What Made in Italy Means

Prato sits twenty minutes from Florence and it used to be one of the most important textile towns in Europe. Wool, specifically, and in particular recycled wool: Prato built an industry on taking old garments apart, re-spinning the fibre and selling cloth, which is worth remembering when you get to the recycling lesson in the next book.

Since 2000 the number of Italian-owned textile firms in Prato has roughly halved. Official employment in the sector fell by about the same proportion. The town that exported cloth to the world became one of Italy's main channels for cloth imported from China.

And in the same period, thousands of Chinese-owned workshops opened in Prato. Not mills: sewing workshops, doing *pronto moda*, which translates as ready fashion and means small batches designed, cut, sewn and shipped within days, to wholesalers and retailers across Europe.

Those garments are made in Prato. Which means a great many of them can lawfully carry a label saying Made in Italy.

This is the part that people find hard to accept, so it is worth being precise about the law rather than indignant about the outcome.

Country-of-origin rules exist to allocate tariffs. They answer one question: in which territory did the goods last undergo substantial transformation, meaning the step that turned them into a new article of commerce. For clothing, cutting and sewing cloth into a garment is normally that step. Italy's 2009 rule tightened matters further, requiring that the product be designed, processed and packaged on Italian soil.

Notice what is absent. There is no requirement about the nationality of the workers. None about their wages, their hours, their contracts, their training or how long they have been in the country. There could not be, because origin law is customs law and labour conditions are labour law, and the two were never joined.

So the label is a true statement about geography that readers routinely interpret as a statement about craft, and the gap between those two is a space a brand can stand in without lying.

Prosecutions in the Prato area have been real and they have been about something else: tax, undeclared work, unsafe premises, and goods actually manufactured abroad and relabelled. The ordinary case, a workshop in Tuscany sewing in Tuscany, is not a fraud. It is the system working as designed.

Now the commercially interesting question, which is why production moved towards the customer rather than towards the cheapest labour.

Because speed is worth more than price when you are guessing at demand.

A buyer who commits to twenty thousand units from Asia must decide six months out, pay freight, and own whatever does not sell. A buyer who can order a thousand units from a workshop two hours from the warehouse decides this week, sees what happens, and reorders the ones that moved. The second buyer is wrong less often and holds much less dead stock, and that is worth paying a higher unit cost for.

This is exactly the logic of Zara's retained European capacity, and exactly the logic of a small brand paying a local screen printer more per shirt in exchange for being able to change its mind. Prato is that principle at industrial scale, in a town that already had the skills, the buildings and the logistics for it.

What it cost is the uncomfortable part. The speed premium did not go to the old Prato mills, which were set up for long runs of fine cloth. It went to whoever would turn work around in forty-eight hours, which in practice meant whoever would work the hours, and the label does not record who that was.