Revealed: the Romanian site where Louis Vuitton makes its Italian shoes

3000Louis Vuitton’s Italian shoes are the very height of luxury. Its Venice workshop claims to embody “ancestral savoir-faire” in a region “revered for its fine shoe craftsmanship”.

It is an image burnished by one of the biggest advertising budgets in the world. The Louis Vuitton Moet Hennessy (LVMH) luxury group spent $4.4bn (£3.45bn) last year on marketing its portfolio of top labels, which range from Moet & Chandon champagne to Givenchy, TAG Heuer and Louis Vuitton shoes, adorned with the LV logo that is a global badge of wealth.

This is, however, far from the full picture. Many of the shoes and boots it sells for between £500 and £1,800 a pair and stamped as “made in Italy” are mostly made in Transylvania, a region better known for vampires than any tradition of luxury craftsmanship.

The factories are a well-kept secret, their identity closely guarded. The management says it has taken pains to ensure they do not turn up in a Google search. On the outside there is no mention of the brand – just a shadow of the Louis Vuitton checkerboard print, painted in grey on the factory walls. The name on the gate is Somarest, a little-known LVMH subsidiary.

A French TV documentary team was turned back at these gates in 2014. Anonymous workers said entire shoes were made in Romania before being sent to Italy, where the soles were added. Bernard Arnault, LVMH’s chief executive and France’s richest man, rejected the claim.

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(Louis Vuitton’s factory in Cisnadie, Romania)

Now the Guardian can report from inside the factory for the first time, and can confirm that thousands of Louis Vuitton shoes leave their doors every week, complete in most details apart from the soles.

When first contacting Somarest, the factory’s communications officer hung up at the mention of Louis Vuitton and did not respond to any further attempt to contact her. Emails were forwarded to the head office in Paris. “We don’t open the doors of our workshops due to internal policy,” the company said.

But Louis Vuitton has not been able to prevent clues about its Romanian operation from leaking on to the internet. A painstaking search through Romanian websites, including staff selfies on Facebook, eventually led to the factory door.

Once you pass security and the cypress trees that stand sentry at the door to the Somarest factory in Cisnadie, a small town at the foot of the Southern Carpathian mountains, Louis Vuitton is omnipresent. At the top of the stairs is a glass case holding a pair of heritage leather boots embossed with the LV logo. They retail for $2,000. On the wall behind is a gallery of handbags on glass shelves.

At the centre of the room is a trunk, a piece of the brand’s history. Louis Vuitton made a name for himself creating these trunks for aristocrats in the 1850s. Today they are made to custom order on the outskirts of Paris, and cost upwards of $30,000.

Exclusivity did not, however, make Louis Vuitton the 20th most valuable brand in the world. In the 1980s the company expanded to cater to a growing middle class, and now the brand makes most of its revenue from selling large amounts of product to the middle market.

As a business model, mass-produced luxury has made Louis Vuitton so successful that it has now acquired 70 luxury houses. Just a few weeks ago it took control of Christian Dior.

To keep profits high, the company had to lower production costs. This is what led it to Cisnadie, a pastel-hued town where EU flags fly from the lampposts along the main street. At one end is the kind of fortified church for which Transylvania is famed. At the other end is the Somarest factory.

LVMH established its first plant here in 2002 to make the most of Romania’s low-wage labour. By 2004, it was producing 1,500 pairs of shoe uppers a week, according to the online CV of the company’s director at the time.

Somarest was not willing to discuss how many shoes it currently produces, but the online CV of its operations manager claims production has increased 70% since 2007, which suggests annual output of well over 100,000 pairs. A second factory was built in nearby Avrig in 2009, also to make components for handbags and suitcases.

A spokeswoman for the factory finally agreed to meet to discuss details of its production. Senior managers, she said, are French and the materials used are likewise imported from France. After assembly, she explained, the factory exports the goods to France and Italy, where they are “finished” so that they qualify for a “made in France” or “made in Italy” label in accordance with EU law.

The European parliament voted for compulsory “made in” labels in 2014 to untangle the knotted thread of globalised production. For goods produced in more than one country, the country of origin is the one where the items underwent “the last, substantial, economically justified processing”. Accordingly, the soles of the shoes are always added after they are exported.

The Romanian factory affords visitors both a real and metaphorical window onto the production process, as a glass wall opens up the offices to the factory floor.

Beyond the window, the work environment is clean and bright and the staff work sitting down. “Here in Romania, these are things that the workers appreciate,” the LV spokeswoman said, referring to the poor working conditions elsewhere in the country that have led campaigners to describe Romania’s substantial garment sector as “Europe’s cheap sweatshop”.

“In Europe’s low-wage countries, workers rights and human rights at work are publicly a taboo and not protected at all,” said Bettina Musiolek of the Clean Clothes Campaign, which works to improve conditions in the industry.

Louis Vuitton’s factories give workers weekends off, pay for overtime and use non-toxic chemicals, the spokeswoman said, facts confirmed by the Inspectoratul Teritorial de Munca, the labour inspectorate in nearby Sibiu. Somarest is a point of pride in this community, the inspectorate made clear. “There have been no complaints, ” said Enciu Dumitru.

The factories employ 734 local people who, according to the spokeswoman, are paid average Romanian garment worker wages. According to Clean Clothes Campaign, that is about €133 (£116) a month. At that rate it would take a worker nearly six months to earn enough to buy a single pair of mid-priced Louis Vuitton leather court shoes.

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At such wage rates, garment production in Romania is cheaper than elsewhere in the EU, but lower prices do not mean lower quality, according to Ioana Ciolacu, a leading Romanian fashion designer. “Nor should it be mistaken for child labour, sweatshops and all those horror stories we hear now and then happening in let’s say China or Bangladesh,” she said.

The products at Somarest are moulded and stitched by hand, just as they are in Louis Vuitton’s advertisements, but the craft is not handed down through generations. Most of the workers are trained on site.

Ten years ago the brand opened a store in Bucharest . Shoes produced in Romania can therefore be soled and labeled in France or Italy and then sent back to the Romanian capital to be sold as goods made elsewhere.

The start of this process can be seen through the big glass window that overlooks the Somarest factory floor and the hundreds of workers inside.Visitors are closely watched, however, and it was a matter of just a few moments before a senior manager appeared to usher the Guardian away from the glass – and to direct the spokeswoman into an office for a conversation that appeared terse and stern. The factory visit then came to an abrupt end.

Source: The Guardian

 

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Bursa de Valori București a realizat Top 15 companii românești: Made in Romania


Bursa de Valori București (BVB) a anunțat oficial și a premiat cele 15 companii care s-au calificat în ultima etapă a proiectului „Made in Romania”, un proiect unic organizat pentru prima dată în istoria pieței de capital românești cu scopul de a identifica și susține viitoarele motoare ale economiei locale sau din regiune.

Conform unui comunicat de presa publicat de BVB, cele 15 companii care au ajuns în finală sunt:

2Performant Network – fosta ‘2parale’, business de marketing afiliat

Agricover – solutii inovatoare in agricultura, de la productie la finantare

Amber – companie de gaming

Autonom Rent-a-Car – liderul pietei de rent-a-car din Romaniamade in romania

Blue Air – cel mai mare transportator aerian cu actionariat romanesc

Cris-Tim – companie de top in productia si comertul produselor din carne

Electrogrup Cluj – lucrari de instalatii electrice

Good People SA – cunoscut datorita marcii si produselor din gama FruFru

Ivatherm – produse farmaceutice si cosmetice

IRUM Mures – fabricarea masinilor si utilajelor pentru agricultura si exploatari forestiere

Lasting System – Furnizor de solutii IT&C din Timisoara

Smart Bill – liderul pietei de facturare electronica

Softelligence – dezvoltator software

Prutul Galati – producator de ulei vegetal

Vola.ro – Agentie online de turism

În urma întâlnirii juriului au fost selectate 15 companii. Juriul a fost format din următorii experți, atât români, cât și străini: Lucian Anghel (Președinte, Bursa de Valori București), Răzvan Butucaru (Partener, Mazars), Radu Hanga (Director Executiv – Head of Group Management, Banca Transilvania), Candace Johnson (Președinte, European Business Angel Network), Dragoâș Petrescu (Fondator și CEO, City Grill), Florin Pogonaru (Președinte, Asociația Oamenilor de Afaceri din România), Rareș Rusu (Marketing Manager, Google), Ludwik Sobolewski (CEO, Bursa de Valori București), Iulian Stanciu (CEO, eMAG), Raluca Țintoiu (CEO, NN Pensii), Kurt Weber (CEO, Horváth & Partners) și Dochita Zenoveiv (Brand Innovator, INOVEO). Celor 13 companii selectate li s-au adăugat două firme care au fost votate de către publicul larg: Smart Bill și 2Performant Network. Publicul a avut oportunitatea de a vota compania favorită prin intermediul site-ului http://www.bvbeague.ro și aproape 11.000 de voturi au fost exprimate în perioada 8 -19 martie.
Cele 15 companii finaliste au fost anunțate în cadrul evenimentului „Made in Romania” de pe 3 aprilie la care au participat peste 100 de antreprenori și directori executivi ai companiilor românești, alături de membrii comisiei de nominalizare și membrii juriului. În cadrul evenimentului, două dintre companiile listate, Bittnet Systems (BNET) și Ropharma (RPH), au fost invitate să participe în cadrul competiției în calitate de experți.
Mai multe informații despre nominalizări, cât și date despre cele 50 de companii de pe lista scurtă pot fi găsite în broșurile special pregătite de BVB și disponibile AICI.