Subcontracting: A supply chain system built on denial
Valentino is the latest brand to come under scrutiny by the Milan Court.
Specifically, Valentino Bags Lab Srl—a subsidiary of the Roman fashion house that produces bags and travel accessories—is being investigated for subcontracting production to Chinese factories that allegedly exploited workers.
According to a 30-page court decree reported by Reuters, judges overseeing preventive measures appointed a one-year administrator to Mayhoola’s investment firm (the Qatari parent company of Valentino) for failing to ensure “adequate checks on contractors’ working conditions or technical capabilities.”
Milan’s Carabinieri Labour Protection Unit—a specialised police division dedicated to enforcing labour law—inspected seven Chinese-owned subcontractor factories on the city’s outskirts that were producing Valentino bags. They found 67 workers: seven undeclared and three undocumented. The Carabinieri report outlines exploitative conditions, including sub-minimum wages, excessive working hours, poor safety standards, and illegal dormitories with unhygienic conditions.
This marks the fourth investigation shaking the luxury fashion industry, following similar actions involving Alviero Martini SpA, Giorgio Armani Operations, and Manufactures Dior, all of which were later revoked.
Subcontracting: A supply chain system built on denial
The low-cost subcontracting system isn’t driven solely by top brands seeking higher profit margins—manufacturers operate under the same logic. It’s a well-known practice across the industry: everyone does it, yet all pretend it doesn’t exist. Everyone passes the buck. No one ever seems to know anything.
To maximise profits, brands demand ever-lower production costs. In response, manufacturers must preserve their margins, so they outsource to third parties. This results in extended chains of subcontractors, often with little or no oversight. Production is externalised, and brands relinquish control over their supply chains—whether intentionally or by design.
More than fashion: A symptom of capitalism
The system of subcontracting—especially low-cost, opaque subcontracting chains—is not unique to the fashion industry. It’s a symptom of a broader capitalist dynamic marked by extraction, exploitation, and systemic opacity.
In particular:
1. A practice typical of extractive capitalism
It stems from a model where profit maximisation overrides everything else, including transparency, workers’ rights, and environmental responsibility. Subcontracting allows companies to:
- Reduce direct liability
- Cut costs
- Avoid regulations and unions
- Claim ignorance when abuses occur (“plausible deniability”)
This logic is widespread across sectors like construction, electronics, agriculture, logistics, and, of course, fashion—any industry where labour can be shifted to where it’s cheapest and least protected.
2. Amplified in the fashion industry
Fashion epitomises this system for several reasons:
- Rapid seasonal cycles and the demand for constant newness push production to be faster and cheaper.
- Fragmented, globalised supply chains make transparency difficult.
- Brand-driven business models mean labels rarely own the factories they depend on, distancing themselves from labour conditions.
- Marketing dominates manufacturing—brands invest more in image and storytelling than in how and where their products are actually made.
So while fashion didn’t invent the system, it amplifies it—making it one of the clearest expressions of capitalism’s outsourced conscience.
Final thoughts
In conclusion, Valentino is just the latest in a growing list of top-tier brands caught in the web of exploitation. But the real issue isn’t just one brand—it’s the system itself.
This ongoing scandal undermines the luxury industry’s carefully curated narrative. Premium prices are justified in part by the “Made in Italy” promise: craftsmanship, quality, and ethical production. Now, that promise rings hollow. The growing popularity of TikTok exposés on Chinese-made luxury bags reflects a broader disillusionment. People are waking up to the disconnect between branding and reality.
It’s not about bad apples. It’s about a broken tree.