...There are many co-operative helping hands in the course of completion of this report. And so we would like to express our heartfelt gratitude to all of them. We would like to give special thanks to Mr. Narayan Pradhan , professor, NCM for providing us with this opportunity to know about the real world practices in carpet industry. We also acknowledge the support and coordination provided by Jawalakhel Handicraft Centre. Moreover, we are very grateful to Mr. K.P. Maskey. We would also like to show our sincere gratitude to the management and faculty members of NCM, who have been very co-operative and helpful. We finally thank all the other who have helped us either directly or indirectly to accomplish our project. Executive Summary The project has encompassed the details on the handicraft industries of Nepal. The project actually has cited the knowledge on the carpet industries of Nepal. The project has explained the details under the following major headings: a) Introduction: The detail introduction on the carpet industry of Nepal. The industry’s major introduction is included here on this section of the report. b) History of carpet industry in Nepal: The history of the industry has been explained in detail in this section of the report. This section of the report has dealt with the contents that sets light on how this industry was before. c) Objectives of the industry: The section sorts out the major objectives of the...
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...ago. Throughout the years with the use of effective globalization, “IKEA managed to increase its business revenue and profit by selling and making home-furniture in different countries all over the world, and it has over 300 retail stores in more than 30 countries”. Other than that, they sell roughly 10,000 different products, which attract customers from different places all over the world. The basic assumption behind IKEA's global strategy was “one-design-suits-all”. This case “IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor ” is about IKEA’s development from a backyard company to one of the world’s largest furniture retailers, which has to deal with the issues of child labor and how they should behave considering economical issues and the company’s policy. Business Manager Marianne Barner has to face tough decisions on How to effectively enforce their anti-child labor policies while keeping the best interest of the child in mind? Indian rugs are...
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...FASHION EXPORT MERCHANDISING National Institute of Fashion Technology, DELHI M.F.M Semester 2 EXPORT INDUSTRY OF INDIA Submitted to – Ms Jasmine Dixit Submitted by – Kranti Wadmare Meghna Kumar Rahul Kumar Rounak Siraj Parul Dang EXPORT INDUSTRY OF INDIA Exports from India amounted to US$317.5 billion during 2014, up 44.1% since 2010. India’s top 10 exports accounted for 60.5% of the overall value of its global shipments. Based on statistics from the International Monetary Fund’s World Economic Outlook Database, India’s total Gross Domestic Product amounted to $7.376 trillion in 2014. Therefore, exports accounted for about 4.3% of total Indian economic output. Given India’s population of 1.252 billion people, its total $317.5 billion in 2014 exports translates to roughly $254 for every resident in that country. India’s unemployment rate was 4.1% in 2014. Sectors 1. Primary: Agriculture and mining (CIL , National mineral development corporation) 2. Secondary: Industry (Tata motors, Sun pharma industries, Indian Oil Corporation) * Petroleum products and chemicals * Pharmaceuticals * Engineering * Gems and jewellery * Textile * Mining 3. Tertiary: Services (Oracle TCS,Infosys) * Energy and Power * Infrastructure * Retail * Tourism * Banking and finance * Aviation * Information technology COMPOSITION OF EXPORTS Commodity group ...
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...lower labor cost. However, this decision pushed IKEA into the accusations of using child labor. In the mid-1990s, when child labor issue arouse for the first time, IKEA promised that “if the supplier employed children under legal working age, the contract would be cancelled” (6) and appointed a third party to monitor its suppliers’ factories. However, in the spring of 1995, a German film maker documented how one of IKEA’s major suppliers used child labor and invited IKEA to participate in an living discussion. This essay evaluates the possible strategies for IKEA in respond to the invitation and the child labor issue. Do Not Participate in the Discussion Program I would recommend that Marianne Barner, as a business area manager for carpets, do not participate in the program. This documentary aimed directly at IKEA and one of its suppliers, so it is highly possibly that the question lists prepared by the Germany documentary maker are used to mislead audiences and the evidences provided are weighted against the IKEA. Therefore, it is better for Barner to decline the invitation at first, conduct a investigation simultaneously and publish the results as soon as possible. Furthermore, in public, Barner should thank the German Video production company to notify this issue and express IKEA’s deeply apologies to mishandle the child labor issue and IKEA’s urgent desires to solve this issue....
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...IKEA is going to be criticized by German TV program because the IKEA’s carpet supplier, Rangan Exports (Rangan), uses child labor in their factory in India. Ms. Marianne Barner, IKEA’s business area manager for carpets, has to deal with this problem. She should keep the contract with Rangan and eliminate child labor by forcing Rangan to comply the contract as written. There are 3 reasons. First, showing IKEA’s stance for CSR is important to appeal its customer. If IKEA chose to just break the contract with Rangan, this does not solve the child labor. IKEA must deal with this problem and find a solution. Therefore, Ms. Barner should keep the contract and force Rangan to comply with it by sending a monitoring person to Rangan’s factory and/or add a penalty clause on the contract. Second, this option will be an opportunity for IKEA to increase its sales. Adapting additional monitoring system would cost more than before, but this will good for IKEA’s sales. Sales in Germany occupy 29.70% of the IKEA’s overall sales in 1994 (Exhibit 4), so dealing with the child labor will protect IKEA from Germany customers’ critics who have strong interest with social problem. Moreover, its positive reputation for dealing with child labor would attract more and more customers not only in Germany but also in other countries. Finally, keeping the connection with Indian company will bring a chance to access to huge market, India. Now IKEA sees India as a supplying country. However, it will be a...
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...2006 CHRISTOPHER A. BARTLETT VINCENT DESSAIN ANDERS SJÖMAN IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor (A) In May 1995, Marianne Barner faced a tough decision. After just two years with IKEA, the world’s largest furniture retailer, and less than a year into her job as business area manager for carpets, she was faced with the decision of cutting off one of the company’s major suppliers of Indian rugs. While such a move would disrupt supply and affect sales, she found the reasons to do so quite compelling. A German TV station had just broadcast an investigative report naming the supplier as one that used child labor in the production of rugs made for IKEA. What frustrated Barner was that, like all other IKEA suppliers, this large, well-regarded company had recently signed an addendum to its supply contract explicitly forbidding the use of child labor on pain of termination. Even more difficult than this short-term decision was the long-term action Barner knew IKEA must take on this issue. On one hand, she was being urged to sign up to an industry-wide response to growing concerns about the use of child labor in the Indian carpet industry. A recently formed partnership of manufacturers, importers, retailers, and Indian nongovernmental organizations (NGOs) was proposing to issue and monitor the use of “Rugmark,” a label to be put on carpets certifying that they were made without child labor. Simultaneously, Barner had been conversing with...
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... *** Sub: Note on Textiles & Clothing Exports of India. 1. Introduction India’s textiles and clothing industry is one of the mainstays of the national economy. It is also one of the largest contributing sectors of India’s exports worldwide. The report of the Working Group constituted by the Planning Commission on boosting India’s manufacturing exports during 12th Five Year Plan (2012-17), envisages India’s exports of Textiles and Clothing at USD 64.41 billion by the end of March, 2017. The textiles industry accounts for 14% of industrial production, which is 4% of GDP; employs 45 million people and accounts for nearly 11% share of the country’s total exports basket. 2. Milestones i) Exports of textiles and clothing products from India have increased steadily over the last few years, particularly after 2004 when textiles exports quota stood discontinued. ii) India’s Textiles & Clothing (T&C) exports registered a robust growth of 25% in 2005-06, recording a growth of US$ 3.5 billion over 2004-05 in value terms thereby reaching a level of US$ 17.52 billion and the growth continued in 2006-07 with T&C exports of US$19.15 billion recording a increase of 9.28% over the previous year and reached USD 22.15 billion in 2007-08 denoting an increase of 15.7% but declined by over 5% in 2008-09. Exports of Textiles & Clothing grew from USD 21.22 billion in 2008-09 to USD...
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...International Finance & Global Capital Markets Exposure Management Himanshu Bhutani A014| Dawood Bukhari A015 Shibani Gujrati A025| Siddhant Anthony Johannes A033 Nishtha Sardana A054| Prateek Walia A063 1 INDEX 1. Introduction…………………………………………………………………………………..3 2. Operational Exposure………………………………………………………………………..9 3. Transaction and Translation Exposure…………………………………………….……..11 4. Other Strategies used by Companies to Hedge Exposure……………………...………19 5. Case Studies: Hedging Strategy used by Companies………………………….………..20 2 INTRODUCTION Foreign exchange exposure represents a material risk for multinational corporations which are unrelated to business operations. One needs to identify each foreign exchange exposure, the risk it represents and methods and costs available to limit such exposure. The value of a firm’s assets, liabilities and operating income changes continuously due to change in factors such as exchange rates, interest rates, inflation etc. In other words, a firm is “exposed” to uncertain changes in a number of variables in its environment. Exposure may therefore be defined as a measure of sensitivity of the value of a financial item to changes in the macro economic variables mentioned above. Risk refers to the variability of the value of the item. FOREIGN EXCHANGE EXPOSURE Foreign Exchange Exposure occurs because of unanticipated change in the exchange rate. For example the difference in the spot rate & one month forward rate is 0...
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...delivery, IKEA taught their processes and provided machinery to their suppliers in Poland. After expanding their suppliers globally, IKEA created a general procurement principle that that stated IKEA should develop close ties by supporting its suppliers with a long-term relationship. By the mid-1990s IKEA worked with 2,300 suppliers in 70 countries. IKEA has 24 trading service offices in 19 countries that monitor production, test new product ideas, negotiate prices, and check quality. Since 1980’s IKEA has been looked upon in regard to environmental and child labor concerns that their suppliers are practicing. Marianne Barner is the Business area manager for rugs and Rangan Exports is the Indian rug supplier that signed a contract forbidding the use of child labor. New reports have surfaced that Rangan Exports are using child labor in their factories. IKEA has to make a decision, whether they should sign up to a...
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...We would like to express my profound gratitude to all those who have been instrumental in the preparation of this project report. We wish to place on records, our deep gratitude to our project guide Dr. Rajesh Jain, a highly esteemed and distinguished guide, for help and advice. INDIAN TEXTILE INDUSTRY The Textile industry in India traditionally, after agriculture, the only industry that has generated huge employment for both skilled and unskilled labor in textiles. The textile industry continues to be the second largest employment generating sector in India. It offers direct employment to over 35 million in the country. India is the second producer but India will lead in all. According to the Ministry of Textiles, the sector contributes about 14% to industrial production, 4% to the country's gross domestic product (GDP) and 17% to the country's export earnings. The share of textiles in total exports was 11.04% during April–July 2010, as per the Ministry of Textiles. It is estimated that India would increase its textile and apparel share in the world trade to 8% from the current level of 4.5% and reach US$80 billion by 2020. During 2009-2010, Indian textiles industry was pegged at US$55 billion, 64% of which services domestic demand. Contents 1 History 2 Production 3...
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...India-Japan Economic Partnership Agreement: Gains and Future Prospects Preface India signed a two-way Comprehensive Economic Partnership Agreement (‘CEPA’ or ‘the Agreement’) with Japan on 16 February 2011. CEPA would provide a framework for enhanced cooperation between the two countries and is aimed to facilitate trade in goods and services and increase investment opportunities, besides protecting intellectual property rights. The Agreement is likely to be implemented from 1 April 2011. The highlights of CEPA have been provided below. CEPA The CEPA aims to reduce or eliminate tariffs over next 10 years on over 90 per cent of goods traded between the two countries. The Agreement inter alia provides ‘schedule for India’, a list detailing product wise plan for reduction/ elimination of duties for imports into India and a similar ‘schedule for Japan’. The quantum of duty reduction under CEPA will vary from product to product. Therefore, some products may see a complete elimination of duties on 1 April 2011 itself (or any other day on which the Agreement comes into force) while others may see a gradual reduction over years. Sensitive sectors for India and Japan are fully protected and will not see any tariff change. An illustrative list of goods for import into India and the time period over which basic customs duty would be eliminated is given below: |Description of goods |Period in which tariff to be reduced...
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...IKEA’s Global Sourcing Challenge IKEA, one of the world’s largest specialized furniture retailers, has been presented with a large issue within their operations. In 1995, a German TV station released an investigative report which exposed one of the suppliers for IKEA rugs for exploiting child labor in their factory. A recent addendum was signed by all IKEA suppliers which forbid the use of child labor (Bartlett & Sjoman, p. 1, 2006), so this incident has called the company to make an action based on the accusations at hand. The amount of turnover that is accounted from Indian rugs for IKEA is small on the full scale, and made the company question whether or not the product line was worth the profit potential. The following will be an analysis of the history of IKEA’s manufacturing, external forces related to the presented issue, rising issues, and recommendations for the company’s future moves. History of IKEA’s Manufacturing Though IKEA is one of the largest brands in the furniture industry, the company has been involved with some environmental issues related to their manufacturing. In the 1980s, IKEA’s products were subject to investigation as they were observed to emit more than allowed levels of formaldehyde (Bartlett & Sjoman, p. 5, 2006). The issue occurred from suppliers buying materials from sub suppliers, which resulted in the product not passing the regulations placed by legislation. The company began to change the way they worked with their suppliers...
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...Barner business manager for IKEA’s carpets should respond with a firm no to the invitation. The German video program would only bring detriment to the company, rather than relief or support for the issue at hand. In comparison to the Swedish program, which did not target a specific company, this German-produced program planned to take a confrontational and aggressive approach targeted directly at IKEA and one of its suppliers. Germany currently brings in the most sales for IKEA with $10.4 and 29.7%. Since Marianne Barner’s goal was to stop the issue, accepting this invitation would only bring fuel to the fire. The producers of the German documentary invited IKEA to send a representative to take part in a live discussion during the airing of the program. The benefit of accepting this invitation is the opportunity for IKEA to educate the producers and the public on their current efforts to fight child labor. However, the fact that the producers won’t allow the company to preview the video and that the program clearly planned to take a confrontational and aggressive approach aimed directly at IKEA raise the possibility that the representative would be blindsided and IKEA’s message not accurately portrayed. Thus, declining the invitation and respond to the allegations in the video would be advantageous only when they’ve had a chance to review and verify the evidence. 2) What actions should she take regarding the IKEA supply contract with Rangan Exports? If the evidence of child labor...
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...IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor 1. List and describe the key components of IKEA’s business strategy? * Low price is one of IKEA’s most important components of business strategy. Its low price attracts many people to purchase products there, especially young householders looking for well-designed but inexpensive furniture. It is the low price that helps IKEA stick on its version: “selling affordable, good-quality furniture to mass-market consumers around the world”. To stay constant low price, IKEA matches products to supplier capabilities and also makes cost consciousness a really strong part of the IKEA’s management culture. * Opening display stores is also a key component. Customers can go to the display stores to look around and inspect furniture and other products before buying. This is really helpful for customers to choose the right products they need and also helpful to reduce products returns at the same time. * Self-assembled furniture is a key feature of IKEA. This concept helped IKEA gain so many customers. Customers buy furniture in flat packages and assemble the furniture at home. This idea save IKEA’s transport and also storage costs. With money saved, IKEA could offer constant low prices for its customers. * Advising by issuing catalog is a significant idea. By sending is catalogs to customers, IKEA get the chance to introduce every products to its target market. Many people who go to IKEA to purchase are driven...
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...handloom sector has seemingly lost relevance in contemporary society. The number of weavers has also reduced during the last 15 years. The Indian culture is fading away. One of the objectives of GST was that, a common rate across the chain would avoid confusion, but job workers are not able to avail input tax credit that had been increasing the cost of the products and affecting the export competitiveness and also the domestic consumers. The Handloom Industry received its massive boost in 2015 when the PM announced “Handloom Day” and declared that it would be celebrated annually since. A lot of measures to promote handlooms, schemes for their effective marketing were taken up. The GST rates are equal or lower than the pre-GST tax incidence. And therefore, the price of fabrics is not likely to go up, Jaitley said, explaining why the 5% rate cannot be removed. How can the government launch two contradicting policies within a span of two years? At one moment you are promoting them and in the other you are trying to ruin the industry. It shows that the policies were not planned carefully before implementing them. Due to this, 'Fake' handloom products are being replicated with inferior materials in the name of handlooms and attracting demand due to low price, and that time is not far away when China is going to have copyrights over the Indian art and cultural work. The handloom sector has always had it bad when it comes to reliefs, relaxations, institutional credit, assured markets...
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