poorly maintained. There
is dust on most of the displayed items.
b) Not only the shop is poorly maintained but it is also much suffocated.
There is no proper air ventilation as there is only one window and the
air conditioner is also not working properly.
c) The collection of books is very poorly displayed. No section has been
maintained for similar kinds of books due to which it becomes very
difficult for the buyers to find a book of their choice.
d) Apart from some handicrafts and handloom products, no other
segment products are displayed.
THE CRAFTS MUSEUM SHOP
The Crafts Museum complex is a charming oasis in the midst of the hustle
and bustle of Delhi. Mud huts with painted walls and thatched roofs,
51
courtyards, terracotta horses recreating village shrines, craftsmen at work
are some of the elements that add to the rural ambience of the place.
Within the museum itself are examples of traditional Indian crafts, Wooden
Carvings and Images, Metal ware etc. which includes clay and terracotta
pots, toys and images, folk and tribal paintings, jewelry and textiles. The core
collection of the Crafts Museum was actually put together to serve as
reference material for the craftsmen who were increasingly losing touch with
their own traditions in terms of materials, techniques, designs and aesthetics
of their arts and crafts due to the sudden changes caused by modern
industrialization. The Crafts Museum shop gives the craftsmen an opportunity
to confine to his tradition or to innovate in response to his new contemporary
environment.
Since the Crafts Museum shop is located in Pragati Maidan, it faces a lot of
problems which are as follows:
a) The majority of the sales take place only when there are some fairs.
During the rest of the period, the sales are very minimal.
b) The Crafts Museum shop is also poorly maintained. There is a lot of
dust on almost each and every item displayed.
c) The shop is very much suffocated as the air conditioners are not
functioning properly and the fans kept there does not solve the
problem of heat.
d) The product displayed does not include home furnishing, jewelry and
garments. The foreign customers specially ask for these products.
e) The products are not displayed in an efficient manner. There is no
sequence of products which leaves a bad impression on the buyer.
52
THE HHEC SOUVENIER SHOP
Situated in the heart of Delhi, the unique Dilli Haat is an upgraded version of
the traditional weekly market, offering a delightful amalgam of craft, food
and cultural activities. Spread over a spacious six acre area, imaginative
landscaping, creative planning, and the traditional village architectural style
have combined to produce the perfect ambience for a Haat.
Dilli Haat transports you to the magical world of Indian art and heritage
presented through a fascinating panorama of craft, cuisine and cultural
activities. It has a wide variety of skillfully crafted handicrafts intrinsic to each
part of the country. These range from intricate rosewood and sandalwood
carvings, embellished camel hide footwear, to sophisticated fabric and
drapery.
The Handicraft stalls are allotted on a rotational basis to craftsmen from all
corners of the vast and varied land of India. Shows promoting handicrafts and
handlooms are held at the exhibition hall in the complex.
The HHEC Souvenir shop at Dilli Haat is very ideal because the foreign
tourists visit these shops very often. The shop has a total turnover of Rs. 1.36
crores in the year 2006-07 as compared to Rs. 1.05 crores in the previous
year. While allowing free interaction between buyers and sellers, the
Corporation favors a check on prices regularly to keep them moderate. The
HHEC shop acts as a major strength to cover up the problems, however, it
also needs some modifications.
a) The HHEC shop at Dilli Haat is very small and the products are not well
displayed due to lack of space.
53
b) The shop requires at least one air conditioner to make the temperature
in side the shop comfortable.
CONCLUSION
Based on my internal scanning of the Corporation, I came to the
conclusion that for HHEC to become a successful organization, the
crafts should be re-developed with modern technology. Therefore,
following steps should be taken:
The Artisans should be taught modern techniques to produce their
products. With the introduction of improved labor saving techniques,
tools and appliances to them, they can have a high turnover.
The Indian craftsmen generally produce objects of traditional designs
but it should be re-designed or some changes should be brought in
order to compete with the machine made products which are
comparatively beautiful and less costly. A craft can only compete with
54
the machine made products in the international market if the designs
are improved. But the improvement in designs should be made without
sacrificing the traditional qualities and the artist standards of the raft
objects. The craftsmen should retain the old and blend it with new
things of their own invention.
The standard of living of the Craftsmen should be raised. Currently,
their earnings are not sufficient enough to provide them with the basic
requirements. They are mostly illiterate and live in unhealthy places.
To ensure a better deal from the craftsmen, the whole structure of
production has to be reorganized which will lessen the domination of
dealers, financers, and middle men.
The crafts of a country can flourish only when the raw materials used
by the craftsmen are available to him at reasonable and concessional
prices. Therefore, it is suggested that the distribution of the raw
materials should be done through the state governments. Special
efforts need to be made so that the raw materials are available to the
craftsmen on time.
The future of Indian Crafts depends on the popularization of craft
products among both the masses at the national and international
level. Therefore, more utility articles should be produced at a cheaper
rate. As a result, wider publicity should be done through newspapers
and journals. Apart from this, the Central and State Governments
should also take appropriate steps in arranging exhibitions and fairs.
Various promotional schemes should be developed in order to promote
the Indian Crafts. The Government should provide financial and
technical support to various institutions like The Handicrafts and
Handloom Export Corporation of India, The State Industries
55
Department etc. who are closely associated and concerned about the
functioning and development of crafts in different parts of the country.
The Corporation should also focus on an effective export programme.
For this purpose, proper advertisement is required and adequate funds
should be invested. Films on Indian Handicrafts should also be shown
in foreign countries. Moreover, the corporation should also develop
special products that really portray the cultural heritage of India.
For the development of crafts, the individual craftsmen should be
given better credit facilities. They should be allowed to avail loans from
various banks which help them for their working capital requirements.
The Corporation should focus on the re-orientation of the Craft
traditions. With the impact of modern civilization, significant changes
have taken place in the aesthetic value of the people. Majority of the
people does not want ornamented crafts. They require simple and well
designed objects of utility which are inexpensive and handy. To satisfy
the modern needs, the traditional designs should be improved. The
revival of these craft traditions should, however, be undertaken in the
light of modern requirements and taste. Moreover, the government
should patronize and give recognition to the skilled craftsmen who
have produced great works of art which will ultimately motivate them.
The Corporation should also focus on the appropriate marketing and
promotion of Exports. The rate of growth in the exports of craft
products is very significant as compared to the total exports of our
country. The share of exports of craft products in the total exports of
our country has also increased in the recent years and crafts have
become one of the important export items. For the promotion of
56
exports, the crafts goods should be marketed appropriately through
exhibitions, fairs and brochures.
Apart from re-designing and re-orientation of the Indian Crafts, special
concessions should be provided by the Government in the Handloom
and Handicrafts sector.
The Corporation should also take steps to provide better technical
guidance to craftsmen which will enable them to understand the finer
details of quality production, tools and technological infrastructure
which will help them in designing and processing of their products.
Lastly, the Corporation should re-formulate its policies keeping in mind
the current market situation.
RECOMMENDATIONS
Based on the detailed study about the Corporation, I would like to
recommend the following points which will benefit the organization:
1) The Corporation should Re-orient the policy of Procurement with the
main focus on source buying by establishing strong and direct links
with artisans and craft-persons.
57
2) The Corporation should avail up discount on price through prompt
payments.
3) They should also take steps to upgrade the existing website with latest
catalogue for advertisement and enquiry/order generation as this will
give adequate information to foreign buyers.
4) They should also focus on controlling and managing the cost of people
through re-structuring solution in order to achieve the industry norms.
5) Induction of officials in the key functional areas of design development
and marketing trade functions is also required. This will lead to better
and improved designs and effective trade between the manufacturer
and the organization.
6) They should re-organize the workforce through proper training and skill
based job allocation in order to make them more efficient.
7) They should also give ample opportunities to craftsmen and artisans so
that they can have greater exposure and should have the access to
national and international markets thereby giving them a better
livelihood for more sustainable developments.
8) They should appoint more buying agents who possess the in-house
skills in product lines such as Jewelry, Furniture and Carpets. Since, the
Corporation is planning to set up more showrooms; these buying
agents will prove very beneficial for them.
9) The Corporation can also have a Color Forecast link on its website
which provides the future design and color directions of fashion and
home furnishings for domestic and international markets. As a result,
58
small apparel and furnishing manufacturers, exporters, domestic
textile traders and producers will respond adequately and in a timely
fashion to market requirements.
10) They should also try to maintain and build good social relations
with the buyers as well as with the manufacturers of different
segments like handicrafts, handlooms, carpets, garments etc.
11) The Corporation should take possible steps to publicize its
products in the popular periodicals and magazines. This will leave an
impression on the mind of the customers who read them frequently.
This ultimately will increase the customer base for its products.
SPECIAL RECOMMENDATIONS
THE NATIONAL MUSEUM SHOP
1) The items should be displayed in such an attractive way that it should
catch the attention of the buyers at once.
2) The displayed items should be cleaned regularly and should not have
dust on it.
3) Proper air ventilation with adequate air conditioners and windows are
necessary to make the shop a comfortable place for buyers and foreign
tourists.
4) There should be products of other segments apart from only
Handicrafts and Handloom products. These include garments, home
furnishings and jewelry as these are in great demands by the foreign
tourists.
59
5) Different variety of Handicrafts and Handloom products should be
added to the collection.
6) Finally, the collection of books should be appropriately displayed.There
should be different sections for different kinds of books so that the
buyers can locate it easily.
THE CRAFTS MUSEUM SHOP
1) Firstly, the interiors of the shop should be highly appealing to the
customers. For this purpose, the exhibits should be displayed to attract
the attention of the customers.
2) The Crafts Museum Shop is very small. Therefore, its area should be
increased as it will give a new and pleasant look to the shop.
3) The displayed items should be cleaned regularly from time to time. It
leaves a very bad impression on the buyers if there is dust on
displayed items.
4) The problem of air conditioner should be immediately solved. Proper
air ventilation is required as the shop attracts a majority of foreign
tourists.
5) Finally, different section should be made for different products like
garments, home textile, home furnishings and jewelry.
THE SOUVENEIR SHOP AT DILLI HAAT
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1) The area of HHEC shop at Dilli Haat should be increased in order to
accommodate more customers and to display the products in an
effective way. The outlet should be spacious to move around freely.
2) The Dilli Haat shop of HHEC does not have the collection of books.
Books are always appreciated by the foreign customers and efforts
should be made to display the books.
3) The shop does not have proper air ventilation. The experience of
visiting HHEC shop at Dilli Haat should be a pleasant one but high
temperature inside the shop plays the opposite.For this purpose, the
problem of air conditioner should be immediately looked into.
4) Another way to increase the sales is by the hospitality of the staff
member present at the shop. For this purpose, adequate training from
time to time should be imparted to the staff members.
BIBLIOGRAPHY
WEBSITES
1) www.hhecworld.com ( March – 12,13,15,18,19,20,21 and April – 5, 12,13,18)
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2) www.ministryoftextiles.com ( March – 13,14,15 and April-7,8)
3) www.craftsinindia.com/arthistory ( March – 18,19,26,27 and April – 1,2,3,7,10)
4) www.crafts-wikipedia.com ( March – 18,19,20 and April – 3,4,5)
5) www.indianartsandcrafts.com ( March- 29,30 and April – 1,2,3,4,6,8)
6) www.google.com ( March – 15,16,17,18,20,22,24,25,26,29,30 and April- 4,5,9)
7) www.dillihaat-wikipedia.com ( April – 2,3)
8) www.nationalmuseumofindia.com ( April – 5)
9) www.craftsmuseum.com ( April – 7,8)
BOOKS
1) Annual Report 2005 -06
2) Annual Report 2004-05
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