Thoughts on the Corporate gift industry in Singapore
Corporate Gifts - A Price Competition Industry
The corporate gifting industry is crowded and competitive with low barriers to entry. The corporate gifts industry in Singapore is most characterized by price competition. There is no lasting competitive advantages within the circle due to the absence of a manufacturing base. In addition to poor intellectual protection of designs, there is no push for companies to innovate and create new products.
Most companies are essentially sourcing for products overseas - namely in the manufacturing powerhouse called China. China is rife with copycat designs and the proliferation of blatant copying combined with almost non-existent intellectual property rights, it leads products that are repetitive and boring almost.
Singapore is a major economic hub that has huge open trade flows. Because an open economy with pretty much virtually no natural resources, manufacturing base or larger hinterland, the island state is practically completely dependent on trade. To survive in the ultra competitive environment brimming with commerce, businesses in Singapore compete for every single customer. This designs the backdrop of a lively as well as very competitive corporate gift idea industry in Singapore.
Presently, there are 2 types of firms - those with a physical presence and freelancers. As everyone primarily functions as an agent, it creates a unique situation where freelancers can compete almost on par with established companies for business.
Low Barriers to Entry
Half relationship and brand building and half advertising, corporate business gifting as well as prizes is part and parcel of the budget of every firm which requires some form of promotional advertising. The range would number from trophies, honors, plaques, gifts, hampers to even greeting cards. The corporate gift business in Singapore is definitely fragmented with extremely minimal barrier to entry. Because there is not a indigenous manufacturing industry, the corporate gifts in the market are really almost completely imported. It only takes new entrants to secure an account from local suppliers who stock imported goods to be in business. Since such, it has led up to a dearth of product diversity in the market.
Often times, firms are more interested to supply inventory to the end consumer rather than recommending a suitable product. This ends up with the uncomfortable situation where the customer may end up with products which may not necessarily suit their requirement. There is also almost non-existent after sales support.
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The same old boring gifts
Within the realm of business gifts, the typical offerings are corporate diaries, polo-tees, bags and also fabric products, mugs as well as drinkware, lifestyle electronic items to the a lot more boring pens. Alongside common source chains that are inevitably linked to china, the corporate gift business shows an daunting boring homogeneity. This is similar to the retail scene in Singapore where it is almost completely dominated by large brands. Independent labels find it extremely challenging to compete in terms of prices, rental, visibility and customers.
Inside the region of trophies and additionally honors, the exact same situation applies where the standards of production and presentation fluctuate commonly over the business. There are well established players that are leading suppliers alongside their own manufacturing ability, and also the other clothes who just exist in trading. There is an insufficient real design and also thought into the finish product, partly due to the non-existent intellectual cover towards a created product.
The future of the corporate gift industry
The future ahead may lie in an increasing convergence between product design and supply, where it becomes an integrated supply chain of in house designed products and increasing customization to meet the higher expectations of clients and customers alike. Those firms which fail to innovate and keep up with the times would risk being sidelined in the corporate gift industry.
May we suggest even that the integration of the product design and industrial design with manufacturing will be the future of the corporate gift industry. With the hallowing out of the industrial and manufacturing base from Singapore to other low cost countries, the inevitable shift is towards design and services. This will become similar to just-in-time production where the goods are highly customized to each customer, only to be produced in batches which are unique. This obviously would command a higher premium over the existing cost competition products, which would translate to higher margins. This probably would be the way forward for the industry, or risk being sidestepped.