Guus Backelandt is the mind behind Grosso Moda. The CEO, majority shareholder and founder of the group is someone who looks for challenges, and the fashion industry is a demanding task. “In the automotive industry, there is cooperation,” he explains. “Competitors do combine each other’s components. There is no such cooperation in the fashion industry.” Nevertheless, he decided to tackle this business early on in his career.
“I used to study commercial economics in the evening and worked at a fashion company during the day,” he recalls. “I used the time to research how to outsource production to Eastern Europe. When I finished my studies, I set up Grosso Moda. I was curious about having that kind of company, and clothes are always necessary."
The company was legally established in 1991. By 1993 it was fully operational. “In the old days, creativity was enough for success and the margins were high enough to finance your learning curve,” Mr. Backelandt points out. “Now it is different. You have to be good at everything.”
Everything means, in Mr. Backelandt’s case, that Grosso Moda manages the whole supply chain from design to shop floor delivery in different regions and for both women’s and men’s clothing. “Light wovens, suits, outerwear,” lists Mr. Backelandt. “We work with all woven fabrics, in different regions and different categories, all with specialized departments. It is necessary to think big and act small. In the end, itis all about people and cooperation.
Clients want us to integrate, and that requires transparency. We work almost against the grain in the fashion industry because it is basically design-driven.” specialized in ‘smart casual’ and classic ‘city’ clothing, the company works for brands as well as for retail clients. “What connects it all is my fascination with know-how,” Mr. Backelandt says. “I’ve collected around me people that have expertise in different areas: pattern development, designing, fabric development. It all starts with the mix, and things evolve from there. Managing that complexity is my fascination. It is about repetitive production, but combined with open-minded creativity. Fashion changes every month. We deal with so many different suppliers, developments in fabric, geographically widely spread locations–managing all that to get the right result is quite a difficult challenge.”
While the company headquarters of Grosso Moda are in Doorn, the production head office is in Ukmerge in Lithuania. There are also sales and design departments in the Netherlands and Germany. 250 employees work at the production sites in Lithuania and Russia. An additional 175 work in offices in the Netherlands, Germany, Lithuania, Ukraine, Belarus and China.
“It was nice to have production closer to home,” Mr. Backelandt admits. “But the pressure of lower margins was too high. That kind of flight, quite literally, to lower wages is impossible now. It ends in Asia. The fashion industry should strive for increased efficiency.” Grosso Moda itself has always been a forward-thinking company which has a keen eye on the social aspects of producing abroad. As a BSCI member, it is audited and certified for social compliance.
“It is most important to have continuity,” Mr. Backelandt points out. “And that also includes taking good care of the production staff, no matter if it is your own or outsourced.” That might explain why Grosso Moda works like a very well maintained machine. “We integrate into the process of our clients in terms of efficiency, cost and speed,” Mr. Backelandt emphasizes. “And we integrate into the supply chain, combining close cooperation with control in order to get reliability. We cannot wait for what the quality of a fabric will be when it is finished, so we cooperate with a quality control agency like Buro Veritas and visit our suppliers for quality checks during their production process. Reliability is the most important aspect of all, to get the right product at the right time in the right place with the right quality for the right price.”
In this case, quality is not just about the excellence of the products, but also about timely processes. “Speed and just-in-time delivery are important,” Mr. Backelandt emphasizes. “We set up a fast track company, Cum Laudy BV, to be able to realize delivery times of four to eight weeks. It is growing fast because retailers want to react quickly to trends in the market, especially nowadays with the growing competition of online sales. They want to react to consumers outside of collections.”
The industrial foundation combined with the know-how in fashion and the processes behind it make Grosso Moda a stable, reliable and professional partner. To realize these high standards, the company regularly invests in both staff, educating the employees in the different processes, and production. “We have 35 people from Eastern Europe and China, who are highly educated in (digital) pattern designs,” Mr. Backelandt points out. “We educate them to work independently with clients. And we invest in our own site as well as sites of our subcontractors, improving machines and support, technical know-how and maintenance.”
The last big investment was for a new integrated computer system. “NAVISION brings it all together,” Mr. Backelandt explains. “Based in the head office in Lithuania, it required quite a lot of us, but it offers the potential to control all processes and even more transparency for our clients.” Financially, Mr. Backelandt can rely on ING as trusted partner. “ING understands us,” he stresses. “But the pressure is getting higher. New ways of financing are needed, looking at other industries. Banks in general could play a different role in financing the supply chain. Retail and brands should be more involved in financing the working capital, that will be unavoidable. ”
Grosso Moda works for clients in Europe as well as Canada. “Germany is important,” Mr. Backelandt reveals. “The Netherlands are, as well, and of course the brands we work for are international brands. At times we deliver to countries to all over the world – which adds a logistic puzzle to all the other complexity.” Recently Grosso Moda started cooperation with Hugo Boss. “That is a professional company with a strong production foundation, as well,” Mr. Backelandt praises. “For the future, we are looking for serious opportunities of integration with other clients, but also into the chain.”
In this cooperation Grosso Moda will take care of concepts, give design input and provide the supply management. Working for other companies instead of founding its own label has its own challenges. “Marketing B2B is basically the achievement itself,” Mr. Backelandt points out. “Every order is a test. What we did is not important; what we are going to do is. This means that we sometimes have to confront our clients about what they are doing when mutual goals are at stake. That is our responsibility. We do whatever it takes to deliver what the client asks of us.”
A new development in demands is the social aspect. “We, as well as our clients, are now very stringent in this aspect,” Mr. Backelandt notes. “We are trendsetters in this regard, since we have always observed social compliance. Nobody really expected this to be a big issue so soon, and all of the sudden, it is very important. Companies, like the one in Bangladesh, have collapsed before, but it was a short article in the paper that no one noticed. But now society has become more reflective and is asking more critical questions, and that is justified.”
Another change in recent years posed the difficult economic situation. “We cannot underestimate the impact of that,” Mr. Backelandt emphasizes. “It takes time to overcome, and there has been and will be a selection in the fashion industry. But every true entrepreneur is better because of the crisis. There has been unrealistic growth, but now there is more room for controlled entrepreneurship.”