The Journal Gazette
Sunday, August 26, 2018 1:00 am

Small clothiers buck global trend

DANICA KIRKA | Associated Press

LONDON – Claudio Belotti knows he cut the denim that became the jeans Meghan Markle wore on one of her first outings as the fiancée of Britain's Prince Harry.

That's because he cuts all the fabric for Hiut Denim Co., a 7-year-old company that makes jeans in Cardigan, Wales. Belotti is a craftsman with 50 years of experience that gives his work a personal touch – something that's not quite couture but not exactly mass-produced, either.

“There's a story behind each one,” Belotti said. “You're paying for the skill.”

Customer demand for something unique is helping small companies like Hiut buck the globalization trend and set up shop in developed countries that had long seen such work disappear.

While international brands like H&M and Zara still dominate the clothing market, small manufacturers are finding a niche by using technology and skill to bring down costs and targeting well-heeled customers who are willing to pay a little more for clothes that aren't churned out by the thousands half a world away.

Profits at smaller national clothing firms grew 2 percent over the last five years, compared with a 25 percent decline at the top 700 traditional multinationals, according to research by Kantar Consulting.

Their success comes from promoting their small size and individuality, said Jaideep Prabhu, a professor of enterprise at Cambridge University's Judge Business School.

“It's a different kind of manufacturing,” he said. “They are not the Satanic mills. These are very cool little boutiques.”

Hiut, which makes nothing but jeans, employs 16 people in Cardigan and makes 160 pairs a week. Women's styles range from 145 pounds ($192) to 185 pounds ($244), men's go for 150 pounds to 235 pounds. Each is signed by the person who sewed it, known in the company as a “Grand Master.”

Many of these small manufacturers also try to stand out by embracing social issues, from reducing waste to paying a living wage.

Hiut, for example, highlights its efforts to put people back to work in a small town that was devastated when a factory that employed 400 people and made 35,000 pairs of jeans a week shut down.

Underscoring the years of craftsmanship that go into each pair of jeans, the company offers “free repairs for life.”

This kind of customer service helps form a “personal relationship” between a brand and the shopper that is valuable, says Anusha Couttigane of Kantar Consulting.

The rise of small clothing makers reflects a broader shift in consumer preferences away from big brands. In fashion, technology is fueling the trend.

The internet provides a cheap way to reach customers, while off-the-shelf artificial intelligence programs allow companies to accurately forecast demand and order materials so they can make small batches and avoid unwanted stock.

That makes it possible to produce clothes that are more customized.

“Data is the backbone for this and the trigger,” said Achim Berg, a senior partner at McKinsey & Co. in Frankfurt who advises fashion and luxury goods companies. “It's not custom-made, but it gives the consumer the opportunity to be more individual.”

Prabhu sees this as part of a bigger shift away from the model of outsourcing production to low-cost countries like China.

“You're trying to constantly keep up with your customers. Your competitive advantage is to give them something closer to their needs.”

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