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Peru Translates Textile Heritage into Sustainable Positioning

Apparel sourcing strategies in recent years have largely centered on seeking low-cost production. But rather than competing on pricing, Peru is taking an alternative approach to differentiate its textile and garment industry.

While Peru has long been a go-to sourcing partner for high-quality garments, the country’s government and the private sector are joining forces to give the four-year-old Peru Textiles label a rebrand inspired by history. Peru has been in the textile business for millennia, and the nation is well known for natural fibers including alpaca and Pima cotton, as well as craft. Now, Peru Textiles’ value proposition is expanding to include sustainability.

“We have an ancient textile heritage in Peru,” said Mario Ocharan, director of exports of PromPeru, the nation’s export and tourism board. “One thing that our textiles have in common now with those 5,000 years ago is that they were really sustainable.”

During a discussion with Sourcing Journal president Edward Hertzman, Ocharan and Rizal Bragagnini, executive director of the Peru Textiles Exporters Association, explained the rebranding effort.

The process began with a benchmarking exercise that pointed to Honduras’ success story. Peru decided to follow the Central American country’s playbook by enlisting consulting firm McKinsey & Company and establishing an exporters association. Knowing that competing on low cost was not a fit for its apparel sector, Peru asked McKinsey to help it determine how to differentiate itself. This work identified five sustainability pillars where the country’s garment industry can take a leadership role: energy, water, carbon emissions, production and labor.

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“We will never be the biggest, we will never be the cheapest supplier in the world, but we can be the best,” said Bragagnini.

Peru is aiming to become the most sustainable apparel production market in the world by 2025, at which point it also plans to have scaled its exports to $2.1 billion, returning to volumes last seen in 2012.

As it works toward these goals, the government is putting an emphasis on collaboration and shared costs along the supply chain to make sustainable production viable. “The world is driven around pricing, and we cannot charge the full price of sustainability to the end consumer,” said Bragagnini. “And that’s why we want to work together with the value chain to make sure that we can do this competitively.”

Involving all parts of the value chain, including both businesses and communities, also enables Peru to have more visibility from the raw materials stage. Peru has an added advantage in sustainable oversight courtesy of its vertically integrated production. “Transparency is the new value of the Peru Textiles brand,” said Ocharan. “We aim to have full traceability of our products from the fiber on the fields to the garment at your door.”

Click the image above to watch the video to learn more about how Peru Textiles is approaching sustainability and the mindset shift that needs to happen in fashion.