S&V Weekly Newsletter Vol.2 No.21, May 30, 2016

S&V Footwear and Leather Goods / S&V African Leather/ S&V Protect

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SAFLIA, NULAW settle, SACTWU declares dispute

Durban (SA) – Employers association Saflia and NULAW, 1 of 2 unions involved in wage negotiations, reached agreement on an 8% increase in wages during the second round last week, according to Gerald Naidoo, general secretary of the National Bargaining Council of the Leather Industry of SA.
Among peripheral issues, they agreed on a 6-month reduction in the learnership period for all categories of learners, the deletion of the adult clause for learners, and in terms of ratios, employers may only employ 1 learner for every 3 qualified staff.
SAFLIA was unable to reach agreement with the other union, SACTWU, which has declared a dispute.

Big cities and the Langkloof

From Karl Flowers, sub-contractor for the Institute for Creative Leather Technologies, who are consulting for the DTI on the proposed Leather Research Institute
The next leg of the three-week consultation of industry takes the delegation to remaining upholstery producers. The home of high tech automotive tanneries, Gauteng welcomed our delegation with open arms. The visits started off with a very informative meeting with Rudolf Hanni of Hannitan. Rudolf is a details man and painted a very comprehensive picture of the current operating conditions in South African tanneries. Rudolf’s tannery is a classic example of how a small determined company can steadily grow into a thriving producer that employs many people from the surrounding community. Hannitan also manufactures leather goods and it is this supply chain extension that allows additional value to be obtained from the raw material that exists in South Africa.
The next port of call was GST Seton Autoleather and quite a few people attended the meeting including Detlef Wedekind, Richard Delfel, David Dean and Peet De Jager. Many good points were discussed including the technical training that Nene College (now Institute of Creative Leather Technologies) and Reutlingen (now closed) used to offer. A tour of the facility showed a typical automotive tannery that has extremely high standards.
After the weekend, and a short flight to Cape Town, the focus shifted to Mossop Western Leathers where our planned meeting with Gert Kruger had to be substituted (due to illness) with an equally interesting meeting with Gert Bosch. Apparently you do not need to be called Gert to work at this shoe upper producer as a meeting with Jerome Alexander, an ex-LIRI student, gave us a reflection about the benefits of a LIRI education. The production of laminated splits allowed the delegation to get some insight into the use of splits in SA and discussion was had at length in terms of importation of semi-processed leather.
After lunch, visits to Fusion leather (in Belville) to meet with Denzil Spolander who said very similar things to Gert Bosch about the current difficulties related to the operating conditions of SA tanneries. Particular attention was given to the inequality of payment terms demanded by the raw hide merchants, and taken by the manufacturers and retailers, leaving component suppliers in general, including tanneries, operating as banks.
A late meeting with Richard Silber at Richard Kane gave the first snapshot of how the fellmongery business is doing in SA. The difficulties of exporting into a highly competitive market with raw material that appears to be rapidly declining in quality was discussed, but very positive discussions were had about the future and about the role the tanning industry could play in providing employment to the SA population.
On Tuesday, a meeting with Derrick Frantz and Jonathan Hagan in their impressive Woolworths headquarters in Cape Town city centre allowed detailed discussions over the leather knowledge levels that exist in the SA retail sector. The discussions about testing in the local market highlighted the need for better local services.
To finish the day a meeting in Salt River allowed discussions with Simon Eppel (at SACTWU) to turn to labour relations and many things were heard ranging from: the labour research currently being done; to the training provided from the unions; to possible considerations (from a labour relations perspective) required in a possible LRI.
On to Port Elizabeth on the Wednesday. Discussions with African Hide Trading (Phillip Staples, Dale King and Steve Broughton) shifted focus to raw materials and the difficulties facing the commodity sector of the SA leather industry. A brief meeting with David Boast about the activities that took place while he worked at LIRI were also very informative. Immediately afterwards very similar sentiments were offered across the road by Stan Blumberg at CPC.
On the Thursday, an early meeting with Charl du Plessis, Du Toit Kruger and Shane Claassen at KKI in Oudtshoorn and a site visit allowed us to see the first of two international quality exotic leather producers. The discussions focussed on the provision of ISTT and it was made very clear about how important current training provision was to KKI.
After a brief journey to Mossel Bay, Frik Kriek, Charl du Pisani, Cobus Brink and Johan Yzelle at SCOT showed a different, but effective style of tannery when compared to their competition up the road. The importance of ISTT training was again discussed and further talks about consulting-support (especially effluent) were had.
At Groot Brak Rivier, an excellent meeting with Marius Ferreira (of the Southern Cape Regional Footwear Cluster), and members from the Bolton Footwear group allowed emphasis to be placed on the need for leather knowledge training and upper leather testing.
Moving on to Grahamstown, the whole of Friday was deep discussions with Dr Clive Jackson-Moss, the only member of the South African leather tanning industry who holds a PhD. At the International School of Tanning Technology facility, we got a very clear picture of the role ISTT plays in the industry. For the last 17 years, students have been attending ISTT for a range of training activities and quietly and methodically they have received upskilling and then go into companies better off than when they started. Clive patiently heard about the plans for the LRI and showed great interest and support for what was planned. Many ideas were discussed about future plans for the SA industry, in terms of training and education and the week-long collection of visits concluded with a great feeling of optimism and potential. – [+27 (0)76 081 5903, karl.flowers@northampton.ac.uk] Note: In the previous report, Bader SA Employment Equity & Training Manager Tom Ramdin’s name was misspelt. Our apologies.

Machinery to be auctioned

Polokwane (SA) – Footwear and clothing machinery – still in bubble wrap – is to be auctioned here on June 23.
Manie Marx of auctioneers Eli Ströh said the equipment had been set up for production in Polokwane, but had never been used.
A list of the equipment will be advertised in next week’s newsletter, and again on June 13, but a list is available. Contact Adrinette [adrinette@elistroh.co.za, +27 (0)15 287 3300]

SAFLEC: ‘Relationships have to start somewhere’

From Nerisha Jairaj, executive director, SAFLEC
Durban (SA) – As part of an additional strategy aside from trade shows, SAFLEC has embarked on letting the world know that South Africa has a footwear, handbag and a belt industry. We have found that on trade show platforms, many in the global market is often surprised that we have a growing industry. We are creating awareness and attempting to network with major retailers to form relationships that could benefit our manufactures.  At the recent trip to Dubai, we started the process with both the Landmark and Apparel Groups.
   We have done the same with the Footwear, Retailers and Distributors Association of America as well as the Apparel and Fashion Association.   At the recent summit held in Washington, SAFLEC met with the CEO and Chairman of Steve Madden, the Sourcing Director of Express Shoes, Wolverine, Payless Shoes and many more retailers.
  We understand that it will take time, nothing gets done overnight but awareness and relationship building for the benefit of our manufacturers have to start somewhere.
  FDRA is a body that lobby’s strongly on behalf of its members and SAFLEC is considering forming alliances with this body to benefit our manufacturers.   With a strong push from American government for retailers to start moving away from China and looking more to Africa, we would want to ensure that South Africa is on the radar.  Additional benefits to encourage this, is the current AGOA agreement.
  We form the relationship, and together with our Embassy’s and the DTI representatives, introduce the manufacturer to the retailer and then allow the manufacturer to negotiate from that point.  SAFLEC creates the opportunity and you take it from there. – [+27 (0) 31 266 1472, nerisha@saflec.co.za]

Mauritius to send big delegation to Source Africa

Cape Town (SA) – Enterprise Mauritius will lead a major delegation of 39 clothing, textile, footwear and leather goods enterprises to the Source Africa Trade Show on June 8 and 9, part of its strategy to maintain its visibility as the ‘Preferred Next Door Partner’ and to boost exports to South Africa. It will also host a fashion show on June 8.
The will be its 4th show.
Says Enterprise Mauritius CEO Arvind Radhakrishna: “In 2015, South Africa was the third biggest export market for Mauritian textile and apparel products. Exports to South Africa have increased by 500% over the last decade and last year it reached Rs6.0Bn, a 21% increase over 2014.”
With decades of experience and investment in design skills and manufacturing technology, Mauritian textile and fashion producers supply leading fashion brands, primarily in the Eurozone and the USA. He said SA retailers were “progressively recognising the benefits of partnering with Mauritian manufacturers for their sourcing options due to the preferential trade agreement and short lead times”.

Source Africa organisers expect to attract more than 1500 visitors to the Cape Town International Convention Centre. The event will feature over 180 exhibitors and African countries represented include SA, Mauritius, Lesotho, Kenya, Egypt, Madagascar, Tanzania, Ethiopia, Nigeria and Zimbabwe.
Source Africa will bring together manufacturers, buyers, suppliers and services providers in one major integrated event, enabling International and African buyers to view and explore an extensive array of products and services. The event will promote African manufacturers, with the aim to increase market share for the continent as well as develop regional trade between African countries.
A series of business seminars including key topics such as AGOA – the Africa Advantage; WGSN Trendtalk: Spring/Summer 2017 Buyers’ Briefing, and UL’s Textiles, Apparel and Footwear: The main challenges for manufacturers and retailers from testing, to inspections and responsible sourcing, will be presented by top industry speakers. The complete seminar programme can be viewed on http://sourceafrica.co.za/wp/seminars-programme/. Entrance is free, but seats are limited so pre-registration is necessary.
Africa will play an increasingly important role in the textile, apparel and footwear industry over the next decade. So, come and meet top class exhibitors from Africa who’s compliant, capable and ready to do business! – [+27 (0)21 790 5849, deidre@sourceafrica.co.za, www.sourceafrica.co.za]

ABSA Agri Trends 17/05: Hides & skins prices

The average hide price over the past week was R14.50/kg green. Hide prices are determined by the average of RMAA and independent companies.
The average price for Dorper skins was R60.77/skin and Merino was R92.41/skin.
The average price for ostrich skins was R1486.14.

Birthdays this week

31/05/1959: Mike Ing, The Ing Thing, Pietermaritzburg.
31/05/1951: James Stewart, Tokyo+Co, Cape Town.
31/05/1963: Craig Davis, Spunlok, Pinetown.
01/06/1942: Chris Horne, Little Slipper Company, Port Elizabeth.
01/06/1947: Peter Howard, left the industry, formerly CPC, Port Elizabeth.
02/06/1975: Shaun Ganesh, Nikkita Footwear, Chatsworth.
02/06/1983: Jana van Vuuren, Maraschino Shoes, Pretoria.
03/06/1958: Tom Bailey, Watson Shoes, Great Brak River.
05/06/1960: Tom Bassage, CC Leather, Pietermaritzburg.
05/06/1967: Vimla Naidoo, Edcon, Durban.

In Memoriam this week

01/06/1992: Harry Gassert (Panther Shoe Co).
04/06/2002: Rex Phillipson (b. 13/4/1917), Picaninni Shoes [closed], Durban.

Trade Fair dates

For a list of local and international trade fairs covering footwear, leather goods, leather and PPE, visit our website: http://www.svmag.co.za/events.php

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Next newsletter: June 6, 2016.

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