D. Exterior is a clothing company in Italy owned by Nadia Zanola.
She started the business in 1997 based on a small business her parents started in 1952.
Zanola employs 50 people in the northern city of Brescia.
She worries about the future of her business. She has made a lot of clothes for people in Russia but, due to international economic restrictions, the stores that have requested the clothes cannot afford her.
The restrictions, known as sanctions, began earlier this year due to Russia’s invasion of Ukraine. They are intended to punish Russia for the war by making it difficult to send money to other countries or receive goods.
However, the sanctions are also making business difficult for people like Zanola who rely on sales in Russia. She has over $2 million worth of clothes she made for Russian stores that she didn’t get paid for.
“If they can’t pay, I’ll be on my knees,” Zanola said. She described the situation as “painful”.
The sanctions are hurting a number of companies in Italy that make expensive fabric products and leather, such as clothes and shoes. Italy is the largest producer of this type of expensive product in the world. The industry adds $101 billion to the Italian economy every year.
While the Russian clients add only about three percent of that total, and any loss hurts the 80,000 small businesses that supply that market.
Fabio Pietrella is president of a fashion industry trade group in Italy.
He said the loss of Russian customers takes away more than 80% of the money small businesses make each year.
Regions of Italy such as Marche, Veneto, Umbria and Emilia-Romagna depend on orders from Russia.
“These are neighborhoods that connect Supply Chain“, said Pietrella. He noted that if small producers close, it will harm “the whole system that (makes) this country an economy central.”
Some of the most famous fashion companies in the world like Gucci, Versace and Armani are Italian. They’re showing off their menswear this week in Milan.
A number of Italian companies such as Diesel, Benetton and Armani still do business in Russia. Their names appear on a list drawn up by Jeffrey Sonnenberg, professor of commerce at Yale University. He called these companies “gluttonous.” He noted that companies that continued to sell goods to Nazi Germany after the start of World War II are not “celebrated”.
Sonnenberg said apparel companies aren’t able to find ways around sanctions like the pharmaceutical or agricultural industries do.
Other clothing companies in France and Spain severed their ties with Russia when war broke out. LVMH is a French company which includes the fashion brands Louis Vuitton, Christian Dior, Givenchy and Fendi. LVMH continues to pay its 3,500 Russian employees even though it no longer does business there.
Pietrella said he and the companies he works for were “extremely concerned about the aggression in Ukraine”. He said there was no way to defend Russia’s actions. But he added: “We have to think about our businesses. Ethics are one thing, the market is another. A company’s workers are paid by the market, not by ethics.
For those who say companies should find a new market for their products, he said that’s easier said than done.
“If there was another market, we would already be there,” Pietrella said.
For companies like D. Exterior de Zanola, it has taken many years to develop business in Russia. He now accounts for 35-40% of the $22 million his company brings in each year. D. The exterior is also under additional financial pressure due to rising energy and material costs.
When Russia invaded Ukraine at the end of February, the company was already sending clothes ordered for the summer and taking orders for the winter. But in March, Zanola customers in Russia were missing payments.
She said she is unlikely to get any money for the 4,000 spring and summer clothes she owns. And there was a contract that she had to go ahead and start making winter clothes. If she cannot send the winter items to Russia, she will lose at least $100,000.
She said Russian customers are good because they enjoy the extra work it takes to make beautiful clothes.
After working so hard to win clients, she doesn’t want to give them up.
She said she hoped people would recognize the difference between Russian leader Vladimir Putin and the Russian people.
“Since Russia is not just Putin, it is hoped that poor Russians will manage to rise again,” she said.
I am Dan Friedell.
Dan Friedell adapted this story for VOA Learning English based on reporting by The Associated Press.
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words in this story
leather – nm animal skin used to make shoes, clothes and other things
customer -not. a person who pays for goods or services
Supply Chain – nm the systems and organization involved from manufacturing a product to delivering it to a buyer
central – adj. a group or organization that has a lot of power and influence
fashion – n. (industry) the activity of creating and selling clothes
gluttonous – adj. having or showing a selfish desire to have more of something, especially more than is necessary
ethics – nm rules of behavior based on ideas of right and wrong
enjoy -v. to understand the worth or value of something or someone