Favela Fashion Overcoming Business Challenges

by FELICITY CLARKEon Forbes  Megacities

Rio’s favelas pulse with creativity, from rough-edged baile funk rhythms to seemingly impossible housing structures to inventive ways people earn a living. However, harnessing creative ideas and establishing a successful business is an extremely tough challenge for budding entrepreneurs without financial backing and business know-how.

right to left, Luciana Almeida, Silvinha Oliveira, Nadja Araujo & Luciana Meireles from the favela fashion label Retalhos Cariocas

Silvinha Oliveira, resident of the Barreira do Vasco favela, always dreamed of having her own fashion business. She first had the idea for her Retalhos Cariocas label’s signature Havaianas sandals which combine a feisty gladiator shape with vibrant tropical colors and patchwork finishing when she was running free dressmaking and craft courses for women in the favela.

However turning her ideas into a business has been a challenge for Silvinha and her partners Luciana Meireles, Nadja Araujo, Luciana Almeida and Fátima Souza, who between them do everything from production to marketing and administration.

“I believe Retalhos have arrived today because of perseverance, trying until it happens,” says Silvinha. “I graduated in 2003, so that’s nine years believing in a business that operates with good values, even though we don’t have money.”

Their sustainable ethics are an example of these values. Recycling the scraps of material donated by clothing factories and sculpting plastic bottles donated by residents of the community into packaging, are not only environmentally friendly, but financially benefit to the company.

They also put a strong emphasis on dignity and respect. There’s a fierce determination to reverse the perception that a favela-based business, particularly one run by women, is a charity case. As Luciana Almeida emphasizes: “We don’t want to be seen as girls who need help. We want people to recognize our potential. We’re women, we’re fighters and we’re studious.”

While they have no shortage of creativity and spirit, working out how to successfully run the business has been their greatest challenge. The machines and fabric donated for the courses plus the support of the resident’s association in providing a space and labor acted as their start-up capital, but keeping on top of the business side has been difficult.

Silvinha recalls: “We didn’t know how to administrate. We understood what our style was like, who our customers were, but we didn’t know how to make money.”

Luciana Almeida and Nadja Araujo joining in late 2009 revitalized the company, Luciana bringing administrative support allowing Luciana Meireles to focus on communication and marketing and Nadja taking responsibility for production. However they still lacked the organizational skills to manage the business side.

This changed when Marcelo Fujimoto, a Brazilian born private equity consultant from Chicago, came to work with the girls on a volunteer basis in July 2010. He helped them create a business plan, understand costs and stock control and organize their monthly and weekly activity.

Marcelo, now based in Rio working with Retalhos Cariocas, believes the organizational problems faced by the young women are a common shortfall of business practice in the slums. He says: “The biggest challenge for favela-based businesses is actually knowing how to operate their businesses.  There are a lot of small businesses that make a lot of really bad decisions.

“Smaller businesses have as much motivation to grow and make money as anybody else, they just don’t have the appropriate tools and this disadvantage is magnified when you consider that small businesses don’t have the same resources.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s