Watch the video below to see the journey of Kasperi - from European vegetable-tanned hides to probably the most durable backpacks in the world. All Kasperi’s are made locally in Finland, because we believe this is the way to make world class products that establishes the gold standard of a sustainable products that last for life.
This article will expand upon the current state of and the future role that local manufacturing will play in a transition to a sustainable future.
Hand-crafted in Finland - but at what cost?The reality for many European design brands is that local production is not feasible. The sales margins are not big enough for retailers, nor are they big enough for the brands themselves. The simple act of "reshoring" production without a vision is a fool's errand.
A challenge for local production can be in the scalability of specialized hand-craft. If a brand outgrows the capacity of local production, it may face a bitter reality. A part of the established production might have to be moved abroad, or the brand will hit a glass ceiling or worse. Thus, if the intentions and actions of a brand are genuine, we do not think producing locally is an absolute value to adhere to.
Visions for the future - reimagining local manufacturing
For local production to make sense, it needs to evolve into something more. Something that delivers a new vision, new value. In the US, terms like newshoring or nearshoring have been introduced to mean creating something new instead of just reshoring old production. That work of redefining what it means to produce locally is still in its infancy.
For us, that new vision - and those new values - are as clear as day. Locally produced goods will be the ones to set the bar on what consumer products need to look like for a sustainable future. Locally made products need to have the power to change the way we consume.
To achieve these values, local production needs to be seen more as a partnership rather than a supplier. Only a joint vision, alignment and efforts with the producers can lead to the continuous improvements and innovations in the product that can deliver on those new values. Products designed with superior quality, durability and repairability, products with ethical and sustainable supply chains.
Local production leads to sustainable, better products
It is a valid question to ask what do these things have to do with local production?
The expectations, realities, and strengths of local production align with creating sustainable products. Because higher cost leads to more expensive goods. And more expensive goods could never survive in the market if they were not superior. Being radically good is vital for a brand that strives for international success yet produces locally.
While it's possible to create sustainable products abroad, the incentives at play can push brands in another direction. Producing abroad makes competing with prices feasible. It also makes producing high-cost and quality goods riskier. Thus brands that have offshored production are unlikely to gravitate towards maximizing impact.
The challenges and opportunities of a direct-to-consumer business model
For a sustainable future, radical changes to how companies operate need to happen. For instance, if we want local production to develop in the Nordics, we need to sell direct-to-consumer. Direct-to-consumer makes it possible to create products with outstanding quality as retailer margins can be bypassed. Yet, it introduces significant new challenges. Lacking the support of retail networks, the brands are all alone at creating visibility. In this reality a superior product is a prerequisite, but still not enough. A brand will only flourish with stellar brand communications, media and influencer relations, and digital marketing.
Yet, the risks, courage, and persistence required are so significant that we can not afford for them to go unnoticed or we risk them not happening at all.
Within Direct-to-Consumer brands there is a clear division. On one hand, there are companies that use the opportunities provided by the new business model for creating better, more ecological and ethical products. On the other hand, there are companies that use the possibilities provided by this model to maximize profits, further exacerbating over-consumption, sometimes even using an ethical message as a smokescreen for their real intentions. Thus it is often up to the consumer to check whether the brand is actually striving for change or not.
A sustainable future needs responsible investors on its side
The opportunities of direct-to-consumer brands have also lured investors into the emerging industry. The typical pitch for such a brand is a shot at "disrupting traditional fast-fashion or retail." Yet challenges lie in the incentives created by outside investment and the growth objectives.
Venture capital can at best be "impact investing" enabling a change the world needs to see. But at its worst, it can corrupt a vision of creating something good for the world into creating something of yesterday, producing disposable goods, and maximized profits.
Cultivating a sustainable business is a process that takes vision, courage, and determination. But it also needs support. If you want to support brands that strive to create a better world, invest in their products and spread the message. If you're a media, influencer, or impact investor, contact us.
The path forward is a shared path
We want to thank Jani Niipola, a Finnish journalist for opening up this conversation in the Finnish media. In his two columns, he articulated a notion of "Made in Finland 2.0" that contains the call to redefine the values behind local production. This article is our take on those ideas.
Jani also highlighted other Finnish design brands who are part of this same movement. Those brands are Saima, Nordic Matter, Myssyfarmi, Tarvas footwear, Lapuan Kankurit, éN Hats ja Teatiamo. Go check them out.