Economic value

Unrivalled supply chain, creative driver and model for change

The fashion industry is the second largest manufacturing sector in Italy

di Giulia Crivelli


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Shows are just the beginning. During September fashion week the White and Super trade fairs in Milan's Tortona district are equally important events for international buyers on the hunt for emerging brands from Italy and elsewhere; alongside, a scene from the Pitti Immagine event in September 2018

4' di lettura

Unique and strategic, both in terms of quantity and quality. We are talking about the multi-sector industry of textiles, fashion and accessories, Italy’s second most important manufacturing sector after mechanical machinery. Yet in reality little is known about its tangible economic value, in terms of number of jobs and businesses, or its intangible value. We don’t tend to think too deeply about the contribution that fashion makes to Italy’s global image. It is of course important, we all agree that. Yet there is a deeper, more profound aspect that makes the textiles, fashion and accessories industry an invaluable resource: its variety, its ability to adapt and evolve. In this respect it is similar to the wood and furniture industry: operators from outside Italy who do business with entrepreneurs and businesses from these two major sectors - clothing and furniture - often say how exciting it is to work with Italians, who believe that nothing is impossible. In the United States they call it “thinking outside the box”. This is an indispensable ingredient for the world of fashion, even more so than in the furniture sector: no other production category offers such a broad range of products with such a high turnover rate.

If a probability and statistics expert tried to calculate the possible combinations of all the clothes, accessories and shoes on the market, there’s a good chance they’d give up. It is much simpler to apply statistical methods to other types of goods such as electronics or food. The possibilities are endless (as is the number of competitors), but so too is the demand which evolves constantly. In fact, there is no single target market: fashion has long since escaped the prisons of age, social class, occasion, gender and location. Marketing, communication and distribution strategies have had to adapt, reconsidering the methods used until just a few hours ago on a daily basis, and naturally relying on big data, which they have had to learn to interpret. This is the intangible value of the sector: its ability to adapt even to major revolutions like the advent of digital technology.

As mentioned, in terms of its tangible, economic value, for Italy as a whole and for its two cities, Milan and Florence, which host shows and events, the figures are impressive. According to data from Confindustria Moda, which unites the leatherworkers’ association Assopellettieri, the federation of goldsmiths Federorafi, the footwear manufacturers’ association Assocalzaturifici, the Italian Tanning Union (UNIC), the Italian Association of Furriers (AIP), Sistema Moda Italia (SMI) and the eyewear manufacturers’ association ANFAO, in 2018 the textiles, fashion and accessories sector grew by 0.7% to €95.5 billion. The sector exports 70% of its production (63.4 billion, up 2.7% on 2017) thanks to almost 66,000 businesses that employ over 580,000 people. In the first quarter exports accelerated (+5.6% to 16.6 billion), chairman Claudio Marenzi noted during Confindustria Moda’s first conferences earlier in the year, but throughout the year there will be many unknown factors at play, both internal, like the governmental crisis that erupted in Italy in early August, and external.

The textiles, fashion and accessories world is present in Milan, Florence and almost all Italian regions: in fact, Italy is the only country in the world with a complete high-end supply chain which includes businesses that work on the raw materials and in all stages of the production process, and brands on the market. This heritage - as the luxury brands in France and the United States have come to learn - is built over decades, with skills and expertise handed down through the generations. When businesses close down, when the supply chain is dismantled, as with the textiles industry in France and the United Kingdom, that know-how is lost forever. In fact, Lvmh, Kering, Hermès and Chanel, as well as Ralph Lauren and Michael Kors for their respective top lines, produce many of their products in Italy.

When compared to France and the markets in English-speaking countries, Italy is at a disadvantage in two areas: mass distribution (in fashion and other sectors, such as food) and its ability to self-promote. We’re talking about the general image of Italy, its ability to present a united industrial sector and, last but not least, the investments in marketing and communication by individual companies. Yet even this snag - something of a raw nerve - can be overcome. Think back to the foundation of Confindustria Moda: until a few years ago it would have been unthinkable for seven associations to unite in pursuit of shared strategies and synergies. Similarly, the internet and social media have aided communication: the defining characteristic of the digital revolution is its ability to breach entry barriers. This is true not only of retail but of marketing as well. Today, anyone with the necessary drive, awareness (this is above all a cultural shift) and, naturally, investment, can develop a new communications strategy, made effective by new tools but with solid roots and foundations: manufacturing, knowledge, and the appreciation of all that is aesthetic and well-made. Technology can be learnt, but heritage? Either you have it, or you don't. Italy has it and needs to learn how to make better use of it.

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