Taking fair trade to market has never looked so good. Lauren Bartlett talks to companies at both ends of the business spectrum about the startling growth of trading fair.
Plus: 12 tips from Trade Aid’s Vi Cottrell
It’s a tough ol’ market at the moment. Consumers are feeling the pinch, retailers display hangdawg expressions. But there is one sector emerging like never before—the growing fair trade market.
The idea of trading more fairly with developing nations first sprouted roots in the 1970s. In New Zealand, the not-for-profit Trade Aid stores led the way.
Founders Vi and Richard Cottrell left their Christchurch home in 1969 on the faith of a single telegram, heading for India to work with Tibetan refugees. On their return they were eager to continue their work and, cutting a long story very short, opened the first Trade Aid shop.
Thirty years on and 32 stores later, Trade Aid is still open for business and is experiencing 16 percent retail growth rate year-on-year, over the past three years.
“We keep waiting for the downturn to hit us, but it just isn’t happening,” says Vi Cottrell.
On top of its retail operation, five years ago Trade Aid became a coffee broker, supplying fair trade beans to more than 60 New Zealand coffee roasters. Trade Aid coffee imports are predicted to hit 800 tonnes this year, up from eight tonnes in 2003.
Professor of Strategic Entrepreneurship Trish Corner says this is indicative of a general growth in fair trade goods worldwide. “From a global perspective, interest in fair trade is growing. From an academic view, we’re studying it. From an on-the-ground perspective, well, now I can buy fair trade coffee at my local supermarket.”
Trade Aid is just one example of using a commercial model to achieve change in developing countries. The products are bought at a fair price, then the profits over and above this are returned to the producer community. The more products sold, the better off the producer community.
In this respect, marketing matters.
“It is essential for us to have a mix of conventional business-minded staff and idealists concerned about the development of the company,” says Vi. “If something isn’t selling, it’s your responsibility to market it differently, or go back to the producers and make changes so it does sell.”
No one knows this more than former Woolworths New Zealand chief executive Andrew Davidson.
Andrew formed food marketing company Lighthouse Ventures to promote Fairtrade-certified supermarket brand Scarborough Fair, partnering with former Saatchi & Saatchi New Zealand chief Mike Hutcheson and a group of investors including Sarah Scarborough herself.
“The key thing is understanding what consumers are looking for. If you don’t understand who your consumers and customers are, then marketing can be very difficult. You need to understand the supply chain,” says Andrew.
Fair traders are also becoming smarter about the way they brand their products in an ever-growing market.
Scarborough Fair purchases its products at a fair price, then acts as a commercial venture—not as a not-for-profit organisation. For this reason, it explores several marketing avenues; product promotion at events like the Real Women’s Duathalon raises profile and increases profitability for shareholders.
“We’re in business to make money—there is a commercial aspect. But there is good to be done, and this feels a lot more complete, in regards to both the economy and the environment,” says Andrew.
Transparency is important in a company that markets itself in fair-trade environs. If you are not open with consumers, it can backfire.
“Big companies source one percent of their products in a fair-trade way and then call themselves fair trade. It’s going wild,” says Vi. “We mean it to be something much more than that.”
It seems Trade Aid’s work has paid off. A recent study, taken over a year in Kashmir, found that 90 percent of women who worked in Trade Aid-supported cooperatives had their children in schooling, compared with just over 50 percent of children with mothers in non-Trade Aid cooperatives.
“This is really exciting,” says Geoff White, current general manager of Trade Aid. “It shows we’re making a difference in the next generation. It’s about offering them a change.”
Keran and Ngawang Tsering: The Yak
Keran and Ngawang’s story could be a big-screen love story. Keran, an Australian working in India conducting monk culture tours, fell in love with her driver Ngawang, a Tibetan monk in exile. She continued her work in Tibet until Ngawang risked his life to meet her in Nepal, leaving the monastery to be with her.
En-route home to Australia, the couple stopped in Christchurch for a holiday. They loved New Zealand and had decided to set up home here when Keran discovered she was pregnant. Desperate for a way to support themselves while continuing their work with Tibetan refugees, the couple began buying Tibetan products directly from refugees and selling them at the markets—with promising results.
After gauging what New Zealand customers liked, they began importing more products, packing and labelling them, then supplying them to retail outlets. After hiring a sales representative and working with a mentor, the business has grown exponentially and The Yak products are now available in 140 retail stores in the North Island, with requests coming from the UK and Australia.
The Tserings put all the profits back into the business, and live frugally off the income they generate at the market. Since beginning The Yak, the Tserings’ proceeds have enabled a nunnery and a school to feed and clothe school children in the prefecture of Kardze (Ghanzi).
“I like working with the Tibetan communities and working with products that have more than one purpose. It’s a full circle. They are beautiful products and that excites me,” says Keran.
To any others thinking about starting a fair trade business, Keran says: “From the smallest intention to the greatest idea, the key is just getting started. Stop with the ‘gonnas’ and give it a go. It’s the intention that counts.”
Cherie West began importing coffee from Papua New Guinea after spending time there with aid fund Mission Aviation Fellowship, alongside her husband Richard, a pilot, and their two young children.
“Richard and I were horrified at the prices they received for the beans. One village didn’t even bother to pick the crop as the price to export it was more than the cost of the beans.”
The Wests lobbied the PNG Coffee Industry Corporation and got the Mission Aviation Fund involved with the export. At the same time, she helped local families sell second-hand clothing. “I’ve got a bit of a passion for developing countries and I got a real buzz from micro-enterprise.”
Tragically, Richard was killed when his small plane crashed in the jungle. When Cherie arrived back in New Zealand she expanded the business to support her young family, advertising the beans, tripling the volume and returning ten percent of the profits (over and above the fair trade price) back to the villages in PNG.
The proceeds have allowed one village to purchase a radio, and there are plans for a second radio and other aid projects. “It means a lot,” Cherie says. “They no longer have to walk six hours. They can call the plane to collect the crop, receive medical advice, and they listen to the news.”
The farmers have also been able to compare coffee prices, allowing them to negotiate their own deals. “It’s a tool for empowerment,” she says. “The more we sell, the more we can help. Soon the villages will be able to take the next step. We’re just giving them that initial step up.”