subcontractors of high fashion companies (22.5 per cent of the sample) and enterprises
which sell more than 50 per cent of their production to large buyers (17.5 per cent) we
are left with 60 per cent of firms combining several different chains. Therefore, Brenta
shoe enterprises often face several exit options, dependence on one value chain is
limited to a reduced number of cases.
At the same time, most producers resorted to international delocalisation of
production as a cost-reducing strategy. The decentralisation of low value added
activities to foreign subcontractors can be interpreted as a form of functional upgrading,
as lower value added activities are externalised while keeping high value added
activities at home. The participation in the top brand chain, however, affects the pattern
of delocalisation: Brenta still maintain the bulk of intermediate processing at home
while delocalising a larger volume of assembling operations. This might be interpreted
as a way to reduce production costs on assembling operations (which are usually labour
intensive), while maintaining high quality standards on intermediate inputs.
On the other hand, clusters of firms which have usually positioned on lower quality
goods, on the one hand do face much more severe competitive pressures from producers
in emerging economies and on the other hand, do not take advantage of linkages with
the fashion industry. This implies a need for urgent ripositioning in new value chains or
new segment of the markets. In fact, the international delocalisation strategy as a way to
reduce production costs is not likely to be enough to counter competition from low cost
producers in other countries.
Besides delocalisation, low cost producers would need to enter new value chains by
establishing linkages with other producers in higher quality segments of the market.
This is actually what is happening nowadays with production agreements between
Brenta and Barletta. According to these agreements, the two districts will cooperate by
integrating vertically. Brenta will partly delocalise its production in Barletta, for two
main reasons: firstly, the need to maintain quality standards prevents producers to rely
massively on foreign subcontractors; secondly, producers in Brenta find it increasingly
difficult to find skilled labour force for their high quality production, and considered the
possibility to cooperate with producers in Barletta as regards training. For Barletta too
this could bring several advantages, first of all the insertion into a new higher quality
value chain.
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