During the forum, the following issues were discussed: promoting the green economy; trade and export; creating a favorable business environment for small and medium-sized enterprises, including women and young people; the availability, promotion, and dissemination of digital solutions; and the expansion of regional and international cooperation, new markets, and new opportunities. More than 600 representatives from 70 countries participated in the World Export Development Forum. The results of the discussions and meetings will be consolidated and reflected in the National Export Strategy to be launched by the end of 2023.
During the forum, we spoke to S.Gansukh, the founder of the fashion brands Bogts and Hunnu, about the features of their products and the Mongolian leather industry.
How many employees did you start with?
I had only one employee; that was me. It has grown since then. Before the pandemic, we had 48 employees. Now there are 24-26 employees, including a salesperson, pattern-makers, designers, contractors, and auxiliary personnel.
How many years of hard work and dedication has it taken you?
Twenty-nine years. We are successfully producing finished products from livestock raw materials, which are Mongolia’s inexhaustible national wealth, and supplying them to the international market. After processing livestock skins and wool, we produce finished products and sell them in the American, European, and Chinese markets.
Where did it all begin?
I grew up in a family of "producers", such as factory tailors and designers, so I’ve been close to leather and understood it well. When the country transitioned to a market economy, the only thing I knew I could do well was leather products. I improved my knowledge and entered this industry, but I didn’t just develop myself. There are 14 major foreign and domestic brands created by young people who’ve worked for our company and learned from me. There have been Kalmyk, Tuvan, Buryat, Inner Mongolian, and Yakutian employees. My younger brother produces Hoondiy horse leather shoes. There are also professional shoe designers who produce a variety of in-house shoes. Another brother of mine makes tweezers and shoe presses.
What stages of processing do the raw materials for your leather goods go through?
Leather is a raw material connected to meat. Raw materials with a clear origin and registered in the traceability system are delivered to the Ikh Ergelt processing company. Ikh Ergelt imports natural, eco-friendly processing materials from different countries and processes raw materials. We also chose this factory because it has an internal water purification facility.
The ornamentation and decoration for your products are very unique.
We’ve been studying and researching decoration design since 2000. In 2010, we started to make custom orders incorporating the Mongolian designs, archaeology, and cultural heritage that have been passed down to us. The uniqueness lies there. I think it stands out because we incorporate these designs and ornaments into our leather products and because we put a QR code on each leather product to track its origin.
Other than that, there aren’t many leather product manufacturers, but there used to be many. Sadly, some factories closed their doors over time due to labour shortages and the pandemic. I hope that since they’re young people with work experience, they’ll open their doors again because I think good times are coming. I hope they can get back on their feet and move forward without giving up.
Twenty-nine years of trying to stay in the leather industry has not been easy. People say it’s difficult to start production in Mongolia. What about you?
It's not easy. There are different tax policies, where everyone who produces and works is at fault and bears their own risk. It's not something that generates regular income. It’s true that you can make it today only by exhausting all of your resources. The market is tough. Sales are also difficult. There are high costs and little chance of free rides. Only the most tenacious people enter the leather industry. Only the most resilient, risk-taking, and persistent will survive in this industry.
Anything we produce doesn’t sell out in the blink of an eye. Some things take a day, some take two or three years. Not everything goes smoothly.
It takes a lot of time and research to create anything. It’s not wise to put something into the market without fully researching challenges and coming up with solutions. When people buy products from us, it means they’re giving us their scores on them. Everywhere you go are the vast plains and livestock on the steppe. This is something that can be found only in our country. It’s the same with wild animals. Local and foreign researchers have studied all the products coming from our livestock and say they have the potential to compete in the international market. So, Mongolians have the opportunity to compete globally.
Hasn’t leather become really cheap?
Everyone is talking about it. It’s not something that devalues when it comes down to it. Everyone should work. Only those of us who produce finished products have the opportunity to make raw materials more valuable.
As a raw material, it’s priceless. It becomes a finished product after human labour and skills add value to it. There are many steps.
About 500 people from many companies and cooperatives are behind one product, from preparing primary raw materials to deep processing, wet processing, and transportation. Starting with the herders, it goes through the whole system and becomes a finished product.
When did you start working with The Hu? Their endorsement is also important, isn’t it?
We’ve been working together since 2019. We’re getting orders for their products from all over the world. The Hu has become the face of our industry by wearing leather clothes. They’re wearing locally produced clothes and motivating foreigners to buy them.
How many products have been produced so far?
Over the past 29 years, more than 300 different products have been introduced to the market. Over 2,000 ideas have been tested. As consumer trends change, the products change. Many years of experience influence the development of new products. Manufacturing is a time-consuming process.
Is it almost impossible to stay in this industry without a little support?
Swiss National Day is on the 1st of August. For 17 years, the Swiss Agency for Development and Cooperation has successfully implemented the Green Gold Animal Health Project and invested a lot in our agricultural sector. Grants of 600 million MNT were also provided. Two of our companies were included in this project. We are very grateful to the Swiss Agency for Development and Cooperation for giving us the opportunity to bring our eco-friendly products to the international market and identifying and tracing the origin of livestock raw materials and including two of our companies in the project.
We officially started exporting our products registered in the tracking system programme to Global China Group two days ago. A launch event will be held on the 2nd of next month at the Embassy of Mongolia in Beijing, with the participation of representatives from more than 30 countries. We hope our industry peers successfully enter the international market by making products using our inexhaustible national treasure.
