The global footwear market valued at $365.5 billion in 2020 is projected to reach $530.3 billion by 2027 growing at a compound annual growth rate (CAGR) of 5.5 percent according to Allied Markets Research, this is a viable market that Nigeria can tap from if its major footwear manufacturing hub located in Aba is well positioned.
According to experts, growth in this industry is primarily attributed to high demand for convenient and comfortable footwear, especially for companies that focus on innovative designs, product developments, and advanced technical fabrications, to boost product sales.
Nigeria already has a N120 billion active market located in Aba which houses the country’s major footwear hub, however with lessons from India, much of its untapped potential can be realized.
India, one of the fastest growing emerging markets, has its shoe manufacturing hub located in various areas in the country. In 2018, the country became the second largest footwear producer and one of the top 10 exporters.
According to the World Integrated Trade Solution (WITS), India’s global exports was $9.31 billion between 2017 and 2019, accounting for no less than five percent of the total global footwear output annually.
While India’s success was not overnight, the government supported the industry through grants and accessible loans. In 2017, the Indian government established the Indian Footwear Leather and Accessories Development Program (IFLADP) that grants 20-30 percent subsidy for Micro, Small and Medium enterprises (MSME) for capital expenditure purposes which include building a plant and buying machinery.
Furthermore, to encourage the business owners, the government set aside Rs2,600 crore as a special package for fuelling the leather and footwear industry and also generate employment. Provision was also made for 300,000 people to be trained with the aid of government sponsorship annually.
The federal government needs to roll out accessible intervention funds that will help scale up production and promote expansion in Nigeria’s footwear industry.
Furthermore, adequate infrastructure should be made available to aid output and boost production to meet market demand globally and domestically.
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The Indian shoe industry focuses on supplying domestic demand which is usually high before meeting global demand. Patronage of the made-in-Aba products should increase more importantly, the Executive Order 003 established by the president must be strictly complied with,
India’s footwear industry is driven by technological innovation and advancement. In line with global best practices and trend, the Aba leather industry must be centered on and driven by technological innovation in its output, design, activities, and branding. This will attract a wider market and improve patronage.
Furthermore, branding and marketing strategy must be indigenous and domesticated. BusinessDay findings reveal that artisans in Aba brand their products as ‘made in China’ in order to boost market reach and improve patronage locally and globally.
“Branding is important because it helps to change the perception of consumers who think that Aba products are inferior,” said Amanchukwu Nwankwo, a shoemaker in Aba.
According to experts, while it might serve its function, it kills the prospects of boosting Nigerian-made products and has negative impacts on local consumption of goods.
Local shoemakers will need to work on rebranding and repackaging of their products for higher and wider consumer attraction/acceptability.
Ken Anyanwu, national secretary, Association of Leather and Allied Industrialists of Nigeria (ALAIN), told BusinessDay in 2019 that Aba is in need of foreign investors and partners that will foster the much-desired growth and development.
“With the presence of foreign investors, stakeholders in the industry will be exposed to training that will inspire new innovations and designs as well as external knowledge from foreign bodies,” he said.
Anyanwu added that access to foreign investors and partners will lead to a reduction in infrastructure problems and reduce the lack of necessary machines and instruments which will provide a platform for industrialization and increase output.
Taking cue from India’s shoe industry, Aba has the potential to become more significant in the economic development agenda and become a more competitive hub.
