1. A
presentation
ON
LEATHER INDUSTRY REVIEW
2016 – 18
FACULTY OF MANAGEMENT
Pacific Academy of Higher Education and Research University,
Udaipur
Guided By: Submitted By:himanshu panchal
Mr. Jinendra Vyas
(Assistant Professor)
2. Introduction
Leather is one of the most widely traded commodities
globally. The growth in demand for leather is driven by
the fashion industry, especially footwear. Apart from
this, furniture and interior design industries, as well as
the automotive industry also demand leather. The
leather industry has a place of prominence in the Indian
economy due to substantial export earning and growth,
besides the fact that it employs 2.5 people. India is
fifth-largest exporter of leather goods and accessories
in the world.
3. HISTORY
Over the years the Indian leather industry has undergone
drastic change from being a mere exporter of row material
in the early 60’s and 70’s to an exporter of finished, value-
added leather products. The main reason behind this good
transformation is the several policy initiative taken by the
government of India. Since 1991 as India adopted the
globalization and liberalization economic policies, the
leather industry has flourished consistently in several ways
and has contribute heavily to the Indian exchequer. There
has been a phenomenal growth in exports from Rs.320
million in the year 1965-66 to Rs.69558 million in
1996-97.
4. Important leather products exported by
India
Leather Footwear
Leather Garments
Leather Goods (Including Harness &
Saddlery, Leather Gloves etc.)
Footwear Components (Shoe Uppers, Soles
etc.)
Finished Leather
5. Predominantly, most of the manufacturing units for
leather goods are located in cities like Kolkata, Chennai,
Mumbai, Kanpur, Bangalore and Pondicherry.
Kanpur is popularly known as the “Leather City of the
World”.
Kanpur leather traders Export leather goods in large
volumes throughout the world. These massive amounts
of leather products are shipped to New Delhi and other
major cities in India by the Kanpur leather traders. From
these places, they are exported to other nations of the world.
Kanpur leather traders are involved in manufacturing,
exporting, and supplying of all types of finished leather
products.
Sourcing Hubs
6. Full-grain leather refers to the leather which has
not had the upper "top grain" and "split" layers
separated.
Top-grain leather is the second-highest quality
and has had the "split" layer separated away,
making it thinner and more pliable than full grain.
Corrected-grain leather is any leather that has
had an artificial grain applied to its surface.
Split leather is leather created from the fibrous
part of the hide left once the top-grain of
the rawhide has been separated from the hide.
TYPES OF LEATHER
7. Percentage share of leather
product in export
45%
9%
22%
3%
21%
percentege share of leather product in export
FOOTWEAR
LEATHER
GARMENTS
LEATHER
GOODS
SADDLERY AND
HARNESS
FINISHED
LEATHER
8. Percentage share of various
countries in India's leather & leather
product export
57%
11%
3%
8%
1%
3%
17%
European union
USA
UAE
Hong Kong
Africa
China
other
9. Employment in different sectors
of leather industry
Sector Total
Employment
Flaying, curing & Carcass Recovery 8,00,000
Tanning & Finishing 1,25,000
Full Shoe 1,75,000
Shoe Uppers 75,000
Chappals & Sandals 4,50,000
Leather Goods & Garments 1,50,000
10. STRUCTURE OF INDUSTRIES
The leather industry is spread in different segments, namely, tanning & finishing
footwear & footwear components, leather garments, leather goods including saddlery
& harness, etc. The estimated production capacity in different segments is as under
Product Capacity
Leather
Hides 64 million pieces
Skins 166 million pieces
Footwear & Footwear Components
a) Shoes 100 million pairs
b) Leather shoe uppers 78 million pairs
c) Non-leather shoes/chappals etc 125 million pairs
Leather Garments 6 million pieces
Leather Products 70 million pieces
Industrial Gloves 40 million pairs
Saddlery 6000 pieces
12. Public/Private Sector Leather
Products companies in India.
Company Name Company Website
1 Bata India www.bata.in
2 Relaxo Footweas www.relaxofootwear.com
3 Mirza International www.mirza.co.in
4 Bhartiya International www.bhartiya.com
5 LibertyShoes www.libertyshoes.com
6 Superhouse www.superhouse.in
7 Lawreshwar Polymers www.leharfootwear.com
8 Tinna Overseas www.tinna.in
9 Super Tannery www.supertannery.com
10 Sarup Industries www.sarupindustries.com
13. 1] Bata India Ltd-Bata India is the largest retailer and leading manufacturer
of footwear in India and is a part of the Bata Shoe Organization. Incorporated
as Bata Shoe Company Private Limited in 1931, the company was set up
initially as a small operation in Konnagar (near Calcutta) in 1932. It was also
the first manufacturing facility in the Indian shoe industry to receive the ISO:
9001 certification.
2] Relaxo Footwears Ltd-Such is the story behind the creation and
flourishing of Relaxo Footwear, the company that has established itself as one
of the most stalwart, quality conscious and avant-garde footwear companies in
the Indian economy today. Headquartered in New Delhi, India, it maintains a
fine combination of comfort, style, and workmanship and is embarking upon
appreciable growth plans for the future.
3] Mirza International Ltd-Mirza International Limited is India’s leading
manufacturer and marketer of leather footwear and finished leather. With an
established footprint that spans across 30 countries, as well as a rock solid
infrastructure, Mirza has taken ground-breaking strides in the Indian leather
industry since its inception in 1979.
4] Bhartiya International Ltd-Bhartiya International Limited is an India-
based company, which manufactures leather garments and accessories. The
Company’s segments include: Leather Products and Textile/ Textile Product.
Its fashion products include leather outerwear, accessories, textile apparel,
leather finishing and design studio.
14. 5] Liberty Shoes Ltd-Liberty Shoes have been fashioning footwear, for well
over 60 years now, for the style-conscious people around the globe. Currently
with an annual turnover exceeding INR.600 crore (U.S. $150 million),
company figure amongst the top 5 manufacturers of leather footwear of the
world producing more than 50,000 pairs a day using a capacity of more than 3
lakh square feet of leather per month.
6] Superhouse Ltd-Superhouse Group , is a multi- unit and multi- product
conglomerate with brand leadership in the field of footwear manufacturing
and exports. The Group is well equipped with the most modern machineries
and a specialized workforce and produces all types of quality leather, leather
goods and textile garments that are appreciated all over the world.
7] Lawreshwar Polymers Ltd-Lawreshwar Polymers Ltd was incorporated
as a Private Limited Company in the year 1994 with the object of
manufacturing of canvas shoes, lightweight hawai chappals and EVA
Injection footwear.
8] Tinna Overseas Ltd-Tinna Overseas was originally incorporated as a
private limited company on 4 Mar.`87. It became a deemed public limited
company w.e.f. 31 Mar.`92 and a public limited company on 18 Apr.`94. It is
the flagship of the Tinna group, engaged in the manufacture of leather
footwear, footwear components, thermoplastic rubber (TPR) compounds,
edible oil, shipping and warehousing.
15. 9] Super Tannery Ltd-Super Tannery Ltd (STL), established in
1953, started operations by processing 50 Buffalo hides per day,
converting them into Vegetable Tanned Leather for shoe soles.
Since then, the company, well guided by a professional
approach, has marked an important name for itself in the world
leather map, making it, one of the oldest and well reputed
business houses of Northern India.
10] Sarup Industries Ltd-Sarup Industries Ltd is engaged in the
business of leather, tanneries and developing the new products
with wide range of uppers, soles, tanneries and complete shoes.
Sarup Industries Ltd is one of the leading manufacturers of
export quality shoes in Northern India.
16. 7 cities of India famous for leather industry
1. Jajmau – Kanpur, Uttar Pradesh-Jajmau is also
known as Jajesmow, is a district of Kanpur. This is the
main and the largest center for the leather industry in
India. Home to some of the largest leather tanneries in
the Northern part of India. The Kanpur’s leather and
tannery industry contribute to around Rs 6,000 crore
worth foreign exchange for the country and also gives
direct livelihood to more than one lakh people.
2. Unnao – Uttar Pradesh-Located approximately 18
km from Kanpur & 60 km from Lucknow city. Tanning
is one the biggest industry in Unnao and this city is
very popular for its huge leather industry. Big leather
manufactures like, Superhouse Group, Mirza Tanners,
Rahman Exports, and Zamzam Tanners have their
factories in Unnao.
17. 3. Chennai- Tamil Nadu-Chennai is located on the
Coromandel Coast off the Bay of Bengal. In south India,
Chennai is the biggest industrial and commercial center. And
also a major cultural, economic and educational center. It
contributes far more than 50 percent of India’s total leather
exports. It also has a CSIR research institution named the
Central Leather Research Institute.
4. Ambur – Tamil Nadu-Located on the banks of the
Palar River, it is a town and the state Assembly
Constituency in the Vellore District of Tamil Nadu.
Home to a major part of the India’s leather tanning
industry. This town has also earned its nickname as the
Leather City of South India. India’s largest and finest
tanneries are located here, which makes it one of the
leading exporters of leather goods in India. The
finished and unfinished products include shoes,
garments, and gloves.
18. 5. Kolkata – West Bengal Also known as the City
of Joy, is the capital city of the Indian state of West
Bengal. It is located on the east banks of the river
Hooghly. It is the major commercial, educational
and cultural center of the Eastern India. It is the
second most important tanning center in the India.
Home to around 500 tanneries which contribute
about 22-25 % of the total country’s tanning. It
also contributes to about 55% of the total country’s
export contribution.
6. Agra – Uttar Pradesh-Agra is located on the
banks of the river Yamuna; it is the northern most
state of Uttar Pradesh. Total 40% of the population
largely depend on agriculture, and the others on
the leather and footwear business. Agra city is
very popular for its leather goods in the country.
The Leather footwear of Agra is very popular all
across the world for its superb craftsmanship.
19. 7. Ranipet – Tamil Nadu-Located on the northern bank of the
Palar river, this city is also known as Ranipettai. It is a suburb,
town and also the industrial hub of the Vellore city. It houses
nearly 400 small and medium leather units. The large number
of medium-scale leather industries which make both finished
leather and leather articles for export.
20. FOREIGN INVESTORS
Apache Group (Taiwan), Nellore, Andhra
Pradesh
Feng Tay Shoes (Taiwan), Cheyyar, Tamil
Nadu
Itares (Italy), Ambur, Tamil Nadu
21. SWOT ANALYSIS
Strength
High Growth
Ready availability of highly skilled and cheap manpower.
Large raw material base.
Policy initiatives taken by the Government.
Capability to assimilate new technologies and handle large
projects.
Continuous emphasis on product development and design
upgradation.
Weaknesses
Lack of warehousing support from the government.
International price fluctuation.
Huge labour force resulting in high labour charges.
Lack of strong presence in the global fashion market.
Unawareness of international standards by many players
22. Opportunities
Rising potential in the domestic market.
Growing fashion consciousness globally.
Use of information technology and decision support software
to help eliminate the length of the production cycle for different
products.
Use of e-commerce in direct marketing.
Threats
Major part of the industry is unorganised
Limited scope for mobilising funds through private
placements and public issues (many businesses are family-
owned)
Difficulty in obtaining bank loans resulting in high cost of
private borrowing
Stricter international standards
High competition from East European countries and other
Asian countries
Lack of communication facilities and skills
24. GOVERNMENT REGULATION
Globalization of the Indian economy is a major objective of the
Government. It has been appreciated that given the right type of
policy support and framework, India would be able to
substantially augment her exports. The basic thrust of Indian
economic policy in the recent years has been to integrate the
Indian economy with the global economy and expose the Indian
manufacturers to the global market and competition.
This sector as a Focus Sector in the Foreign Trade Policy
2004-09 to implement Special Focus Initiatives is a bold move
towards further up gradation of the leather industry.
ILDP- Indian Leather Development Programme –The Euro
223.15 Million scheme was undertaken during the Ninth Five
Year Plan (1996-2000) and is still being implemented during the
Eleventh Five Year Plan ( 2007-2012).
25. Tannery Modernization Scheme - This was launched under
ILDP in 2000. The objective was to support existing tanneries for
undertaking modernization programe for positive environmental
impact, becoming competitive, effecting better capacity utilization,
achieving productivity gains and reducing wastage.
NLDP - National Leather Development Programe – The Joint
Programe of Government of India and UNDP with a total outlay of
Euro 19.11 Million ( with Euro 11.7 Million from UNDP and the
rest by Indian Government) was drawn up for the integrated
development of leather and leather products sector within the
country
Leather Technology Mission - The Government of India
launched the four year mission in January 1995 aimed at spreading
the awareness of wide variety of technology in the leather sector
primarily focusing the tanneries. The program coordinated by
Council of Scientific and Industrial Research with its constituent
organization, Central Leather Research Institute covered 172
projects in 16 States.
26. GROWTH DRIVERS
The Indian government has put in place an array of measure for skill
development and skill up-gradation of workforce.
Youth power: with 55% of work force below the age of 35, the
Indian leather industry has one of the youngest and most productive
workforce.
Skilled labor at your doorstep: The humans resource development
sub-scheme under the Indian leather development program (ILDP)
implemented by the departmental of industrial policy and
promotion(DIPP) is providing skill development training to the
unemployed for placement in the leather industry while upgrading
skills of the existing workforce at the shop floor level and importing
training to trainers.
