February 2017—Lilia Ranogaet didn’t start out wanting to be a clothing designer. She had studied law, and for years she ran a consulting company that helped Moldovan citizens find work abroad.
Moldova is the poorest country in Europe, and good jobs at home can be hard to find. Thousands leave the country each year seeking employment elsewhere to better support themselves and their families.
Ranogaet explained that her experience helping people leave Moldova made her realize how important it is that they stay. “I wanted to think of how we can keep Moldovans here,” she said. “I was thinking, we can’t bring construction or certain other jobs here—but we can bring production here.”
Ranogaet had limited experience in production processes when she started her business in 2001. But over the past 15 years, she has worked hard to strengthen her knowledge of the industry. Her efforts have paid off as her company, Portavita, now boasts three clothing factories—one in Chisinau, one in Balti and one in Ghindesti—and employs about 380 people.
Portavita is one of more than 100 companies from light industry that have received assistance from the USAID-funded Moldova Competitiveness Project aimed to help move them from low-value to high-value manufacturing.
Like many clothing manufacturers in Moldova, Portavita relies on low-value production under which foreign companies send the company precut pattern designs, fabrics, threads and accessories, and Portavita’s employees assemble the items of clothing and send them back. While this model can provide experience in learning how to produce high-quality apparel, it also results in a low profit margin.
For example, Ranogaet might be paid 1.5 euros to assemble a blouse. After paying salaries and operating expenses, she may earn a 10-cent profit per blouse. However, if she makes the same item herself, under her own label, she can earn a profit of about 3.5 euros per blouse. This kind of increased profit margin, says Ranogaet, would enable her to invest more money in her business, hire more people, and pay higher salaries.
USAID-funded programs are working with aspiring own-label companies to develop marketing approaches, identify target clients, and create modern brands that can compete successfully against imported garments. Training is also provided on increasing competitiveness by organizing production lines and controlling manufacturing times.
Ranogaet said that she first tried to market her own label in 2005, but, due in part to consumer skepticism about the quality of Moldovan-made clothing, no one was buying. Then, in 2012, a USAID-funded campaign was launched to attract Moldovan consumers and improve the perception of domestic products. “From our Heart—Brands of Moldova” became a slogan highlighted on billboards and in TV and radio spots airing across the country.
“This campaign has had a great impact in terms of the image of our clothing producers,” said Ranogaet. “Now local consumers know the value of what we’re making.”
While 80 percent of Portavita’s manufacturing still involves assembling garments from foreign companies, Ranogaet continues to create designs for her own label. She hopes to soon expand her business to 10 stores that will carry her label; eventually she would like to operate 50 stores throughout Moldova. Ultimately, Ranogaet would like to export her clothing to neighboring countries.
USAID’s Moldova Competitiveness Project, which runs from 2015 to 2020, supports the country’s efforts to promote a strong, diverse and export-oriented economy. It focuses on the tourism, textile and ICT sectors to increase incomes, alleviate poverty and reduce emigration. The project is implemented by Chemonics.
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,“I wanted to think of how we can keep Moldovans here.”
Ludmila Bilevschi, USAID