"This is the moment when we must build on the wealth that open markets have created, and share its benefits more equitably. Trade has been a cornerstone of our growth and global development. But we will not be able to sustain this growth if it favors the few, and not the many. Together, we must forge trade that truly rewards the work that creates wealth, with meaningful protections for our people and our planet. This is the moment for trade that is free and fair for all". (Obama 2008)
"Has the supermarket trolley dethroned the ballot box?" This powerful statement from The Economist (2006) reflects the fact that the process of going into a shop and purchasing a product can lead to sending a clear message to the global community. Indeed, the consumers have found new ways to communicate and make common knowledge their dissatisfaction towards the global regulation and policies.
The ethical sector and more precisely Fair Trade are currently at a "turning point" (Nicholls and Opal 2007). The movement does not seem "on the fringe" anymore and more and more people are becoming aware about the products. As Tallontire (2001) depicts, the movement "faces challenges at the both ends of the supply chain, reflecting the dual roles of Fair Trade as a business and development instrument". Indeed, Fair Trade is currently in a situation where it is marketing its products via the mainstream outlets, encouraging the firms to adopt the Fair Trade labels or even the practices, compete with the "fairly traded products" and other "sustainable development product" while trying to not lose its "soul" and its former principles.
But at the same time, we can ask ourselves to what extent this industry can put itself to the next level and become sustainable. The bottom line is to understand and clearly define the general vision of this movement as well as the ways to face the futures challenges while keeping the spirit of the movement. On the other hand, several conventional large scale companies encompassed Fair Trade or the "fairly traded" products in their portfolio while many companies are still refusing to support the values conveyed by the Fair Trade movement.
1.2 History of Fair Trade
The idea of equitable trade appeared the first time at the United Nations Conference on Trade and the Development in 1964, in Geneva with the principle of the "Trade not Aid". In 1968, during the following conference at New Delhi, the developing countries presented once again their claims for a more equitable and more sustainable improvements in terms of development.
Thereafter, in the Netherlands some groups sought alternative ways of doing business and at the end of the 1960s the first "World Shop" opened. The objectives were to sell Third World artisanal products, limit the number of middlemen so that the producer will beneficiate the most and finally to make the people sensitive to the issues related of the unfairness of the globalization.
But the real starting point of Fair Trade was in 1973, with the introduction of the Indigo coffee coming from Guatemalan co-operatives. Indeed, the turnover of the Fair Trade coffee exceeded rapidly the one of the craft and other artisanal items. Progressively, the World Shops moved from an only consciousness raising mission to a more commercial aspect. At the same time, the quality of the products was improved and the product range was widened.
In 1988, a label "Fair Trade", under the name of "Max Havelaar" was allotted for the first time to a coffee brand. By the creation of a label, Max Havelaar aimed to get into the mainstream business. Later, other labels came out: "Transfair" and "Fairtrade". In 1997, many labels among Max Havelaar and Transfair merged in order to create a larger common one: The Fair Trade Labelling Organization (FLO). Today, the movement encompasses more than 1.5 million producers and workers in 58 developing countries.
[...] The purpose of this survey was to determinate to what extent this industry can sustain itself in the mainstream from a customer point of view. The online survey system Survey Monkey available on www.surveymonkey.com was used in order to facilitate the analysis of the data and reach more potential respondents; the target of this online survey was the final consumer people received two links by email, one to answer the English questionnaire and the other one to answer the French one people answered the English questionnaire and 58 the French one, so 125 people in total. [...]
[...] Some assert that supermarket and large retailers are selling Fair Trade only with the aim to serve a cluster of consumers, taking advantage of a growing market without encompassing the Fair trade principles , what do you think about it? For this question, all the professionals interviewed seem to agree with the fact that selling Fair Trade product does not always mean to encompass the principles. Geoff Moore is depicting the situation in the United Kingdom: “some retailers as Tesco in the UK seem to have a very different approach concerning the Fair Trade than some others like Waitrose or Sainsbury or the Co-op. [...]
[...] Indeed, for the mainstream retailers and distributors entering a growing niche market by selling Fair Trade products is a common business strategy to maximize profitability within a highly competitive sector. In fact, generally the demand and the offer are characterizing the profitability of a market. In the very competitive retail industry, the profitability is mainly based on the quantity sold; indeed for the majority of the items the profit margin is relatively low. Therefore, the business potential profit is highly correlated with the size of the market. [...]
[...] Tables of Content CHAPTER ONE: Background & Objectives Background History of Fair Trade Principles and Rules Fair Trade Organizations Particularities Fair Trade Goes Out of Marginality Strategic Positioning Justification of the Topic Focus and Objectives of the Dissertation 15 CHAPTER TWO: Literature Review Overview Consumer Behaviour Distribution Channels From Market Niche to Mainstream, One Example of Success: The Organics Products 24 CHAPTER THREE: The Research Plan Research Perspective Research Design Secondary Data Primary Data Online Survey Interviews Access Sample Data Analysis Limitations 30 CHAPTER FOUR: Data Collection, Analysis & Findings The Fair Trade Online Survey Professional Interviews 45 CHAPTER FIVE: Conclusion & Recommendations Conclusion Recommendations Futures research 61 Ethics 62 References 63 Appendix Fair Trade Online Survey (English Version) 67 Appendix Interviews Questions 72 CHAPTER ONE: Background & Objectives 1.1 Background “This is the moment when we must build on the wealth that open markets have created, and share its benefits more equitably. [...]
[...] Many companies are shifting to a Corporate Social Responsibility's (CSR) concept; the Fair Trade movement should then build a business upon this current shift of values of the traditional big business which are more and more conscious that being fair can largely improve their brand image. By working with the Fair Trade organization companies will, to a certain extent, externalize their CSR operations to an external entity which is required to control their respect of certain requirements (work conditions, wages . [...]
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