Hyper-local Manufacturing on the Final Frontier
This article first appeared in Impact Entrepreneur Magazine.
As part of a series of “fireside chats” sponsored by R.I.S.E. Artisan Fund, Amneh Shaikh-Farooqui of Polly & Other Stories and Afshan Abbas of Fuchsia Shoes conversed from opposite sides of the globe about the artisans of Pakistan, the final frontier for impact investors, how their companies managed to gain momentum during COVID, and what they need to reach their goals.
Valuing the Craft of Pakistani Artisans
Afshan Abbas, Co-Founder and CEO of Fuchsia Shoes, would like to correct an injustice – the severe under-valuation of handcrafted products made by highly skilled Pakistani artisans. “We want their craft to compete with Italian craftsmanship,” Abbas said in a recent video call, noting the unreasonable disconnect between the skill-level of Pakistani shoemakers and the price of their goods. Her company Fuchsia Shoes sells delightfully designed handcrafted flats, called khussas, made by Pakistani artisans with traditional methods, but made more comfortable and durable for the American consumer. The artisans making Fuchsia’s shoes are every bit as capable as those stitching the most expensive Italian brands.
“Sometimes the skill set is the same, but how we value it is very different,” said Amneh Shaikh-Farooqui, Co-Founder and CEO of Polly and Other Stories, a company selling a wide variety of handcrafted Pakistani goods, from homewares and art pieces to children’s toys and beauty products. As she describes it, “Polly & Other Stories supports artisan makers across Pakistan to create modern products using heritage skills via scalable models of ethical handmade production that can reduce inequality and poverty.”
Abbas and Shaikh-Farooqui and their companies are changing the dominant narrative, and helping to revalue handcrafted products from Pakistan. By doing so, they intend to transform the entire artisan sector, and lift its artisans out of poverty. So far, the results are very positive. “We are making sure these artisans take home 3X more than what they make in the local market,” Abbas said. Shaikh-Farooqui estimated that her company had measurably improved the lives of 7,000 people. Having proven their concepts, each co-founder is looking to secure funding for the next phase of growth.
Building Enterprises in Pakistan during a Pandemic
Building artisan enterprises in Pakistan during a pandemic might seem to be a doomed endeavor. But, when asked about COVID and its effect on their operations, Abbas and Shaikh-Farooqui had similar stories to tell. Neither Polly nor Fuchsia was significantly threatened by supply chain issues, a fact they attributed primarily to the “hyper-local” nature of their manufacturing. Labor was also plentiful, particularly as local factories closed due to lockdowns.
Fuchsia, which was already producing in small batches, found ways to transition to a complete work-from-home model. Their pivot was so effective that the company was able to grow dramatically even as the pandemic raged. Polly and Other Stories didn’t have to go far to transition to work-from-home either. Said Shaikh-Farooqui, “75% of the artisans we work with are women, who, due to socio-cultural reasons, are not allowed to leave home anyway.”
According to Shaikh-Farooqui, COVID has been a catalyst for stronger relationships with artisan groups. Polly distributed food to laid-off workers and their families (“our moral obligation,” she said) and also repurposed its digital communications to distribute vital COVID information to rural artisans. “Usually we would be sending supply chain information or order information or market information, and we thought, these structures exist, why not use them for something that isn’t commercially-minded but is such a critical social good?” In addition to these actions, the company gained the trust of artisan groups by stepping in and proving itself to be a reliable commercial partner when traditional markets abruptly closed.
“It’s been an interesting learning experience about what it means to have a hyper-local supply chain – both in terms of its climate impacts and carbon footprint but equally in terms of what it means for sustaining people’s livelihoods,” said Shaikh-Farooqui.
Ambition & Opportunity to Scale
Fuchsia and Polly are both looking to scale up significantly in the coming years. Shaikh-Farooqui said, “We’re currently reaching about 1,000 artisans and we work with 90 SMEs in Pakistan…The goal is to accelerate that ten-fold. Within the next 5 years we want to be working with 10,000 artisans and at least 500 companies across Pakistan.” Fuchsia, which managed to grow from a 500 shoe-per-month operation to a 5,000 per-month operation in a single year during COVID, is now “looking at how are we going to get to 50,000, and from there, millions of shoes,” Abbas said. Her vision is unabashedly global, with a plan to expand beyond Pakistan to the rest of South Asia, then to Africa and eventually South America. “We want to increase our footprint to millions of artisans around the world and create a responsible brand that is creating original and authentic products but also ensuring equitable opportunities for all our artisans across the globe.”
Of course, the ability of these co-founders to reach their goals is largely dependent on investment. Both Abbas and Shaikh-Farooqui said that attracting the right set of investors was one of their most important jobs in the near term. “The biggest challenge, not surprisingly, is that we need the cash to scale,” said Shaikh-Farooqui. “We’ve been really good about bootstrapping…But if we really want to deliver the impact that we know we can, then we definitely need the right set of partners and investors to help do this.”
Shaikh-Farooqui noted that Pakistan now has less than 1% of the global craft market, which is valued at approximately US $1 trillion, so there is huge upside potential for artisan enterprises. Pakistan is the 5th most populous country in the world, behind only China, India, the US and Indonesia. As a general trend, the Pakistani middle class has been growing significantly, at a rate of almost 10% per year over the past decade[1]. Consumers and producers are increasingly connected to online markets, a trend accelerated by COVID. More than 180 million Pakistanis – about 80% of the population – use mobile phones[2]. With the country’s growing consumer class, large domestic market and massive export potential, investing in growth-minded social enterprises in Pakistan is a significant opportunity available to impact investors.
© 2021 Polly and Other Stories
Co-founder and CEO of Polly and Other Stories, Amneh Shaikh-Farooqui supports artisan makers across Pakistan to create modern products using heritage skills via scalable models of ethical handmade production.
The Final Frontier
“Pakistan is the final frontier. We’re the only market of our size that is now truly left untapped in the world,” Shaikh-Farooqui said, “and those that get in early will definitely yield dividends.” Investors looking to create social impact in addition to profits will be able to see “real and quantifiable and palpable” differences within the next few years, she said.
Both companies are perfectly situated to capitalize on a sea-change in customer behavior. Customers are younger and their purchases are increasingly socially conscious and impact-oriented. Both companies apply current design to traditional craftsmanship, and both focus on storytelling to connect customers to the people behind the products. “We are seeing a lot of people that buy the shoes just because they love the story. Then they see it’s also functional and comfortable and they come back for 3 or 4 pairs,” Abbas said.
Storytelling reassures the customer that they’re making a positive difference. Equally, Shaikh-Farooqui said, it puts the spotlight on the artisans who deserve recognition, giving the unheard a voice and raising the value of their work.
Impact Opportunities
To learn more about these R.I.S.E. Artisan Fund impact opportunities:
The R.I.S.E. Artisan Fund invests in early-stage artisan enterprises creating sustainable livelihoods for rural communities with few economic alternatives. The fund deploys capital using a range of investment vehicles from grants to revenue-based equity investments while seeking a return of capital for further investment, thus creating a reinvestment cycle that multiplies the catalytic impact of philanthropic capital.
To invest via the R.I.S.E. Artisan Fund, you can make a tax-deductible contribution directly or via a grant from your donor advised fund (DAF). You can also co-invest directly in select investment opportunities. Contact ellen@sproutenterprise.net for more information or complete the Philanthropic Investment Grant Form to invest in the fund.
[1] Farooq Tirmizi, “How Big is the Pakistani Middle Class?” Pakistan Today, September 19, 2020.
[2] “IT Minister Says Pakistan Will Launch 5G Next Year; Here’s When?” Phone World, October 26, 2021.