How one small business is greening the textile industry, partnering with customers, and changing lives in North Carolina
For many countries, small and medium-sized enterprises (“SMEs”) are the backbone of their economies.
According to the United Nations, SMEs account for 90 percent of businesses worldwide, more than 70 percent of employment, and 50 percent of Gross domestic product (GDP). In the United States alone, the Small Business Administration states that there are over 34 million small businesses across the country, employing around 59 million people, as of 2024.
Yet if you ask business leaders at large global businesses how SME suppliers can support their sustainability strategy, some may only point to one priority: suppliers complying with environmental, social, and governance (ESG) regulations and sustainability progress reporting.
By limiting their focus just to regulatory compliance and reporting, large businesses are overlooking their SMEs’ significant ability to create value.
These vital and vibrant businesses support economic growth and workforce development by employing innovative, problem-solving, and skilled workers, creating positive social impact in local communities while creating more resilient supply chains and delivering successfully on sustainability priorities.
The Industrial Commons (TIC) is a great example of why companies assessing their commitments of their sustainability strategies and ESG material issues should take a closer look at SMEs. TIC is redefining North Carolina’s textile circular economy through employee-owned social enterprises and workforce development. Its large customers include Smartwool, Bassett, and DeFeet.
Thanks to funder Ares Charitable Foundation (ACF), TIC received a grant through the Quality Green Jobs Regional Challenge led by Jobs for the Future. The Challenge directly invests nearly $5 million in communities to develop and implement regional quality green job strategies.
Here’s how TIC is transforming people’s lives, jobs, and communities - and the business of their customers.
Helping local towns keep jobs through strong strategic partnerships
Thanks to TIC, jobs are staying in Morganton, NC, where TIC is based.
“Unfortunately, a lot of the story of rural communities has been that you need to leave in order to find some type of fulfilling work, which has meant a lot of really smart and talented people have left,” says Molly Hemstreet, TIC’s co-executive director. “What we want to demonstrate with models like The Industrial Commons and by building these ecosystems of thoughtful, green sustainable work is to really show people that you can stay in your place. You can stay in the community, there's opportunity, and there's a future for you here.”
Through strategic partnerships with local enterprises, youth engagement programs, and job training programs, TIC has been at the forefront of cultivating community-owned ventures and initiatives tailored to enhance resilience, empowerment, and environmental stewardship in the business sector, creating 85 jobs, supporting over 60 businesses, and successfully training nearly 3,000 workers and counting. These opportunities ensure Morganton doesn’t lose its population to other cities and keeps schools and other community infrastructures in place that support civil society.
“The movement and the work of The Industrial Commons is really to think about the ecosystem and the whole entire supply chain around textile and furniture manufacturing in the region,” says Hemstreet.
TIC’s partners include Manufacturing Solutions Center, whose mission is to keep local, domestic work in the United States by serving as an incubator of small businesses and product development. Manufacturing Solutions Center prioritizes low-waste design and sends its leftover materials to the TIC’s Material Return, which works with local manufacturers and national brands to transform textile waste into new products. These new products are then sold to bigger companies like Smartwool.
Sustainable solutions create value for customers and community
Sustainable products, such as recycled textiles, not only have an important role in a customer’s sustainability strategy but also in transforming an industry and community.
“Currently, there are 2.1 million tons of waste going into the landfills from textile waste,” says Chuck Costner, a 40-year veteran of the textiles industry who is an engineer at Material Return. “The reason behind what we are doing is we want to protect the environment. We don't want to take everything to the landfills and use what we can.”
“Our future plans are really all about sustainability and the greening of these heritage industries that have really helped to build our community over generations in order to continue to bring wealth into our community and to create strong livelihoods and quality jobs,” Hemstreet says. “We want to be able to be sure that we can help facilitate the continual greening of those industries. It really is the future. It's not just the future of industry. It's the future of our communities. It's the future of our planet, quite honestly.”
TIC’s sustainable textile solutions show that good jobs, good business, and good environmental solutions go hand-in-hand.
Upskilling workers for an innovative, problem-solving supply chain
TIC makes it possible for current workers to keep upskilling on the job, ensuring they can succeed in their roles, engage their teams, and adapt to changes in their industries.
Walter Vicente is a plant manager who works at TIC’s Opportunity Threads, a worker-owned, cut and sew textile plant based in the foothills of Western North Carolina. He’s one of the organization’s many employees who are from Guatemala. He says one of the best benefits about being a part of Opportunity Threads is the training he and other workers receive.
“It really helps us a lot because we have leaders here on the floor, and they've never done this before, so it's good to take them to The Industrial Commons where they offer this training,” he says. “When they come back, they're like, ‘Wow, I feel better now. I know what to say now if there's anything that comes up with someone that works on the floor.’ The classes are really important for our leaders, and I would say for myself as well.”
“First and foremost, we need to appreciate the worker and their ability to think creatively,” Hemstreet says. “And we need to train not only new skills, but we need to really relish and, and support creative thinkers that are standing in our manufacturing facilities.”
Local workforce development through meaningful education
Through its ecosystem of enterprises, TIC has created life-changing opportunities for its workers to upskill, creating a sense of trust, partnership, and loyalty with employees and giving them the education to adapt to market needs.
Ashley Clark, a fifth-generation seamstress who grew up in Morganton, works at Manufacturing Solutions Center and teaches industrial sewing classes at Carolina Textile District, a key TIC partner.
For Clark, it’s deeply gratifying to know she is helping support a resurgence of the textile industry by mentoring people and giving them the confidence to pursue meaningful employment without leaving her hometown. After taking her classes, her students have been able to start careers in the textile industry and reach important milestones, like getting married and raising families.
“I have a younger student who graduated from high school a year after she took my class. She was working at a fast-food restaurant at the time, and I told her, ‘That's not going to pay the bills, you need to do something,’” Clark says.
With Clark’s encouragement and training through the class, the student got a job “that wasn't even available because of all the skills that she had. They opened up a door for her just because of all the training she had … So, she's starting out in a great place at 19 years old!”
This experience speaks to the incredible impact SMEs like TIC are creating in the broader community.
Increasing employee engagement and supply chain resiliency through good pay and ownership opportunities
Employees also value TIC’s opportunities for good pay and collective ownership.
“The jobs that we have here at The Industrial Commons are a much higher pay scale-based on a much higher pay scale than the normal jobs in this area,” Costner says. “This is extremely important for us that we can take waste and provide jobs for this area and move this forward.”
At Opportunity Threads, employees can also become full owning members. “It's always good to profit share and help the families make more than just a regular paycheck,” Vincente says.
“We take our network and our relationship building and our supply chain and value chain building very seriously,” Hemstreet says. “As we're trying to build skills, we're also looking at this idea of wealth creation and ownership, either partnering with companies that are taking on employee ownership, helping companies transition to employee ownership models, or creating catalytic companies as part of the supply chain that are also employee owned as well.”
How can large companies engage with SMEs to create value for all
As The Industrial Commons amply demonstrates, with the right resources and investments in place, SMEs can be instrumental to innovation, economic growth, and value-driven sustainable development. TIC has not only created jobs and an industry-leading circular economy for textiles, it’s also successfully sold its sustainable products to bigger companies, effectively reversing the narrative of global corporations needing to drill sustainability down to suppliers.
How can more companies ensure SMEs utilize their creativity and resourcefulness in the same way and integrate into their ESG strategies more effectively? Here are suggestions:
Talk to your company’s head of supply chain or chief procurement officer to learn more about what your SME strategy is domestically and internationally.
Research and identify organizations that partner with/understand SMEs and can funnel the appropriate training and resources.
Understand the challenges that SMEs can face; they don’t have access to training or conversations with their largest buyers. Sometimes they’re downstream and you’re speaking to the middleman. Go on a listening tour. Look for organizations that engage with SMEs.
Take advantage of partner organizations’ materials to reach communities.
Additional resources on Ares Charitable Foundation’s $25 million CREST initiative and the activities funded through Job for the Future, and World Resources Institute are available:
Have an example of a successful partnership with SMEs? Share with me and readers in the comments on LinkedIn.
Chrissa Pagitsas of Pagitsas Advisors serves as a strategic consultant to the Ares Foundation for the CREST initiative. Views expressed are her own.
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