New brands are changing what ‘made in China’ means

“Made in China” fashion startups are hoping to draw other brands that manufacture there out of the shadows.

“There is a lot of luxury fashion that is made in China, but luxury brands do not talk about that,” said Anna Lecat, the founder of apparel and lingerie brand Les Lunes, which makes its product in Shanghai. “It’s part of the supply chain, but production is often attributed to where the item was designed, not manufactured. It’s unfortunate that luxury brands don’t proudly say, ‘We’re made in China.’”

Les Lunes, along with companies like Grana, Ellie Kai and Everlane, is part of a cohort of modern fashion brands that have recognized China as a valuable manufacturing partner for high-quality, ethically made apparel that still operates on a quick production cycle. They’re also brands known for practicing supply chain transparency, meaning China’s role in the production of these items is recognized. The goal is that the stigma surrounding “made in China” — that it’s all products that are poorly made, by low-wage factory workers — will eventually be shaken.

“There is such a stereotype [about made in China] in the minds of the end consumer, when in reality, some of the manufacturing facilities in China are more advanced than factories in Europe or the U.S.,” said Yana Bushmeleva, the chief operating officer at Fashionbi, a fashion business intelligence firm based in Milan.

Bushmeleva said that while the quality of factories in China still varies, brands have the power and control to seek out the ones that pay fair wages, employ highly skilled workers, use automation and are less harmful to the environment. According to Lecat, the quality of Chinese-manufactured goods declined when American corporations like Walmart began to source production there, in search of cheap laborOperating on extremely narrow margins, there was no room for factories to produce high-quality goods or take care of their facilities or workers.

“The only way to capture this surge in business was to stay low-cost,” she said.

Lecat, who has lived in Shanghai for twenty years, said that it became well-known among Chinese garment workers that items produced for America were cheap and low-quality; therefore, the highly skilled workers sought employment at facilities that produced domestic goods.

“Americans are largely responsible for the idea that ‘made in China,’ on the global scale, means cheap. If we step back and look at Chinese manufacturing as a whole, there’s a long history in innovation and producing high-quality products,” said Lecat. “In China, consumers will look at products made for the U.S. in China, and they won’t buy it. They’ll only buy things made for Chinese customers, by local brands.”

In order to reverse this dynamic, companies including Les Lunes and Ellie Kai, a made-to-order clothing brand designed, sourced and manufactured in Shenzhen and Hong Kong, have had to build trusted relationships with their production partners. Lecat built a private production facility staffed by highly skilled garment workers local to the Shanghai neighborhood it’s located in. Ellie Kai CEO Liz Hostetter grew her supply chain by forming relationships with tailors in Shenzhen and Hong Kong, where she lived for six years.

Hostetter said that her team in China grew close, and that without that network in China, her company wouldn’t be able to scale its customizable, made-to-order clothing. The company’s slogan is “Made with love in China.”

The Chinese government is also trying to change the global perception of its manufacturing industry. In 2015, it released the Made in China 2025 plan, a 10-year initiative to advance the country’s network of factories and facilities, in terms of innovation and ethical practices. The main components of the plan include increasing the use of automation in factories, focusing on quality rather than quantity, and fostering local talent.

“The main goal of [Made in China 2025] is to transform the Chinese manufacturing industry from large to strong,” said Bushmeleva. “China is already a manufacturing partner for many fashion companies. The question is when the companies will be proudly sharing that.”

As China becomes an important region for e-commerce growth for established luxury brands, some are giving its manufacturing presence more attention. On some items, Michael Kors has started using labels that say “made with Italian fabric in China.” Designer Phillip Lim, who has roots in China, spoke out about the “made in China” stigma at the Business of Fashion China Summit this week: He said his brand is proud to manufacture products in Shanghai, but he realizes the same isn’t the case for fellow luxury brands.

“It’s going to take a long time for this to change,” said Lim during the summit. “People still see it as a place that’s fast and huge, and a black hole. Our Chinese-based factories are so used to clients who just want cheap, fast and large quantities.”

For direct-to-consumer brands, China is a valuable partner throughout the production cycle, not just on the manufacturing level. Grana, a Hong Kong–based apparel brand, is helping to normalize the region’s role in Western retail by sourcing fabric, manufacturing, and distributing its clothing from China. Co-founder Luke Grana said he decided to launch his brand in Hong Kong because of the operational benefits and talent pool he found there.

“Chinese manufacturers are strong on the technical and automation side. Skilled technicians do the work, but they’ve invested in technology and a focus on efficiency and quality,” said Grana. “When we look at more developing markets, there’s more manual labor. China has invested in automation and technology that makes the garments higher quality. In other markets, the garments would be driven from the actual workforce with more questionable treatment of its workers.”

As for its distribution center, Grana said he chose Hong Kong for many reasons: It’s a free-tax port, so goods can be shipped in and out without added fees; it’s home to many fabric mills, meaning materials are sourced close to home; and its shipping rates are lower than other countries, so Grana can deliver products faster for cheaper. Grana’s entire production cycle takes under five weeks, and it offers two-day shipping in countries all over the world.

“As e-commerce takes over, Hong Kong is really the best place we could be,” Grana said.

Transparency has been dinged as a marketing term for fashion brands that haven’t fully committed to being sustainable, but its value comes into play not as a way to puff-up the efforts of going green, but to change the way we visualize the factories and workers that are part of a transparent supply chain.

“Since modern customers require more transparency from brands about the manufacturing of its products, it will be difficult for brands to sell expensive products that were made in China if the stereotype is still so strong,” said Bushmeleva. “But transparency is also how it can help it change with time.”