Mossop Leather: Big opportunities for local manufacturing
Published: 22nd May 2020
Wellington, W Cape, SA - One has to acknowledge that the remainder of 2020 will be very tough. Liquidity in the industry will be the largest challenge we face and all of us have to act responsibly to our customers and suppliers in this regard. There is vast uncertainty about the medium term future and shoe manufacturers will continue to take a very cautious approach in this environment. Within this context, Mossop will position itself to continue to provide exceptional service, product and support to all our partners in the shoe and leathergoods industries. Mossop has for some time now moved beyond traditional supplier/customer relationships and has steadily built long term partnerships with key manufacturers and suppliers in our value chain.
Longer term we believe that the structural changes that will take place in the South African economy will benefit local manufacturing. Therefore, we believe that by mid-2021 the larger manufacturing landscape in South Africa should benefit from on-shoring of product, provided our value chain can prove its ability in providing consumer product that is relevant to our market. This is a challenge all of us have to take on and analyse properly to understand our readiness to respond to this opportunity, despite the difficulties of seeing through the haze of Covid-19.
The exchange rate is also a factor, at least for now. Our export business is ongoing and growing. Our customers know what our currency has done, and expect keener pricing, but overall it is an opportunity in the short term, and perhaps for longer to grow our export volumes. One has to bear in mind that most of our chemicals and some of our hides are imported.
The exchange rate also means that, even though our prices will have to increase, local leather will be cheaper than the equivalent imported leather.