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Surveying the Business Horizon
ImageSince the 31st edition of Materials, Manufacturing and Technology (MM&T) ended on 1 April 2015, the demand for leather on all levels and its price has slid from around US$ a July low of just over US$60 which equals a 40% price decline. Prices were in the stratosphere in mid September 2014. Result – leather had succeeded in pricing itself out of the market as well as the manufacturers’ demand portfolio with the exception of the booming automotive sector.

The slowdown was indeed reflected at MM&T 2015 but at that point prices had not hit the steepest part of the slippery slope which succeeded in knocking confidence out of the sector. Cheaper synthetics invaded the price-sensitive footwear segment on the back of plunging oil prices hence enabling these petrochemical, non-biodegradable and environmentally unfriendly leather substitutes to grab market share from leather which has not yet been recovered.

Pointers to this recovery could well be gleaned during the world’s leading leather trade fair fair APLF - MM&T in Hong Kong at the end of March 2016.

Supply-demand, the economy and even the money supply move in cycles and with huge supplies of low-cost splits and lower grade leather populating warehouses worldwide it is a question of time before footwear manufacturers turn their attention back to leather. Making an extra 5% margin on each pair of shoes manufactured is a powerful motivator for any COO or production manager.

The golden rule in any market – whether the stock or commodity market – is to buy low and sell high. Well, in the case of leather, buyers bought high and have not yet girded themselves with enough courage to buy low (i.e. now) when prices are on the floor and packers need to sell if only for cash flow reasons.

As we lead up to the 32nd edition of MM&T in Hong Kong at the end of March, now is the time to survey the business horizon and realise that leather will not have lost its appeal to the average consumer or to the designer whose ideas and vision drive the demand for leather as well as other raw materials.

With prices for all grades except the top ones being much lower than one year ago, we expect buyers to come in their droves to MM&T where the world’s major suppliers can be seen, under one roof in a professional business atmosphere and in the context of The Meeting Place of the Global Leather Industry.

Features to Look Forward to at MM&T 2016

MM&T consists of around 1,200 exhibitors accompanied by 20,000 visitors who come to Hong Kong not only to buy but also to look for information; seek colour trends; visualise the latest fashion for upcoming seasons; talk with their peers about the market and listen to all the rumours that tend to float around on the stands and in the aisles of the mega trade fair. At the same time it is an ideal opportunity to combine the visit to MM&T with visits to major Asian clients in the region.

For the 2016 event countries such as Brazil, Italy and Spain have increased their group pavilion sizes by as much as 25% acknowledging the key role MM&T plays in their annual international marketing and sales efforts.

The 2016 Focus Country will be Turkey showcasing their signature project Meet the Turkish Effect. A wide range of leathers will be on show from this major European country that forms part of the global leather industry.

The Organisers of MM&T have transformed the trade fair over the years into an integral event that makes it more than just a trade event.

For example – for the 2016 event the newly inspired MM&T - FabLab will be launched. This section of the fair is where buyers can find performance materials that are used in the manufacture of ready-to-wear sports fashion as well as a whole range of footwear components.

Being aware of the busy needs of international visitors to MM&T, the Organisers introduced last year a Concierge Service. This free-of-charge service is designed to maximise buyers’ time at the fair so that they can locate the exhibitors that have the specific products they are sourcing for upholstery, garments, leather goods and footwear.

The UK BLC will be organising a conference on sustainability together with APLF where the latest advances in this critical field can be heard from renowned experts.

In addition, APLF’s professional trend consultants will present the Material Trends Space once again where materials for upcoming fashion seasons can be seen. This is of great interest to designers looking for inspiration as they can select their materials and then visit the companies that manufacture them at the trade fair, under the same roof.

The fair is also active online with ongoing pre-show events that started in December: Leather Forum Webinar: “Working together for a Sustainable Leather Supply Chain”. The first and second sessions were presented by Ikea and PrimeAsia respectively.

MM&T is a key component in the global leather industry and prides itself in promoting and supporting it in good times and bad by actually being part of it as the industry’s premier business platform. This aspect will be extended and become even more important as the TPP gets underway and ASEAN develops and expands its intra-FTA trade.

Hong Kong is the right place to be for the leather industry from 30 March – 1 April 2016 for MM&T which offers the prime opportunity to survey the business horizon now that the “shakeout” in the leather market has finally taken place and its impact on Fashion Access, MM&T´s sister event that takes place concurrently at the same venue. This “shakeout” has led to lower prices in the supply chain and will attract exhibitors from Fashion Access.

This synergy between the two collocated APLF trade fairs serves to strengthen the total event and brings customers and suppliers together under one roof where they can interact and, at the same time, attend the many thousands of buyers that visit both fairs during their three day duration.

Finally, we are happy to inform that online visitor pre-registrations for Fashion Access and MM&T are now open until 14 February 2016, please click here for Fashion Access or here for MM&T.

APLF, Hong Kong

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