Thursday, August 16, 2012

Small Business Series 4: Nanette Lepore, and the Textile & Apparel Industries

 In 1960, 95% of clothing sold in the United States was made in the United States

Today, that figure is 2%. 

No, that was not a typo.  TWO per cent.

The Textile and apparel industries in America have been decimated by outsourcing and the consumer’s embrace of cheaply made, mass-produced clothing imported from abroad. Between 1994 and 2005, the United States lost more than 900,000 textile and apparel jobs to overseas operations. 

And yet, there are still 846 fashion companies headquartered in New York City, most in a small area of Manhattan known as ‘The Garment District,” (or the " Fashion Center "),  bordered, roughly,  by 5th and 9th Avenues to the east and west, and 40th and 34th streets to the north and south.   They employ 24,000 people in all steps of the apparel industry: designers, pattern makers, cutters, sewers, accessory manufacturers, fabric importers, dyers, synthetic fiber fabricators, weavers, spinners, marketing specialists, wholesalers, and retailers.  Though only a tiny fraction of the number of jobs that have been lost,  (2.6%), they forge ahead in spite of devastating competition from industrializing nations such as Honduras, Pakistan, and China, where textile wages are less than the U.S. equivalent of $250/month.  And in spite of this competition, there are still more apparel workers in NYC than in the other big three fashion capitals (London, Paris, and Milan) combined. New York City has been and remains, the Fashion Capital of the World.

While interested in the industry in a general way for some time, I became even more ‘drawn in’ on my first visit to  Nanette Lepore,  a NY clothing designer headquartered on the 17th floor of 225 W. 35th Street, in the heart of the Garment District.  Joining up with college students from three different schools like a pilgrimage, we were escorted to the proper room by none other than Nanette’s husband, who joined us in the elevator.  As we exited, we were greeted by Erica, a Lepore marketing professional who had arranged to take us on a tour of this proudly American business.  I should point out that this was not a tour of the 'retail face' of the designer, or of her shops in Soho, Los Angeles, Chicago, Bal Harbour (FL), or Boston.  This was the nitty-gritty, daily-decision-making, cutting-and-stitching hands-on nerve center of a fashion operation.

 Nanette Lepore is a crusader in the effort to save the American textile and apparel industries.  She is an underwriting sponsor of the television series “Project Runway,” and is a driving force behind the “Save the Garment District” campaign, which came into existence when zoning changes in New York City threatened to favor trendy, national, upscale restaurant chains over gritty industrial looms, garment racks, and dying vats. If anyone has prevented that “2%” figure from shrinking even further, it is Nanette.

 We were lead through the non-glamorous work stations of pattern makers and sewers, and finally made it to the showroom floor where, in April 2012, samples of the Fall 2012 were being displayed. 

Yes, we took pictures, but we promised not to release them to commercial websites.  

And so, I was excited to receive an email from Nanette Lepore last week, recommending the DGExpo (“Designer’s Guide Expo,”) a trade show and series of workshops designed to help small design businesses connect with providers who gladly work in "small lots,”  i.e., textile and apparel industry businesses that are happy to work with a small producer requiring 500 or 1,000 garments, rather than the tens of thousands demanded by Target or Walmart or even Macy’s. 

 (Side note: large Department stores like Macy’s are the death knell for small, upstart designers: their packaging, delivery, and tagging requirements – as thick as a phone book – permit ‘penalties’ against small producers, called ‘chargebacks,’ which can bankrupt a small upstart.)

So down to NYC we went.

All sorts of fabric and accessory companies filled the expo floor. From leather to fur to wood to silk to batik to hemp to metal, they shared one thing in common: they were small businesses, eager to work with small and new designers, to create cost-effective, unique, quality, American-made clothing.

I admit to falling in love with several of these companies.

Buttonology , located at 264 West 40th Street, was delightful.  I was first attracted to their selection of beautiful wooden buttons, but, upon moving some samples, found some fun, whimsical rainbow-colored buttons that would be perfect on summer beach house ware.  

 Their minimum order?  A dozen.  Yes, that’s right – small quantities for small producers.  Founded 7 years ago by two partners, Buttonology has made a niche for themselves in providing a broad and unique array of non-mass-produced buttons and accessories.  It was fun just pawing through their samples.  

Across from Buttonology was a company I visited several times:    Hemp Traders, who had come all the way from 335 E. Albertoni Street in Carson, California.  Twenty years old next year, Hemp Traders is the largest supplier of the Hemp products in the world. 

Small business?  Absolutely.  Hemp Traders fights a daily battle with the purposely and genuinely ignorant about the nature of Hemp fiber.  

Hemp is simply an incredible plant product. Among the characteristics of hemp fiber are its superior strength and durability, and its stunning resistance to rot, attributes that made hemp integral to the shipping industry. Hemp fiber allows for environmentally friendly bleaching without the use of chlorine. It is 100% biodegradable. 

I had an image of Hemp as scratchy and sort of like burlap.  What I found were samples of hemp and hemp-cotton blends that were as soft as baby blankets.  No wonder George Washington grew and promoted hemp.  Too bad our current politicians have banned the production of industrial hemp from our shores….all hemp must now be imported, raising prices to American consumers and producers who would gladly use this fiber. Another example of small business strangled by bureauocracy . . .

The minimum order size for struggling new designers?

None.  Zero. Zilch. Nada.  

 No, really.

This is a company that wants to help the small producer, the new designer, the boutique artisan  - and they back it up with a quality product at a price that makes sense.  I fell in love with these guys.

In all, I got to visit with 65 companies: small companies, struggling and striving to remain afloat in a country that complains about poor job prospects, but then buys clothes from a sweatshop half a world away that poisons the water and abuses their labor.

I admit it: I love the Garment District. And I'm not alone:

Consider the following blog article, which appeared originally as "New York’s Fashion Industry Reveals a New Truth About Economic Clusters,"by Elizabeth Currid-Halkett and Sarah Williams, posted in the Harvard Business Review Blog on February 10, 2014. Minor editorial notes have been added by this blogger to clarify certain points above.

The week before Fashion Week in New York is perhaps the busiest in the city’s apparel industry. Frantic designers rush around looking for gold buttons with blue inlay, for seamstresses to make pleats and for patternmakers with spare fabric.  They make modifications to dresses in real time under enormous deadline pressures.

Yet when eyes eventually fall on the runways, they witness virtually glitch-less shows and talk-of-the-town creativity.  How does New York’s fashion industry continually pull off Fashion Week year after year?

The answer lies in a complex economic system whose informal origins date to the mid-19th century and whose central idea rests on geographical proximity. We’re talking about the Garment District, eight blocks in Manhattan where designers, wholesalers, manufacturers, fabric sellers, button makers, and seamstresses all work.

The idea that highly specialized concentrations of an industry like the Garment District offer significant economic advantages is hardly revolutionary. The automobile, steel, mining and textile industries similarly occupied proximate physical space, sharing resources, labor and information to their great economic benefit. As the great economist Alfred Marshall observed in 1890, industries that clustered together generated economic growth by virtue of something “in the air.”

Exactly what is “in the air” in places like the Garment District? For a long time, discussions on the benefits of economic clusters, or "business clusters," or agglomeration economies as urban planners call them, have been mainly theoretical or qualitative. Interviews, case studies and ethnographies tell us proximity matters to certain industries. Think Silicon Valley, Wall Street or Hollywood. Therefore, so the argument goes, cities ought to push policies that encourage the growth of spatially concentrated economic activity. But why — and how – these clusters work has remained a mystery.

To find out answers to these questions, we tracked 77 fashion designers working in the Garment District and the larger New York region over two weeks in July 2011 [Ed Note: generally considered to be 34th Street to 40th street, between 7th and 9th Avenues] Using their cellphone data and a social-media tool we tracked their geographical movements and documented exactly where they went and when, compiling a real-time, minute-by-minute, day-by-day, snapshot of what they did. The designers voluntarily let us in on their activities  – picking up a fabric, meeting with a manufacturer, grabbing a cup of coffee — by “checking-in” to Foursquare, a social media application that allows users to identify precisely where they are and what they are doing. To gauge the economic importance of the Garment District to the broader region, we studied the work lives of designers with offices in the district and those with addresses in New Jersey and the other boroughs. A majority of our sample worked outside the Garment District  [Ed Note: a particularly important factor to consider when looking at the many trips these individuals made *to* the Garment District in this two week period.]

It turned out that the benefits of the district’s agglomeration economies were not confined to eight blocks in Manhattan, but spread evenly across the region. Having an office in the Garment District was not as important as the existence of the area itself.  Seventy-seven percent of all trips the designers made were to the Garment District, and 80% of the businesses they visited were located there. Not only that, regardless of where the designers’ offices were located, they all similarly interacted with manufacturers, wholesalers and suppliers, spending almost the same amount of time with them.  The difference between Garment District-based designers and outsiders was a mere 10 minutes.

But what the designers actually did from 10 am to 6 pm (the hours most kept) revealed no set patterns. When we studied the timing of their trips to manufacturers, wholesalers or suppliers, we found no meaningful pattern, regardless of the size of the firm.  Every day was a new day.

Herein may lie the magic – what Marshall said was “in the air”– of economic clusters and their importance to cities. All designers need the same basic materials and labor to make a dress. But how they individually pursue and use those resources — and how they respond to the changing demands of realizing their conceptions — is a key component of their creative process. The Garment District’s agglomeration economies foster the freedom necessary for creativity to thrive, which is part and parcel of how great dresses are made in the first place. What we think is raw creativity – the electric energy of Marc Jacobs and Anna Sui or the exciting parties reported in the media – is quite a practical matter.

The great urbanist Jane Jacobs once remarked that “diversity is natural to big cities.”  Her point was that the intermingling of different firms and industries that work together to produce things and ideas is a central feature of an urban economy and accounts for its ongoing vibrancy.  And our study shows that this sharing is much wider geographically than previously thought.

Creativity and its economic impact – whether producing a wrap dress or a semiconductor – is rarely an act of genius in isolation. It instead is the interworkings and interventions of a highly efficient and effective cluster of firms and those who work for them.

This phenomenon unfolds in particular places, and those special places must be preserved if we want to keep our cities bright and our industries innovative. Let that be a lesson as we watch the runways and the flashing lights.

To see the actual travel routes and stops, watch the video at the end of the article at this link:

NYC Garment Center Business Cluster

 [This is the Fourth in a series on Small Business in America]

1 comment:

Erynn Hazlett said...

What a great event! Nanette sounds amazing, and these small business, encouraging small business, sound outstanding. This event, sadly I did not attend, motivates me to continue my path of entrepreneurship and small business development, focusing on rebuilding manufacturing in the USA. I SUPPORT THE GARMENT INDUSTRY!