The idea of a design collective had been at the back of Targett's mind for a long time. 'I've always thought there was much potential here but not enough great products,' she says. 'Or the people who are making the good products in China are often just exporting them and not selling locally.'

Danish-born Targett moved to the mainland in 1997, with a mission to start her own design company. In 1999 she founded Jooi and was one of the first businesses to move into what was then a rundown 1950s-built former candy factory in Taikang Lu (Tian Zi Fang) district, now an artistic hub. Jooi's collections - among them cashmere and silk pillows, sculptural vase-shaped bags, hand-crocheted silk blankets, suede and leather computer cases - fuse Scandinavian style with subtle Chinese cultural influences, using artisan craftsmanship (silk-yarn embroidery, for example) with materials made on the mainland.

Keen to explore new avenues for her business, Targett talked to several designers about a possible collective, but things really got moving when she hooked up with Americans Rachel Speth and Jeff Delkin, co-founders of Shanghai-based home and kitchenware company bambu.

At that point, bambu's products - colourful modern wares made from organically grown bamboo - were being made on the mainland for the American export market. The duo, who started their business in 2003, told Targett they would be interested in securing retail space in Shanghai, but not on street level. 'From that evening I started thinking. I was restructuring my business and I had this great loft space and staff who could handle something like this,' says Targett.

With Speth and Delkin committed, Targett spoke to a slew of designers to drum up interest in the collective. She wanted to find people who not only produced contemporary designs but were also committed to quality craftsmanship and responsible manufacturing - those who cared about product processes, materials used and the craftspeople.

Speth and Delkin provided valuable support to the venture. 'We said we were interested because we loved the idea of a collective, of working with other like-minded designers,' says Speth.

They also wanted to highlight designers who had taken local skills and crafts and translated them into designs for modern living. 'I have always wanted to foster local talent and the cottage industries, keeping skills alive,' says Targett, explaining that techniques used in her product lines, such as 4-split silk yarn embroidery or handcrafted dovetail handle woodwork, require the skills of fine workmanship handed down through the generations.

The 'design with a conscience' tag came about because each member of the collective took that approach to doing business on the mainland, whether using materials that were natural, renewable or recyclable, creating products with a low impact on the environment, or providing social advantages for local workers. For example, Torana Carpets' weaving workshop near Lhasa employs 55 Tibetan workers who create handmade rugs. These days, very few Tibetan rugs are actually woven there, so Torana helps keep a traditional skill alive in its native land.

Launched last month, Nest is housed in Targett's Jooi design studio, a 1,300-square-foot light-filled space. 'It's not retail, so you have to seek it out. That's part of the beauty of it,' she says.

Alongside Jooi's and bambu's collections, there is pure white fine bone china by Asianera, founded

in 1995 by Grace Liu and Jian Ping, and graphic handwoven Tibetan carpets by Chris Buckley of Torana House, who spends his time in Beijing, Shanghai and his workshop in Lhasa.

Providing a handy perch is recyclable laminated cardboard and plywood furniture - for example, the Syzygy bar stool and the Flip Lounge Chair - by Sacha Silva and Raefer Wallis of A00 Architecture. Wallis' wife, Sherry Poon, exhibits her WoBaby Basics range of supersoft organic cotton children's clothes.

For adults, Lin Wen's Chinese-inspired fashions, under the label Brown Rice, combine Chinese historical designs with contemporary styling. And adding a dash of funky street style to the collective are recycled plastic bags by Jamy Yang, founder of Y-town. The cult bags are hand made from former outdoor exhibition posters and combined with modern graphics.

It's an eclectic combination but one which works and, as the word has spread, more designers are asking to join. 'We have a little bit of room left but it's vital they gel with our concept,' say Targett.

It's important too, stress Targett and Speth, that the designers involved in Nest also get something out of the collaboration, be it a new forum in which to retail their merchandise or the ability to brainstorm with others. 'For those of us who are accustomed to working alone, this has been a wonderful departure from the day to day,' says Speth. 'Nest is a perfect metaphor for what we envisage.

Like a nest, the sum is greater than its individual parts.'

The collective also functions as a place to exchange ideas among a wider audience. Plans are in the pipeline for Nest forum, a monthly event featuring a panel of designers talking about aspects of their business, from responsible manufacturing to fair trade to how to start a business on the mainland.

'We are offering ourselves up to talk about who we are, how we came to be, and to foster and create awareness,' says Speth. 'It's good to know it's not someone else's brand that fell off the back of a truck. You can come here, meet the designer and have interaction. That's quite meaningful.'

NEST, 2/F International Artist Factory, Lane 210, Taikang Lu, Shanghai, tel: (86) 21 6473 6193