SME leather exporters, who are already witnessing erosion in their margins due to the volatility in rupee movement, will now have to brace up to face more upheavals in the coming days. The prolonged impact of the recessionary pressures is posing difficulties for small-scale leather goods exporters,particularly those in the eastern region of India, to sustain steady margins.
Exports likely to dip
Paresh Rajda, regional chairman (East) of the Council for Leather Exports (CLE), anticipates that leather exporters from the eastern part of the country may have to witness a 20-25% drop in their exports in the near-term on account of continuing impact of the recession.
Speaking to reporters on the sidelines of a press conference to announce the 15th International Leather Goods Fair in Kolkata, Mr Rajda said, Leather export orders usually come 6 months in advance. However, beginning October 2009, the sector has witnessed contraction in overseas orders, which is affecting SME leather exporters in the region.
Drop in margins of the SME-oriented leather export sector is likely to affect the overall growth of the sector. The grim export market situation will also put in jeopardy the growth of other allied sectors such as footwear, leather glove, handbag and garment manufacturing, some of which had witnessed phenomenal growth in 2008-09, said H Singhania, proprietor of Leather Club, a small-sized leather goods outlet in Kolkata.
With margins anticipated to plunge further, SME leather exporters and manufacturers are recommended to tread with caution and exercise prudence while making any strategic decision.
Exports likely to dip
Paresh Rajda, regional chairman (East) of the Council for Leather Exports (CLE), anticipates that leather exporters from the eastern part of the country may have to witness a 20-25% drop in their exports in the near-term on account of continuing impact of the recession.
Speaking to reporters on the sidelines of a press conference to announce the 15th International Leather Goods Fair in Kolkata, Mr Rajda said, Leather export orders usually come 6 months in advance. However, beginning October 2009, the sector has witnessed contraction in overseas orders, which is affecting SME leather exporters in the region.
Drop in margins of the SME-oriented leather export sector is likely to affect the overall growth of the sector. The grim export market situation will also put in jeopardy the growth of other allied sectors such as footwear, leather glove, handbag and garment manufacturing, some of which had witnessed phenomenal growth in 2008-09, said H Singhania, proprietor of Leather Club, a small-sized leather goods outlet in Kolkata.
With margins anticipated to plunge further, SME leather exporters and manufacturers are recommended to tread with caution and exercise prudence while making any strategic decision.
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Source : articlesnatch
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