The Hindu Business Line : N. Arcot leather units brace up to meet retail major orders

Mr Rafeeque Ahmed has strict instructions from his son — the new factory must be ready in 2-3 months; commitments have been made to Wal-Mart and deliveries need to start by the year-end.

Mr Ahmed, Chairman, Farida Shoes, shares this bit of information with journalists as he shows them around the busy construction site at Ambur, where workers are putting up the company's fourth factory.

It sums up the mood in the area — `get it done now', the dictate of fashion in Europe and America. Also, the third generation is getting into the saddle in the family-held leather businesses and they are setting their sights far.

Finished leather, leather footwear, garments and accessories manufacturers are pushing hard to increase their factories' capacity or setting up new ones.

The leather industry — much like a host of other products and services — has also benefited from the need for international players to keep costs down, and identify a production base other than China with a skilled workforce, ability to deliver and being quality conscious. The small, dusty towns in North Arcot — Ranipet, Ambur, and Vaniyambadi — meet these conditions.

Mr Rafeeque Ahmed says, "From trading in plant extracts to catering to tanners, getting into tanning and moving on to leather products, the industry has evolved over the last century. From there to meeting the needs of premium brands in European fashion has happened in the last decade or two."

Problems galore

The growth is not without pangs.

Leather manufacturers tell the journalists on a tour organised by the Council of Leather Exports that full order books are counterbalanced by labour shortage and problems of communication; broadband connectivity, video conferencing facilities, etc are still a problem, though these towns are just a two-hour drive from Chennai, a hub for the telecommunication industry.

International businesses mean expatriates, middle-level managers with good pay packets looking for some quality of life. But basic facilities such as good schools, entertainment and shopping facilities are almost absent. Most companies build their own guesthouses to attract the executives to stay on.

At Ranipet, Mr P.V. Gopalakrishna, who heads Bachi Shoes, says the company expanded from making a 1,000 pairs of shoes a day in 1998 to 6,000 pairs now and a new facility to produce another 3,000 pairs will be completed in 2-3 months. Bachi started making shoe components with a 12,000-pairs-a-day factory in 2003 and is doubling this capacity now.

In two months' time he will need 750 more workers at the shoe factory. Buses now transport workers from 40 km away to and from their residences. They will just have to look further afield. Being within a 100 km of the major centres of automobile and telecommunication production centres in Sriperumbudur is another problem. Those industries can out-pay the leather industry.

Another problem is communication. Broadband, video conferencing facilities and e-mails are not good enough.

Mr P. Anees Ahmed, Director, Naser Bali (gloves) Pvt Ltd at Vaniyambadi, says that his company depends on the liaison office in Chennai, 200 km away, for fast communication.

There are just two or three others making gloves and his is the only factory that makes golf gloves for the international premium brands — No, Tiger Woods wears their competitors' brand. They are expanding their tannery — it will produce 15 million sq ft of leather a year. The glove makers are getting together to start a training school for new workers, he says.

Mr T. Rafeeq Ahmed of T. Abdul Wahid & Co says workers' availability is the limiting factor to expansion.

If it was just equipment, a shoe-upper production line can be in place in two days. "But where do I go for workers," he asks. Factories need to move into the interiors, but roads and communication facility would become a bigger problem.

Factories need to expand to cater to the US market — much larger than the European market. Entire factories making several thousand pairs of shoes a day need to be dedicated to one US retailer. Companies cannot always make that kind of a commitment, he says.

The 55-year-old company has even started a school in the area. It is an English-medium school and most of his employees put their kids through school. But there are not many other schools in the area.

They build guesthouses for their customers to stay. There are no good restaurants or hotels in the area.

Manufacturers say town planning is a must in Ambur, which is — a maze of narrow lanes and open drains. And that is also true of the other centres.

More Stories on : Leather | Retailing | Tamil Nadu

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page