Business

Making a fortune from Armani
shoes

Who hasn't heard of Giorgio Armani, the world-famous fashion designer? But do people know some Armani footwear is manufactured in Bandung?

"Armani trusts us to manufacture his shoes," Abdul Kadir, the export division head of CV Fortuna Shoes, told The Jakarta Post at the sidelines of the 2010 Indonesian footwear, leather and leather goods exhibition on Friday.

Fortuna was one of more than 100 shoe and leather goods manufacturers who displayed their products during the four-day exhibition that ended Sunday.

Abdul said the fact that Armani trusted his company to manufacture shoes carrying his trademark proved that the products were of a high quality.

"Currently, our company manufactures only European-style shoes for foreign markets," he said.

Fortuna, owned by renowned Bandung shoemaker Dede Chandra, is the only shoe manufacturer in the country to construct shoes using a Goodyear welt, a construction technique that is claimed to make dress shoes stronger and more durable.

Abdul said the company, established in the 1980s, manufactured shoes only for export because they used calfskin imported from France with tax breaks from the government.

He added they exported their products to several countries, including France, the Netherlands, Germany and Japan.

"We cannot sell our products domestically because the leather material is exempt from import duties," he said.

Because they made Goodyear welted dress shoes, Abdul said, Fortuna only used high quality imported raw leather.

The Goodyear welt requires a complete mastery of working techniques and high quality raw materials, he said, adding that the "process required competence, patience and precision".

"It is a completely manual process," Abdul said, adding that the thorough finishing process meant production numbers were limited.

He said tight control was required in the stitching process, which resulted in the strength of the sewing, good performance and even comfort.

"We have a production capacity of only 150 to 250 pairs of shoes a month," Abdul said, adding that Fortuna employed 300 workers, meaning that one craftsman made only one pair of shoes a month.

"Apart from the high price, our shoes offer high quality," he said, adding that his products were sold for about 60 per pair.

PT Ethree Abadi, a handmade shoe manufacturer established in Jakarta in April 2005 and owned by Elly Sulistyowati, is another success story in the industry.

"We manufacture handmade shoes to size for our customers," Ethree marketing division head Abadi Nunung said.

She said the company provided solutions for customers with needs that were difficult to address.

"We directly measure and sketch our customer's feet, which we then use as a basis for the creating the shoe," she told the Post.

The process means the production runs are limited and costly. The company prices its footwear between Rp 450,000 and Rp 1 million a pair.

"We prioritize the quality and comfort of our products," Nunung said, stressing that her products could last up to five years if properly maintained.

However, the market still tends to shy from local footwear.

Industry Ministry Director General of Metal, Machinery, Textile and Multifarious Industries Ansari Buchari said the government was committed to expanding the sales of leather footwear in the domestic market.

"We hope domestic manufacturers can meet increasing demands for footwear and leather products both domestically and in overseas markets," he said, adding that he expected footwear exports to increase to US$3 billion in 2014 from $1.72 billion in 2009. Currently, Ansari said, local footwear manufacturers could only meet less than 50 percent of total domestic demand, meaning they had ample room to increase their market share to at least 60 percent.

However, the chairman of the Indonesian Tanners Association (APKI), Senjaya, said the local footwear industry still faced difficulties due to a lack of raw materials.

He said the 15 to 25 percent export tax imposed by the Indonesian government did not limit exports of raw leather and therefore, domestic demand could not be met.

"I think the export tax is not effective in preventing the increase in exports of raw leather," Senjaya said.

He added that he hoped the government could facilitate imports of raw material so that problems of low domestic supply could be overcome. (ebf)

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