are supposed to be higher and returns from branding and marketing very high.
Therefore, following Kaplinsky (1998 and 2000), economic rents in this chain are
assumed to be higher than in other types of chains.
Recently, the high and medium-high segments of the footwear industry have
increasingly attracted the interest and the financial capital of well-known top brands and
luxury multi-product oligopolies from outside the shoe world.11 Some world top luxury
companies, looking for highly skilled manufacturing capabilities to begin footwear
production, identified the Riviera del Brenta as a preferred area in which to find
subcontractors. The beginning of this trend corresponded with a difficult time in Brenta
because local firms were facing the end of the positive impact on exports of the 1992
devaluation of the Lira.
According to Rabellotti (2001), 17 enterprises (corresponding to 42.5 per cent of the
sample) work as subcontractors to high fashion companies, producing shoes sold with
globally known top brands. In five cases (12.5 per cent), they work exclusively as
subcontractors, while four of them (10 per cent) make between 50 and 89 per cent of
their total production for high fashion companies and the remaining eight (20 per cent
of the sample) make less than 50 per cent (Table 5).12
Table 5: Production for high fashion companies among sample firms (%)
|
% of total production |
No. of enterprises |
% of total sample |
|
^0 |
23 |
575 |
|
1-49 |
8 |
20.0 |
|
50-89 |
4 |
100 |
|
≥90 |
5 |
12.5 |
|
Total |
40 |
100.0 |
Source: Rabellotti (2001)
11In Italy among the top ten companies in the luxury industry there is only one footwear firm - Tod’s,
ranking at 9th position with a sales value of US$ 202 million. It originated in Marche, the largest Italian
footwear cluster, and was recently listed at the Milan Stock Exchange.
12According to the local entrepreneurial association, in 2000 the amount of production made by Brenta’s
enterprises as subcontractors to high fashion companies has reached 50 per cent of total production in the
area (personal communication with the director of ACRIB). If these estimates are correct, subcontractors
are underrepresented in our sample.
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