Specialist veg-tan leather producer Wickett & Craig is almost 150 years old and has survived a move from Canada to the US and several changes of ownership. The tanning company is now forging its way into new growth markets for veg-tan while continuing to serve customers in its traditional areas of focus.

He explains that the city authorities in Toronto acquired substantial parcels of land around the Lake Ontario waterfront as part of its ultimately unsuccessful bid to host the 1996 Olympic Games. Atlanta and Athens beat Toronto in the final rounds of voting, which took place in September 1990, but Toronto’s bid beat those of three other cities during the process and had reached an advanced enough stage for city hall to feel the need to snap up land for the proposed Olympic Village. Wickett & Craig had been making leather on a piece of that land since the 1860s. Compensated for its loss, but homeless, it crossed the border and moved into a former cheese factory in Curwensville. It was no longer in the hands of the founding families by then and had become part of the Dominion Tanners group. Vice-president for operations, Chin Min Lim, also has links to Wickett & Craig’s days in Canada. His career later took him into technical sales for BASF and work at the Salz tannery in Santa Cruz, California, from where he moved to Pennsylvania.

Neighbours, not rivals

A town of only 3,000, Curwensville already had a tannery, Howes Leather, when Wickett & Craig moved in. Prasad Inaganti, now the chief operating officer of Wickett & Craig, came to Curwensville in 1993 but to work “across the street” for Howes leather corporation. Mr Inaganti completed his education as a leather technologist in his native India, but has spent his whole working life in the US, arriving in 1971 to work for calf leather specialist A. F. Gallun & Sons in Milwaukee and, except for a two-year hiatus when he worked for leather chemicals firm Rohm and Haas, he stayed with Gallun until it closed in 1993. After three years in Pennsylvania, the owners of Howes Leather allowed Prasad Inaganti to complete a leveraged buy-out of the company and he owned and ran it until 2003.

The closure of Howes coincided with another change of ownership at Wickett & Craig. Both Curwensville producers had found life challenging in the early years of this century when a large proportion of North American tanning capacity moved offshore. Dominion Tanners went into receivership in August that year and Wickett & Craig found new owners in the shape of Toronto-based hide processor Bank Bros & Son Limited.

Vertical integration

“When Dominion went bankrupt, Wickett & Craig was one of only two divisions in the whole group that was still profitable,” explains Barry Bank, who is principal of the tanning company and of its parent group. “It was buying 100% of its raw material from us and the bank that was handling Dominion’s receivership got in touch to suggest we acquire the tannery.” He thought this vertical integration idea made sense from a business point of view.

Areas of common interest

His view is that the leather industry as a whole suffers because of a lack of synergy and a lack of co-operation among companies. He accepts that competition is keen but believes it should be perfectly possible to identify a series of areas of common interest for which rivalries can be put to one side to allow different players to work together for the benefit of the whole sector. In his eyes, the most obvious example is the leather industry’s poor track record in advertising and public relations. The way it presents itself to the public is a prime target for improvement, he feels. “Advertisements in important consumer magazines and websites could put across strongly the message that leather has unique qualities. This is something that would benefit everyone. People have to understand that leather is not a commodity and that who makes it and how they make it are important factors. The Holy Grail would be for consumers to know you and demand your leather, but the only successful example there has ever been of this was [Rolls-Royce supplier] Connolly,” he says. Practising what he preaches, he is about to embark on what he refers to as “a very ambitious project” to improve the Wickett & Craig brand, saying that everything the company has done in this area up till now has been “not nearly as good as the leather we produce”.

He believes the leather sector has much to learn from the diamond industry. It has a clear system for grading and certifying the colour, cut, clarity and carat of any stone, rendering redundant disputes about whether one diamond is better than another. He also thinks the leather industry, collectively, should “chase down” counterfeiters. There also should be a programme of delivering education about leather to people in retail companies who sell shoes and leathergoods. Even in exclusive stores selling exclusive women’s bags, for example, expert knowledge of leather is thin on the ground. It’s up to the leather industry to change that, Mr Bank thinks. “Some actions would benefit everyone in the industry, and those are the things we should focus on,” he says.

Right hides for the right customers

What Bank Bros is able to offer John Lee, Chin Min Lim, Prasad Inaganti and their team are hides that are pre-sorted using a proprietary technique, allowing them to identify with a decent degree of accuracy  quality raw hides that Wickett & Craig needs for its customers. “My hypothesis was and is that we will be successful if we can get the right hides to the right people. We grade our raw hides specifically for particular customers and particular finished products. We regard this as one of the benefits of the synergy we have created.”

Wickett & Craig processes 400 hides a day, specifying that these must be jumbo steer hides from North America. Bank Bros is not the only supplier, just as Wickett & Craig is far from being Bank’s only customer. Barry Bank says it’s an advantage for the tannery to have access to Canadian as well as US hides. “The quality of the raw material in Ontario is very high,” he says. “In the US, Black Angus cattle predominate because that’s the kind of meat people prefer. The hides are good, but not great, in my opinion. In Ontario, we prefer continental breeds such as Limousin, Simmental and Charolais. Our cattle are non-branded and the husbandry is on a European model with smaller herd sizes and the cattle spending the winter in barns and being generally well looked after.”

His view is that a reduction in quality has occurred in the US over the last 25 or 30 years. The move to Black Angus cattle instead of once common breeds such as Herefords is one of the reasons for this. Another is a decline in husbandry standards and “all manner of hide defects” are on the rise because of that, he claims. Chin Min Lim makes the point that good connections between Wickett & Craig and its main hide supplier allow the tanning team to give good feedback on the sorts of defects it sees on the hides when the hair comes off and the tanning process gets under way. This has helped Bank improve quality considerably.

Market demand

The tannery’s output is around 35,000 square-metres of finished leather per month. Prasad Inaganti says he and his colleagues recognise the importance of the raw material they source. “Customers want sides with a thickness of between 4 and 5 millimetres, so we have to buy hides that can produce these articles, and we have to buy select grades,” he points out.

Equestrian leather, for bridles, saddles and skirting, accounts for 60% of the  demand that Wickett & Craig is experiencing at the moment. The figure for this market used to be higher, but the economic downturn in 2008 put a lot of people off the expensive hobby of horseriding and many have yet to come back. “This encouraged us to search for new customer markets,” says Mr Lim. The new markets it has found include high-end leathergoods, which now account for another 40% of demand, and specialty security products such as holsters. An even newer venture is in the world of footwear; the tannery has developed a waterproofing treatment for full-grain veg-tan leather, which is attracting the attention of a number of prominent footwear designers and brands. There have also been interior design projects, with leather wall tiles at the headquarters of a major bank in New York the most prominent. Future ambitions include completing more interior design projects and Wickett & Craig is also confident it could produce “amazing veg-tan leather for car interiors”. This prompts a reminder of the recent headlines about electric car company Tesla coming under pressure at its shareholders’ meeting in June because one participant complained about how difficult she found it to have the company include a vegan-friendly interior as part of her order. Mr Bank says he believes companies like Tesla should adopt a veg-tan-leather-only policy in its interiors because “it’s much more in keeping with their ethos” than chrome-tanned leather.

“We now make a lot of customised leathers too,” says Mr Inaganti. “There’s a lot of interest in that: As the customized leathers saves the customer’s finishing expense by eliminating several steps in his operation.” Other areas of interest are the Amish communities that live and work, without the aid of modern conveniences, in Pennsylvania and the surrounding region. They have a need of leather for their own work and travel, which depends a lot on horses, but they are also adept craftspeople and some of them have made a business out of producing artisan leathergoods. Wickett & Craig has also developed a market for offal—tanned splits as footwear linings instead of sending to landfill. That not only saves land fill expense but increases the sales revenue.

Authenticity is in demand in the mainstream consumer products sector too. A number of heritage US brands, most of them more than 100 years old, are enjoying a renaissance in popularity. In Prasad Inaganti’s view, consumers are tired of “cheap imports that offer no durability and fail to fulfil people’s needs”. Not all, but a segment of the market wants something better and is prepared to pay a premium for it. The products are of high quality and proudly proclaim that they are made in the US. Wickett & Craig’s perception is that this is really striking a chord with consumers, and not just in the domestic market because these brands are also popular in Japan and other Americanophile countries. Domestic producers are beginning to be able to be a little more competitive compared to rival tanners in China or other parts of Asia, the company believes, and there’s more to this than just rising labour costs in China. Freight, too, is becoming more and more expensive and can undo any production cost advantage that export market-focused manufacturers in Asia still hold.

A workforce of local people

Most of Wickett & Craig’s 100 employees live in Curwensville, or at least within 15 kilometres of the town. Chin Min Lim says: “It’s a small community, and we aim to treat people like family. We care for one another.” The company pays 85% of its workers’ healthcare costs and contributes generously to all fundraising initiatives, either for individuals (real-life cases have included helping families get back on their feet following a house-fire) or for the town. There is an education programme in place to encourage workers to go into tertiary education, with the company giving workers time off to study and paying their college fees (provided they achieve good grades). There is further proof that the tannery is a good corporate citizen because it is able to share its location without complaint or controversy with all the children in the local area; it is located only 250 metres from the site of Curwensville’s elementary, junior high and senior high schools.

There are also company policies to recycle and reuse as much water and dyestuffs as possible and to buy as much material and equipment as possible for the tannery from local suppliers, including local small hardware stores. Pennsylvania is not short of water, but Wickett & Craig knows it makes good environmental sense to manage its water resources responsibly too. Because veg-tan hides hold larger volumes of moisture than chrome-tanned leather, the company has found that an operation it carries out with a massive dehumidifier can collect a surprisingly large volume, almost 2,000 litres of moisture per day as a load of hides dries out. It uses that water to mop the floors of the factory.

The company has invested heavily in keeping its environmental performance high. Barry Bank says the tannery strives to keep the water the tannery discharges well below regulatory requirements before discharging into the  nearby  river, the Moshannon Creek (which flows into the Susquehanna River). He also retells the tale of the representative of a prominent US luggage and briefcase brand visiting the tannery and, upon leaving, being  amazed  to see local people fish in the creek, downstream of the tannery. He admits that it took hard work to establish high levels of environmental standards. “One of the first things we had to do when we took over the company was improve things like wastewater treatment,” he says. “Now, I would say we do a great job on the environment.” 

In mid-August 2015, the company arranged a celebratory lunch, bringing in special food to allow the workforce to celebrate having gone a whole year without any downtime because of accidents. It’s the second time it has gone a whole year accident-free; the celebration is to show its workers that the company is grateful to them for taking care over the way they work.

Set apart

Asked what he thinks sets Wickett & Craig apart, company principal, Barry Bank, says vertical integration between a hide trader and a tannery is very unusual and different from the other forms of vertical integration the industry has seen (between packers and tanners and between finished product brands and tanners). He then points once again to what he calls the tannery’s “extreme environmental friendliness” and its commitment to working as closely as it can with its customers, with a standing invitation in place to all of them to come and see the tannery and witness close up how their leather is made. “We are always looking for new ways in which our customers can use veg-tan leather,” he adds. “We need to find new outlets and expand our business. We know there have been applications in the past in which people have tried to use veg-tan and it hasn’t worked. We want to know about all those projects; we’ll find out why they failed and we’ll use the knowledge we have to try to make them work now.”

He is optimistic about the future—hides will continue to come in, he insists, adding that he doesn’t believe a decline in beef demand among western consumers will have any great effect. He even thinks it’s “not an unreasonable hypothesis” to suggest that cattle slaughter and beef production could go up if the meat packing industry in China, for example, invests in new abattoirs and other up-to-date infrastructure. Demand there and in many developing economies is strong. “If automotive demand for finished leather remains strong, too, there will be cannibalisation from footwear into automotive,” he continues. “What remains of the leather footwear sector will be high-end shoes.”

The final points he makes is that the quality of Wickett & Craig’s finished leather sets it apart too. “That’s not just my opinion,” he says. “It’s something we hear all the time from our customers, that we are producing incredible leather: it has quality, beauty and durability. What we have to do now is start doing a much better job of promoting ourselves.”

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