Guatemala Craft Sector Export Initiative, Aid To Artisans, 2004-2006

    For What's New Visitors, two semi-annual progress reports have been added from 2004 and 2005. This project ended in February 2006. Final documentation is forthcoming.

    The ATA/AGEXPRONT project to promote craft exports in Guatemala aims to mainstream microenterprises into the export market through promoting business links and developing BDS markets. The project links poor, indigenous crafts producers to the sophisticated home accessories market in the U.S. through a supply chain of U.S. buyers and Guatemalan exporters, rural producers, and input suppliers. With co-funding from exporters, ATA provides product development services to develop local designer capacity and AGEXPRONT, an association of exporters, uses funds from other donors to provide training directly to producers. Together, they facilitate the development of local service providers.

    ATA and AGEXPRONT are strengthening the capacity of Guatemalan exporters to: develop products that meet the demands of the export market; communicate with and obtain quality products from craft producers; communicate with and sell to importers; and meet importer delivery requirements. They help producers meet exporter quality and quantity standards and deliver products on time. To address market inefficiencies that impede entrepreneurial growth in the craft sector, ATA and AGEXPRONT facilitate market links, product development/design, consulting, and embedded services between exporters and producers that include product design training and quality production techniques.

    In an effort to encourage exporters and producer associations to hire local product design consultants on a regular basis, AGEXPRONT helped develop a fee schedule for first-time users and temporarily subsidized related activities. To foster long-term business relationships, ATA invites large buyers to visit Guatemala and meet with exporters and producer associations.

    The project is also building AGEXPRONT capacity to provide value-added, on-going market facilitation services to members on a fee-for-service basis.

    Summary of results
    As of June, 2005 the project was reaching over 4,000 micro producers.

    Major challenges are the dynamics of the crafts market, and working with very poor, indigenous crafts people, training them in new designs that run counter to traditional ones, and ensuring that the poorest in the supply chain benefit from the activity and are empowered by their participation in the export market.

    Progress reports contain lessons on the following topics:

    - Strategies for integrating the poor into mainstream markets: determining which project activities effectively reach microenterprises and meet their needs and how the program can ensure that benefits reach microenterprises.

    - Strategies for embedded services: effective, and cost effective, ways to follow a BDS market development approach, in a market where most services are embedded.

    - Strategies that ensure the poor benefit from BDS market development (market links): ensuring microenterprises increase their percentage of the Freight on Board (FOB) price they earn and determining the most advantageous intermediaries for microenterprises to use.