This table lamp from Falcon Indventure Pvt. Ltd has a clay body.

To better differentiate their products from competitors', suppliers are highlighting models in natural materials. Enterprises are also shifting to more mechanized production processes.

Suppliers of home decor in India are carrying out various product development measures and undertaking machinery upgrades to counter different industry challenges.

Faced with intensifying competition in the region, domestic manufacturers are stressing innovation to remain viable. Makers are launching models made of plant-based inputs amid the growing demand for sustainable goods. Cane and bamboo, in particular, are widely used as they can be readily procured from local vendors. Instead of wood pulp, enterprises are creating paper products from banana and cotton fibers, thus reducing the need to cut trees. In addition, these materials are versatile to be woven in various combinations, allowing makers to differentiate their products better from their foreign counterparts.

Aside from exerting efforts to keep up with the latest trends, suppliers are modernizing facilities by emphasizing mechanization. Several manufacturers have started incorporating electric metalworking equipment such as lathes, and cutting, sanding and drilling machines. This approach helps companies boost efficiency and reduce manpower outlay.

To further enhance workers’ machine-usage skills, the national government, with financial and technical assistance from the United Nations Development Programme, has established the Metal Handicrafts Service Center. Located in the city of Moradabad in Uttar Pradesh state, the facility organizes training sessions aimed at teaching craftsmen on how to use advanced tools and equipment. It also offers courses on various techniques such as electroplating, lacquering, sandblasting and powder coating.

Challenges

Malik Exports manufactures this brass table clock that features an antique finish.

The soaring cost of labor is considered as the primary roadblock facing the sector. Because of the surging manpower outlay, some buyers are shifting their purchasing activities to more economical hubs such as China and Vietnam.

As part of its reforms, the national administration has authorized state governments to independently set the minimum wage in their jurisdictions to offset rising living costs. In Delhi, where most head offices and factories are based, workers receive between $152 and $185 per month, depending on the skill level. Pay rates in Uttar Pradesh start at $98. Wages in the state of Haryana are from $100 to $105. To save on manpower expenditure, several suppliers are forced to cut jobs while others resort to subcontracting. Assembly, molding and carving are some of the most commonly farmed out production processes.

Compounding the difficulty of manufacturers is the increasing cost of raw materials. In January, the price of steel went up from $607 to about $650 per metric ton due to rising input costs and freight charges. This month, steelmakers are set to raise quotes by at least $8 per metric ton amid strong demand from the construction sector. In addition, prices of base metals such as aluminum and nickel have surged by nearly 12 percent since December last year because of the rupee’s depreciation. Paper and wood, meanwhile, have become more expensive by at least 5 and 10 percent, respectively.

Industry composition & hubs

Government statistics indicate that there are more than 7,000 handicraft makers across the country. The majority of suppliers are locally owned, with nearly 70 percent considered as export-oriented. Close to 6 million people are employed by the sector.

The city of Khurja in Uttar Pradesh state specializes in ceramic pottery and vases. It is home to over 20 export-oriented companies supplying various handicrafts to clients in the US, the UK, Australia and New Zealand. Statistics show that there are more than 500 factories in Khurja.

Moradabad is famous for its metalwork such as brass and bronze sculptures and statuettes. An estimated 600 home decor suppliers operate in the city. Firozabad city in Uttar Pradesh is known for its glass handicrafts. Wooden items are mostly created in Saharanpur district, where roughly 50,000 artisans engage in wood carving. The cities of Bangalore and Mysore are known for goods that adopt rosewood.

The state of Tripura is considered as the primary sourcing center for cane and bamboo models. More than 10,000 craftsmen producing lamps, curtains, mats and baskets made of these natural fibers are currently based there.

This article is an excerpt from India Sourcing Report: Home Decor, published by Global Sources and the Hinrich Foundation. For the full report with complete Industry Overview and 18 suppliers, click here.

This article and its contents are provided by the Hinrich Foundation, a partner of Global Sources in promoting trade across Asia. The products and the suppliers featured in this article are export assistance program beneficiaries of the Hinrich Foundation.