Causes of failures:

Infringement of designs China is one of the culprits

Lack of capital / financial capability
Loss of skilled workers
Loss of designers
Exchange trade
Technology
Government did not support the industry
Production costs are high
Raw materials are lacking
Shipping costs

Government agencies involved in export promotion:
DTI
BETP
FTSC
EXPO-NET
CITEM (1 Furniture show and 2 GTH shows)

Garment exporting was shut down when WTO removed the export quota for garment. Prior to
the removal of the export quota, supplier countries had to take their allowable quota from GTEB
(Garment and Textile Export Board).

Philippine handicraft companies died or went down because they were competing with each
other to get the foreign buyer and they were pricing their product outside the market.

Violation of the distribution channel:

Foreign Buyer - $10 / dozen
Wholesaler/distributor
Retailer - $10 / dozen

What went wrong above? An exporter should never price the same for importer and
retailer. In fact, retailers are to be priced six times fold (rule of thumb). Therefore, the retailer
should be priced at $60 / dozen.

Export promotion for handicrafts:

a. Export promotion by handicraft in coordination with CITEM, and the commercial attachs office
b. Local promotion and advertising by the foreign buyer

Conclusions and Recommendations;

A. Finance Packing credit line 70% - 80% of the LC value
a. Banks require hard collaterals land/property
B. Building relationships
a. To make sure your foreign buyer is satisfied with the quality of product you give, hire a
Foreign Buyers Representative. This person will issue an inspection certificate that will
prove that the quality of products being exported is good. There are three types of
certificates...
1. Manufacturing Process
2. Completion
3. Packing/Loading
C. Government Support