Pakistan tanner says margins have halved because of power problems
24/07/2014
Imjaz Latif, who runs Sheikh in Sialkot with his brother, said in recent comments to local media that his company is having to pay to generate its own electricity for up to eight hours per day. Mr Latif explained that the company is committed to fulfilling customer orders at any cost, but said his operating margin has halved in the last ten years, with energy costs the biggest factor.
Because power cuts are common, Sheikh and similar businesses have taken to running their own generators, which is adding substantially to the cost of production, he said. “We do casual garments and supply orders in bulk and in that category, the only competing point is price,” Mr Latif added. “If the buyers want high-end work, they will get it from Turkey, India or China.”
The Sheikh tannery makes leather from cow, buffalo, sheep and goat and produces around 2 million square-feet per month. In its finished product factory, it produces around 60,000 leather jackets per month.
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