WSJ article: Breaking a Taboo, High Fashion Starts Making Goods Overseas

[Caffeine]

Zamb, thanks for posting that article! This is how I look at the competition and the trade issue although I don't think my Eurpoean friends will like it (let me say it anyway ):
China's goods used to be expensive thousand and hundreds of years ago when it was a strong country. Remember the silk road? European businessmen came to China to purchase the expensive silk. They were not happy;and then in 1840 eight European countries invaded China and robbed tons of valuable art pieces, gold, etc. China went down because of the war and the corrupt governments.
China is on the way coming back right now, but the cost in this country is so low that it threatens the European countries. The EU is not happy again. What they are doing now is to increase tariff and set quota and give the Chinese government pressure year after year. Chinese shoe makers' warehouses were burned in Spain recently because they did business better than the local companies. After reading all those articles talking about how dangerous China is, you have to wonder why the media keeps to be negative. The key is to stop blaming the low cost in China (it was partially cost by the European countries years ago), but to find the competitive advantage in the European countries.

[faust]

Originally Posted by Caffeine

Zamb, thanks for posting that article! This is how I look at the competition and the trade issue although I don't think my Eurpoean friends will like it (let me say it anyway ):
China's goods used to be expensive thousand and hundreds of years ago when it was a strong country. Remember the silk road? European businessmen came to China to purchase the expensive silk. They were not happy;and then in 1840 eight European countries invaded China and robbed tons of valuable art pieces, gold, etc. China went down because of the war and the corrupt governments.
China is on the way coming back right now, but the cost in this country is so low that it threatens the European countries. The EU is not happy again. What they are doing now is to increase tariff and set quota and give the Chinese government pressure year after year. Chinese shoe makers' warehouses were burned in Spain recently because they did business better than the local companies. After reading all those articles talking about how dangerous China is, you have to wonder why the media keeps to be negative. The key is to stop blaming the low cost in China (it was partially cost by the European countries years ago), but to find the competitive advantage in the European countries.

What's not to like? Everything you said is true. I think the biggest advantage Europe has left is exactly the feeling of luxury and design. That is their competitive advantage. That's why the Intellectual Property laws are the hottest topic right now.

[zamb]

there is more to the article i will post later if someonce can go to the tribune and do it that would be good. I am in a hurry so i have to leave,.



bye.thanks

[tott]

Yes, Caffeine and faust: it's all too true.

You know the old saying: When life hands you lemons...

Of course this transition is painful in some ways for a lot of people, but sometimes you can't resist change. I know there are quotas and so on in the EU, and a little bit of protectionism might be a good thing sometimes, but it's really not that smart to throw up the walls and isolate yourself.

[tott]

Btw, this is a bit interesting... "Thanks to an early start, we are in good position - and we have to make sure we maintain it," says Ferragamo. "At the top end of the market, they appreciate especially things that are not made in China. And we are 100 percent made in Italy."

Sooo, European luxury companies are breaking into the Chinese market because they are European luxury labels, sort of. But what happens when they move the production there, will they be able to retain that "European luxury" image when they are in fact made locally? Doesn't this diminish the aura of exclusivity, make it more common? Especially to new groups of customers who may not have an established, deep relationship to the labels?

[Caffeine]

Originally Posted by tott

Btw, this is a bit interesting... "Thanks to an early start, we are in good position - and we have to make sure we maintain it," says Ferragamo. "At the top end of the market, they appreciate especially things that are not made in China. And we are 100 percent made in Italy."

Sooo, European luxury companies are breaking into the Chinese market because they are European luxury labels, sort of. But what happens when they move the production there, will they be able to retain that "European luxury" image when they are in fact made locally? Doesn't this diminish the aura of exclusivity, make it more common? Especially to new groups of customers who may not have an established, deep relationship to the labels?

Interesting question, tott! personally I don't mind even one day Hermes scarves are made in China as long as the quality is good. I always think that the "made in Italy" thing is all mental. There are lots of inferior products made in Italy, but people never complain about those things. I believe that people will be educated and they will realize that a tag doesn't mean anything. It's difficult for the Chinese designers to catch up, but it's easy for the seamstress to make better garments. At the end of the day, there are two thing matters: design and the quality. The best result is to combine the Italian design and the good quality that is produced in China. The reason for luxury goods to be luxury goods is not the label or the price tag, but the design and the quality. Consumers need to be educated on that, and luxury goods will remain special because of that.

[finalfashion]

Wow, caffeine, that's an insightful way to see the past 500 years of the fashion industry... I hadn't thought of it that way.

[PrinceOfCats]

There are lots of inferior products made in Italy

I think the general assumption is that Italy has some laws about ethical work practices and such...

[tott]

Originally Posted by PrinceOfCats

I think the general assumption is that Italy has some laws about ethical work practices and such...

But Italy didn't always have those laws, it used to be a very poor country where workers were badly exploited. And China will probably start to protect its workers better once the general income and standard increases. Relative wealth and degree of "civilization" aren't absolutes. The West hasn't always been rich and cultured. The Arabic world was the center of culture and science during the middle ages or so, for instance.

Of course I realize that it's morally and ethically questionable to transfer production to countries where workers are exploited, and I do feel that companies should treat their workers fairly. They can certainly afford to since salaries are only a fraction of what they would be in Europe.

[PrinceOfCats]

Originally Posted by tott

But Italy didn't always have those laws, it used to be a very poor country where workers were badly exploited. And China will probably start to protect its workers better once the general income and standard increases. Relative wealth and degree of "civilization" aren't absolutes. The West hasn't always been rich and cultured. The Arabic world was the center of culture and science during the middle ages or so, for instance.

Of course I realize that it's morally and ethically questionable to transfer production to countries where workers are exploited, and I do feel that companies should treat their workers fairly. They can certainly afford to since salaries are only a fraction of what they would be in Europe.

Is supporting Chinese (or any other lower-salary country of your choice) goods going to improve the fortunes of the Chinese economy if a large proportion of the profits pours back into Europe, I think was possibly the dilemma I was trying to point out...

(In Colin McDowell's Fashion Today, he says that the main reason for production starting in Italy was that it avoided many import levies, because it was still European and it was more glamorous than 5th Avenue but mainly because it was the cheapest country to produce in because the economy had been ruined by the war)

[Caffeine]

[quote=PrinceOfCats]Is supporting Chinese (or any other lower-salary country of your choice) goods going to improve the fortunes of the Chinese economy if a large proportion of the profits pours back into Europe, I think was possibly the dilemma I was trying to point out...

[quote]
You are right that the large proportion of the profits pours back into Europe, but the Chinese workers are actually not considered exploited at this moment. China is an agricultural country, and the rural population is going through difficult process to industrialize the agricultural production while finding new job opportunities as the labor is less important now. Lots of them went to the east coast of China working in those factories. They are making nothing, but the salary is higher than what they make as peasants anyway. For one thing, the outsourcing of production is helping China change from an agricultural country to an industrial country.

[PrinceOfCats]

[quote=Caffeine][quote=PrinceOfCats]Is supporting Chinese (or any other lower-salary country of your choice) goods going to improve the fortunes of the Chinese economy if a large proportion of the profits pours back into Europe, I think was possibly the dilemma I was trying to point out...

You are right that the large proportion of the profits pours back into Europe, but the Chinese workers are actually not considered exploited at this moment. China is an agricultural country, and the rural population is going through difficult process to industrialize the agricultural production while finding new job opportunities as the labor is less important now. Lots of them went to the east coast of China working in those factories. They are making nothing, but the salary is higher than what they make as peasants anyway. For one thing, the outsourcing of production is helping China change from an agricultural country to an industrial country.

As with Britain's transition to industry, this is quite possibly NOT a bloodless coup...

A few hundred years on though and the only noticeable side-effect is that we have pollution and crap food in Britain.

[Spacemiu]

While I worry alot about globakization and out sourcing, I think ,at least it terms of product, as long as it is still high quality and the workers are paid living wages then it's fine.

[tresormakati]

case in point, earlier on, i think kate spade made their bags within the US. and now that they made a lot in china, the quality has somehow been compromised. my good friend bought a kate spade bag, and after the 2nd day, the bag began to fall apart.

[castorpollux]

If they could control the quality, which they don't always do, I wouldn't have a problem with it. Look what happened when BMW started making their SUVs in the United States. Serious quality issues...
I could see how a label would lose some of its allure in the eyes of many if it was being produced in a country lacking that "aura" of prestigous quality. But, these perceptions could change in time. 30-40 years ago anything coming from Japan was a total joke, particularly electronics and automobiles. Now it's considered to have arguably the finest quality control and innovation in the world (e.g. - Sony, Lexus, Toyota, Nakamichi).
I say give it time...