Raw material keeps flying high

They always said it was pigs that fly but over the summer it has been raw material prices.  The big issue of small tanners and big customers has come up again and made the leather industry all over feel a bit like the old days of the garment industry.  Then an order was an order when the raw prices went up but just a forecast if the prices went down.  So if the prices went up tanners had to keep on buying but sell at the low prices and if the prices fell tanners who had bought the stock to cover found themselves in endless renegotiation as the season wore on.  Any determination to hold prices meant the leather came back with “quality” issues.  And in the garment trade if suppliers got at all insistent they just went bankrupt and restarted the next day under a new name.

Now the big brands and retailers are not as bad as the old clothing leather users but they do push their weight about and leave tanners with low margins and in some instances losses.  They need to learn that those days are over.  The famous phrase that everyone in the supply chain has to make money does actually mean something important. If new leathers are to be developed and the environment and employees fairly treated then tanners to have to be allowed to make a decent margin consistently and playing the bully to force prices down or wandering off somewhere else is no way to protect the future.

On the other hand the tanners need to give themselves more power and position their leather better. That is the concept behind LeatherNaturally!  Get into the DNA of the final consumer who after all is the one who decides the value of your leather and educate them.  In a way that coincides your leathers, perfectly made, to neatly fit with their expectations of a high quality, high performance material.  Sounds easy but so many tanners live a product oriented life to the extent that talking to a customer beyond partners and close family is anathema. “Market orientation is for the drinks industry, not for tanners”.  You do not need an MBA to know that this attitude has to change or your business will die.

Lineapelle and Tanning Tech

Many of these things will play out in Bologna next week. It is going to be a very important fair. For the University there will be two stands:

Hall 35, stand D47 in Simac/TanningTech, staffed by me and Jeffry, representing the Institute for Creative Leather Technologies
Hall 21, stand C90, staffed by Caroline Southernwood, Jane Mills and colleagues, representing the Division of Fashion and Textiles at The School of The Arts

If you would like to arrange a meeting with Mark or Jeffry you can call +44 7545 420059.

If you would like to discuss Fashion, Textiles or Footwear Design please contact Caroline Southernwood via e-mail at caroline.southernwood@northampton.ac.uk

As in previous years, we have arranged a Corium Club Reunion at the Starhotel Excelsior Bologna, opposite the railway station:

19 October, 18.00 – 20.00
Starhotel Excelsior
V.le Pietramellara, 51
40121 Bologna

We are hoping for another good attendance for an event that seems to be developing strongly in the calendar. It is good as the Starhotel location opposite the station is a good spot to meet after the show before going on to dinner or taking the train to Florence (as quite a lot do).  See you there!

Mike Redwood
11th October, 2011

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