MILAN — A tour between factories offered to end consumers is one of the implementations that distinguishes the Portuguese brand ISTO in terms of transparency.
Instead of simply talking about its environmental and social commitment, the company came up with the concept of “invoicing” to allow customers to experience first-hand how its products are made.
The project builds on initiatives ranging from providing price transparency to on-demand production that supports the green mindset behind the brand, which was launched in 2017 by a trio of young talent from different industries.
Pedro Palha, co-founder and CEO of ISTO, fits the modern archetype of the Millennial Entrepreneur: on the go, curious, clearheaded and determined. With a background in business management, she developed an interest in fashion and the direct-to-consumer model while working for a German company in Mexico in 2014. Upon her return to Portugal, Palha and her previous collaborator Vasco Mendonça, who specialized in advertising and marketing digital, he began to envision a brand that could answer his personal demand for value-for-money clothing of understated elegance.
They were encouraged by the potential of their homeland, as Portugal has a dense concentration of textile factories that supply international brands. “I think our fashion industry exports about 95 percent of what it produces… We have a lot of quality and experience, but we don’t have a lot of fashion culture compared to [other countries]Palha noted.
Interior of the Lamosa factory in Portugal.
Courtesy of ISTO
The dearth of local brands further widened the gap to fill the market, encouraging Palha, Mendonça and graphic designer Pedro Gaspar to eventually start ISTO and root the company in sustainability and classic designs.
“We all liked well-made clothes, but we couldn’t find any at an affordable price. Everything we liked at that time was either very cheap or very expensive,” Palha said. “But most importantly, we wanted to build something that had a purpose. Everything had to be consistent and make sense.”
Therefore, the product assortment is based on a permanent collection of wardrobe essentials conceived for longevity with their minimalist designs and circularity in mind, as they are made with organic and recyclable fabrics provided by certified suppliers. The brand also reflects the understated nonchalance of the Portuguese style, the country’s colors through the natural palette, and an overall sense of calm and pragmatism that define the local approach to life.
A look from ISTO.
Courtesy of ISTO
Representing the Portuguese term for “this”, the brand name itself is an acronym for its four pillars, which are independent thinking, excellent quality, transparency and organic textiles. Palha especially highlighted the financial independence of the company, which allows the founders to set their own conditions regarding the frequency of falls and avoid following the seasonality and trends of the fashion industry.
“It took us six months to develop our white T-shirt and another six for the Oxford shirt… the entire brand started with the two most essential items for men… no marketing money or budget, just our good storytelling,” Palha said, noting that the opening of the brand’s first store in Lisbon in 2018 “helped us grow and reinvest everything in our collection.”
Launched as a menswear brand, ISTO’s collection now encompasses staples such as T-shirts, linen shirts, polo shirts, corduroy pants, chinos, wool sweaters and safari jackets. The offer includes a selection of women’s clothing, an undyed line and accessories such as scarves, belts, hats and baseball caps.
A look from ISTO.
Courtesy of ISTO
The “Factourism” project was started earlier this year to further enhance storytelling while fulfilling the overall mission of empowering customers with insight and transparency. Initiative attendees can learn about the processes and understand how organic clothing is made through free guided tours of the northern part of the country, where the local textile center and factories that ISTO works with are located.
So far, each trip has had around 26 people, selected by registering on the brand’s website. “We even reached 200 people who signed up for a ride, and some users even came from Singapore,” Palha said. The co-founder is committed to organizing tours more frequently given the growing interest and because he believes that “today it is important to be close to our customers and provide them with a personalized experience.”
Another tool that ISTO leverages to perpetuate its mission of full transparency is its website, where supplier lists are displayed. Mostly local SMEs, these include the family business NGS Malhas which produces the t-shirt for ISTO t-shirts and hoodies; knitwear firm Orfama; the specialist in shirt making Docas Confecções, and the Somelos company that supplies the fabrics for shirt making, from linen to flannel, to name a few. Lamosa also makes the brand’s best-selling work jackets, which are available on-demand through a service that further reflects ISTO’s quest to limit overproduction, reduce waste and minimize its environmental impact.
Interior of the Somelos factory.
Courtesy of ISTO
On the brand’s online platform, detailed information on production processes, deep-dive into fabric characteristics, and clothing care guides are accompanied by pricing details, allowing users to get an idea. clear statement of how much ISTO paid for each component of a garment.
For example, the material cost of a single T-shirt that sells for €34 is shown at €12.65, broken down into fabric prices at €6.38; for the label at 0.14 euros; labor at 4.64 euros, and transportation at 0.09 euros. In the case of a €179 T-shirt, the material cost of the garment also shows wages, marketing and rental expenses.
In general, ISTO prices range from 34 to 275 euros, with an average basket of around 140 euros, Palha said.
Despite the gradual expansion of the assortment, the best sellers remain the basic T-shirts in classic color combinations, “that are impossible to beat from day one,” as well as the work jacket that Palha defined as a money maker due to at its highest price.
Interior of the NGS factory.
Courtesy of ISTO
In addition to its e-commerce, the brand has four physical stores in Lisbon, ranging from its first flagship store in the Príncipe Real neighborhood to its latest unit, which opened this month in the city’s oldest shopping mall, Amoreiras. The company recently also opened a pop-up store in Porto, a retail format that Palha is considering expanding abroad in the near future, starting from Paris.
The label already has an international presence as sales online and outside of Portugal account for 60 percent of total revenue. Overall, ISTO’s sales last year reached 1.2 million euros and are expected to double by 2022, Palha said.
The United States is the best performing market online, followed by Germany, France and the United Kingdom, as well as Portugal.
Today, most of the collection is still aimed at the male audience, which generates 90 percent of sales. Even if ISTO has relied on its womenswear offering over the years, Palha said the company will now change strategy and halt development of that division.
ISTO shirts.
Courtesy of ISTO
“I think we’re not putting enough effort into making products for women right now, also because we don’t have venture capital money. [backing us]. We can’t do a lot of things so we have to choose carefully what we do and we are taking a step back to focus on the men and again on [understanding] what is the purpose of woman. Should we do or not do women? Is ISTO meant to be for women or is there even room for another women’s company? And if there is space, would it be below? [the] IS FOR [banner] or through another brand? What is our differentiation? Palha said.
“There is also interesting buying behavior to reinforce this [focus on men’s]: there are fewer competitors [in terms of brands] and male customers are much more loyal to each brand. they buy less [frequently] But better. And when they buy, they buy more [from ISTO] than women, who are always looking for new things, so we are not as attractive to them”.
Palha’s intention is to direct investments towards the addition of other wardrobe basics, boost outerwear to better cover the winter season and improve the offer of accessories.
More recently, ISTO introduced blue jeans and cashmere sweaters. The first ones were developed with denim supplied by the Italian specialist Candiani to ensure a sustainable approach to one of the most polluting fashion items; the latter are the first ISTO product manufactured outside of Portugal as they are produced entirely by the Italian textile company Cariaggi. The blue jeans and cashmere sweaters sell for €138 and €275 each, respectively.
Cashmere jumper from ISTO.
Courtesy of ISTO
When asked about competitors, Palha appreciated the Swedish brand Asket but highlighted the difference in scale, following and support. Since his end, he has remained open to the idea of having investors in the company, as long as they bring additional value in experience and insight, rather than just a financial injection.
“We are not lying, we want to make money but we want to do it in the long term. My dream is to leave this company to my grandchildren”, concluded Palha.
Source: news.google.com