The Gifts and Decoration
Market in Austria
HS-Codes: 34, 39, 44, 46, 67, 69, 80, 83
A report prepared by the
Office of Commercial Affairs
Royal Thai Embassy Vienna
C O N T E N T
1 Market Overview Page 3 1.1 Consumption Page 3 1.2 Production Page 3 1.3 Opportunities and Threats Page 4 1.4 Useful Sources Page 4
2 Trade Channels Page 4
3 Imports Page 7 3.1 Statistics Page 7 3.2 Opportunities Page 8 3.3 Useful Sources Page 8
4 Market Access Requirements Page 9 4.1 Packaging, Marking and Labelling Page 9 4.2 Tariffs Page 10
5 Doing Business Page 10
Appendices Page 11 A1 Product Groups Page 11 A2 HS Codes Page 13
The Gifts and Decoration Market in Austria 2 | Page
• The total consumption of gifts and decorative articles in 2005 (no later data available) in Austria
1amounted to 294 Mio USD (207 Mio EUR). Austria accounted for 2% of the EU-27 gifts and
decorative articles consumption. Compared to the other researched markets, Austria was one of the small markets in Europe in 2005. Consumption increased by 1.8% during the period 2001-2005, or 0.9% on average annually.
• Plasticware was the largest product group sold in 2005, accounting for 26% of total consumption. The second largest product group was Candles, which amounted to 25.8% of total consumption, followed by Ceramics (17.2%), Woodware (9%), Metalware (8.8%), Paperware (4.8%), Art. Flowers and Fruits (4.6%), Wickerwork (3.7%), and Glassware (N.A.).
• Austria has one of the largest GDPs per capita for 2007 and 2008 in Europe, which enables Austrians to spend more of their disposable income on gifts and decorative articles.
• According to Euromonitor, consumption is expected to increase slightly in the period 2006 – 2009,
especially in the segments concerning small home furnishings and decorations. However, sales of expensive china and porcelain are expected to continue to decrease in absolute value.
• The trend of declining of loyalty among consumers in favour of the attractive price and reasonable quality of many discounted private label gifts and decorative articles continued in both 2006 and 2007. For example, Ikea private label decorative articles represented one of the leading brands in value terms.
• Demand for decorative articles will primarily stem from a continuous cycle of new generations of single householders and replacement needs, as well as more enthusiastic hobby hosts searching for premium or specialised products.
• Total Austrian production of gifts and decorative articles amounted 111 Mio USD (78 Mio EUR) in 2006. Production in Austria increased by 25.8% during the period 2002 – 2006.
• Plasticware was Austria’s most produced product in 2006, accounting for 76.6% of total production.
Followed by Ceramics (14.8%), Woodware (7.3%), and Candles (1.3%). Production figures for Art. Flowers and Fruits, Wickerwork, Paperware, Metalware, and Glassware are not available for Austria.
• According to Euromonitor, production of gifts and decorative articles in Austria has an uncertain future due to high manufacturing costs in the country and the general trend towards outsourcing for the lower segments of the market.
1 Exchange rate: 1 EUR = 1.4187 USD, 1 USD = 0.7048 EUR, Source: Website of the Bank of Thailand accessed 13.08.2009
The Gifts and Decoration Market in Austria 3 | Page
1.3 Opportunities and threats
+ Exporters from Thailand will be faced with increased demands for higher quality, environmentally and socially friendly products.
+ Many Austrian producers will continue to outsource their manufacturing to developing countries (DCs) in order to reduce their costs.
- As less expensive Chinese imports continue to make inroads into the Austrian market, the industry will have a difficult time growing in value.
1.4 Useful sources
• Euromonitor – Research agency (http://www.euromonitor.com)
• Datamonitor – Research agency (http://www.datamonitor.com)
• Market Research – Research agency (http://www.marketresearch.com)
• Austrian Trade (http://www.austriantrade.org/austriantrade/austriantrade/en/)
• Austrian Business Agency: (http://www.aba.gv.at)
2 Trade channels for market entry
• Wholesalers, importing manufacturers, grocery multiples and non-specialised chains, like hypermarkets, discounters and do-it-your-self chains are potential trade channels for exporters in Thailand.
• Price competition in the retail sector is extremely aggressive and the retailer concentration in many retail sub-sectors is increasing. The latter trend is escalating as the giant retailer groups attempt to expand and win market share through the acquisition of small and medium-sized retailers. Gifts and decorative articles are retailed through a wide variety of different retailers. The variety stores and department stores as well as the hypermarkets are generally considered to be the leading retailers.
• As the number of actors in the export chain can differ and the quality and contents of each actor also, it is impossible to give a standard overview of costs and margins for the different phases in the process. However, there is a rule of thumb in the market for interior articles and gifts that an article with an FOB price of 1 USD will sell for around 4 to 5 USD in the shop in Europe. In the more expensive countries like the UK, Ireland and the Scandinavian countries a markup of 6 to 6.5 (instead of 5) is more common, going up to 8 for the high end of the market. The mark-up in the new east European countries will be closer to 3.5 – 4, although this will rise with the growing prosperity in these countries.