SBN Feature Article: April 1997 -
[Cached Version]
Published on: 7/23/2001
Last Visited: 4/6/2002
"People are moving toward the idea of trying to live a life that is more in tune with social values," says Bruce McKinnon, marketing director for Equal Exchange, a Canton, Mass., coffee importer.According to the 1993 Roper Starch "Green Gauge" study, which divides Americans into five groups based on their environmental awareness, some consumers have changed their shopping behavior for the sake of the environment.
One demographic of this group, the so-called "True-Blue Greens," precisely hits the natural products target--the educated, affluent and socially active consumer.The study also shows that a second group increased substantially.The "Sprouts," consumers just beginning to accept the environmental message, grew from 26 percent of Americans in 1990 to 35 percent in 1993.According to an article in American Demographics, two-thirds of Americans have noticed environmental claims on packaging in the past year, and half have purchased green products since 1990.
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For his part, McKinnon defines fair trade as something ingrained in the company from its beginning and not as an afterthought.
Fair traders attempt to source ingredients in a way that benefits developing nations, usually by paying higher prices directly to producers and eliminating "coyotes"--the middlemen who trade commodities for a cut of the profits.That way producers receive a premium price, rather than a trickle-down price after all the coyotes (sometimes three or four of them) take their cuts.By buying direct, fair traders greatly reduce exposure to world commodity-market price fluctuations.
Sometimes fair traders confront a communication gap between corporate marketing departments and procurement offices.What the marketing department would like to say on its product packaging is not always feasible for the manufacturer to live up to, especially when a company is sourcing products in the Third World or using a large number of commodities.
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McKinnon, who is from the United Kingdom, says Europeans have been more involved in fair trade because they are more outward-looking than Americans and have a tradition of following international affairs.
The market for fair-trade products here, however, is rapidly growing.Although he declined to give precise numbers, Mc-Kinnon says his company's sales have "grown substantially."And although Alexander sources some product through the traditional routes, he says his business in fair-trade products is also doing well.
Some European companies have developed models to determine if the projects they source their ingredients from are really sustainable.For example, Rapunzel Chocolates, a Swiss company that imports its products to U.S. natural products stores through Chatham, N.Y.-based ASI Organics, runs a program called Hand-in-Hand.That program determines the sustainability of its sources using three independent experts--an organic certifier, a food scientist and an aid worker familiar with the local culture, including its pay rates and social needs.The company also fills out a five-page questionnaire on each cooperative farm it works with.To determine the best price for products, experts work with local farmers, taking into consideration the local price, the world price and other factors.Rapunzel assures, through the questionnaire, that the cooperative pays workers local minimum wage, or, if that wage is deemed insufficient, whatever wage is necessary to meet workers' needs.