CHALLENGES FACING HANDICRAFT BUSINESSES IN IMPLEMENTING PROMOTION STRATEGIES FOR THEIR PRODUCT

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Marketing and promotion is a strategic tool for the business development and it helps in the proper growth and endurance of micro, small and medium enterprise. It plays a crucial role for the success of any enterprise and the large firms have been hiring employees to take care of marketing of products or services of their enterprise but micro (Handicraft industry) and other small enterprises have no strong financial supports which make them efficient to invest money on marketing of crafts products. As we know that finance is the blood of any industry which make them competent to fight against any crisis but these enterprises have no any strong financial support which make them self-dependents to take any decision regarding the wellbeing their works. Governments started different marketing scheme to increase the awareness among the people like exhibition, Handicraft emporia, training, publicity through painting and electronic mode, market and products assessment tour for artisans (Annual Report 2010-11, Ministry of Textile). Shopping matrix analysis help to understand the consumers buying behavior regarding purchasing and helps to overcome the differences between what the firms provides and what the consumer expects from firms, it is helps to developed a marketing strategy which help to resolved the problems effectively (William, 1965). Marketing Support & Services Scheme is a new scheme which comes in to light after clubbing of two schemes like Marketing Support Scheme and export promotion scheme in Eleventh five year plan (Annual Report, 2010-11, Ministry of Textiles). This is the time where small scale enterprise behaves like an engine in globalization era which promotes the products innovation, broaden the economic development and has a significant participation in the international markets. The entrepreneurial orientation has an important characteristic of the entrepreneur, who formulates the marketing strategy according to their firm performance in the Globalized era (Gary Knight, 2000). Marketing Support and Services Scheme is the only subsidiary of handicraft industry which mainly focused on marketing activities in the Domestic and International publicity by using different mode of the communication (Annual Report 2011-12, Ministry of Textile).

Tero and Erkki (1979) found that formulation of marketing or promotion strategy depends upon the different market condition and objectives like non- adaptive, time- dependents, competitively adaptive, sales responsive and profile responsive strategy which helps to capture the market due to the changes in seasonal growth, merchandising and competitive aspects of the markets. Yoram et.al (1973) said that sophisticated management approaches has a vital role for formulating international marketing strategy in which four types of altitudes or orientation has played a significant role like ethnocentrism (Home country orientation), polycentrism (Host country orientation), regiocentricism (a regional orientation) and Geocentrism (a World orientation). These are depends upon the different market environment and intra company factors on the basis of cost and benefits of the firms. Nigel et.al (2011) opines that the role of strategy management is very important in marketing management because traditional approach of marketing has not been playing significant role in the real world of business. The educational organization and training center has a tough task for the strategy management to design and delivery the education. Yihao and Yuning (2010) found that consumer’s psychology is an important strategic aspect through which industries should design their crafts products. Handicraft industry has facing different types of problems regarding detachment from the modern manufacturing technique, large flexibilities in design and have less knowledge related to the different types of the promotional activities etc.

R. Ramaswamy (2013) opined that the handicraft promoting federation should play a significant role in increasing the competition at the local, National and International level and the marketing research is the part of the marketing management, which has an unavoidable position to know the test and preferences of the customers in the craft markets. The diverse clusters has been working in the different part of the country which has their own products specialties like Assam Bamboo crafts and these clusters need to provides a common platform where they exchanges their idea and technique regarding the crafts and which is also very important for the buyers and sellers. At the present time advertisement play a significant role to aware the uses and availability of the products but due to unorganized and low profitability in this industry make the manufacturer of the craft products inefficient to invest money on advertisement. Noor et al (2012) said that handicraft industry in Nigeria s been playing a vital position in for the purpose of the employment and foreign exchanges but this industry is far away for the implementation of the modern concept in manufacturing and retailing activities. Handicraft product has played a significant medium through which any country shows their culture and tradition to attract the domestic and foreign tourists. Most of the handicraft producers made products for their own and local users because they have no information regarding the demands of the craft products in the national and international level and they never put their best because maximum artisans involved in this work as a part time basis. Kumar and Rajeev (2013) said that this the era of e-commerce. Internet has been playing a vital role to provide a common platform for each and every business. It is a cheap and strong medium through which a consumers easily know about any products features, price, availability, accessibility, order the products, paying the prices etc. handicraft industry needs this medium to markets their products which has an effective way through which the small retailers take these benefits after small investment and it covers large proportion of the customers including local, national and international as compared to the other medium of the of advertisement like banner, poster, pump lets, exhibition etc.

1.2 STATEMENT OF THE PROBLEM

The increasing intensity of competition in global markets is a challenge facing firms at all stages of involvement in international markets. As markets open up, and become more integrated, the pace of change accelerates, technology shrinks distances between markets and reduces the scale advantages of large firms, new sources of competition emerge, and competitive pressures mount at all levels of the organization.

Most handicraft entrepreneur sells their product locally and through agents and majority of them never promote their products abroad. This has been attributed to lack of adequate marketing skills and financial resources to fund marketing efforts. The most significant challenges facing export of handicrafts are high packaging and shipping costs, high and ever changing tariffs, certification and quality standards set by importer countries, counterfeits and lack of patent laws and lack of innovation and creativity amongst artisans to meet market specifications and demanding contracts respectively (Ndungu, 2012). All this challenges highlighted arose the interest of the researcher research more on the challenges facing handicraft entrepreneurs in implementing promotion strategies for their product.

1.3 OBJECTIVES OF THE STUDY

The main objective of this study is to find out the challenges facing handicraft entrepreneurs in implementing promotion strategies for their product, specifically the study intends to;

1. Find out the challenges of handicraft business in Nigeria

2. Analyze the effect of those challenges on the growth of handicraft business in Nigeria

3. Find out the impact of implementing promotion strategies on the sales of handicraft business in Nigeria

4. Proffer solution to the challenges of handicraft business

1.4 RESEARCH QUESTION

1. Are there challenges of handicraft business in Nigeria

2. Is there any effect of those challenges on the growth of handicraft business in Nigeria

3. What is the impact of implementing promotion strategies on the sales of handicraft business in Nigeria

1.5 RESEARCH HYPOTHESIS

Ho: there is no significant effect of challenges on the growth of handicraft business in Nigeria

Hi: there is a significant effect of challenges on the growth of handicraft business in Nigeria

1.6 SIGNIFICANCE OF THE STUDY

The findings of this study will serve as an empirical basis for future policy making in Nigeria on issues related to the handicraft. To the government, the findings of this study will provide important information that could be useful while formulating policy decisions with an aim of providing an enabling environment that can help facilitate the global market of handicrafts traders in Nigeria. To academicians and researchers, the findings of this research project are a source of reference material for future research on related topics; and will also help other academicians who undertake the same topic in their studies may use the findings of this study to restart undertaking activities aimed at reducing the challenges facing handicraft traders in accessing global market.

1.7 DELIMITATION OF THE STUDY

Finance for the general research work will be a challenge during the course of study. Correspondents also might not be able to complete or willing to submit the questionnaires given to them.

However, it is believed that these constraints will be worked on by making the best use of the available materials and spending more than the necessary time in the research work.

---

---