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Major Distribution Channels

Handicrafts is distributed through five major channels: 

  • Wholesalers
  • Importers/Distributors
  • Commission Agents/Sales Representatives
  • Department Stores
  • Mail-Order
  • Internet Sales
  • Tele- Shopping

The individual channels are described in detail as under :

Wholesalers
Besides offering wide range of goods to retailers for direct sales, this channel also supplies large quantities of individual articles.They are very particular in maintaining consistency in the kind of products and their quality.  One of the distinguishing features of wholesalers is to provide distribution and storage facilities.  Specialised wholesalers deal in sales to retailers as well as to final consumers.  They maintain high quality standards and but have a narrower and in-depth range of arts and crafts.

Importers/Distributors

Most Indian giftware and handicrafts companies use importers/distributors to market and sell their giftware and handicrafts lines.  They buy and sell on their own account.  Thus, the companies take advantage of the distributor's expertise, his sales force and his existing distribution channels.  Distributors call on giftware and handicrafts retailers, purchasing groups and supermarkets.  The distributors' mark-up varies depending on the giftware and handicrafts item, but at least 50 percent.  While the mark-ups vary according to the distributor; they usually also depend on the exclusivity of a product and on its competitiveness in the overall giftware and handicrafts market. 

Commission Agents

 An Indian firm wishing to appoint an agent should make sure that such standard contracts meet its expectations.  In order to facilitate market entry efforts by the agents their initial commission is often a few percent higher than the "usual" commission. These additional payments are to reimburse the agent for substantial advertising and any special efforts facilitating the new product's market entry.

Department Stores
Indian companies interested in establishing business contacts with major department stores, mail-order houses and retailers may also choose the direct approach.  Department stores in particular, prefer to deal directly with manufacturers.  Their buyers are very specialized and only handle a limited range of products.  At some occasions department stores also buy through independent commercial agents.  Quite often they have their own buyers as well as a few agents that usually work with them and who know their assortments.  If a department store decides to import a particular giftware and handicrafts item, it places bulk rather than small orders.

Internet Sales

As far as the distribution of handicrafts is concerned, the internet has lowered the barriers significantly for market access. Even small producers of handicrafts can reach consumers all the way across the world. Information about products and their characteristics that suit the market most will help in driving the rural economy to produce what is needed. This will generate employment and preserve traditional skills, while tuning them to national and global demand.

Packaging of handicraft goods is an aspect which needs to be taken care of, as, at present there is no proper arrangement for it. Due to lack of proper packaging goods get damaged in transit, because of which the artisan is forced to sell locally and thus restrict his market. Packaging is done only in case of exports, which are rare, or when a customer insists on it, and pays for it.With increasing online awareness most of the firms prefer to do sales through Internet.Indian companies interested in establishing business contacts with major department stores, mail-order houses and retailers may also choose the direct approach. Department stores in particular, prefer to deal directly with manufacturers. Their buyers are very specialized and only handle a limited range of products. At some occasions department stores also buy through independent commercial agents. Commission agents provide Indian companies with direct access to the global market and direct control. They concentrate on specialist retailers, purchasing groups and department stores. In order to facilitate market entry efforts by the agents their initial commission is often a few percent higher than the "usual" commission. provide distribution and storage facilities apart from maintaining consistency in the kind of products and their quality Specialized wholesalers deal in sales to retailers as well as to final consumers. They maintain high quality standards and but have a narrower and in-depth range of arts and crafts.


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