Leather Industry of Thailand – A Sustainable Growth Sector in the country

 

The leather industry of Thailand is developing at a steady pace from the last few years. It has now become one of the most notable manufacturers of leather items all over the world. However, Thailand is not the only country that produces high-quality leather items, but its neighboring nations like Indonesia and China are also giving tough competition who are bringing quality products in the market at low price rates.

This is not the only hindrance. The labor charges in Thailand have also increased a lot over the years. This hindrance the manufacturing of low-cost leather items in the market due to which they are facing fierce competition. China and other countries’ leather products at comparatively lower prices has pushed Thailand out of the International market.

Due to higher labor charges, Thailand is compelled to offer their leather products at higher price rates due to which customers are moving to Vietnam and China for buying these items at cheaper price rates. Currently, the leather industry of Thailand is facing difficult days. The country has signed a trade contract with a developing nation in Japan, which has increased the hope of import taxes. Thailand has created a huge amount of buffalo hider, and for this, the country produces industrial gloves.

Thailand has the largest unit of producing golf gloves, which are popular all over the world. Besides these, there are manufacturing brands that have started investing in the leather sector of the country.

What is the condition of the Thai leather industry?

For attaining a considerable growth in the leather industry, an imperative element of advanced technology and eye-catchy product designs which can rule a worldwide market. The manufacturing of various leather items can be divided into three important segments or stages. Let’s brief these stages one by one –

The first stage is the production of leather goods and items for domestic selling purposes. They are also export to some other places. These items are offered at lower prices so it can meet the competition in the leather market.

In the second stage, the manufacturers of leather goods try to improve their quality of items so they can make a strong base in the International market and with some international brands.

In the third stage, the leather manufacturing brands of Thailand start exporting their high-end leather items to the international markets, and therefore, it is an important step towards their brand establishment in the leather business of the world.

Check out leather industry statistics

Since the leather industry of Thailand is a growing sector of the country, it has provided employment to more than 3 million workers. Eighty percent of the leather industry is consists of small and medium-sized enterprises.

Due to their steady growth in this sector, Thailand has been ranked six in the world in terms of exporting high-end leather items in the international market. The most common leather item of Thailand is a bag, and nearly ninety percent of the total items is made from using original quality leather. This is the main reason why leather bags of Thailand are high in demand.

Currently, more than 1000 factories were registered with the Industrial Works of Thailand in 2005. These enterprises mainly manufacture footwear and leather bag items. As per the survey, it has been proved that more than 90 percent of factories are small and medium-sized business organizations where more than 15 thousand workers have found employment.

The leather industry of Thailand is continuously aiming at developing the quality of products so they can make their footprint in the international market and become the leader in the Asian market. The Thai government has also taken serious initiatives in this sector with a project like “the center of Asian Fashion.” The government has adopted a few important strategies for the establishment of leather industries in Thailand. These strategies are as follows –

  • The creation of a push market
  • The creation of Thai brand name in the market
  • The promotion of Thai leather products in the market
  • The management and production of leather items
  • The establishment of an effective networking system in the leather infrastructure industry
  • The development of regulation and law

Government initiatives in the leather sector of Thailand

The government of Thailand has taken strong steps to encourage the production of leather items and thereby enhances the establishment of leather industries across the nation. More than 27 leather manufacturing companies are working in the process of production, tanning, and designing. A new show brand has come up in the Thai market, and this brand is named as Club. This shoe brand is the association of 27 Thai leather production companies. This is a developing project which is backed by the Industrial promotion department of Thailand. This project aims at enhancing the design of leather shoes and thereby increasing its value in the international market.

This brand produces various categories of footwear such as slippers, casual shoes, sports shoes, moccasins, etc. and they are sold both in the domestic and international markets. It is hoped that the brand will soon start producing other leather items.

The future prospect of the leather industry

Thailand mainly exports leather footwear items and various other general items like bags and various other things. Thailand is the only exporter of leather items to various nations like Japan, the UK, France, the Netherlands, and China. The Thai leather goods association has joined the hands of the Ministry of Commerce Department, which helps attaining sustainable growth in the leather sector.

The policies are to help the entrepreneurs of the country so they can establish their own enterprises and thereby improving their quality of products. The manufacturers are bringing innovative craftsmanship through their products, and this is the very reason behind the growing popularity of Thai leather products in the International market. The manufacturers are employing effective branding and selling policies to get more success in the future. It is hoped that the leather industry sector of Thailand will soon its booming stage.

 

 

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Andy Aditya

As Business Startup Specialist, Andy is often hired as a Virtual Director/Consultant to assist Business Owners in Thailand. For total business information and consulting for doing business in Thailand - Pls check - startupinthailand.com