Back in the 1970’s during my student days I spent
semester breaks travelling in SE Asia, and back home I would often visit the small
stores selling Asian handicrafts. Many of these stores were the beginning of
what we now see today as Fair Trade handicraft retailers.
But looking at these stores now, not much as
changed and the products are looking tired.
In communicating with various Fair
Trade producers, wholesalers and retailers a few things have become apparent. For
many innovative and new Fair Trade handicraft producers it impossible to break
into the Fair Trade market. Most have written to large distributors/wholesalers
and the response coming back is usually along the lines of “Unfortunately at
this time XYZ is unable to begin new partnerships ….. XYZ values the close
relationships that it maintains with its current artisan and producer groups.
These relationships help to ensure that our trading partners receive a consistent
volume of purchases….”
Therefore we have a number of large
wholesalers locked into a fixed group of producers supplying a significant
percentage of the Fair Trade handicraft market. At the same time many Fair
Trade producers are effectively locked out of this market. No wonder the Fair
Trade handicrafts retail market looks tired.
Some retailers provide interesting
retail environments for handicrafts. By combining handicrafts with organic and
Fair Trade food, coffee, tea and tables where one can sit and enjoy a snack and
coffee while browsing magazines etc. some pleasant retail spaces are being
created. Interestingly, I find these sorts of stores are flourishing in the
South where there is a lot more pressure on Fair Trade producers these days to
sell locally as trade with the North has decreased significantly in recent
years..
At Indochine Natural (www.indochinenatural.com) we have responded to these challenges in a number
of ways? Firstly, we have given up entirely any hope of entering the Fair Trade
market. We see are Fair Trade retailers/wholesalers trading in products similar
to ours, but the focus is on low quality, and we cannot compete with our high
quality products. Secondly, while maintaining our Fair Trade principles we are now
competing on the open market with an emphasis on product quality pitching exclusively
to top end markets including boutique hotels and organic retail chains. These
buyers are not certified Fair Trade, but they support the principles of Fair
Trade and leverage our Fair Trade status in their marketing.
There are very stark contrasts in
dealing with the Fair Trade wholesalers who are very limited in the products
that they will take and have the tendency to only want very cheap items (often
well below our ingredient costs), and the open commercial market with its focus
on our product quality and willingness to pay higher prices.
For us as a Fair Trade producer all
of this is a no-brainer…..Fair Trade is a business model providing sustainable
economic opportunities to the disadvantaged, and commercial sense says you go
where the opportunities are without sacrificing Fair Trade principles. To
survive, Fair Trade handicraft producers will need to move outside of the Fair
Trade market and learn to compete in the open market. This will ultimately result
in shrinking shop fronts in the exclusively Fair Trade retail sector (and even
more tired looking products) as Fair Trade producers seek more lucrative sales
channels. Ultimately, with more dynamic and interesting Fair Trade handicrafts
appearing in upmarket mainstream outlets this may be a more effective channel
for spreading the Fair Trade message. And it does not need to be limited to
whole products, Fair Trade handicraft artisans may supply components of larger
products, for example handmade decorative belt buckles for mainstream leather
belts that may or may not be Fair Trade……the possibilities are limitless.
You can learn more about our company
at www.indochinenatural.com
