Cloth Manufacturing – The Textile Industry in Albania

Home Industries Cloth Manufacturing – The Textile Industry in Albania

“Made in Albania” the new blooming market in Europe

Woman working in a clothing factory in Albania
Source: www.veerleluiting.com

In the recent years, Albania has had a ‘boom’ in the textile and shoe manufacturing, not only producing for the local market, but mostly partnering and exporting for some of the biggest European and U.S. brands like Zara, Gianfranco Ferre, U.S. Polo to mention a few. It can be an exciting venture, and less challenging compared to if you’re thinking about opening the same manufacturing factory in far Asia. We give you an insight how the clothing and shoe factories work in Albania, and pros and cons.

The textile manufacturing companies in Albania, pros and cons

The history of the clothing industry in Albania is tremendously strong as it was among the main sectors of the Albanian economy until the 1990s.  Operating under the conditions of a centralized economy, the industry not only oversaw the entire chain of production from the raw materials (e.g., raw fibers) to the conclusion of the final products (e.g., fabrics, clothing, and rugs), but even produced locally a considerable amount of the raw material.  The sector met over 70 percent of the demands of the domestic market and it was also important in terms of exports.

Following the economic transformations of the early 1990’s, state factories were privatized and both the function of the textile industry and the ideology of production changed substantially.  Albania no longer produces raw materials and the factories no longer produce fabric, but factories have been producing clothing with ordered material, which is then exported (in technical language: production under the regime of active processing), during the past 20 years.  Through this regime, hundreds of factories continue to produce clothes for well-known brands in Western European markets.

T-Shirt ManufacturingThe export of the clothing and shoe manufacturing in Albania currently makes up the 44.4% of the general national export according to INSTAT (the National Institute of Statistics), which means it´s a very important sector in the local market. The Albanian factories and companies are investing hundreds of thousands of dollars onto the new machineries and improving work conditions, while keeping prices competitive, which makes it likable for foreign brands to start partnering with them.

Unlike in other sectors of the Albanian economy, the global financial crisis has produced a positive impact on the clothing industry in Albania.  Supported by 20 years of experience in production (albeit partial) for important companies in Western Europe, Albanian manufacturing companies have improved their processes as they have transitioned from manufacturers with ordered material to genuine manufacturers.  Furthermore, there is a greater number of factories able to offer finalized products (i.e., products that they have produced start to finish) than there were only two years ago.

Albania has 1,034 manufacturing companies and approximately 150,000 employees, with 95% employed women. Although the raw material to make a new apparel is still imported from abroad, they do mostly the time-intensive cutting, packaging, and the final step of delivering to the respective countries. One of the most successful ones is “Kler” which partners with some famous brands and also produces its own clothing line. The quality of the clothes that they produce is medium to high.

Acne Jeans - Made in Albania
Acne Jeans – Made in Albania

Shifting manufacturing to the Albanian clothing and shoe market is favorable for a lot of foreign brands because the wages are lower compared to the same wage in an European city. The cost of the production is much lower in Albania, than in surrounding countries. One further advantage is the geographical closeness with western European countries. Delivering the final products to them is faster and more flexible compared to Asian countries like Vietnam, India and China.

Entrepreneurs from the largest factories are purchasing raw material from abroad and proceeding to complete the production processes, where upon trademark sportswear manufacturers then export to countries like Italy, Germany, the Netherlands, and France.  Also, several international organizations have supported the clothing sector.  The USAID program, “Rritje Albania” [Competitive Enterprise Development], is assisting Albanian entrepreneurs with increasing the quality of production, increasing their production capacities, improving enterprise management, and finding new markets.  At the same time, the German Program for International Collaboration (GIZ) is assisting with enhancing labor processes.  In this sector, the goal is to coordinate these projects, which is also what the directors of Albanian clothing and fashion companies seek.

Flamur Hoxha, the entrepreneur behind ‘Kler’ says his firm collaborates with thousands of clients who have stores in the shopping malls of Italy. In a distant market, the cost of transport, different time zones and the speed of delivery is crucial why they choose the Albanian market compared to the Asian ones. The downside according to him is that the big brands use contractors to partner with the local vendors, making it harder for the Albanian entrepreneurs due to the very competitive price.

Another upside is definitely the same time zone with the rest of Europe, closeness in delivering and in some cases, even the knowledge of a foreign language, as the Italian and English language is spoken largely by the Albanian population. The low cost of production is a major advantage. Big brands charge 4-10 times higher claims Hoxha, for example a t-shirt if it is sold for €200, the cost of production for it is at most between €10-15, giving the brands a very large margin.

Main Suppliers of clothes and shoes to Albania

Albania has 4 big suppliers regarding the textile industry in the country. This excludes curtains, rugs, and other materials which are not considered ‘clothes’. The first spot is lead up by Turkey, with a value of €33.6 millions imported clothes.

Turkey has been for decades our main partner, this comes as a result as being very close to Albania in terms of geographic distance, the quite well-developed textile industry in this southern European country and the trade relations between the two countries. It contributes also the fast that many Turkish brands are very much present in the Albanian market for sale in retail stores and commercial centres.

China is ranked the second, with a total value of €31.4 million imported garments. The biggest manufacturer in the world right now does not only provides the country with their textile productions but as well plastic materials. As this is not enough, many vendors and individual consumers from Albania use online apps and websites to make orders directly from the Asian country.

The third spot is held by the neighbouring country Italy, with a value of €8.6 million. Whereas INSTAT lists it as Albanians main partner in terms of the ‘clothing and shoe manufacturing’, in reality most of these productions go back to the Italian market.

A big surprise in the list of Albania’s biggest suppliers is the remote country of Bangladesh, with a total value of € 1.7 million. It’s an interesting indication that although being far away from Albania, this country with a developed textile industry is in the top 4. Furthermore, Bangladesh and the neighbouring countries like India, Sri Lanka, Cambodia and Vietnam serve as the countries that deliver more the second-hand clothes in the world for reuse or recycle.

Coming back to Europe, after Italy being the biggest suppliers for attire and shoe manufacturing, it is followed by Spain, Greece and Romania. The blossoming textile industry in Albania benefits both international brands, and local manufacturers, developing and expanding the growing textile industry garments and shoes in Europe.

Video: The Fashion Industry in Eastern Europe

Fashion Made in Albania

Veerle Luiting is an innovative Dutch business strategist working in the fashion industry, and advocating for a sustainable, clean & value-based future of fashion.

She has hands-on knowledge of the manufacuring process in Albania, and has shared her time in researching the garment industry in Albania in the presentation below. (55:34 minutes)

See also

Manufacturing companies in Albania

If you need more specific information e.g. if Albania produces a specific textile, or you´re looking to get in contact with an Albanian manufacturing company for clothes, please use the contact form below and send us your requirements.