We formally knew of it as Colomer Munmany and, by the looks of it, the acquisition involves a series of commercial units in Spain, one in Japan and a tannery in China which is a joint-venture with Henan Prosper. Chanel already own the French Tanneries Haas and Bodin-Joyeux as well as Megisserie Richard.

The move by luxury groups into different areas of the supply chain (Chanel also owns glove and shoemakers) is only one sign that the leather industry is quietly but steadily restructuring. For the luxury companies, sometimes the purpose is to retain disappearing craftsmanship or to secure supplies of specific raw materials. In some sectors, such as automotive and mainstream footwear, organic growth or acquisition allows for the development of larger tanneries with better scale and efficiency; or as we have seen with ISA TanTec’s acquisitions in Italy and the U.S., there are more subtle objectives at play than merely achieving critical mass.  

Industry restructuring

As a result, we are seeing restructuring being initiated by new thinking often supported or catalysed by new sources of capital entering the industry, and refusing to accept what we have come to term “traditional thinking”.

During last century, upholstery tanneries began selling cut pieces into the automobile trade and go back a century or two, glove makers routinely tanned their own leather, as quite frequently throughout Europe, did those making embossed, gilt leather wall hangings. So, who is to say that the job of a tanner starts at the raw hide and ends at finished leather?

Innovation is important in product, process and service

It is easy to talk about innovation only in terms of product, but we must remember that innovation also comes through process and service. In fact, a lot of what we see being loosely called “disruption” is essentially a reconfiguration of the standard elements of a business with just one really new idea, often a bit of technology, added.

These new groupings that are steadily developing in the leather industry and nearly all combine all three aspects of innovation, allowing for the creation of new types of partnerships with key accounts that make it easier for all parties to work together to extract waste, cost and duplication. More importantly, it increases the likelihood of breakthrough ideas not only through co-development but through the sheer excitement of routinely interfacing with customers who share their view of the future.

When the leather industry says it is competing against cheaper fabrics, plastics and textiles, it is not always true. John Graebin of Deckers told a seminar at the NW Materials Show that in footwear it was engineered uppers that were the problem and, until tanners realised this, even matching price at the materials level would not be enough. The issue for leather in footwear is not one to be solved only by product innovation. The likelihood of footwear wanting cut uppers from tanners was raised some years ago at a Lectra/Leather Naturally seminar at the APLF in Hong Kong but for most tanners it was one of those truths that you trip over, but then hurry on as though nothing has happened. As China’s shoemaking has changed its attitude to leather countries such as Portugal with skills and interest in making leather footwear have seen steady gains. Yet, overall, the leather industry has missed the event and lost out to a global move away from leather in footwear.

The danger is that this will drive tanners to lower price to regain share, which would not be the correct route. Making leather a commodity is a sign of failure, and sadly the biggest culprits are tanners themselves.

Dr Mike Redwood

September 19, 2018


Follow Dr Mike Redwood on twitter: @michaelredwood

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