Leather goods never go out of trend, especially accessories like briefcases, suitcases, jackets, footwear, and more. In the leather goods segment, bags or handbags are the most popular and the top-selling items and are expected to have significant growth in the number of leather bags retailers, mainly because of two reasons;
(1) the rise in the number of women working these days
(2) the increasing purchasing power of consumers.
The overall global leather goods market is forecasted to reach USD 121.16 billion by 2022 at a CAGR of 4.47% during this period. It is a highly advanced and growing market in which retail stores hold the dominant share of over 90%, but, with the emerging growth in e-commerce – there is an existing threat from online sales, which will increase during the same period.
Industry Structure and updates
As the competition is high in the industry, leather bags and handbags retailers need to regularly think of new strategies like expansion and acquisition, to be able to increase market presence and expand the customer base.
Drivers and constraints
Global economic power and a higher disposable income are two significant drivers in the leather bags & handbags industry, both, in the domestic and international markets.
The input costs for leather products have increased, which has declined the profit margins. The amounts in this market can be high, especially for luxury leather products, which does not target a vast consumer base, which can sometimes cause a constraint in this market.
What Do Retailers and Manufacturers Need to Understand?
- There needs to be a good understanding about how to perk up the leather production process from when it is at the raw stage up to the finishing.
- Quality management of leather, how to select the right tanners, leather grading, measures to improve the cost-efficiency of leather.
- Managing the supply chain in a better way.
- Improving quality control.