• Thursday, March 28, 2024
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BusinessDay

The blossoming N96bn Aba shoe industry

This was 5pm. Date was February 23, 2017. Sam Okenna, a 42-year-old man, was cutting Chinese leathers into pieces and gumming the layers together.

Okenna had been on this since morning. No time for lunch. No time for frolic. No time to waste. He had secured a supply contract from two secondary schools. One school was located in Aba while the other was based in Umuahia.
He needed to produce 1,200 pairs of shoes in three weeks’ time. Failure to do so would rob him of further contracts.
It had been a good business. A pair of shoes was N1,300. So he would walk off with N1.560 million in three weeks if he could complete the contract. If he failed, getting his money would take another two months.
“Drive the nail into the sole, fast. Don’t be lazy,” Okenna shouted at one of his three staff members named Obi.
“Joy, allow the glue to dry. I don’t like the way you work. You have been with me here for eight months, yet you are still sluggish,” he barked at a female apprentice, who was desperate to become a shoe exporter.
His supply contract was one of the best that happened to him that month. To produce a pair of shoes, Okenna needed to have some synthetic leather, adhesives, fabrics, nails, dye, heels, fittings and decorative items, as well as finishing materials such as polish, lacre and waxes.
All the raw materials were expensive but each pair of shoes still cost him less than N1,000. The foreign exchange crunch in the country had spiked the cost of raw materials, as a dollar went higher than N360/$. Had it not been for foreign exchange scarcity, Okenna would perhaps be going home with half of the money. Be that as it may, he was sure of making N400,000.
Okenna had no registered business name, even though he told friends and patrons that he was the managing director of O’ Sam Enterprises. Yet, he was getting contracts because he was skilful.
Okenna’s story typifies the Aba shoe industry, made up of majorly small-scale shoemakers.
Four million pairs of shoes are produced each week in Aba by over 70,000 shoemakers, mainly micro- and small-scale, according to leaders of various sections of Ariaria Market in Aba.
Ariaria Market is the shoe hub in West Africa, with nine clusters, including Imo Avenue, Shoe Plaza, Bakassi (Umueghilegbu) Industrial Market, Old Site, Bag, Belt, Trunk Box and Powerline Clusters.
Traders from Cameroon, Togo, Mali, Ghana and other parts of West Africa file at the market to buy and resell in their countries.
Shoes and slippers are cheap at Ariaria and tell little story about the innovations and craft that go into them.
The industry is now estimated at N96 billion and has produced millionaires who are redefining the way the business of shoemaking is done.
More than 70 percent of the shoemakers are micro and small players but produce shoes that ring bells in the ears of Nigerians.
Late last year, former President Olusegun Obasanjo ordered and took delivery of Aba-made shoes.
An elated Obasanjo told Governor Okezie Ikpeazu of Abia State, “Afreximbank is spearheading made in Africa, and they came during their annual meeting. They told me to tell you that they have heard so much about Aba, and want to come back and pay a special visit to Aba, because they want to establish an industrial park in Aba to encourage production and exportation of goods made in Africa.”
Abis State government has already secured a $1.5bn deal for the establishment of a shoe industry in Aba from Huajian Shoe Industry in Dongguan, Guangzhou, China.
An Abia-Huajian Shoe Industrial City will be established and will have the capacity to produce 5,000 shoes per day and employ about 10,000 people directly and indirectly.
If this deal materialises, Aba will perhaps rival Ethiopia in a decade, which attracted over $500 million in FDI to the shoe and leather industry just between October and December 2016.
Aba has been in the business of producing millionaires since the early 1980s and 90s when the industry boomed.
Brand names such as John Wax, Virgy Shoes, Anzy, Ncol Shoes, and later Aris Ken were household names from Aba shoe cluster that made millions from shoe production.
However, things started dwindling in the early 2000s, leading to divestment by the popular brands.
These manufacturers divested from the business due to high cost of production, occasioned by lack of power, government’s insensitivity to local manufacturing, influx of Chinese products, lack of machinery and patronage by government and Nigerians.
Okechukwu Williams, president, Leather Products Manufacturers Association of Abia State (LEPMASS), explained that the Aba shoe cluster has produced so many millionaires.
“I know that this cluster has produced millionaires. People like Anzy Shoes started here, but he is now into food processing, oil and gas among other businesses,” Williams said.
Kenneth Oforha, one-time chairman of Umuehilegbu Industrial Market, also started as a shoemaker.
He, however, stated that John Wax is the only firm that is still in production, noting that they produce for schools in Ghana and FAMAD in Nigeria.
According to him, some of these names mentioned made their money in the early 80s and mid-90s.
He attributed the dwindling fortunes in the sector to relatively low patronage and influx of low-priced, low quality foreign-made shoes, especially products from China, a development, he stressed, affected the Nigerian finished leather industry negatively.
“Manufacturers in Aba were devastated by the influx of Chinese products and we couldn’t do anything, because that was what people wanted – cheap products – not durable and less quality products.
“It is obvious. Everybody knows what caused the dwindling fortunes in the shoe sector. In those days, we were following Italian designs and quality and there was so much demand. We had patrons from within and outside, but all of a sudden, Chinese products came in and affected our market system,” Oforha said.
He said the trend is gradually changing with the emphasis on made-in-Nigeria products, which he said is impacting positively on local shoe manufacturers and their products.
Williams revealed that the market share of the Aba shoe cluster has gained 5 percent and now stands at 25 percent.
For Chinatu Nwagbara, managing director, Chinatex shoes, the annual made-in-Aba trade fair sponsored by Enyinnaya Abaribe, senator representing Aba South senatorial zone, and the recent campaign pioneered by Governor Okezie Ikpeazu of Abia State, are impacting positively on the sector.
“These initiatives have changed my life for the better and my business is growing. The involvement of Governor Ikpeazu in the campaign has brought more life into it and we are happy.
“I was not proud to be identified as a shoemaker before, but now, anywhere I go, I like to be identified as a shoe manufacturer from Aba and people are identifying with us now,” Nwagbara said.
To revive the sector, Francis Chukwu of Frantonia Industries Limited urged the federal and state governments to improve infrastructure, implement cluster concept, and provide incentives to local manufacturers, especially small and medium manufacturers.
He buttressed that lack of patronage and incentives from the Federal Government made the big players in the shoe sector to close shop.
According to him, there was no incentive from the state and Federal Governments.
“They paid lip service to locally-made goods, they don’t even use it themselves,” Chukwu said.
He implored Nigerian leaders to live by example, by using locally-made goods, noting that they would serve as role models when they start using home made products.
He attributed the boom currently witnessed in the sector to the high cost of foreign-made goods.
“We are experiencing boom in the industry, because of the state of the economy. People can no longer afford imported goods. The declining Naira has made it difficult for people to import.
“People have now settled for improved locally-made products. We need improved infrastructure to expand and improve quality of our products. We don’t have access to machines and quality materials like leather. Adhesives and soles are not made in the country. Leather produced in Nigeria are shipped out and then exported to us,” Chukwu stated.
“If we are quartered in a nice place, catered for and encouraged by the government, we would do well. But for now, we are individually improving on our own,“ he said.

 

ODINAKA ANUDU & GODFREY OFURUM, Aba