Jewelry, furniture industries eye new approach to clustering

The fine jewelry industry in Meycauayan, Bulacan, the furniture industry in Cebu and the ceramics industry in Metro Manila have expressed interest in adopting a new approach to industry clustering as a strategy for faster growth.

This surfaced after a series of dialogues between industry leaders and a team of consultants from the JE Austin and Associates of the United States in a mission here to help specific segments of the export sector develop their strategies for faster and rapid growth.

The dialogue was initiated by the US-AID supported TAPS project of the Philippine Exporters Confederation.

The jewelry and furniture groups have already been organized as pilot clusters with the help of the Export Development Council. Their initial success was used as the basis for the Department of Trade and Industry (DTI) in adopting this year industry clustering as a national strategy in spurring industry growth in the provinces.

In the latest dialogue where JE Austin team leader David Flood compared notes with industry leaders and EDC cluster management team captain Ceferino Follosco, it surfaced that benchmarking Philippine industries in relation to world leaders in the same business to determine what segment of the market the domestic industry seeks to hit, can add a new dimension to the strategy.

In the case of the furniture industry in Cebu, the cluster has reached a stage where they are ready to undergo the exercise and try to reposition themselves to specific targets in the global marketplace.

In the case of the fine jewelry industry, the group is yet to pinpoint where the greatest obstacles to growth are and evolve a clear-cut strategy to overcome barriers along its path.

The industry has successfully lobbied for a special law that clears away previous national policy that imposes heavy tax on imported gems like uncut diamond and jade and imposed limited access to local gold.

And yet, new investments have not come in although the industry has shown it can stay growing in these times of global trade slump. Its main challenge is to speed up its rate of growth.

The Philippine ceramics industry, on the other hand, has found itself in a bind after mainland China invaded the decorative ceramics market with cheap, though less artistic versions. Its leaders also got fascinated with the prospects of finding out what segment of the market it must target and what strategy and tactics to adopt to hit that market.

The JE Austin method of analysis and its access to hard facts and figures in the global marketplace have been seen as pivotal in the three industries’ development.

These groups, when resources allow that they get the services of the team that has helped other industries in Sri Lanka, Thailand and other East Asian countries, are ready to again be the country’s test cases.

Other industries, especially those that are dominated by small enterprises, may have to move their industry clustering programs using government finding and local consultants through the EDC and DTI.

From both experiences, the export sector expects to draw the best practices and develop a new module that fits the distinct business environment in the country. — Abe Belena, Philexport News & Features