African fashion is growing in popularity, sparked by both an intercontinental rise of Afrocentrism and changing perceptions of the continent. Fashion designers, both in Africa and abroad, are leveraging rich histories, cultures and fabrics to create unique styles. Yet designers living and working in Africa often struggle to find a sustainable local market.
The African Development Bank is hoping its Fashionomics initiative will boost the textile industry and create structures to enhance the livelihoods of the countless youth and women employed by this sector. Fashionomics centers around an online platform that serves as a database and networking site for designers, buyers, retailers, suppliers, donors, and end-consumers. The initiative also seeks to reduce logistical and operational deterrents, exploring partnerships with shipping companies and standardizing practices by providing skills training.
Devex spoke with Emanuela Gregorio, the AfDB economist and gender specialist who championed the undertaking. The initiative targets an industry with an estimated $15.5 billion in revenue and presents a large potential for growth and job creation ability, she told Devex. Our conversation below has been lightly edited for length and clarity.
What is “fashionomics”?
We are targeting African SMEs operating in the textile and fashion sector. We are looking at this sector because, after agriculture, the textile and fashion industry is the one that employs a majority of women as a workforce. Fashion is at the very end of the value chain so it is a very attractive way to gain attention. While we are looking at this through an inclusive approach, including men and women, we have a special focus on empowering women and helping them to access resources.
Raising awareness in the sector, even to get a buy-in from the bank, was a bit difficult. This is a nontraditional sector for the bank, where 70 percent of our resources go to infrastructure development. It was a way to rethink development and also look at sectors that youth are very attracted to. Now the priority for all the development agencies, as well as governments, is job creation and especially youth employment, because there’s a huge gap there. This is where the public and private sector failed. Now it is imperative to help those in the informal sector to merge with the formal sector.
The needs are huge, of course, and we decided to develop an online platform to bring together all the different stakeholders to give visibility to the sector. There’s a huge lack of data, and this is also impacting the risk takers. There are many investors looking at this sector, but they don’t understand it because they don’t have enough data to lower and assess the risk.
We decided to do a feasibility study in Ivory Coast and Ethiopia, to do a comparative analysis. Both countries have a dynamic fashion sector, both countries have raw materials — cotton. We came up with recommendations that have been translated in this prototype platform. The idea is to create a database of entrepreneurs, suppliers, retailers, buyers, investors and financiers that are looking at the sector and are interested in having access to information. We also want to provide access to markets. That’s why in this first phase, we wanted to develop a minimum viable product, to develop a wholesale and retail platform. We believe that, thanks to the platform, the entrepreneur will manage to grow their business.
[This is] the online platform aspect of the Fashionomics initiative. There is also the offline work that needs to be done to really create this enabling environment so the bank can work with the governments. We are receiving funding proposals from governments in Kenya, Ethiopia and South Africa, for example, to develop production facilities or fashion hubs where entrepreneurs can cluster together, share equipment, reduce operational costs and also create those market linkages that they need to place their products.
How can this initiative assist entrepreneurs increase their trade and brand recognition?
Logistics is a big issue in Africa. It is cheaper to bring a container from Milan, Italy, to Dar es Salaam, Tanzania — something like $2,000 — than from Dar es Salaam to Lusaka, Zambia, which is $7,000. I find this a bit criminal.
We have to create incentive systems. Why should they use this platform and not another one, for example. There’s not such a pan-African fashion platform for this sector. And not only African, I haven’t seen to my knowledge, anything like this in Europe or the U.S. The initiative reminds us that Africa can do things differently, not only follow the lead of others.
Our idea is also to do a study to determine how to develop partnerships to logistic companies, like DHL and FedEx, to say, those who are users of the e-commerce platform can also lower the costs of their transport. It’s not rocket science or impossible, but that’s one of the biggest issues. Even if they have skills, they will have access to funds and so on, but when it comes to trade and logistics, this is where the big issues come in.
Most fashion designers in Africa are small business owners who sell to a small, local market and may not have access to the online platform. How can these entrepreneurs benefit from the Fashionomics scheme?
Internet penetration is increasing. Many have a mobile phone, and more are having smartphones now. Our way of trying to succumb to this issue is to create a mobile app that works offline, because it might be that people don’t have a laptop, but they do have a mobile phone.
And again, the online platform is a way to generate visibility. It’s a living story, because you are generating data. We managed to have baseline values and indicators de-segregated by sex and age. It’s a way to collect data for us and then to interpret, because knowledge is power.
It’s also about the offline work. The way we always do business is that we are supporting governments to increase capacity, develop infrastructure and reach out to the bottom of the pyramid.
What are some other challenges for this project and how can members of the development community get involved?
The challenges are many, and they are all related to the lack of data available and lack of infrastructure for designers to improve their productivity and education. There aren’t many fashion-related schools or vocational training centers to help these entrepreneurs to succeed.
It needs to be a holistic approach, of course, because it’s not just about access to finance. Sometimes, even if the entrepreneurs have access to finance, they are not able to absorb it because they don’t have the capacity. This all starts from being able to develop your business plan, keep your books in the right way, and so on. What I would say to all local partners out there is that the bank intends to forge strategic partnerships, because we cannot deliver on these ambitions and agenda alone. We are looking for those that can help us create this enabling environment in this sector, specifically to help it develop.
There’s no doubt that African fashion has been gaining international attention in developed countries. Why now for this initiative?
I believe it's time. We also want to promote Made in Africa brands. What's also happening now is that there are big manufacturers that were present before in China and India and Cambodia and Turkey — they're all looking at the continent, because their cost of production is increasing, their domestic economy is expanding, and the cost of labor is increasing. They are already localizing production. This brings an opportunity: there's a transfer of know-how, which is a good thing. But at the same time, they operate for exports only, so very little value added stays in the local economy. What we are doing at the African Development Bank is to integrate African economies and develop local private sector.
We all have this obsession to reach international markets, and I understand that, but there is a growing middle class in Africa. They need to, first, be able to serve their local markets. To do so, before they can reach the global market, they have to improve their quality and level of productivity of their garments. Many times when talking to these entrepreneurs, they told us they cannot reproduce the same t-shirt at the same size, so there’s an issue of standardization also.
The beauty of using culture as an asset is recognized, but now it’s about, how do they become more competitive. First, serve your local markets because there is a middle class that wants to pay for your beautiful products. There is a big momentum to invest in fashion in Africa because there is a huge room for improvement and for growth.
Read more international development news online, and subscribe to The Development Newswire to receive the latest from the world’s leading donors and decision-makers — emailed to you free every business day.
