STEP 2: Market Review : External Analysis Session 5

1. STEP 2: Market Review: External Analysis Session 5

2. STEP 2: Market Review: External AnalysisRecap: What is Step 2? 2.1: Considering Trade Structure: Distribution Channels and Segmentation 2.2: Researching and Analysing your current customer profile 2.3: Reviewing ‘Styles’ of different markets/countries and their suitability for your products 2.4: Researching and Identifying relevant Design Trends in the existing and potential Market to inform your product development/identify where opportunities exist 2.5: Assessing Promotional Opportunities for your business 2.6: Researching the current Business environment and growth opportunities in different EU countries to identify appropriate target markets/countries 2.7: Researching Market Access Requirements (Legislative/Non- legislative) in target markets to ensure that these can be met 2.8: Assessing your competition to ensure that you have a competitive advantage, or at least a fair chance 2.9: Identifying Your Opportunities and Threats from your External Analysis The ‘OT’ of SWOT

3. Identifying your opportunities and threats as part of the SWOT process  At this point, you have completed the Internal Analysis (the SW) of the SWOT process, and so, in order to complete the SWOT analysis, the external analysis of the target market is required in order to identify the Opportunities and Threats that exist. This will enable you to make choices about which products you want to develop and sell, and to which markets (PMC’S –PRODUCT/MARKET Combinations) This can be done by becoming more informed about your existing and potential market(s)

4. EU Market and Industry Trends for HD & HT • Market structure • Understanding Europe and the EU • Trade watch facts & figures • Current economic situation • Influencer on consumption • Distribution • Segmentation • Price points • Regional differences • Info Sources

5. EU Market and Industry Trends for HD & HT • UNDERSTANDING EUROPE AND THE EU

8. The official MOTTO of the European Union • United in diversity • The motto means that, via the EU, Europeans are united in working together for peace and prosperity, and that the many different cultures, traditions and languages in Europe are a positive asset for the continent.

9. How many countries are united in the European Union? 28 Let’s name them…

10. Which of the following countries joint the EU in 2013? • Croatia • Switzerland • Turkey • Iceland

11. : Croatia Croatia became the EU's 28th Member State on 1 July 2013.

12. Switzerland

13. How many official languages are there in the EU? • 2 • 23 • 15

14. Answer: (b) • The EU has 23 official languages. • Moreover, the EU has more than 60 indigenous regional minority language communities.

15. How many countries currently use the Euro as their currency?

16. The correct answer is 17 countries

17. Which countries are the main importers of Home Decoration and Home Textiles in the EU ? Germany France UK The Netherlands Belgium Spain

18. EU Market and Industry Trends for HD & HT • TRADEWATCH • FACTS & FIGURES • Current economic situation • Conclusion for action • HDHT consumption – import

19. TRADEWATCHEU trade facts & figures http://www.cbi.eu/system/files/marketintel_platforms/CBI%20Tradewatch%20Home%20Decoration.pdf • The EU is the world’s biggest single trading block Total EU imports valued € 1,550 billion and represented 20% of total world merchandise trade. EU is also leading exporter. 45% of world merchandise exports

20. The EU as trade partner for developing countries

21. In times of economic adversity, the EU market for HD comes under pressure. Consumers are more cautious about spending money on products for the home and this has an effect on trade, with both consumption and imports of HD showing signs of decline 2014 Current Economic Situation As soon as economic conditions improve, consumption is expected to pick up again. Economic indicators are currently forecasting modest improvements after 2013. Caution is advised as consumer confidence is still low and fragile and there are variations between countries

22. which products ?home decoration & home textiles variety of products(from cupboard to sun bed from statue to teapot to lamp) variety of uses (utilitarian/decorative, home/fashion/gift) variety of materials (wood, bamboo, natural fibres, textiles, metal, ceramics, paper, lacquer, leather, etc.)

23. Home Decoration and Home Textiles variety of products accessories art bags & purses bath & beauty crochet books candles ceramics & pottery sund bed furniture Glass outdoor housewares bamboo sofa Instruments needlework paper goods toys woodcarving

24. variety of uses & materials gift fashion useful decoration home

25. Product tree

26. Product Groups The product groups in the Gifts and Decorative Articles Sector are categorized as follows: (CBI The Netherlands): plastic, wicker, candle, ceramics, glass, wood, paper, metal and artificial flowers

27. market of home décor products is declining Germans account for 16% of the spending on average UK 24% Market size Home Decoration and Home Textiles The EU is one of the most lucrative markets of gifts and decorative articles in the world. In fact, the EU ranks among the top consumers of this product category in the global market. However, with the labour cost is increasing, more EU countries have to rely on imports, opening the opportunities for Asian countries total EU-27 consumption of home decorations and accessories amounted to € 13 billion

28. Consumption of HD in the EU/EFTA

29. Consumption in the EU consumption of home decorations and accessories per household in € ? € 65,00

30. IMPORTS The economic crises caused a dip in HD imports in 2012, but is expected to recover in line with market developments.

31. EU/EFTA Imports of HD

32. EU/EFTA Imports of HD

33. Population 499 Million EU 160 million households house construction 1.7 million/year immigration is an important source for population growth 291 Million US 127 Japan

34. EU Market and Industry Trends for HD & HT • Distribution • Various intermediaries • Niche markets • Segments • Positioning • Price levels

35. DISTRIBUTION The EU market for HD is fairly stable in its distribution structure, with wholesale importers and, increasingly, self-importing retailers as the main channels between exporters and the market. Real change can be seen in the increasing segmentation, especially in the upper middle and higher markets, as well as in the market for sustainable products and in the emergence of on-line retail. Find out how these developments offer opportunities for you as a DC exporter.

36. Trade Structurefor HDHT

37. The different types of intermediaries Retailers Variety retailers the variety stores are one of the most important formats for the sales of gifts and decorative articles and make up around 45 percent of the turnover. variety stores need to redefine themselves.

38. Furniture & Home Interior retailers This group includes a large variety of formats (all selling interior decoration products) like specialists, large furniture outlets, etc., each aiming at a specific area or consumer group. The large furniture outlets are generally large stores, with different types of products under one roof. A notable development in the European furniture landscape Ikea.

40. Garden centres

41. Department stores

42. Mail-order houses

43. Grocery multiples Supermarkets and hypermarkets

44. Wholesaler

45. On-line stores

46. Fair Trade

47. : e.g. www.etsy.com, On-Line Selling: B2C

48. On-Line Selling: B2B On line Platforms Examples: www.achica.com www.notonthehighstreet.com www.boticca.com www.5rooms.co.za www.superbalist.co.za Plus ..plus…

49. Street markets

50. NICHE MARKETS – CONCEPT STORES.......