From Folk Tradition to Fair-Trade Fashion:
Indigenous Designs Brings Opportunity to Impoverished
Andean Communities

By Kat Schuett


In the Highlands of South America live some of the world’s most skilled hand-knitters and weavers, natives who have passed this art down through the generations since the days of the Incas. But with no way of getting their handiwork to a world market where it could truly earn the price it was worth, the people richest in cultural tradition were some of the poorest, and more and more people were moving to the city to find higher paying work. Those who stayed would have to walk an entire day to get to market and pay top dollar for low-quality yarn, only to have to walk back again to sell it to a middleman, or “agente,” who would give them hardly enough to pay for the yarn, let alone the hours of skilled labor. Or, maybe if they were lucky, they could peddle their art to tourists on the street and make a couple extra “sols,” equating to a few more pennies on the dollar.

But 15 years ago, a series of acts of fate intervened and a new business model was born—one that could help these natives protect their culture and reward them for their truly world-class artistry. Combining the use of organic fibers, eco-friendly production practices and fair trade principles, Indigenous Designs brought a business model to life to empower these artisans while providing high-end, beautiful clothing for the eco-consumer. Blending old world traditions with new world style, the company has created a modern market for the South American artisans while also carving out a niche for the “passionista,” the person who is concerned with making a positive impact as well as keeping on top of fashion.

Today, Indigenous Designs works with over 300 social entrepreneur co-ops throughout Peru and Ecuador, providing economic opportunity and a better quality of life to around 1500 artisans. The company’s handcrafted clothing is sold in over 400 specialty boutiques under its own brand name, “Indigenous.”

It can also be found in many other high-end retailers such as Nordstrom’s, Bloomingdale’s and Nieman Marcus, where the company’s custom creations wear top designer labels and are sold next to other best-in-class fashions.

Altogether, in just three years Indigenous Designs has grossed over $12 million from sales, of which an average of 30 percent goes to the artisans. This year, the company will also be one of the first U.S.-based apparel companies to launch a fair trade certified label. And the work they have done to better the lives of these artisans is getting noticed as well. Jessica Rodriguez, one of the company’s key partners, was recently awarded Hillary Clinton’s Pathways to Prosperity Award for Women Entrepreneurs. The company also recently beat out 400 others to win the Youtopia award, from which they will receive grant money and expertise to create an educational multimedia campaign to tell their story. Soon they will be sharing their story in movie theatres as well, as part of a feature film on conscious consumerism called “Rooted in Peace.”

Serendipitous Sustainability: How It All Started
The founders of Indigenous Designs often refer to their company as the “the sweet spot between serendipity and sustainability.”

“On the path to sustainability, we have tended to bump into people or situations that seem to be meant to be,” says Scott Leonard. And he means that quite literally. Leonard was rushing across the street in Ecuador when he nearly knocked over Joe Flood, a native Ecuadorian. Leonard helped Flood pick up his books that had scattered across the street and soon the two were discussing how they wanted to make a difference in the world. They stayed in contact and one day, inspired by a beautiful handmade Andean sweater, started discussing how they wanted to help stop the exploitation of the indigenous women who made these garments. Indigenous Designs began to take shape.

At a friend’s wedding just a year and a half later, Leonard happened to run into an old friend, Matt Reynolds, who had just come back from Europe where he sensed a growing trend of organic, eco-fabrics emerging. Reynolds’ father also happened to be a Stanford economics professor and an authority on breaking down inequities in South America, so Reynolds was very familiar with the issues these natives faced. Fueled by passion to make a difference, Leonard and Reynolds spent the next few months putting together a plan of action.

Building a Sustainable, Fair Business Model
From the beginning, the entrepreneurs knew the key to this new business model was sustainability. Part of this was ensuring that each and every practice, from the farm to the mill, was respectful to the earth. To achieve this, production is certified by the Global Organic Textiles Standard (GOTS).

The other part of this model is economic sustainability and creating a system that would ensure fair, stable income for their artisans. So, rather than starting a nonprofit, they decided to start a business that could grow and create a long-term source of income.

“Because NGOs are founded on grants and free money, they weren’t sustainable. Financing dries up,” says Reynolds. “From the beginning, we knew we had to make a scaleable, profitable business that empowered artisans and elevated them to a world-renowned status in fair trade, indigenous, organic production.”

Indigenous has always followed fair trade guidelines. In fact, they have been working on the fair trade pilot program for Transfair USA, and will be launching the first organic, fair trade certified apparel this year. In contrast to the artisans’ situation before, Indigenous pays its hand-knitters 50 percent more, and its loomers an average of 20 more, than they would be paid working for another non-fair trade company. Indigenous also offers a form of scaled microloans to its work groups to purchase high-quality yarns to make the clothing. Additionally, the company has supported and provided free training that helps artisans develop skills that give them better opportunities in the market, no matter where they work. The artisans also learn about business and accountability. For example, in the Pono region in the south of Peru, Indigenous provides the first set of knitting needles for free, but if an artisan loses a set of knitting needles, they are required to buy the next set. They are also shown by examples of other artisans within their community that if they work hard, they can rise up and perhaps run their own workshop, or become a lead knitting trainer and travel around to other communities.

Becoming vertically integrated was also an important step in being sustainable, both environmentally and economically. This involved working directly with the farmers, artisans and mills. “The irony is that they are growing the raw fibers and raising the alpaca in their communities, but they don’t often have the technology or resources to process those raw fibers. Instead, a large multinational will come in, buy the raw fibers, process them and ship them to China,” Reynolds says. “What we wanted to do is be stewards of these natural fibers, process them in best-of-class boutique mills and then bring the fibers back to the artisans—keeping everything as close to the artisan communities as possible.”

Another important part of this model is transparency. Everything is done through as much of a democratic process as possible, allowing the artisans to have a voice. “We don’t dictate the prices and bail on them if they cannot meet that. We share the information with the knitters and say, ‘These are prices that we need, these are our range of products, let’s work on that,’” says Reynolds.

He adds that one reason why this is so important is to allow the artisans to stay in their communities. Many migrate to the city for higher-paying jobs. “Part of this is to encourage cultural preservation and bring jobs back out into the communities, stabilizing the family unit so the children can stay in school.”

Organic Growth
Right before Leonard and Reynolds serendipitous meeting at their friend’s wedding, Indigenous Designs landed its first national account. The Nature Company wanted 6000 sweaters and 2000 jackets—and it wanted them in 120 days. To do this, Indigenous Designs brought together three NGO knitting co-ops to work as one entity and began working through the hurdles of infrastructure and educating smaller groups about the power of working collaboratively.

“They all had the same vision, which was to get jobs to artisans, but they were competing among each other and bickering,” says Reynolds. “We had to point out that all the knitters working together was far more valuable than working as separate little hubs. We could share resources and the best knitters for training. We could consolidate our orders to get better pricing on the yarns. And, together we could start creating a sustainable business model.”

At the time, artisans were washing the natural sheep wool in the river and using old tire spokes as knitting needles. The infrastructure was raw—still the entrepreneurs needed to prove that they could deliver the units on time and to spec. “We needed to show that a remote artisan handicraft production model could be reliable and consistent,” comments Reynolds.

And they proved just that. The products were shipped to over 300 stores on time and with no returns. “People would say to me, ‘I’ve worked with hand-knit, handicraft artisan clothing lines before and it’s never consistent and they never deliver on time.’ But these days we have one of the best on-time shipping records in the industry. We shipped 98 percent fulfillment last year and we had less than a 2 percent defective return rate. And that in a handknit/loomed company is just unheard of. It’s because we’ve invested so much time into this model and infrastructure,” says Reynolds.

From Old World to On-Trend
Although the coarse wool that the original sweaters were made of was perfect for the rugged outdoorsmen who shopped at The Nature Company, the two entrepreneurs knew that in order to appeal to the mainstream—especially women, who do 80 percent of the purchasing—they needed to take the quality up a few notches.

“Better quality means the profit margins can increase, allowing for higher wages and more money that goes directly back to the artisans,” says Leonard.

The first challenge was to find softer yarn, so they started building relationships with boutique mills and invested in machines that could wash the yarn. They still followed the strictest environmental practices and made sure that the mills they worked with were certified to organic standards. As they grew, they were able to slowly start getting financing together for more looms, better equipment and finer gauge yarns—and systematically, organically, over time the quality started getting better and better.

The company also became known for its innovative blends—creating yarns with free-range, hand-sheared alpaca, Merino wool, and tencel, a sustainably produced fabric that gives materials a silky feel. Indigenous Designs was one of the first clothing companies to have a hemp/wool-blend sweater in 1995, but when they realized that they could not source hemp that was sustainably processed to their standards, it was dropped from the company’s line. Indigenous was also first to market an alpaca/organic cotton blend as well as an angora/organic cotton blend, which is made from fibers naturally shed during molting. The alpaca blend is featured in the company’s Fall 2010 line.

“Today, our handmade sweaters are hanging next to some of the most sophisticated brands out there, in some of the most premium retail locations across the country. That would just not have been heard of 10 or 15 years ago. We just didn’t have that ability. But we’ve been able to elevate to that quality without shifting our production model. We decided to take the slow, organic approach and stay true to our mission—to work with small-scale, disadvantaged artisans and find ways to create scaleable models with them,” Reynolds says.

Telling the Story
With the infrastructure in place, the next step is to educate consumers—and many exciting events have come about to help the company do this. First, Indigenous Designs recently was awarded a grant from Youtopia to work with Free Range Marketing to create a multimedia outreach campaign. Free Range is most well known for the eco-awareness video, “The Story of Stuff.” In combination with this, the company will also incorporate funds from a project-related investment (PRI) low-interest loan from RSF Social Finance. The goal in all of this is to connect consumers to the company’s value chain and educate them about what exactly happens when they buy an Indigenous sweater. The company also plans to add a code on each hang tag where consumers can look up the specific co-op that made the garment.

“This is about creating the tipping point for fair trade, like the tipping point for organic cotton a few years ago,” says Reynolds. “Organic cotton had the momentum of organic food to move it along and it started snowballing, but now we want to add fair trade and keep pushing that snowball till it builds up.”

Lastly, one of the most recent serendipitous events that is sure to help the company’s message snowball even more was when director and producer Greg Reitman, known for the movie “Fuel,” stopped by the company’s booth at a recent trade show and invited them to the Sundance Film Festival to be a part of his upcoming movie “Rooted in Peace.” The film features luminaries like Desmond Tutu and centers around raising consciousness about what we’re contributing to on a daily basis through our purchases and our actions.

“This is a really exciting time. Even the fact that I am having this conversation with you is another sign that it’s time for our story to be told. We’ve invested the time, the money and the heart and soul into building something that is truly remarkable,” says Reynolds.

“This mission is beyond us and so many people have joined us along the way; providing guidance, or helping educate communities, or introducing us to cooperatives through their travels,” he adds. “There is this gigantic network of people looking to make a difference and it’s filtering through Indigenous. By being open to serendipity, we are open to meeting people and always discussing ideas and collaboration that take us closer to our mission.”

Kat Schuett is the editorial director of Organic Processing Magazine. You can reach her at kat@organicprocessing.com.