Value Chain Assessment in Ethiopian Leather Garment Industry The Case of Selected Garment Producers in Addis Ababa

No Thumbnail Available



Journal Title

Journal ISSN

Volume Title


Addis Abeba university


The major objective of this paper is to explore the strength and weakness of the valu e chain in the Ethiopian leather garment sub sector. In order to look into the strength and weakness of the leather garment value chain, nine garments and three tanneries were purposive ly se lected as case studies. In order to see the linkage between the garments, the tanneries and their distributors in the garments value chain, qualitative method and simple quantitative methods of analys is like percentage arc used. Though Ethiopian fini shed leather is renowned for its fin e sheep sk in in glove making industries throughout the world, garment producers are making their products from reject quality leather unwanted by export standards. Owners oJ' t h ~ garmenls in Ihe sludy a r~ luund 10 be in vo lved in all ac ll v ll l ~' ul Iii" garments from the workshop to the office administration, sa les, marketing, and planning issues. Their involvement from big purchasin g, marketing and production monitoring responsibilities to small day to day office affaires and personnel management has resulted in very little time to carry out cooperation opportunities (with similar firm s) and strengthening the leather garment supply chain. The firms are small sca le enter prises and linkage among thcm is characterized by mi strust and lack of cooperation to work together. The lack of coordi nation is a major reason for lack of bargaining power in leather purchase from their suppliers, lack of collective effic iency (greater production capac ity) in the export acti vities, and learn ing from cooperat ion among themselves ·and· from integration in the buyer driven global market. Major problems in the buying pract ice of the leather garm ents are the low (reject) quality of leather they pu rchase from the tan neries and very weak integration with their suppliers based largely on non market relationships. Due to scarcity and low quality of fini shed leather prov ided by the suppliers, nepotism, corruption and highly non transparent dea lings have become common busin ess practices between the garments and the tanneries. The study recommends that the garments should have access to the purchase of higher quality leather to enhance their competitiveness in global garm ent trade. Effective management structure to undertake marketing research, reduce the slow decision making process in the purchasing of leather from the suppliers could be introduced. However, int roduction of effective management practices at the firms should consider the small fin ancial capacity of the firms. Skill building training for the workers should also be given due consideration in the upgrading process to enhance productivity of workers. Joint purchase programs should be organi zed by concerned authorities at the Ministry of Trade and Industry and multilateral deve lopmental partners



Ethiopian Leather Garment Industry