London, Milan, New York, and Paris: Around the calendar, the world’s fashion-forward gather in global centers to survey the latest trends in the industry. Far from the bright catwalks where the latest high-profile designs are shown is an unlikely common thread: creators in the Republic of Moldova (Moldova), who are using intellectual property (IP) tools to tap into the global demand for fashion.
A small, landlocked country between Ukraine and Romania with less than 4 million people, Moldova might seem like a surprising participant in the high stakes, fast-paced world of fashion. Yet the country has a long history in the textile, apparel, footwear, and leather goods (TAFL) industry (United States Agency for International Development (USAID), 2015).
With a skilled workforce, ideal location between Eastern and Western Europe, membership in free trade agreements between the European Union and the Commonwealth of Independent States, and close access to a market of over 800 million people, Moldova offers attractive pricing, high quality products, short lead times, and close ties to the labor force that have fostered the growth of an international commercial textile hub (Invest in Moldova, 2015).
These features have led the TAFL industry to become integral to the Moldovan economy. However, over 90% of companies in the industry engage in what is known as lohn contracts, meaning Moldovan companies making products for export to foreign fashion labels (Cluster Policies in Europe, 2008). This has led to domestic consumption of only 20% of industrial production (Invest in Moldova, 2015).
Seeing an opportunity, in 2012 the Association of Light Industry Employers (APIUS) and the Government of Moldova, with the support of USAID, launched an umbrella brand for the country’s TAFL companies - Din Inimă - Brandurie de Moldova (From the Heart - Brands of Moldova). “We saw a need to decrease the number of enterprises providing only lohn services and increase the number of those selling products under their own brands,” said Ms. Diana Stici of the legal department of the Stage Agency on Intellectual Property of the Government of Moldova (AGEPI).
The Din Inimă umbrella brand aims to move to a higher income model of value-added products by increasing the competitiveness and prestige of Moldovan TAFL enterprises and brands through providing training on how to use IP effectively, developing consumer oriented promotional programs, and improving consumer perception and knowledge of local brands (USAID, 2015).
Supported by USAID’s second round of the Competitive Enhancement and Enterprise Development project (CEED II) for Moldova (USAID, 2015), Ms. Liliana Vieru of the International and European Integration Division at AGEPI explained that the Din Inimă umbrella brand is an example of a successful public-private partnership. Implemented by APIUS and the Moldovan Government, the project combines micro, mezzo, and macro level technical assistance and training to boost competitiveness and add value to products, thereby increasing sales and strengthening the industry.
As more companies joined the Din Inimă umbrella brand more also joined APIUS, with membership quadrupling to over 90 companies by 2015 (Chemonics, 2015). This facilitated a further public-private partnership for the TAFL industry between the Technical University of Moldova, APIUS, the Ministries of Economy and Culture of Moldova, and USAID, culminating in the launch of the Zip House Design and Technology Center of Excellence in 2015. The Center provides designers in the fashion industry with training and resources that address gaps in industry skills, fosters innovation, and cultivates entrepreneurship (Chemonics, 2015).
Trademarks and branding
It could be argued that success hinges on branding, design, and trademarks that connect with consumers just as much as it does on creativity and skill. “When speaking about the TAFL industry, the most critical area would be trademarks and design and that is why the focus of the Din Inimă project was on branding development and promotion,” said Ms. Vieru. “Brands bring to the holder a considerable competitive advantage, and Moldovan companies must understand that creating powerful brands means diminishing risk and obtaining higher profits,” added Ms. Stici.