Luxury brands are taking vertical ownership of their supply chains to ensure longevity, sustainability, artistry and reduce risk.
After all, what better way to ensure a designer's collections are delivered on time, than by owning the factory that produces the garments.
And it is not just production facilities that designers are investing in. When Victoria Beckham launched her namesake brand in London with investment from Simon Fuller's XIX Management, she quickly expanded her team with in-house pattern cutters and seamstresses, jobs that are often outsourced to sampling houses and factories.
Having the design team and development process under one roof means designers can be more agile and invest in developing sample collections, which often require several fittings and toiles before the final prototype is ready. It also saves having to outsource to companies that are mostly abroad, and keep the skills and artistry alive at home.
Of course when skills and artistry do not get passed on, there is a risk of losing the craft. In Italy luxury tailor Brioni opened a tailoring school in 1985 to ensure the skills of its ageing needle workers were passed on.
In 2016 Chanel bought four silk producers in France, ensuring it could continue rely on high-end specialists for yarn making, weaving and printing. “Through these investments, Chanel is reaffirming its commitment to the long-term sustainability of a high-quality segment and to ensuring the longevity of the silk weaving industry in France,” Bruno Pavlovsky, President of Chanel Fashion said a in a statement.
Prada, in 2013, saved a French tannery from going out of business by buying it. The company is known for its specialisation in lambskin and plongé leather, which are key leathers in Prada's collections.
Owning supply chains gives way to bigger margins
Franck Delpal, an expert in vertical integration and a professor at IFM, a fashion school in Paris. told the New York Times: “If you control the greater part of your supply chain, you get margins at every step, and at the end of the day, it creates big business.”
In 2013 Kering bought one of France's most renowned tanneries, France Coco, a Normandy-based tannery specializing in the sourcing, tanning and processing of crocodilian skins.
By embedding sustainability across its entire supply chain and setting targets for its 2025 sustainability strategy Kering has seen industry-leading results. Most importantly, the company "aspires to find business approaches and supply chain solutions that contribute to the restoration and regeneration of natural capital, support the protection of biodiversity, address health and safety by eliminating hazardous chemicals, and meet the highest standards of animal welfare."
Photo credit: Richard Tannery, Brioni tailoring school