The fashion market in Prato, a town in Florence Italy, has become a place of opportunity for Chinese entrepreneurs and workers to branch out in. According to Marco Landi, president of the Tuscany branch of trade body CNA, stated that, "Italian companies can't compete on price, their strength lies in the area of aesthetics. As a result of backdoor globalization, Italian businesses are being forced to restructure".
According to bbc.co.uk, Landi also stated, "At the moment there are approximately 4,000 Chinese-run clothing factories in Prato. These new production dynamics are compelling the remaining Italian businesses based there to rethink their markets".
Before the influx of Chinese workers, thousands of Italian textile units produced cheap "Italian made" clothes from Italian-made fabrics but with the help of hired Chinese workers, according to bbc.co.uk.
Things have changed due to the Chinese setting up their own businesses and importing far cheaper fabrics from China. The Prato industrial zone now accounts for more than 30 percent of Italy's textile imports from China, according to bbc.co.uk.
Landi stated, "More than half of Italian-owned businesses in the industrial zone have gone to the wall over the past decade. There are now more Chinese garment manufacturers than there are Italian textile producers."
The Chinese are exporting millions of low-cost garments with the "Made in Italy" tag upon them and also increasing demand in Europe through cost-cutting, according to bbc.co.uk.
Chinese entrepreneur Xu Lin has also found an opportunity in Italy with his clothing business Giupel. Lin stated that he is already employing Italians as designers and in key factory positions.
Lin also stated, "If the Chinese weren't in Prato and the clothes were made in mainland China instead, the Italians would be suffering far more. We have helped the Italians by ensuring the Made in Italy brand is ever more popular in China".
According to bbc.co.uk, Xu Lin stated that while Italian companies cannot compete on price, they have other advantages. Italian companies invest heavily in technological research producing innovative textiles for the couture end of the market.