More Nepali Identify with the domestic brands of shoes today.

Hom Nath Upadhyay
President
LFGMAN



Hom Nath Upadhyay is the President of Leather Footwear and Goods Manufacturers’ Association Nepal (LFGMAN). He has been associated with LFGMAN for the last 12 years, holding various positions and promoting Nepali leather industries. Upadhyay is also serving as the Managing Director of BF Dear Hill shoe company. In a recent interview with Sujan Tiwari of The Corporate, he shared the problems and opportunities of the Nepali leather products industry. Excerpts:

How do you see the present status of leather goods and footwear business in Nepal?

The market of domestic leather goods has grown encouragingly in recent times. More people are involved in the industry today. The interest of Nepalis in domestic leather and footwear products has increased significantly. As a result, we have witnessed a surge in the number of our customers. Also, a number of new industries are being opened. All these are positive signs. I can say that the business of domestic leather footwear has been on a constant rise for the past few years. This growth in leather goods and footwear business is more than satisfactory.

A number of exhibitions and sales of leather products are organised these days. How have they contributed to the business?

The sales and expos have significantly contributed to the branding and promotion of Nepali leather products. We have been organising industrial exhibitions of leather goods and footwear for the last eight years. When we organised the first exhibition, people were unaware of the Nepali footwear brands. They used to ask whether the shoes were made in Nepal or imported. But today, they are very much familiar with all the Nepali brands. They have started identifying with a particular brand of Nepali footwear. A lot more Nepalis wear Shikhar Shoes or bf Dear Hill shoes or other brands. I mean the number of loyal customers of Nepali brands of footwear has been on a constant rise. This is a huge change. And the credit for this change goes, to a large extent, to the exhibitions which have really helped make the Nepali brands of footwear known to the customers. Furthermore, these exhibitions inform the customers about the quality of the products and the materials used. These events also grab the attention of our stakeholders, and we can display the status of the business to them.

How was the participation in the recent Big Sale, and in the annual industrial exhibition this year?

The annual exhibition is one of the major events organised by the Association. Not very long ago, Nepalis were attracted to the sales of Nike, Adidas, Bentley and other foreign brands. But the Nepali manufacturers are now able to attract a bigger crowd. The recent shoe and slippers Big Sale was crowded with the lovers of Nepali shoes. We even had to extend the sale by four days considering the increasing crowd. We are very encouraged by this event. This is an evidence of the successful branding and promotion of domestic footwear products.

What are the major achievements of the LFGMAN so far?

LFGMAN has helped in expanding the market of Nepali leather goods and has made the brands known to Nepali buyers. We are promoting Nepali products, industries and entrepreneurs. The Federation of Nepalese Chambers of Commerce and Industry has awarded us with the Excellency Award for the promotion of Nepali brands and products. The Nepal Chamber of Commerce, too, awarded us with the First Excellency Award for our contribution to the promotion of Nepali brands and industries.

Can Nepali leather products compete with the international products in terms of quality?

I can say with confidence that the quality of Nepali leather products and footwear is on a par with that of the international ones. We manufacture best quality products that are durable as well as stylish. We can compete with the international brands in terms of both quality and design. We are frequently changing the design of the shoes as people are very fashion conscious these days. We organised the Big Sale to sell the shoes that are no more produced, as better designs are being made. So, we can compete head-on with the international products.

What is the share of Nepali leather goods in the market?

Domestic products share 55 per cent of the Nepali leather goods and footwear market. We believe this will only rise in the coming days as our products are more affordable than the international products. In terms of price, our competition is with those international brands that are not genuine. People usually buy the Chinese-made "international brands" that are not original. They bear the logos of popular international brands, but they are counterfeit products. People have to understand that they can have Nepali genuine products for the same price they pay for these fake products. We are offering better affordability, better quality and better design than the Chinese imitations.

Where does the raw material for shoes and other leather goods come from?

Eighty percent of the raw material is imported. And 40 per cent of the imported raw material comes from China, 30 per cent from India and the remaining from the rest of the world. At present, Nepal produces only 20 per cent of the raw material the industry needs. We conducted a survey last year that showed that on an average a single Nepali spends Rs 2500 a year on shoes. That means, when you think about the entire population, the annual spending on shoes is huge. We can prevent that money from going outside the country if Nepali products are promoted. We are looking forward to be self-dependent in leather goods and footwear. If we can achieve that, it will be very helpful to the economy. Besides, we are creating better employment opportunities in Nepal itself. For every two Nepalis wearing Nepali shoes, one Nepali will get employment.

What are the problems of this sector?

First, shortage of skilled and efficient manpower; there is a lot of manual work in making shoes. Energy crisis is another challenge for us. We don’t have industries producing the required raw material here. We have a small supply of buffalo hide, but cow hide and other raw materials have to be totally imported. Some of the imported raw materials are very highly taxed and make the products more expensive. The unchecked, huge import of Chinese counterfeit products is also a major problem. If such import is discouraged, our Nepali brands will have a better market. Also, we have to look for new designs and trends every time. Shoes go out of fashion very soon, so we have to be constantly paying attention to the introducing new designs. We have to bring in new technology on a regular basis. We just have to be moving, and we cannot rest. This makes it a tough job.

What do you expect from the government and the customers?

The government should give more priority to this sector and make favourable environment for us. This sector makes use of Nepali skill and labour. There is no foreign investment here, so we can say we are a true Nepali sector. People should learn to respect domestic products and give them a try. We need more support and feedback from our customers so that we can provide them better products in the days to come.