A new report in our exclusive Market Intelligence series became available for subscribers to read on August 23, writes Leatherbiz.

This report makes the point that the leather industry faces a serious dilemma as it moves into the last third of this difficult year.

As is the case for most manufacturing sectors, leather producers are having to contend with sharp rises in costs. Our report picks out two factors that are having a particularly significant impact: energy costs and labour costs.

It says this makes it essential for leather manufacturers to increase the price of finished leather.

However, this comes at a time when consumers are becoming increasingly cost-conscious and are already altering their shopping habits to focus on buying only on what is truly necessary and, when they do decide to buy, “will probably shift down one price level” when choosing products, the report says.

The report said one positive aspect of this is that products made from leather are a good buy in the long run because they last well and look good for a long time. This is the message that the industry has to try to drive home among retailers and consumers at this difficult time, the report says.