Transcript Slide 1

JANUARY 2004
The Artisan-Owned
Direct Distribution Model
Rural Women’s Artisans
Cooperative
art camp
méxico
www.lumika.org
AODD
Taxco
Development
Inventory Community
Export
Sustainability
Quality
Technology
Shipping/Fulfillment
Cash
Tecalpulco
Production
Marketing
Publicity
Reliability
Service
Socio-economic Internet
Free / Fair Trade
Original Design
Fashion
Jewelry
Modern
TAXCO,Digital
MEXICO
Direct Distribution
Social
Projects
Sales/Support
T H U N D E R B I R D
DIGITAL DIVIDE
“I begin with two words that all men have uttered since the dawn of
humanity: thank you. The word gratitude has equivalents in every language
and in each tongue the range of meanings is abundant.”
(Octavio Paz – Nobel Lecture
Nobel Lecture, December 8, 1990)
This presentation was made in the Digital Partners Social Enterprise
Laboratory (SEL). Along with the entrepreneurs, a student team from
Thunderbird, The American Graduate School of International
Management and a group of business industry advisors contributed to its
development. Work on the presentation spans from December 2002 to
April 2003. Without the assistance of Art Camp, this work would not
have been realized: thank you.
table of contents
ARTCAMP VISION
Who are Artesanas Campesinas?
What is Artcamp’s mission?
What is Artcamp?
Where and What is the Region’s History?
2
3
4
5-7
ARTISAN OWNED DISTRIBUTION SYSTEM
Current Problem
Solution
Anticipated Results
Total AODD cost: $30,000
Inventory: $10,000
Infrastructure: $10,000
Marketing: $10,000
AODD Description
AODD Model
8
8
8
8
8
8
9-10
11
INVENTORY, INSTITUTIONAL DEVELOPMENT &
TRAINING
Stock Manager and Shipper Clerk
Shelves, Parts bins, Packaging materials, etc
Database
Basic materials and components
New lines and best sellers
MARKETING
Media Strategy
Increased branding / differentiation
Pricing Strategy
Distribution
IMPLEMENTATION TIMELINE
FINANCIAL ANALYSIS
Summary
Budget
12
12
12
13
13
14
15
16
16-17
18
19
20
The Artisan-Owned Direct Distribution Model
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who are artesanas campesinas?
Artesanas Campesinas (Artcamp) is a for
profit enterprise with a social mission.
Artcamp is a rural women artisans
cooperative from the Municipality of Taxco,
Guerrero, Mexico (southwest of Mexico City),
specializing in handcrafted jewelry
production.
http://www.lumika.org/mexico.htm
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What is artcamp’s mission & vision?
Artcamp’s
mission is to connect the
rich handcrafts tradition of their
community with the present day
markets of the world. In doing so,
they aim to provide a sustainable
flow of income into a region that
sees many of its men leaving town
to find work.
vision is to be a model
for other low cost native craft
enterprises both in Mexico and
abroad. Their goal is to share
their knowledge in inventory
and distribution management,
technical infrastructure, and
marketing with other artisans
so that too can become more
creative, efficient, and
productive.
The Artisan-Owned Direct Distribution Model
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what is artcamp?
Artcamp SC de RL (Artesanas Campesinas) is
legally established under Mexican law as a
producer cooperative. The Constitution of our
Cooperative defines the various committees
participating in decision making:
Admission and Exclusion of Members
Committee
Organization of Work Committee
Education Committee
Social Prevention Committee
Safety and Hygiene Committee
Capacitating and Training Committee
Conciliation Committee
Artcamp’s story goes back to the times of their mothers and grandmothers. They are country of women
mostly from villages near Taxco, especially Tecalpulco. Their grandparents fashioned elaborate tin mirrors
and frames. In the 1970s and 1980s, they created abalone jewelry in alpaca metal. The elaborate floral
encrustations were well-accepted and sold around the world.
At that time, the community artisans were extremely successful. Buyers came from all over the world to
purchase the handcrafted jewelry of Tecalpulco. Unfortunately, their markets collapsed in 1990. Suddenly,
their pieces were no longer valuable. Additionally handcrafts products were flooded into the world market
from places like China, India, and Bali.
Despite the downturn, they sought out new forms of production, styles, and customers. From a centrifugal
casting machine (left by a small foreign-owned factory), they built the base of their cooperative effort to
create employment. They focused on finding ways to be more efficient in their production that would
translate into higher customer satisfaction in the quality of their products.
Focusing on quality and customer design preferences is their strategy for differentiating themselves from a
cheap handcraft substitute
The cooperative sponsored the donation of ophthalmic medical equipment
from the United States to the local Adolfo Prieto Hospital, and assisted in a project to develop abundant
clean water for Tecalpulco.
http://www.lumika.org/mexico.htm
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project location
GUERRERO
GUERRERO
Profile
Profile
region
region
Tecalpulco is on a high hilltop looking out over an enormous vista in all directions. The
blue tile dome of the temple shines under the radiant orb of Mexico.
Guerrero
population
population
180,645
height
height
1.430 metros
temperature
temperature
22º C
altitude
altitude
5,800 feet
source
source
Guerrero Mayor’s
Office 2002
Legends say they came centuries ago by underground cavern. The rivalry with low-lying
Taxco El Viejo goes back in time. Tales say that the Tecalpulcans won the right to their
hilltop for having hung the bell in Taxco El Viejo's temple by the powers of heroic preColumbian magic.
From the Zocalo at the center of Tecalpulco looking north, far away against the dark
mountains one can see a crease of lights or white shadows: Taxco. A part of the city is
visible at a distance, way above.
Taxco is at 5800 feet altitude; Tecalpulco 4600. This is the southern drop off of the great
central altiplano, the northern Guerrero escarpment.
The Tecalpulcans are indigenous native Mexican country people, rainy seasonal farmers.
Most families plant corn, beans, and squash in the wet months of summer. In the dry
months of December through May, the fields are a dusty desert parched with thorny bush
vegetation. The natives are adept rock masons. The builder surveys the rocks strewn on
the ground, he picks up the one he sees will fit, packs it into the place where it will go
and proceeds to select another.
In mortarless construction, the rocks need to be expertly tied together and balanced; all
this, the village stone-worker does in single vision; never does he pick up a stone, then
put it down, look around for another.
Hernan Cortez, the Conqueror of Mexico, opened the first silver mine in Taxco in the
early 1500s. The mines have been in production, now, for five hundred years.
The Artisan-Owned Direct Distribution Model
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history
In the 1950’s the silver jewelry production of Taxco expanded dramatically as a long-term result of
the intervention into Taxco of a Tulane University architecture professor by name William
Spratling one more gringo who fell in love with the Mexican people he stayed to established the
first modern silver shop *Las Delicias*. Today Spratling signed silver is highly collectible and
reknowned for the technical quality of execution and simple power of design.
This tradition has been recognized as among the highest quality fine silverwork in the world, on
account of its expressive vitality and technical execution of innovative wood, stone inlay into
silver. Hundreds of families in Taxco supported themselves by silversmithing. So the population of
Taxco became the serendipidous beneficiary of Spratling's genius and willingness to give to others.
The general acceptance of the Spratling silver jewelry product by the US and European market,
also the burgeoning domestic market of the growing tourist industry made Taxco into the 'Silver
City'; a city of silversmiths, with generation upon generation of hammerers, of polishers, arc saw
cutters, solderers, casters, filers, and stonesetters. Taxco, with its perfect climate and picturesque
aspect was in the fifties the scene of a Robert Mitchum film and for a while was something of an
art crowd hangout. In the sixties, Tecalpulco's tin mirrors and frames sold through tourist stores in
Taxco.
Spratling combined abalone shell with rosewood and ebony in some of his great jewelry art.
Abalone shell had been a prized material since the Toltecs in every Mesoamerican tradition of
artifact.In the sixties, the abalone shells were huge, and saturated with iridescent blue green
brilliance. The beautiful natural abalone overlaid on tin can led to combining the town tradition of
tinsmithing with the abalone carving technique.
In the seventies came the Abalone Shell Bracelet, with perfect delicate eight petal daisy mother of
pearl flower in an iridescent blue green background of shaped and pieced together abalone. A
demand for the new Tecalpulco jewelry products built up. Taxco merchants, with access to retail
and wholesale customers, organized orders for production by the villagers. Buyers started flying
into Mexico looking for the product. Hundreds of families in Tecalpulco, Dolores, Taxco El Viejo,
Cerro Gordo, and El Ejido Paintla were self sufficient alone on handcraft jewelry production.
In the eighties, Tecalpulco experienced a boom in demand for its products and all the other villages
in the area started making alpaca abalone jewelry; also hundreds of shops in Taxco turned to alpaca
abalone shell jewelry production. A vibrant wholesaler sector grew up in Taxco. Some wholesaler
families became quite wealthy on the strength of the abalone shell jewelry boom that continued the
entire decade. The beautiful shell mosaic handcraft of Tecalpulco was everywhere in the world!
The Artisan-Owned Direct Distribution Model
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history
The 1990’s: fashions changed and the curtain rung
down on the handcrafts of Tecalpulco. The nineties
didn't want flowers or pretty things. It wanted tatoos,
virtual entertainment, and Nike.
At the same time, ferocious costume jewelry
competition came in from the Asia, gaining market
share over the traditional export and domestic
markets of the Mexican artisan. Every year the
abalone jewelry was harder to sell, and the buyer
would pay less for it, than the year before.
Many local artisans gave up jewelry making, but
many don't know how to do anything else. Gradually
the young and active ones have gone North. Others,
forced by the necessity of providing for their
families, have surrendered to the tombs of the mine.
The Artesanas Campesinas initiative was born
in response to the extremely difficult and
dangerous situation the artisan communities
of Tecalpulco discovered themselves in after
the men had mostly disappeared to the US
labor market and the women and children for
the most part remained to manage.
As poor as we are, we are working towards a
bigger dream: that of a much better world for
our sons and daughters; a world of everrefreshed hope, and of new possibilities.
The Artcamp rural womens artisans
cooperative is a positive effort to re-connect
with successful traditions of handcraft
jewelry production in order to bring about a
renaissance of cottage industry in our locality.
The Artisan-Owned Direct Distribution Model
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aodd
ARTISAN OWNED DISTRIBUTION
SYSTEM
Current Problem
Zero negotiation power with distributors
Solution
The AODD solves this: describe the AODD
Anticipated Results
Artcamp is able to receive higher margins and pass savings onto
retailers.
Developing an Artesan Owned Direct Distribution (AODD) system is
increases their profits and makes operations more stable.
Total AODD cost:
$30,000
Artcamp needs $30,000 in financing to build the AODD and create
market awareness for their new capabilities.
Inventory:
$10,000
A $10,000 inventory investment will enable faster production time
necessary to meet growing demand.
Infrastructure:
$10,000
A $10,000 investment in Staff & Infrastructure provides the necessary
overhead to manage the AODD.
Marketing:
$10,000
A $10,000 investment Marketing raises awareness of AODD supply
chain savings, increases market penetration, and improves
customer service.
The Artisan-Owned Direct Distribution Model
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aodd description
Goal: To generate a successful model of functional
artisan-owned distribution.
Looks Like: Shelves, Tables, Inventory, Shipping
Materials, Computer, Data Base,
Website Product Catalog, CDROM Product Catalog,
Offset Print Catalogs
*System calls for 20 – 30 packages to be shipped at
the same time
in order to optimize the ship/import cost.
A weekly shipment 25 packages X $200usd =
$5000weekly sales = $300,000usd/yearly sales
For average under one kilo packages, cost would be
about $7usd + $4usd
Add $1one usdollar for the handling where the
master import is broken into individual shipments
$12usd is the estimated through-Customs delivered
price, factory-to-door.
Retailer places order from an Artcamp Catalog via
FAX or email.
The incoming order is checked against existing
inventory
of finished and semi-finished pieces
Parts of the order that are not available in stock, are
set into the appropriate production sequence;
at this time a determination is made of whether and
how many extra pieces to make for stock.
Just so, the production capacity of the shop is
integrated into the stock inventory position.
Orders come in and are fulfilled from the shelves
and/or the orders are set into production;
A modern data base is applied to the over-all
operation.
The Artisan-Owned Direct Distribution Model
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aodd description
Our intention is to produce, now, the conditions for the establishment of a new functional commercial
model; the idea of producer-ownership. Artisan-owned direct distribution when it has been proven
successful, will provide a valuable tool taken into hands of 3rd World producers.This is, indeed, an
historic project, one that really will make a difference; There is NO need for so much capital to be
soaked up in USA stockrooms.
To a wholesaler, the cost of holding inventory is a great part of his burden; and he/she always has too
much of something, and too few of some others. And the wholesaler has to think and project sales and
make up purchase orders, and pay the stock girls and the accountant and the life style, fixed expenses
etc.All of this burden of stock inventory and sales projection and $US dollar expenses could be better
retained by the producers who would invest in upgrading capability. Is it not logical that it were always
cheaper to ship direct to the final customer rather than to a foreign warehouse, *then* ship again to the
final customer???
Obviously, it were always actually less costly to ship factory-to-the-final-door. All the costs of handling
the merchandise, counting it, organizing it, counting it again when it goes out, maintaining all kinds of
papers....
When the Artcamp women count and pick, making up the packing list, whether it is small or large, we
will make sure that it is done perfectly. By making the shipping list and invoice in a perfect manner,
Artcamp obviates the heavy fixed expense of the wholesalers in handling, shipping and invoicing. This
model is the key to a revolutionary tool and real advantage for the producer; and for the consumer as
well as the product can be delivered at a very good value.
As the model has proven successful, the idea is to make it available to other groups; Producers all over
the world can ship their crafts direct to the retailers, like Artcamp. The founders and promoters of this
project ought to be proud, to play their part; it is a gift of god globalism; how rare that the campesino
would be a beneficiary!
marketing operations
The primary avenue for the financing of the Artisan-Owned Direct Distribution Plan is to be the old
fashioned way; earning it, by proving the products in the marketplace. Fortunately, Artcamp has come a
long way and has valid beautiful product to present. The Artcamp website catalog , the CDROM
catalog, and one page color print brochure. Turquoise and Onyx and Amber Bracelets, Rings, Earrings,
in Fine Pewter and .925 Silver. Candleholdres, Astrology & Runes, Abalone Shell Mosaic, Mother of
Pearl, River Shells. Even though it is far from optimum efficiency shipping single packages to the
customers, it is a practical means to get the project underway, in a healthy manner that pays as it goes.
It is our intention to establish a marketing department to manage the flow of communications with
prospects and customers, and that is another subject that is still to be addressed in detail.
The Artisan-Owned Direct Distribution Model
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aodd model
Traditional Model
1
2
Artisan sells
product to
the
distributor
Local distributor
sells the item to
an international
distributor
3
International
distributor
sells the
product to
the shop
4
5
Shop sells
the
item to the
final
consumer
Consumer
buys the
product
New Model
E-Clients
Designers
Shops /
“Virtual Shops”
Artisan
Final Customer
The Artisan-Owned Direct Distribution Model
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inventory, institutional development & training
Software Database:
Developing an accounting and inventory tracking
system in-house carries a high cost. It is difficult
and time consuming to develop and could delay the
establishment of the AODD. Also, maintenance will
need to be done on the system throughout its
lifetime in order to trouble shoot programming
errors as well as maintain the integrity of the system.
Peachtree Accounting Software, an off the shelf
product, can be purchased for only $200. Its setup is
quick and easy and tutorials are offered as well.
This will ensure that the AODD is established in a
quick timeframe.
Through the use of Peachtree, Artcamp will
be able to track their current inventory
levels as well as past sales information by
customer. Peachtree will aid them in
establishing best seller and seasonal items.
With this information they will be able to
establish restocking points by item and plan
in advance to build inventory levels for
seasonal items.
They will be able to better manage their
inventory so that best seller items are on
hand when ordered by customers. This
software will also enable Artcamp to track
inventory work in process levels so that the
delivery date of any backorders can be
estimated.
The Artisan-Owned Direct Distribution Model
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inventory, institutional development & training
Basic materials and components
Basic materials and components used by
Artcamp are Pewter, Silver, Stone, Shell,
Bark, Paint, Coconut. The average cost for
each item is .40 USD, representing
approximately 20% of the cost to produce
each piece. (50% Direct Labor, 30%
Overhead). These basic components tend to
stay same across Artcamp’s products.
Thus it will be easy to maintain the needed
level of raw materials to generate finished
goods. The initial $10,000 will be used to
obtain the needed level of raw material to
build up inventory levels to meet demand. It is
expected that Artcamp will want to maintain
300 kilos of Pewter, 10 kilos of Silver, a stock
of Stone, Shell, and other basic materials.
New lines
and best sellers
Under the AODD plan Artcamp is expanding
their end customers from Tourist Trading Posts
into the Retailers throughout the United States.
It is believed that best seller items in this new
market will be different from popular items sold
in the existing market. Artcamp has 24 items
planned to be sold through AODD. Upon
receiving the influx of capital, Artcamp will
build up inventory levels in these lines to have
ready to quickly deliver to distributors, retailers,
and customers.
The Artisan-Owned Direct Distribution Model
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R E S O U R C E ALLO CATI O N
marketing
4 things:
1.
2.
3.
4.
Organize Product Offering
Product Positioning &
Brand
Development
Pricing System
Distribution
1. Organize Product Offering:
Considering ArtCamp’s immense product offering, it is necessary to group the products according to
product groups to allow customers and resellers to be able to navigate the product offering more easily. Also,
different resellers will be interested in different groups of products. An example of this would be Surf Shop
(jewelry for young people – rings, toe rings, bracelets, earings, etc.) versus an import store (table-top items,
pill boxes, etc.). Based on the products listed on the www.artcamp.com website, the following is the two
main product groupings:
By separating products into groups, it will be easier to design distribution
channels around various customer segments.
handcrafted jewelry
.925 silver jewelry
The Artisan-Owned Direct Distribution Model
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marketing
2. Product Positioning & Brand Image Development:
The primary elements of value for the customer when buying ArtCamp
products are:
1.
2.
3.
4.
5.
Handcrafted jewelry – this means high quality
Unique designs – created by artisans
High quality and exotic materials – high-grade silver, abalone
Producers are the proud community of Tecalpulco – good cause
Reasonable price – we want this one to become the least important!
By communicating these elements of value more clearly to customers,
ArtCamp will develop a very distinct and valuable brand. The following
will develop their brand equity:
Jewelry tags –a small piece of paper tied to each piece (or set) of jewelry
with the name of the person who made it and their picture (easily done
with a digital camera) and with a little message. This communicates to
the customer both that the jewelry has been handcrafted and that the
artisan has personally designed and made this piece of jewelry.
Product Sizing Charts/Information – one of the difficulties of selling
products (especially jewelry and clothing) to customers via the
internet is the fact that the customers can’t actually see the products
and may have some apprehension about whether or not the product is
available in the right size. A simple sizing chart should be developed
so that customers have less fear that the product will be too small or
too large for them.
Product Display for Retailers – this could be a small rack, designed
by ArtCamp for sale to retailers and wholesalers that would allow
them to display the jewelry more easily for their customers. This is a
way for ArtCamp to control the presentation of their products to the
final customer. It also denotes that ArtCamp products are of high
quality. A high profit margin on this product display would not be
necessary.
E-brochure about the materials and designs of the products –
ArtCamp’s products can be further differentiated by explaining more
clearly to customers about the grade of silver or precious stone, and
where the unique designs come from. This can be done by
developing an e-brochure that could be e-mailed to customers and
included on the web-site as a downloadable file.
The Artisan-Owned Direct Distribution Model
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marketing
3. Pricing System:
Since there is difficulty in maintaining prices when dealing with different customers (wholesale
distributor
versus direct sales to retailer), a pricing system should be developed. The main considerations for this
system are shipping costs, order quantities, and customer type. The pricing is developed using the
following
steps:
1.
Establish a catalog price that includes all costs of material, labor costs (based on the amount of
time it takes to make each piece), overhead charge (this is warehouse cost + generic shipping
cost) and big profit margin for ArtCamp. This profit margin will then decrease depending on
who the customer is and the size of the order. Also, from the customer’s perspective, the price
reflects the quality of the jewelry.
2.
Design a discount structure for different types of customers. This can be done by relating
discounts to order quantities or by assigning special discounts depending on the customer. This
second method is more difficult to manage when the customer is located far from Tecalpulco.
3.
If shipping cost is included in the price of the product, then ArtCamp should design this into the
pricing system. This will make one-piece orders very expensive for the customer. Another
alternative is to remove the shipping cost from the price of the product and charge the customer
separately for it. In this case, there should be more than one method of shipping offered to the
customer (DHL, or regular mail).
4.
(Since we do not have specific pricing information for the products, we are not recommending a
specific pricing scheme. We do recommend, however, that ArtCamp not be afraid to establish a
pricing scheme that allows them to make a profit on any order regardless of the size and who the
customer is.)
The goal in developing a pricing system is to remove as much “negotiation” as possible when dealing
with any type of customer, wholesale distributor or direct to retailer.
4. Distribution:
A strategy for each distribution channel must be developed to make sure ArtCamp can support and
develop each customer group among the three types of channels it wishes to use (wholesale /
distributor, direct-to-retail, direct to customer).
A target percent for each channel must be defined. These targets are direct to retail to 40%, direct to
customer to 10%, while decrease the proportion of the wholesale/Distributor channel to 50%.
The Artisan-Owned Direct Distribution Model
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marketing
Artcamp needs to implement the distribution strategy below to
achieve this target.
a.Wholesale/Distributor
Considering the difficulty to negotiate with wholesalers and
distributors, Artcamp should decrease the channel but they
might not be eliminated soon. By providing them displays for
the products, Artcamp can control the brand image, though it
is still difficult to control the retail price through this channel.
b.Direct-to-Retail
By using the existing address list of the 3000 retailers,
Artcamp can send e-brochures and promote products
periodically. So far Artcamp does not store the contact records
with retailers, but they need to store the data and keep stronger
relationship with retailers. To inform retailers of the Artcamp’s
high quality products is the most urgent task to realize AODD.
When they inform, Artcamp should emphasize the merit for
retailers when they directly purchase products.
c.Direct-to-Customer (via the Internet)
Because of the shipping cost, to sell directly to customers does
not yield high profit. But currently customers buy the double
priced products at retail shops, which purchase the products
from wholesalers. Considering this fact, to purchase products
directly through the ArtCamp’s website gives customers a big
advantage regarding the price. To increase this channel,
ArtCamp can advertise on popular websites.
Current(2003)
Target(2005)
D irect
C ustom er
/R etail
5%
Direct
Customer
10%
W holesale
/D istributor
50%
Wholesale/Dis
tributor
95%
Direct Retail
40%
The Artisan-Owned Direct Distribution Model
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Identify and secure financers
0.3
Enter Customer and Inventory Data
Software Testing of Normal Transaction
1.3
1.4
Organize Product Offering
Product Positioning and Brand Development
Pricing System
Distribiution
3.2
3.3
3.4
Complete Finished Goods Inventory
2.4
3.1
Build Work In Process Inventory
2.3
PHASE 3: MARKETING
Purchase and Arrange Storage Equipment
2.2
3
Identify Most Popular Items and Their Product Components
2.1
PHASE 2: INVENTORY
Software training
1.2
2
Purchase Software & Install Enterprise Sofware
1.1
PHASE 1: INSTITUTIONAL DEVELOPMENT (INFRASTRUCTURE)
Develop further workplan details
0.2
1
Final Presentation Edit & Walk-through with Digital Divid
SECURE FINANCING
0.1
0
Apr
Jun
contingency
time
May
Jul
Aug
Sep
Oct
2003 - 2004
Nov
Dec
Jan
Feb
Mar
timeline
The Artisan-Owned Direct Distribution Model
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resource allocation
summary
Projected # of Beneficiaries / Participants
Community Beneficiaries those community members who will be directly affected by
Male
Female
Total
adult
10
200
210
youth
50
50
100
adult
5
5
10
youth
5
10
15
adult
10
200
210
youth
50
50
100
this activity)
Community Group Participants those active in planning and implementation)
People Trained (expected number of community group participants or others to be trained
in first six months after receiving the grant or after the IT equipment is installed and
operational, etc.)
Summary of Community Contributions and Funding Sources (Proposal – 2 years)
Equipment
Cash
Labor
Supplies
& Materials
Transport
of
equipment
Housing of
equipment
Total
(USD)
Grant from Previous Page
-
34,500.00*
-
-
-
-
34,500.00*
Community Organization
Contribution
(Art Camp)
-
-
3,000.00
2,500.00
500.00
-
6,000.00*
Community-at-large
Contribution
-
-
-
-
-
-
-
Third Party Contribution
name:
-
-
-
-
-
-
-
Third Party Contribution
name:
-
-
-
-
-
-
-
Source
TOTAL ACTIVITY
BUDGET
40,500.00
* Three cash disbursements
The Artisan-Owned Direct Distribution Model
19
R E S O U R C E A L L O C Aresource
TION
allocation
budget:2004
Line Items
Amount (USD)
PHASE I (Institutional Development & Training)
Estimated cost of construction (materials, labor, etc.)
3,500.00
Estimated cost of enterprise management software (database system software
and staff training )
1,500.00
Estimated cost of staffing
5,000.00
TOTAL
10,000.00
PHASE II (Inventory)
Estimated cost of raw materials (20%)
8,000.00
Estimated cost of labor (50%)
1,000.00
Estimated cost of overhead (30%)
1,000.00
TOTAL
10,000.00
PHASE III (Marketing)
Estimated cost of Product positioning and Brand development
4,000.00
Estimated cost of marketing literature (Manuals, Workshops, E-brochure, etc.)
4,000.00
Estimated cost of digital camera and printer
2,000.00
TOTAL
10,000.00
Contingency costs 15%
4,500.00
TOTAL Estimated AODD Grant:
34,500.00
The Artisan-Owned Direct Distribution Model
20