Sunday, March 16, 2008

Globalization and Italy's "Globali Tascabili"

Wedding-dress makers in Putignano, Italy (pictured above) were supposed to be globalization's first victims. Most of the factories make only a few thousand dresses a year, luxurious creations that sell for around €5,000 apiece (about $7,500). The seamstresses who stitch garments by hand enjoy traditional Italian perks such as two-hour lunch breaks and four weeks of paid vacation, and earn competitive salaries.

But many of these companies have become globalization's unlikely winners, managing to expand their sales abroad as their share of the Italian market shrank. It has meant moving into new and sometimes uncomfortable territory. "It would have been ideal for us to stay here, where we speak the language, where we know the customs," says Mr. Lippolis of Giovanna Sbiroli. "For us, it didn't work out that way." Today, Giovanna Sbrioli exports to 18 countries, and foreign sales account for 30% of its business.

Giovanna Sbrioli's evolution is part of a broader transformation of the Italian economy, as its small, specialized and family-run makers of wares from women's stockings to wooden furniture have turned themselves into globali tascabili -- so-called pocket-size global firms that aggressively market their Italian craftsmanship and style. Once thought too small to survive in a global market, these companies have carved out niches around the world. According to the latest available figures, Italy's share of the global export market rose by 6.1% in the first half of 2007, compared with the same period a year earlier.

Comment: What a great and fascinating story about globalization and the significant challenges AND opportunities created by world trade, even for these small, family businesses in the remote hilltowns of Tuscany. Read the full WSJ story here, and read some interesting comments about the story at the Evolving Excellence blog here.

Thanks to CD commenter Ken for the pointer.


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