In 2011, total revenue generated by the leather industry was estimated at approximately US$82.2 million and industry’s contribution or value addition at US$31.7 million. The largest contributions to total sales and margin come from shoe retailing and shoe manufacturing, the two levels of the value chain where there is more value addition. About 1,168 companies are estimated to actively work in the leather value chain, providing employment to approximately 5,610 people.
The strategy also estimates the impact of the leather value chain at the farmer level, by calculating total revenues generated by the hides and skins only. According to price information collected during rural workshops, value chain stakeholders estimated that the value of total hides and skins sales and revenue for the farmer population can range from US$1 million for low quality hides up to US$1.9 million for medium quality and US$3.9 million for high quality hides. Therefore, the issue of quality is of paramount importance and if properly addressed, as proposed in the strategy, it can help increase the income and improve livelihoods of rural communities and smallholders. Additionally, the strategy supports initiatives aimed at encouraging artisanal tanning and value addition for niche products at the community level.
Weaknesses of Zimbabwe leather value chain:
- Lack of trust, transparency and coordination among value chain stakeholders;
- Lack of affordable finance and/or innovative financial mechanisms;
- High cost price of raw materials and inputs for the industry;
- Shortage of hides and skins and poor quality leather, mainly due to poor husbandry practices and improper flaying techniques, as well as an inadequate collection and storage system; and
- Low capacity utilization of the leather industry and poor diversification, quality and design of leather products.
On the other hand, strengths of Zimbabwe leather value chain include:
- Quality of management, particularly at manufacturing;
- Highly educated and skilled labor force at all stages of the value chain;
- An important livestock sector and plenty of resources of exotic skins.
Source : Zimbabwe Leather Sector Strategy (2012-2017)