Why Dutch brands should choose to produce in Portugal

Made in Europe’ is hot and we can see why. Made in Europe’ stands for European regulations regarding working conditions and therefore less abuses in the field of (un)ethical production and because the production takes place locally, there are fewer CO2 emissions involved in transportation. Portugal is gaining popularity with more and more Dutch and other European fashion companies. Why is that? And what are the advantages and disadvantages? 

During the event ​“NEAR SHORING in Fashion and Textile” organized by Roosmarie Ruigrok from Clean&Unique in collaboration with the Dutch Embassy in Portugal, a conversation took place between a.o. Maurice Melenberg (Embassy of the kingdom of the Netherlands), Roosmarie Ruigrok (Clean&Unique), Braz Costa from CITIVE, Rick Schurink from TEXET bv, Geesje Mosies from Hoooked and Daan Ubachs from Unrobe. If you also want to localize your own chain to Portugal or are just curious about their experiences, then read on!

Dutch interest in nearshoring

Dutch fashion companies’ interest in the possibilities of ​‘near-shoring’ to Portugal is increasing. Near-shoring is a trend in which fashion companies are starting to produce closer to home. This is becoming increasingly attractive, partly due to the corona crisis, rising costs in the Far East and the need of consumers for frequently changing collections. 

Esra Sen, ambassador of the Netherlands to Portugal said in the roundtable discussion that ​‘nearshoring’ can play a role in the road to a circular economy. ​“The Netherlands wants to have a circular economy by 2050 and in a circular economy circular textiles are an important part. Portugal and the Netherlands have a common denominator, they are both ambitious when it comes to sustainability.” Sen sees an increase in companies interested in Portugal. ​“The Netherlands is the seventh largest importer of Portuguese textiles. That amounts to 5% of Portuguese exports.”

Maurice Meulenberg of the embassy adds, ​“People are looking into Portugal for (sustainable) production facilities for decor and textiles, among others. It is important to bring parties together to discuss the possibilities for Portugal and the needs of the Netherlands.”

Social and environmental responsibility

Roosmarie Ruigrok, founder of Clean & Unique, an on- and offline platform for sustainable fashion brands, designers, experts and suppliers, has seen accountability become increasingly important over the past 20 years. ​“It’s a big job. Many people are looking for simplicity, social responsibility and circularity. Often with circularity there is a focus on materials but social responsibility is also very important.”

Ruigrok cites a key advantage to nearshoring. ​“When you send an order sheet to Asia, chances are you don’t know what happens next. If you produce closer it is easier to keep an overview of the production.” Other benefits she mentions are that you have a lower carbon footprint if you produce in Portugal. It provides both social and environmental benefits. 

“Good matchmaking”, she adds, ​“is also important.” ​“The textile industry is different from other industries. Everyone has different production facilities because different techniques are needed. It is essential to build relationships with producers.”

You receive quality working conditions in exchange for the price difference

Daan Ubachs, founder of clothing brand Unrobe, has been working in the fashion industry for a long time with a focus on Asia. With his own label Unrobe he wants to do things differently, which is why he now produces in Portugal, Italy and Greece. ​“In the beginning there was a big price difference between Asian and European prices, it’s a premium price you pay here. The salary is higher in Europe and therefore the costs are also a bit higher, but you get something in return, there are better working conditions here.”

Ubachs believes in long-term relationships with suppliers. ​“The nice thing about producing in Portugal is that there is a short supply chain and people know a lot about textiles. All types of production sites such as textile mills, weaving mills and dye houses are close together. That makes it easy to check the factories, besides that the factories often have their certificates in order.” And that is important, says Ubachs. ​“The demand for sustainable clothing is growing. Each of our products has a QR code attached to it that leads to more information about the product, we do that to increase transparency.”

Transparency is everything

CITEVE is a Portuguese technological institute that provides technological support to companies operating in the textile and clothing sector. Braz Costa of CITEVE says that sustainability is no longer a philosophy, but a business. ​“Most companies now have a sustainability strategy because they know that the opportunity to improve will not arise again.”

Transparency is everything, he says. ​“There’s very little information on product labels, and it’s hard to expect customers to choose sustainable products when little information is available. Sustainability is a big investment, and it’s a balance between all kinds of aspects.”

Costa’s goal for the future is to produce with post-consumer and local materials. ​“It’s not sustainable to buy cotton from faraway countries like China. We have set up a program to start sourcing it locally.” He says there are some conditions for that, though: ​“We have to take into account the combination of fiber production and agriculture in the same area, among other things because of the water consumption. We need technology and a mindset change, a crossover between science and this industry.”

In addition to the many advantages to manufacturing in Portugal, Costa says Portugal finds it difficult to bring out its expertise. ​“The Portuguese industry is not the best is in terms of marketing, but there is an industrial culture.”

Rising container costs

Rick Schurink of TEXET, a supplier of quality workwear, workwear and promotional textiles, says Asia is more advanced in terms of sustainability but Portugal is attractive because the supply chain is stable. ​“We are willing to pay more for it but it is a competitive market, so price does always play a role.”

Schurink says that at the moment, it is also financially attractive to produce close by anyway. ​“Container costs are rising so shipping from Asia is becoming more expensive. Another plus is that the travel distance is short. If something is wrong you can travel to Portugal more easily than to Asia.”

Cultural differences

Geesje Mosies of Hoooked works with a Portuguese recycling center to make Hoooked’s post-consumer recycled (cotton) yarn. Hoooked also has yarn made from natural materials such as jute and eucalyptus. Hoooked produces in Portugal so they can properly check the textile origin, quality and working conditions.

Mosies says there are cultural differences between the Netherlands and Portugal that you have to take into account. ​“There is a difference in approach, think for example that people in Portugal will not answer the phone during their lunch break. The great thing is that there has always been a kind of recycling mentality in Portugal, they make handicrafts from carpets, for example.” 

She also talked about production costs. ​“Producing in Portugal is cheaper than producing in the Netherlands or Spain, but costs are rising. In addition, labor laws are different, overtime quickly becomes a high cost.”