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CASE STUDY Women entrepreneurs from rural areas in the souvenir business Eastern CroatiaSlavonia Er

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Title: CASE STUDY Women entrepreneurs from rural areas in the souvenir business Eastern CroatiaSlavonia Er


1
- CASE STUDY - Women entrepreneurs from rural
areas in the souvenir businessEastern
Croatia/Slavonia Erdut Municipality
  • JASMINA Ilincic, Director of development
  • CODD Civil Organisation for Development Dalj
  • RCC - Workshop on Enhancing
  • Women Entrepreneurship in SEESarajevo, 1st
    October 2009

2
INTRODUCTION ...
  • While preparing this presentation, I held a
    meeting (24.09.2009.) with 12 women entrepreneurs
    members of the CODD social enterprise called
    Handwoven souvenirs .
  • We discussed main problems, obstacles, solutions
    ...
  • The presented findings come from their point of
    view ... from real women at grassroots level.

3
What region are we talking about?
  • The situation in the post-war Municipality of
    Erdut (8,500 inhabitants living in 4 villages) is
    quite problematic.
  • High rates of unemployment, depopulation and
    emigration of people, and low interest of young
    people for life in the rural areas hinder the
    development of this territory, rich in resources
    and tradition.
  • But, in such a situation it is sometimes enough
    to identify and initiate ideas that will revive
    the forgotten potential of this region, and
    significantly contribute to the quality of life
    of local people.

4
What region are we talking about?
  • Many donors and official Croatian institutions
    introduced social entrepreneurship and social
    enterprises as a model for job creation and
    local community development for the social
    excluded a few years ago.
  • The nongovernmental association CODD, operating
    in this region since 2002., saw this direction as
    complementary to it's strategic goal of
    empowering rural and marginalised women, not only
    psycho-socially, but also economically.

5
What is a social enterprise?
  • Any private activity conducted in the public
    interest, organised with an entrepreneurial
    strategy whose main purpose is not the
    maximisation of profit, but the attainment of
    certain economic and social goals, and which has
    the capacity to bring innovative solutions to the
    problem of social exclusion and unemployment.
  • (definition by OECD, LEED Programme)

6
How did it start?
  • A group of women enthusiasts, members and
    activists from CODD, recognized this new
    opportunity in a revival of traditional crafts,
    handweaving on Slavonian looms.
  • The idea was, that establishing a social
    enterprise can revitalize the rich culture of the
    Slavonian region, while at the same time promote
    employment and sustainable development.

7
How did it start?
  • Therefore, 12 women started the CODD-social
    enterprise HANDWOVEN SOUVENIRS with the initial
    help of various donors (Japanese Embassy in
    Croatia, just to mention one) for equipment
    purchase (handweaving looms, sewing machines
    etc.).
  • The long-term intention was to form a cooperative
    when the social enterprise develops strong
    enough.

8
What was the business idea?
  • The business idea was that production of
    handwoven souvenirs can contribute
  • ...to the advancement of the region (where rural
    tourism as one of the priority strategic
    directions of the Municipality of Erdut), and
  • ...to the employment of rural women.

9
Why souvenirs?
  • Slavonia, specifically Erdut Municipality, has a
    wealth of high quality traditional handcrafted
    products with a great potential in the tourist
    market.
  • This sector is particularly important due to the
    fact that the vast majority of producers are
    unemployed women in rural areas that were heavily
    affected by the homeland war in the 90's.

10
Why souvenirs?
  • The richness of culture and history has brought a
    wide range of products such as golden embroidery
    or handwoven products.
  • The general situation in Croatia is that tourists
    leave with the impression that there is little to
    buy in way of handicrafts, and, at reasonable
    prices compared to
  • other tourist destinations.

11
What has been achieved so far?
  • Women were trained in hadweaving techniques by
    experts from the Textile Faculty from Zagreb.
  • They obtained elementary business skills training
    and funds to buy initial raw materials for
    production.
  • They obtained some funds for participating in
    exhibition shows and fairs.

12
What has been achieved so far?
  • At first, the enterprise produced various things
    in order to somehow explore what the market
    want's.
  • Bags, rugs, cloth, table cloth, linen, and many
    other products.
  • Women linked to the local and regional Tourist
    associations and participated in many fairs and
    events across Croatia in order to promote
    products, gain income and even more important-
    to see which product is the bestseller.

13
What has been achieved so far?
  • This was done through grants and subventions from
    various donors, who were pushing the female
    social enterprise idea .
  • The goal was to get to the market, link to
    souvenir shops or retailers, and continuosly sell
    products which tourists like the most.
  • This would leed to the establishment of a
    cooperative which could provide employment not
    only to the 12 women entrepreneurs who started
    the business, but to many others.

14
But ... ? Or from theory to practice
  • However, women from the Handwoven souvenirs
    enterprise soon discovered that the market for
    these products is diminishing as people turn to
    mass-produced and cheap items.
  • There is a limited amount of tourists cruising on
    the Danube where Erdut Municipality is situated,
    but even those producers with centrally located
    shops are having trouble attracting customers
    (mostly Americans) and selling their traditional
    handicrafts.

15
But ... ? Or from theory to practice
  • Therefore a limited amount of people will buy
    traditional handicraft items.
  • Slavonia is not a tourist hotspot and presents
    not the main market for those handwoven products.
  • In other words, tourism in Erdut Municipality is
    in it's baby shoes and therefore cant be the
    main souvenir market.

16
But ... ? Or from theory to practice
  • On the other hand, the tourist-rich coast
    (Istria, Dalmatia etc.) is flooded with visitors
    during the summer who have money to spend on
    souvenirs, but Slavonia rarely sees these types
    of visitors.
  • IDEA ?
  • If they don't come to us, let's get our products
    to the tourists!
  • ... how to get to them?

17
But ... ? Or from theory to practice --- first
problems
  • The women from the Handweaving souvenir
    enterprise are tucked into their villages far
    from the classic tourist destinations and are
    isolated from market information and linkages.
  • This makes it nearly impossible for them to
    understand what the market is looking for and how
    to reach it.

18
But ... ? Or from theory to practice
  • In order to get the products into the right
    hands, women soon discovered that they need to
    modify their products in order to meet market
    trends.
  • They must explore new distribution channels to
    get the products out, both on the coast and
    through inclusion in the regional tourism
    activity or souvenir shops.
  • Women asked How to know what foreign tourist
    want and how much they are willing to pay?

19
Women saID ...
  • We have the equipment,
  • we have the raw materials,
  • we have the neccessary production skills,
  • we even have the (right?)products,
  • we attended many fairs and promotion events
    (...while we had the money to do so ...)
  • but what we don't have is THE RIGHT MARKET and
    the RIGHT TOURIST to BUY our products.

20
Main questions ...
  • How to get to the touristic hotspots?
  • How to get to the right people?
  • How to know what foreign tourists want?
  • ... if ....
  • ... you don't have the money, the means and the
    knowledge?
  • Are there any support centers?
  • Who can help us?

21
Some first conclusions ...
  • During this afternoon meeting with women
    entrepreneurs, we came up with some conclusions
    that can bee seen as problems of all rural women
    entrepreneurs

22
Issue Some specific problems of rural women
entrepreneurs
  • Women from rural areas try to start businesses
    suiting to their resources and knowledge. Most of
    them are limited to food and handicraft products.
  • Rural women have family responsibilities. They
    have to take care of children and in-laws which
    takes away lots of their time and energy.
  • When facing non-support from family members it is
    difficult to concentrate on the business.
  • There is the problem of age and educational level
    of rural women.
  • Younger women are leaving rural areas.
  • Problem of mobility due to traditional values, or
    lack of transport opportunities.
  • Location of work (urban versus rural)

23
Issue Market awareness
  • Some identified problems
  • Rural women are unwilling to move beyond comfort
    zone (local community etc.)
  • Sometimes they are just unable to move beyond
    their community due to lack of infrastructure,
    lack of transport opportunities, lack of finances
    etc.
  • Due to low self confidence they fear to face
    risks and troubles that may come up in a business

24
Issue Market awareness
  • Some possible solutions?
  • Trainings for motivation and self confidence
    building
  • Training and assistance in business planning for
    any aspect of the enterprise (production,
    marketing, financial management).
  • Encourage participation first in local, and then
    regional and national fairs/events.
  • The local level (local authorities, local
    development agencies etc.) should provide
    loans/subventions for start-up activities (for
    example, to cover travel costs for participating
    at fairs, education etc.)

25
Issue Market Saturation and Product quality
  • Erdut Municipality is a region with very rich
    handicraft tradition ... but is this enough?
  • Do we have enough evidence of what the market
    wants, whether local, national, or especially
    international?

26
Issue Market Saturation and Product quality
  • Some identified problems
  • Selling sand in the desert, products that
    already exist in a better/cheaper form
  • Rural women entrepreneurs have little info on
    market demand
  • The majority of products are still strongly based
    in traditional colors, designs and function
  • Inconsistency in product quality (variations of
    raw materials due to imports from other
    countries) Poor packaging and marketing
    materials
  • Women expressed frustration not knowing how they
    could produce things that would be purchased.
  • There is great appreciation for their work (even
    from donors, embassies, ministries, companies
    etc.), but often little sales.

27
Issue Market Saturation and Product quality
  • Some possible solutions?
  • Support in market investigation and market
    information.
  • Expert support to identify niche markets.
  • Support to improve product design, quality,
    packaging etc.
  • Marketing material, such as brochures, should be
    published in various languages.
  • Establish linkage with relevant stakeholders to
    provide additional skills training.

28
Issue Competition
  • How to avoid the often heard sentences?
  • ......I can buy a cheaper souvenir.
  • Or
  • ......This is to expensive.

29
Issue Competition
  • Some identified problems
  • Flood of cheap imports to Slavonia (from
    handicraft to food) and Croatia in general.
  • Products made in China or India are cheap and
    trendy, and, as such, the interest in traditional
    local products tends to die out (to expensive
    etc.).
  • High cost of raw materials and inconsistency in
    their supply and quality.
  • High cost of the workforce (even though women
    work for minimum wages!). You cant compete with
    Chinese wages.

30
Issue Competition
  • Possible solution
  • Analyses of market
  • Move into new areas
  • Products must have unique design quality
  • Products must have a story attached

31
Issue Market Access
  • How can rural women, handicraft producers, be
    hooked with clients and other actors involved in
    the market?

32
Issue Market Access
  • Some identified problems
  • To much reliance on family, neighbours or
    previous contacts in local area.
  • Women cant run around for marketing,
    distribution and money collection.
  • Sometimes middlemen tend to exploit them.
  • Little use of market information
  • Rural women have less possibilities to enter
    markets such as Istria or Dalmatia no contacts,
    no information about events/fairs, lack of money
    to participate in events, no means of transport
    such as a car etc.

33
Issue Market Access
  • Possible solution
  • Link to retailers interested in products.
  • Try to directly hook producer to trader.
  • Help set up stands, vending points at touristic
    hotspots.
  • Strengthen sales skills, confidence.
  • Provide funding for transport and exhibitions.
  • Establish webshop.

34
Issue Access to finances and Legal registration
  • Some identified problems
  • Start-up financing for raw materials, marketing
    and other costs is a common challenge.
  • Major problem to rural women is liquidity.
  • Family is the primary source of finances.
  • Most women have never used a credit or applied to
    any kind of subvention.
  • For small levels of production, registration
    costs are significant and beyond womens financial
    means. The majority of rural women entrepreneurs
    in the handicraft business are registered as
    non-profit associations, which have a cap on the
    amount of revenue that they can generate per year
    (85,000 kuna).

35
Issue Access to finances and Legal registration
  • Possible solution
  • Provide initial credit/loans/subventions
    technical assistance at local level.
  • Assist in finding domestic or foreign sources
    (subventions from ministries, EU pre-accession
    funds etc.).
  • Provide support and assistance to women in
    actually obtaining those finances!
  • Pursue registration as a cooperative, as the next
    step.

36
Some ideas ...
  • EDUACTION IN DESIGN, BUSINESS MANAGEMENT
    MARKETING
  • Support rural women in learning more about
    product design and development, general business
    management including accounting, costing,
    pricing and marketing.

37
Some ideas ...
  • FACILITATION OF CONTACT MAKING EVENTS
  • I have a handwoven souvenir who wants it? Is
    it good enough? Should it be modified?
  • For example Organise gatherings between
    designers, hotel owners, souvenir shop owners and
    handicraft producers
  • Organise study tours to examples of good
    practice!

38
Some ideas ...
  • MAKE SLAVONIA THE ULTIMATE
  • HOTSPOT ? FOR RURAL TOURISM
  • Increase the tourist flow into Slavonia so that
    customers are able to have direct contact with
    producers and their work.
  • It would be good to create spaces that would be
    of interest to large tourist groups.

39
Some ideas ...
  • LONG-TERM LOCAL SUPPORT FOR RURAL WOMEN
    ENTREPRENEURS
  • Establish a regional/local ...
  • SUPPORT CENTRE
  • for rural women entrepreneurs.

40
SUPPORT CENTRES should offer
  • INFORMATIONS regarding
  • market -supply and demand
  • loans, credit and subvention offers
  • new regulations in the field of finance and
  • fairs, business and education events

41
SUPPORT CENTRES should offer
  • CONSULTING regarding
  • Finances and investment
  • Marketing
  • Human resources
  • Public relations
  • Import-export
  • IT and E- business

42
SUPPORT CENTRES should offer
  • EDUCATION regarding
  • Start up programs for women entering the
    business (motivation, orientation, business plan,
    registration etc.)
  • Improve your business program for women
    entrepreneurs (new regulations, marketing,
    product/service quality, new technologies etc.)
  • Tailor-made education programs (women in food
    cooperatives, women in handicraft business etc.)

43
SUPPORT CENTRES should offer
  • NETWORKING activities
  • With other successful business women and
    enterprises (examples of good practice)
  • Linking producers with buyers
  • Meetings, fairs or other contact making events
  • Database of women entrepreneurs, retailers, shops
    ...
  • Website presentation

44
Conclusion
  • Like with most handcrafted products, not only
    with the Handwoven souvenirs social enterprise,
    current sales are limited by a lack of market
    linkages, unattractive design, poor product
    development, no marketing strategy, little access
    to finance, inadequate contact with the products
    target market (or no knowledge of what the target
    market is in the first place), overall weak
    business management skills and registration
    constraints ....

45
Conclusion
  • The souvenir market is known as a market for
    cheap, mass-produced items.
  • Yet handcrafted products have a deeper meaning in
    many senses.
  • They can meet a need of a tourist who is looking
    for an interesting gift or something that reminds
    them of their visit. And these products can also
    convey and celebrate a countrys unique cultural
    tradition, while giving the customer a beautiful
    high quality product.

46
Conclusion
  • Most importantly, however, the sale of
    handicrafts can build communities by
    strengthening micro-enterprises and cooperatives
    that are managed by women in regions with great
    economic need.
  • This is certainly the case in the Slavonia
    region. Handicraft development initiatives can
    play an important role in increasing job creation
    and income generation in Croatia.

47
CONTACT ...
  • ... If you are interested in the CODD Handwoven
    souvenirs products, if you know someone who
    could be interested ...
  • ... if you want to know more about my
    organisation ... Visit
  • www.gord.hr
  • GORD-CODD
  • S. Kolara 2, Dalj 31226 Croatia
  • 385-31-591195
  • gord-codd_at_inet.hr

48
THANK YOU
  • ... For you attention.
  • Dont hesitate to contact me personally for
    further information.
  • Jasmina Ilincic,
  • E-mail jilincic_at_inet.hr
  • Mobile 385- 98 - 922 92 56
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