The global leather goods market consists of a wide range of leather products including leather shoes, leather handbags, leather luggage, leather jackets and clothing. Leather goods are highly preferred among consumers owing to their premium feel and durability. Leather is breathable, water-resistant and easy to maintain which makes leather goods suitable for all weather conditions and occasions. Rising disposable incomes in developing countries have increased the demand for premium leather goods. The global leather goods market offers various types of leather goods made from different animal hides including cowhide and lambskin to satisfy diverse consumer preferences.
Key Takeaways
Key players operating in the leather goods market are Mars Inc., CVS Group PLC, Greencross Vets, Ethos Veterinary Health, Idexx Laboratories Inc., Pets at Home Group PLC, CityVet Inc., FirstVet, Kremer Veterinary Services, and Armor Animal Health (Animart), among others.
The rising demand for Leather Goods Market Size from millennials and generation Z due to changing fashion trends has fueled the growth of the global market. Moreover, the increasing working population and growing consumer spending on luxury and premium products have further augmented the sales of leather goods.
Major leather goods companies have significantly increased their presence across worldwide locations to tap the market potential in developing countries experiencing strong economic growth. Key players have established strategic partnerships and collaborations with local suppliers and distributors to strengthen their global supply networks and distribution channels.
Market Drivers
Rising disposable income levels: Improvements in socio-economic conditions across developing regions have boosted consumer spending power. the growing middle-class population with increased disposable incomes has expanded the customer base for premium leather goods.
Increasing fashion consciousness: Consumers, especially millennials, are willing to spend more on branded leather merchandise to enhance their personal style statements. The rising fashion consciousness among urban populations drives the demand in the global market.
The current geopolitical situation is impacting the growth of the leather goods market. With rising geopolitical tensions and threats of trade wars between major economies such as the US and China, the free flow of goods across borders has become disrupted. Both the US and China have imposed import tariffs on certain goods from each other over the past few years, affecting industries such as leather goods manufacturing which depends on importing and exporting materials and finished products globally. The higher import duties have made exports more expensive for many companies, reducing their competitiveness in foreign markets. Some companies have moved production bases to other lower-cost countries to avoid tariffs, initially impacting local employment and economies. The uncertain trade policy environment has also made future expansion plans and investments difficult for multinational leather goods companies with global supply chains.
Going forward, leather goods companies will need to diversify their sourcing and manufacturing footprints globally to mitigate political and trade risks. Sourcing critical raw materials like leather from multiple regions instead of depending on just a few major exporting countries can help secure continued supply. Companies may also consider establishing dual production hubs to serve key markets in different geographic regions. While relocating entire facilities abroad involves large capital expenditure, forming strategic local partnerships can help gain a manufacturing presence with lesser initial investment. Multinational companies will further need to rely more on their well-established brands and differentiate their product range to gain pricing power and offset higher input costs due to changing trade policies.
In terms of value, the leather goods market in Europe accounts for the largest share globally. Countries like Italy, Germany, United Kingdom and France have been dominant consumers and producers of premium leather goods and high-quality leather apparel for decades. Their concentrated premium fashion and luxury industries have traditionally driven higher leather goods consumption. Going forward, the Asia Pacific region, especially China, is projected to see the fastest growth in the leather goods market. Rising incomes and aspirational lifestyles are increasing people's spending capacities on luxury leather accessories in major economies like China, India and other Southeast Asian countries. North America also remains an important region driven by the US market for leather goods used in apparel, accessories, furnishings and automobile interiors.
The growth in the Asia Pacific region particularly in China is projected to drive the fastest growth in the leather goods market over the forecast period. With its huge population, rapidly growing middle class, and rising disposcretionary spending on luxury and fashion products, China has emerged as a major market driving global demand for premium leather goods in recent years. Local Chinese leather brands are also now actively competing abroad. Furthermore, Chinese tourists traveling overseas have considerably boosted leather goods spending in European holiday destinations. The improving quality of locally sourced Chinese leather and availability of skilled craftspersons is helping establish the country as a rising global force in leather production to cater to both domestic and international markets. With infrastructure and standards aligning to global best practices, China’s prominence in the leather goods industry is set to rise further over the next decade.
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