July 14, 2009
Just five years ago, market research predicted Macedonia’s apparel industry, which represented 30 percent of the country’s exports, would die out by 2008. It was a fate that could have been devastating for the low-tech, post-war country facing a dismal unemployment rate.
Then, in 2004, EDC engineered a project that not only helped to resuscitate the apparel industry but also develop its capacity to thrive.
“This project was a way to really help the apparel industry have a quick and significant yet long-term impact,” says EDC’s Janice Brodman.
EDC partnered with local entrepreneurs to create a for-profit apparel technology center called New Trend, which for the first time offered all Macedonian apparel companies access to computer-aided design (CAD) and computer-aided manufacturing (CAM) services at affordable prices.
New Trend is just one of six self-sustaining service providers, referred to as e-BIZ Centers, which EDC helped develop in Macedonia between 2004 and 2006. These centers, each specializing in a different technology service sector, aim to satisfy specific market needs in Macedonia, such as tourism and footwear. They were funded through a $3 million cooperative agreement from the U.S. Agency for International Development (USAID), which eventually grew to $6 million. In turn, the centers have collectively generated more than 1,500 new jobs, $1 million in matching funds from local entrepreneurs, and $9 million in foreign direct investment.
“Creating e-BIZ Centers, like New Trend, that continued to operate after we left provided real, lasting value to the country’s economy,” Brodman says. “The fact that this particular e-BIZ Center helped turn around an industry that was on the way out made it that much more important.”
In Macedonia (which is the size of Vermont, with a population of 2 million), there was little knowledge of the international marketplace. After quickly realizing that Macedonia couldn’t compete with low-cost textile manufacturing giants such as China and Bangladesh, EDC began to search for a market niche where Macedonian companies could be competitive. It was in fashion-conscious Italy where they found a demand for rapid-response manufacturing (i.e., the quick turnaround of orders).
“This was a good solution for small manufacturers in Macedonia that didn’t have the capacity to compete with the world’s largest manufacturers,” says Brodman.
Through a competition, a Macedonian couple Suzanka and Trajan Angelova—who at the time were in the apparel transportation business—were chosen to own and run the e-BIZ Center.
They named it New Trend.
EDC then launched a marketing campaign to spread the word about New Trend’s advanced technology services to Macedonian clothing manufacturers. It was the first time most manufacturers had heard of CAD/CAM services. Before long, Macedonia’s high value-added garments were competing in the rapid-response market.
“The goal was for the e-BIZ Centers to become profitable within a year after we left, so they would continue operating,” says Brodman. “When the project started, we thought if we provided real value to small businesses, our service centers would continue to operate after we were gone. It was really just a hypothesis.”
But it was one that proved successful.
Since 2004, when the project first began, the industry evaluations show a 13 percent increase in employment in Macedonia’s apparel industry and credit New Trend with making a significant contribution to that growth. This is a signal achievement in a sector that was, not long ago, considered on its way out. Additionally, during that five-year period, New Trend’s 4-person staff grew to 36, and many European companies now utilize Macedonia’s production capacities.
The Macedonian pilot program has been so successful that last winter it became a model for four new e-BIZ Centers in nearby Bosnia and Herzegovina, where rebuilding is even more challenging as the country recovers after a long and debilitating war.
And EDC’s efforts won’t stop there.
“We hope that USAID missions and donors in other developing and emerging countries will become interested in the model, so we can support similar activities in those countries,” says Brodman.
In the meantime, New Trend continues to thrive, most recently through the Angelovas’ attempt to explore the feasibility of offering the computer-aided design for car seats.
“The e-BIZ Center for the apparel sector—like the other e-BIZ Centers we established—has prospered and will continue providing valuable services that strengthen the competitiveness of small-to-medium-sized enterprises long into the future,” says Brodman.
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