UK hand in glove with Ethiopia's booming leather sector

Staff at work in one of Pittards' factories in Addis Ababa Pittards plans to substantially increase the size of its Ethiopian workforce

Amid the rhythmic clicking of rows and rows of sewing machines, hundreds of workers are busy creating a range of leather gloves, bags and jackets.

"I can tell when employees' skills have improved by the noises of the machines speeding up," says Tsedenia Mekbib, a general manager.

We are at a busy factory on the outskirts of the Ethiopian capital, Addis Ababa.

It is one of three such facilities in the city owned by UK leather goods company Pittards, which has a long history of operating in the country.

Start Quote

Ethiopia has come a very long way over the last 23 years since I first visited, and the last decade in particular has witnessed massive positive changes”

End Quote Reg Hankey Pittards chief executive

While an increasing number of Western firms of all sizes are now looking at doing business in Africa, Pittards has had a 90-year head start.

The company, which is based in Yeovil, Somerset, in the south-west of England, has been trading in Ethiopia since the 1920s. And it is all down to a celebrated type of sheep - the Ethiopian hair sheep.

This breed, which does not grow a thick coat of wool, also has much thinner skin than its European brethren, making it ideal for delicate leather apparel such as ladies' gloves.

New factory

Pittards now has ambitious plans to grow its Ethiopian operations, which help contribute towards the firm's £39m ($60m) annual revenues.

At present its Addis Ababa-based factories and tannery to the south of the city employ about 1,200 locals, a number expected to grow to about 5,000 within five years. A fourth factory has already been built, and is waiting to be occupied.

On the current production floors, an element of handwork is also included in the manufacturing process, which each month produces 100,000 work gloves and 5,000 dress gloves.

Ethiopian hair sheep The Ethiopian hair sheep is much in demand in the leather industry

Pittards' Ethiopian factories also produce two million sq feet (186,000 sq m) of quality leather for export to be made into garments ranging from specialist golf gloves to couture handbags.

"Ethiopia will grow in importance to Pittards and the global leather industry [in general]," says the company's chief executive Reg Hankey.

Ethiopia's attractions for Pittards, and other Western firms, include the country's large pool of relatively low-cost labour. It also has duty-free status for most manufactured products for export to Europe, the US and other countries.

Animal husbandry

Despite Ethiopia having the largest flock of hair sheep in the world - more than 26 million - it is not the largest supplier of skins.

Start Quote

Ethiopia has worked very hard to establish itself as a preferred country for economic development within Africa”

End Quote Reg Hankey Pittards chief executive

Its flock's reproductive rate of about 37% trails New Zealand's 180% and means Ethiopia has only some 9.5 million sheepskins available annually compared with New Zealand's total of about 30 million.

Better animal husbandry should increase Ethiopia's supply. Pittards is already involved in environmental programmes to improve the quality of local skins through improved husbandry and treatment against parasites.

Another benefit could be improved meat yields, a not insignificant detail while Ethiopia remains a developing country.

Regarding the wider issues of doing business in Ethiopia, Mr Hankey says the country faces the same challenges as other developing nations, encompassing difficulties related to bureaucracy, customs and banking. Yet, he adds, while more has to be done, the situation is greatly improved.

"Ethiopia has come a very long way over the last 23 years since I first visited, and the last decade in particular has witnessed massive positive changes," Mr Hankey says.

"Ethiopia has worked very hard to establish itself as a preferred country for economic development within Africa."

Completed gloves at the Pittards' factory Pittards' Ethiopian operations are now a core part of its business

Ethiopia's government now wants to grow its leather industry's annual exports to $500m by the completion of its five-year growth and transformation plan at the end of 2015. Leather exports stood at $123m last year.

Within Pittards, the British management is happy to be playing a part in Ethiopia reaching its ambitious goal.

"We have put down roots," Mr Hankey says. "This changes relationships and thinking - we see things from the inside and the outside, giving us a unique position for further development."

'Changing lifestyles'

Busy at work in the Pittards factory is 20-year-old Embret Beshada.

Her job is to sew two glove-shaped panels together while incorporating material to create a thumb casing.

Embret Beshada Embret Beshada likes the financial indepedence having a job gives her

She says she found the work easy when she started just over a year ago, despite having to learn many new skills, and was producing gloves within two months.

"Being able to support myself excites me the most," she says.

Sitting at sewing machines nearby are some of her friends. About 80% of the factory workforce is female, while at the tannery about 80% of the workforce is male.

"We are seeing people get more jobs, and people's lifestyles changing, which gives us hope for the future," Ms Beshada adds.

More on This Story

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Business Live

  1.  
    07:27: AGA profits
    AGA Rangemaster

    AGA Rangemaster has reported slight fall in an annual pre-tax profit to £700,000, compared with £1.1m a year earlier. It has also announced it will not be paying a dividend to shareholders.

     
  2.  
    DFS shares Via Twitter

    Retail analyst Nick Bubb tweets: The Chairman of DFS trumpets that it stands for "Dedication, Family and Success". Or Dull Furniture Sale? ;-) @NickBubb1

     
  3.  
    07:15: DFS shares
    DFS

    Buy one, get one half price! Furniture retailer DFS has priced shares at 255p - at the lower end of expectations. The stock starts trading at 0800 today and means the company will be valued at close to £550m.

     
  4.  
    07:02: Eurozone outlook BBC Radio 4

    One thing that may help the eurozone economy is a small but significant accomplishment by the ECB that appears to have gone largely unnoticed. That was last Autumn's asset quality review of the banks, by the ECB which "gave pretty much everybody a clean bill of help", says Mr Cameron Watt. "And that's allowing banks to sell assets off their balance sheets."

     
  5.  
    Greek economy Via Twitter Adam Parsons Business Correspondent

    Former Greek shipping minister @MVarvitsiotis tells #WUTM "we'll do whatever it takes...to stay in Eurozone...leaving would be a disaster" @AdamParsons1

     
  6.  
    06:47: Eurozone outlook BBC Radio 4
    Draghi

    Mr Cameron Watt tells Today: "There is a following wind which is the lower oil price and the material decline in the currency [euro] against the dollar". He says those factors should help boost the eurozone economy, although he he sceptical that it will do as well as ECB president Mario Draghi (pictured) suggested at his press conference on Thursday.

     
  7.  
    06:35: ECB bond buying BBC Radio 4
    The EURO logo is pictured in front of the former headquarter of the European Central Bank

    We're talking quantitative easing (QE) on the Today programme and why it pushes up stock markets. And Ewan Cameron Watt, global chief investment strategist at BlackRock, explains in the most clear terms. It is all about portfolio substitution, of course. "If I buy a whole lot of bonds and give you cash, you have now have to invest that cash," he says. "You don't want to buy bonds because of [current] negative yields, so it forces you to buy riskier assets, which inflates the prices of things like equities." Simples.

     
  8.  
    06:25: Alpacas! Radio 5 live
    Alpacas

    Let's face it - alpacas are a bit weird. But farming the cuddly critters appears to appeal to some who want to escape the rat race, alpaca farmer Mary-Jo Smith tells Wake Up to Money. She says alpaca wool is strong, luxurious and "just amazing to wear". The British Alpaca Society holds its annual show in Telford this weekend.

     
  9.  
    06:15: Insurers v banks Radio 5 live

    Aviva shares ended 7% higher yesterday and Ewen Cameron Watt, chief investment strategist at BlackRock, tells Wake Up to Money it is no surprise that insurers are doing better than banks. He says operating conditions for banks are getting tougher, but some insurers are opting to join forces.

     
  10.  
    06:05: Rangers FC
    A general view of the Ibrox Stadium, in Glasgow,

    It's a big day for Rangers FC as the club holds an emergency meeting where Dave King hopes to oust the board. However, there are question marks over King - who wants to become chairman - because of his convictions in South Africa for tax offences.

     
  11.  
    06:03: Matthew West Business Reporter

    Happy Friday everyone. Don't forget you can get in touch by email at bizlivepage@bbc.co.uk or via twitter @bbcbusiness.

     
  12.  
    06:00: It's Friday Chris Johnston Business Reporter

    Good morning and welcome to the last day of the working week. US unemployment figures are set to dominate the day and are out at 13:30. We'll bring you the reaction to those numbers and all the day's other business news as well.

     

Features

  • Cartoon of women chatting on the metroChat wagon

    The interesting things you hear in a women-only carriage


  • Replica of a cargo boxSpecial delivery

    The man who posted himself to the other side of the world


  • Woman wearing a niqab in Raqqa (31 March 2014)'Run for your life'

    How IS fighter's tip-off led to narrow escape for Syrian woman


  • Target practice for Lithuanian troopsBaltic shiver

    Europe editor Katya Adler on the alarm at Russian muscle-flexing


From BBC Capital

Programmes

  • A robotClick Watch

    The latest in robotics including software that can design electronics to solve problems

Try our new site and tell us what you think. Learn more
Take me there

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.