It was 6.30 pm at Ochanja Market on February 22. Traffic had built up. Scores of people were hurrying home. The large pool of market men and women waving down commercial motorcycles and tricycles were indications that it was time to go home.
Market men and women, who had sampled their wares since 7 am, were now packing them into their dimly-lit shops and warehouses. They had to pack and go home. The Ochanja Market Association officials were already dishing out orders, waving canes on those who were not making efforts to pack.
It was almost a bye-law that everybody must close at 6.30 pm and go home.
As the traders were hurriedly packing their wares, two shoe makers were busy gumming the leathers and pushing the nails.
They did not have to go home at 6.30. Samuel Okechukwu of Smart Leather, one of the shoe makers, had to deliver eight pairs of shoes by the end of the week. The other, John Obane, who manages Brendan Shoes, must deliver 12.
So they must stay till 10 pm and re-open at 7 am the following day. Much of the money given to them by their customers had gone into the purchase of raw materials such as animal skins, synthetic leather, gums, and nails.
The two shoe makers get animal skins from northern Nigeria as raw materials. But these are no more coming regularly, as northern traders and tanneries now prefer to sell the goat skins, the cow skins and the sheep skins to European companies and their representatives who are ready to pay more.
“When they export, they get dollars that are locally scarce. Secondly, the Europeans, who even come into Nigeria to buy, pay much higher. If you pay N10,000 for animal skins, they can pay N30,000,” John Obane of Brendan Shoes told BD Sunday.
Nigeria has more animal skins than Ethiopia, which is now world’s hub for shoes. Nigeria has 131 million cattle, goats and sheep, according to the Federal Ministry of Agriculture (2011 figures).
Ethiopia is home to 56 million cattle, which provide ready raw materials to shoe makers.
However, as Ethiopia feeds its shoe industry with local animal skins, Nigerian tanneries in Kano and Kaduna are exporting the commodities, earning dollars even when local industries are in dire need of them. The impact of this is that shoe makers in Nigeria are still forced to import leather and other raw materials from China and West Africa.
“Once the tanneries are through with production, they export the entire finished leather to the detriment of local leather works manufacturers. This is affecting the finished leather sector in Lagos, Onitsha and especially the Aba cluster,” Ken Anyanwu, national secretary, Association of Leather and Allied Industrialists of Nigeria (ALAIN) complained to BD Sunday.
According to Jide Ipaye, founder of Keexs Footwear, an African- inspired range of casual footwear such as sneakers and smart shoes, there is still no consistency in the supply of raw materials for the shoe industry in Nigeria, owing to poor organisation of the sub-sector.
The two shoe makers in Ochanja market have another challenge in their hands: Power. They use generators for more than eight hours each day, because there are incessant electricity interruptions. These generators consume doses of litres of fuel and constitute noise pollution to nearby homes.
“The impact of this on cost of production is huge,” Samuel Okechukwu of Smart Leather told BDSunday. “Owing to the power problems, the ex-factory price of a pair of slippers may cost N1,300. But it is hard to sell it above N1,500,” Okechukwu said.
“Many Nigerians don’t have confidence in us. They believe our products are not good enough. They prefer Chinese products, but we have high quality local shoes. The major challenge is often raw materials,” he added.
The Nigerian shoe maker is innovative and creative. But there is still something lacking, which makes attracting big money investors difficult.
Multiple taxation is on, roads are majorly bad and inaccessible, and there is still government bureaucracy. Cheap funds are almost non-existent.
Just between October and December 2016, Ethiopia attracted over $500 million in FDI to the shoe and leather industry. About 124 investors willing to invest $3.5 billion have since indicated interest to swell the export-oriented shoe market, according to the Ethiopian Investment Commission (EIC).
“Ethiopia has invested in the shoe space. But this is still lacking in Nigeria. Aba, for instance, has not done well in branding its products. I believe someone should step in and formalise that space,” said Ipaye.
Since 2000, Ethiopia has emerged as a shoe-making hub for the world as it has a well-organised and formalised leather industry, leading to the attraction of tens of Chinese and Turkish firms such as Huajian and My Shoes.
Ethiopia’s comparative advantage in shoes stems from a combination of cheap labour and electricity as well as a formal structure which shoe makers in Aba, Kano and Lagos, three biggest hubs in Africa’s most populous country lack.
Ethiopia exported $33.7 million worth of footwear products, mainly to the United States in 2015, one million lower than the preceding year. Through the African Growth and Opportunity Act (AGOA), the US-Africa trade law that allows duty-free and quota-free access into the US market, Ethiopia shoe exports jumped from $630,000 to nearly $7m between 2011 and 2012, a more than tenfold increase, according to statistics from USAID.
On the other hand, Nigeria’s main entire export to the US in 2015 was $2.6 million, mainly made up of foods.
Shoe makers in Aba, Onitsha, Lagos and Kano need funds to push their businesses. But banks charge them 20 to 35 percent interest rate, which makes repayment within a year almost impossible.
“In an environment like Nigeria where funding is a huge challenge, we have a lot of great ideas but the funds to purse the idea are lacking, because of high risk,” Ipaye said.
Aba is Nigeria’s shoe hub. One million pairs of shoes are churned out each week by averagely 70,000 manufacturers in the city, according to figures obtained from heads of various groups in Ariaria Market.
Ariaria Market in Aba is the shoe hub in West Africa, with N96 billion industry potential, having nine clusters, including Imo Avenue, Shoe Plaza, Bakassi (Umueghilegbu) Industrial Market, Old Site, Bag, Belt, Trunk Box and Powerline Clusters.
Nigeria was a shoe-making hub in 1980s and 1990s with giant firms such as Bata Shoes and Leonard Shoes. ‘Cortina’ produced by Bata and Leonard was popular and compulsory for students of the era. Bata produced 10.4 million shoes in 1990s, creating jobs for many Nigerians.
However, it was faced with challenges such as poor innovation, crippling leather market and managerial problem, which prompted the company to start importation at the twilight of its operations.
Aba is also faced with infrastructure challenge, particularly poor road infrastructure and ailing power supply.
“Our big challenge is market access. Market is a force and when it begins to develop, it goes with everything you are doing. Even the standard and quality of our products go with the market,” Okechukwu Williams is the president of the Leather Producers Manufacturers Association of Abia State (LEPMAAS), in a recent interview.
ODINAKA ANUDU
