Fashion industry doing business in countries at war – Europe’s share of world apparel and footwear production halved to 20% between 1991 and 2008, according to the Oxford Economics database. This decline in craftsmanship appears to be a long-standing problem for luxury brands.
Fashion industry doing business in countries at war
Brands like Burberry or Amélie Pichard are doing business in conflict zones as crafts in the Western world decline.
Doing business in war-torn areas is a great challenge. Problems with financial infrastructure, paying extra for electricity, and hiring security personnel for artisans who operate in conflict areas are some of the challenges that arise when working with these countries.
However, some companies have found that the cost risk is worth it. Artisan crafts are the second-largest legal export product in the developing world, and the handicrafts market had a turnover of $ 34 billion in sales in 2018, according to UN estimates. For countries recovering from conflict or currently at war, this business is a particularly valuable source of income. Brands can partner with NGOs and social enterprises that know how to manage logistics and regulate quality in areas where companies traditionally do not venture.
Building on existing infrastructure
Despite the fact that the conflict restricts commercial access, these states are not completely isolated from the rest of the world. In many cases, NGOs and social enterprises have supply systems and chains that brands can use for sourcing purposes. These organizations take a small cut from product sales to help cover costs.
In Afghanistan, Ishkar finds many of his artisans through the Scottish NGO, Scottish NGO Turquoise Mountain, which runs an arts institute in the Asian country. Nathalie Paarlberg, deputy director of the foundation for Afghanistan, says Afghan artisans are trained to meet the sourcing requirements of international buyers. The foundation has played an important role in the growth of artisan sales in the country, from $ 10,000 in 2006 to $ 1 million in 2018.
Burberry sources much of its cashmere from Afghanistan, which is responsible for 7% of the world’s supply. His foundation operates on a model similar to Ishkar’s, working with goat herders on sustainable agricultural practices through Oxfam.
In 2018, the commission launched Made51, an online platform to connect retailers with social enterprises in refugee-hosting countries. When access to refugee camps in Tanzania was suddenly restricted, Made51 facilitators were able to use the political connections UNHCR had built over the years to export woven baskets for West Elm, the household goods brand of the USA
Many social businesses take a small sales cut to help cover costs. Tight-Knit Syria, a Made51 partner, shares their $ 8.84 share of a $ 45 T-shirt with Syrian refugee artisans and a local tailor. Most of the money is spent on remittances, e-commerce, transportation costs, and taxes, resulting in a gross profit of $ 10.73.
Governments have also established systems to reward companies that extend their supply chains to conflict zones. The European Union’s “Everything But Arms” initiative grants the world’s 47 least developed countries, as defined by the UN, tax-free access to the 15 trillion euro single European market.
In this environment, brands that employ local artisans with limited access to the international market have a competitive advantage. “Before, brands didn’t care how it was done, but it’s starting to be a must,” says Amélie Pichard, a French accessory designer who collaborated with Ishkar on a line of earrings and pendants.