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

[Caffeine]

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]

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]

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]

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.

 

[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...

 

[faust]

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...

What quality issues? I haven't heard of any major recalls

 

[renferme]

AFAIK, the luxury brands have been manufacturing in China for years. I've seen genuine Prada and Gucci over there as long ago as five years ago. As long as they 'finish' the goods in Italy no one need never know.

As for the quality - having worked in factories world-wide - China is now bewcomng a world leader in quality. I'm currently working in a cChinese factory that produces some designer collections - the quality is far superior than what I've seen elsewhere.

When it comes to quality - it matters more who set the factory up and how good the technologists and quality controllers are - not necessarily the location - but becasue the Chinese are shrewd business people they are recognising this and bringing in expertise from the rest of the world.

 

[noyely]

Sorry about jumping in a bit late but this is a subject of particular interest to me as I am conducting a study on European textile industry practices, specifically on the outsourcing of mens formalwear. Most luxury brands outsource to a large manufacturer who then outsources to other European production facilities or Eastern countries, North Africa or, of course, China. I am developping a mapping of each brands chosen production process and the eventual migratory practice to sub-outsourcing. If anyone has any specific information on European brands manufacturing practices, I would be very interested.

As an aside, if anyone is interested, The Economist develops the idea further that outsourcing of manufacturing is the sign of a healthy economy and that the doomsayers should instead turn their efforts to finding new business models rather than fearing for the loss of manufacturing jobs. Check out the link :
http://www.economist.com/displaystory.cfm?story_id=4458528

Thanks in advance. [email protected]

 

[Caffeine]

Thanks noyely! Unfortunately I don't have more info. right now, but I'll share with you if I see any. Also thanks for the article, and what you said is totally true.

 

[jhaime]

first of all, fantastic read...However, I find myself mirroring Faust with this one...

Firstly, let's discard the quality issue here, the chinese are perfectionists...they are technically astute people...if they are shown how to make quality clothing...they will make quality clothing...that's that arguement out of the window straight away...

Secondly, does it matter where the clothing is made? yes

yes it matters if we are lied too...The egyptian labels are ripped out for europe where labelling laws are less strict...erm, am I the only one who would prefer far more informative labelling laws in Britain and for the rest of Europe...the Italians are cheating their own people, as well as their neighbouring countries...pathetic!

Stricter labelling laws and that handles that issue...it will bring the issue directly to the forefront of the industry...i've known about this issue as well as i'm sure you guys have, but there is a lot of people out there who don't understand the implications of what actually goes on in the industry as a whole...

for me persoanally, I care where it's made...if!!! they are going to charge the same price...I just forked out £265 for a pair of Dior sneaks...which had made in spain on the inside...this aggrivates me...call it snobby...but I love the connection and the sheer glamour behind the made in Italy tag...it's what makes it unique...special...However, it's a shame we don't even know where our clothing is made today...(even if it does have made in Italy inside)...

I also care if they're paying chinese workers next to nothing, in comparative to Italian workers...when they're doing the same work, to simply increase profits...

The fact is, if they are going to adopt this policy whereby they manufacture outisde of Italy, but retain their extortionate prices...we should Boycott...because without consumerism, they don't exist...why are we standing for being cheated...??? and most importantly...why do people not care???

Italy are going through the same problem that Britain has had with car manufacturers & numerious telecommunications companies...and if they think they will see light at the end of the tunnel...they are sadly mistaken

I don't want to turn this into a political debate...but the only decent thing Labour has done for Britain...is keep us looking in from the outside...on a shattered european union...

Italty are simply biting the hand that feeds them...

 

[Nader]

ah, the wonders of expendable labour...