Leather Co

# Template State Owned Enterprises- Company Overviews OCPA - Ministry of Industry & Minerals 1. General Information Company Name: State Company for Leather Industries Sector Textile Brief Description Manufacturer of consumer leather products including shoes, bags and garments. Founded in 1976 through merger of the State Co. for Leather founded in 1945 and Bata Co. founded in 1931. Revenue in 2002 (ID '000s) 20445157.5 # of Employees 2822 Annual Employee Salaries & Bonus (ID '000s) 3489682.5 Headquarters Address Baghdad, Karrada Kharij 2. Company Highlights Factories are old and uncompetitive versus both local private sector and imports. Heavy subsidies are required if Company is to survive. In its defence, Company did pass on most of subsidy savings to customers. It sold its products at very low rates, below market. The Chufa plant is the most "successful", focusing on sports wear. Facilities did not get damaged in war or looting. Raw materials in plentiful supply. Although Company will not survive in long run, no reason not to keep operating it until supplies run out. Both World Bank believe this Company should not be funded. Allocated $1M USD for 2H 2003 operating budget and provided with zero mw off of grid (Company is getting power from generator). 3. Facilities Name Province City Grid Damage % Power Needs Headquarters Baghdad MB453835 0 Storage Facility Al Zaafarania 0.2 Kuffah Kuffah 0 Najaf Najaf 0 Value of All Plant & Equipment Before War, and Initial Purchase Dates and Prices for Major Items Value before war of $7.9M USD. Originally paid 9.6M ID when 1 ID was worth $3. 4. Products Product Name Unit Measurement Design Capacity Available Capacity 2002 Production 2002 Revenue Sport Shoes Pair 566000 531000 200000 School Bags Piece 646000 492000 75000 Leather Shoes Pair 2889000 2022000 1440000 Leather Garments Piece 73000 37000 12000 Description of Importance of Products to Other Iraqi Industries None 5. Customers Customer Name 2002 Revenue Subsidized (Y/N) Products Sold to Customer and Unit Pricing Ministry of Defence Yes Army boots at $8.70 each. Other Government Entities Yes Shoes & bags Private Sector - Direct to Consumer Yes Shoes (avg $5), bags, leather garments and brief cases 6. Suppliers Supplier Name 2002 Purchases Subsidized (Y/N) Products Purchased and Unit Pricing Al-Eqtisaad Company (Iraqi) Wasata Al Arab Co (Jordan) Al Warid Co Current Payment Terms From Suppliers Cash at delivery & state arrangement (MOU contract). 7. Imports & Exports 2002 Import Markets for Raw Materials Arab and Europe Potential Import Markets in Free Market Management does not know who to buy from. 2002 Export Markets for Finished Products None Potential Export Markets in Free Market Company believes it can export all of its products throughout the world. May not fully appreciate worldwide competitive market. 8. Competition Description of Competitive Situation Heavy competition both from local market and imports. Market Share Description For Army boots about 90% of the market. Men shoes 10% of the market. School bags 35% of the market. 9. Summary of War Damage & Looting of Property & Equipment Description of Damage Al Zaafarania storage facility was 20% damaged. Otherwise, facilities were not damaged. Current Operating Status Kufa operating at 60%, using diesel generator. Producing $150K USD per month in goods. Immediate Property & Equipment Needs To Restart Operations Nothing, all started working. Need security only. Total Cost to Return to Pre-War Condition $67,000 USD