Problem: Regional textiles are rare and could be used to make luxury fabrics; however, many regional farmers do not have networks to international fashion houses.
Solution: I’ve recently become increasingly fascinated by hyper-localization. What do local peoples eat? Where do they source their ingredient? How do they build their houses and with what materials? What clothing do they wear and how do they create these fabrics? This rabbit hole of hyper-specialization has helped me learn about local fabrics I’ve never heard of: Lotus Silk, Persian Sheep’s wool, Pineapple Fiber, and many others (some of which have been categorized in Business Insider’s series, "So Expensive”).
Given the rise of sustainable fashion and ease of international transport of goods, this business would focus on scouting the most unique discovered (and undiscovered) fabricing and clothing making techniques to bring them to the runway of luxury.
In 2010, The Wall Street Journal wrote an article explicitly about the “New Luxury Frontier” with a focus on Lotus Silk. As Christina Binkley writes,
Regional textiles are increasingly rare. Most of our clothing comes from familiar sources—cotton, linen, silk, wool and man-made fibers. Yet in the Philippines, traditional blouses are made from pineapple fiber. In Scandinavian countries, stinging nettles produce fibers that resemble linen. In Japan, special kimonos are made from banana plants that have been nurtured to be especially tender, says Desiree Koslin, a professor of textile structure and analysis at Fashion Institute of Technology in New York. There is even silk taken from spider webs, rather than silkworm cocoons.
It's often difficult and costly to translate traditional fabric-making techniques into mass production. Dr. Koslin says banana fibers must be painstakingly spliced together, rather than spun into thread. There is a more disturbing downside to the making of black-market shahtoosh shawls, for which the endangered Tibetan chiru antelope are killed.
This business would find out these local textile producers who often have untransferable, un-machine-able knowledge and connect them to mass (higher-paying) markets. As I see it, it’s a natural arbitrage opportunity that has been created through historic limitations like travel time, difficulty of insuring quality, and lack of distribution. All of these problems can be solved today with technology, the internet, and quality-assurance techniques like videos or chemical testing.
These boutique and regional textiles are not easy to make, however they have outsized impact on regional economies. Let’s start with the facts of a Lotus Silk Scarf:
Timing: The lotus silk scarf needs 9200 stems to make. A skillful worker can only make fabric from 200 to 250 lotus stems a day. On average, lotus silk scarfs takes two months to make.
Economic / Environmental effects: As reported by local Lotus Silk makers, this industry has many benefits: (1) it creates income from lotus planters, (2) it creates more local jobs, and (3) it helps reduce environmental pollution (the lotus stems which are supposed to be thrown away can be used to create beautiful silks). Harvesting lotus silk is not only environmentally beneficial (it finds use of out wasted resources), it is also bringing jobs and prosperity into Hanoi especially since designers have started using the lotus silk fabrics in their creations.
Pricing: Regular silk scarfs costs about 20 dollars, but a scarf made of lotus silk can fetch as much as 200 dollars.
Rarity: Lotus silk is made in just a handful of countries such as Myanmar, Cambodia, and Vietnam. It is a traditional handicraft of the lotus farmers of Vietnam.
You can learn more about the Lotus Fabric in this Business Insider Report or this WION News Report.
The aim of this business would be to empower local farmers by co-opting the luxury fashion and luxury fabric markets.
The industry of Luxury Fashion is huge: according to GrandView Research, “The global luxury apparel market size was valued at USD $67.85 billion in 2018 expanding at a CAGR of 3.5%.” Statista is even more bullish, arguing that “Revenue in the Luxury Fashion segment is projected to reach US$107,969m [$107 billion] in 2021. The market is expected to grow annually by 4.8% (CAGR 2021-2025).” For more on the market, I’d recommend Bain’s 2018 Luxury Goods Report.
Monetization: Revenue from connecting manufacturers to farmers or a percentage of sales made from local farmers.
Contributed by: Michael Bervell (Billion Dollar Startup Ideas)