Ethiopia is home to the largest population of livestock in Africa, with at least 40 million people owning livestock. Sheep and goat skins represent the bulk of Ethiopian leather production, producing an estimated 5 million skins annually. This sector is important in reducing poverty, as a large percentage of the population is directly affected by the leather industry.
Ethiopian product names that have for many years reflected distinctive high-end leather products are Bati Genuine, which refers to thin goat suede, Bati-type and Selallie Genuine, which refers to a special type of hair sheep skins.
There is also recognition in the wholesale market of the superiority of Cabretta leather for making gloves, not only for sport but in fashion as well, though many consumers are unaware of the Ethiopian origins. Ethiopian Cabretta leather is distinctive for being soft and yet strong at smaller thicknesses than other leathers making it the best type of leather for golfing gloves, with some retail prices double that of non-Cabretta gloves.
Bati goat skin is known to produce the softest, finest suede. Ethiopian herders are receiving about $10 for the skins that will produce a Bati coat. After tanning and processing to ‘wet blue’ or better levels for export, the exporter collects about $40-50 for the leather that will be manufactured into a coat outside Ethiopia. An importing wholesaler/ manufacturer will then make the coat with the final retail price being at least $400.
Herders and family sheep owners are receiving around $2 for the skins that will be used to produce one Cabretta golf glove that is both strong and thin, and better than other skins. The exporting sector is obtaining $5 for the leather that will be manufactured into the finished glove. Outside of Ethiopia, the glove retails for $25.
Cabretta, Bati, and Selallie skins are all internationally recognised for their strength and other qualities, resulting in premium prices being paid for these types of leather. Also, some of the fine leather goods coming from Italy are made from Ethiopian Bati, as wholesalers and manufacturers know it is one of the world’s best and are prepared to pay premium prices for it. This kind of reputation is important when devising an IP strategy, as reputations have intangible value and can result in greater export income.
Also, twelve Ethiopian leather companies recently developed a brand of luxury leather goods, Taytu. This brand is based on Ethiopia’s image as being authentic, and possessing the ‘essence of Africa’. The brand is distinctive, capitalising on Ethiopia’s geographical location and culture, both of which have strong intangible values. This luxury designer label had a successful launch; the entire collection sold out at the Paris fashion accessories collections in autumn 2006. Fashion experts note that consumers are beginning to tire of big brands; they are looking for unique labels, such as Taytu.
Supporting these differing elements with a package of IP-based business strategies would enhance existing reputations and communicate new ones, in order to produce more export income and secure that income for all stakeholders in Ethiopia. Given the recognition by wholesale buyers of Ethiopia’s fine leather and the intangible values tied to it, experts believe Ethiopian leather producers could increase their export income by three to five times. The 2007 export income was just over $90m, growing most by expansion of volume and some increased processing. Additional processing may create ‘value-added’, but only if the processing is profitable. ‘Value-captured’ through IP-based strategies can produce better net returns, an outcome that can be determined from a feasibility study with consideration of costs and benefits.
The quality and preservation of the hide are affected by dipping for disease prevention and quality control during slaughter and post slaughter transport to tanneries. In order to ensure high quality leather from Ethiopia, a scheme that provides incentives to herders and collectors to give more attention to the quality of the skins should be incorporated into an IP-based business strategy.