The best hand-woven rugs are commissioned by importers who provide weavers with yarn, a loom, and a cartoon (design) of the projected rug. Many entrepreneurs are also involved with people who raise the sheep that provide wool and who participate in shearing, spinning, and dying the wool. On completion the rug is paid for and sent to a central facility for distribution. This is called the "putting out system," which for centuries has given us fine rugs. The notion of a single, naive weaver sitting in a cottage or tent weaving away happily is wishful romantic thinking. Weavers who bring woven goods to public bazaars have generally been unable to sell them through a cooperative or tribal community. The exception to this is the ever more elusive tribal weaving, which is woven within the context of an ethnic culture for personal use.
The best rugs are made with high quality, hand-spun wool and natural, vegetable dyes, both of which are unavailable to a weaver of limited means except as provided by an entrepreneur. When such a rug is woven, the entrepreneur has already bought it. Such rugs are never available to the general public. They are never presented at the weaver's local bazaar. The production from skilled weavers is carefully kept within a closed, tightly controlled enterprise. These rugs are reserved for European and American dealers who will buy a large quantity of rugs at one time and pay in cash. Since they pay in hard dollars and buy in greater quantity, foreign dealers usually pay lower prices than native rug merchants. Since import duties and shipping costs only account for about 8-12% of the rug's cost, it is easy to see that American dealers can offer the same rugs at lower retail prices than can be obtainted at foreign rug shops.
The idea that one can pay less for a rug overseas than in an American rug shop is a mistaken assumption. Any tourist is perceived as a cash cow. Most Americans traveling overseas are perceived as wealthy, not knowledgeable regarding rugs, and naïve to Third World sales techniques. The foreign dealer knows he will never see the tourist again. The disincentive to fair dealings and honesty --- not characteristic of ethnic rug merchants to begin with -- is obvious. I have never seen a rug bought by a non-dealer traveling abroad that is of better quality, or less-expensive, than what can be bought in America. At best, a traveler can buy mid-quality rugs with machine-spun wool and synthetic dyes and pay a fair retail price. One is either a legitimate wholesale buyer or a retail tourist buyer. And overseas retail is higher than domestic retail.
It is sad indeed to have a customer come to the shop with a rug for which they paid $2,000 in Turkey or Morocco. Such a rug generally turns out not to be a rug woven of the promised handspun wool and natural dyes, but rather a rug which we could have sold to them for a fourth of what they paid. However, souveneirs of travel and the bazaar are lovely mementos. We tell customers who want to buy a rug on their foreign travels to limit themselves to $100, and to buy a flatweave, or kilim. Kilims are easier to weave, are abundant, and cost much less per square foot than a pile rug. A small kilim is a nice souvenir and will probably cost about the same as at their local rug shop. It is also easy to carry around, which is no small consideration on a foreign jaunt.