Fairtrade: Building an ethical consumer brand

Commodities such as coffee and cocoa are grown by farmers who suffer from low incomes, volatile prices, and lack of capital. The Fairtrade scheme offers them minimum purchase prices and a social premium payment. With high recognition and rapid growth in sales, Fairtrade is one of the world's most successful ethical consumer brands.

Scope

Find out about the problems facing agricultural commodity producers in low- and middle-income countries.

Discover how the Fairtrade scheme operates for producers and consumers.

Get data on the global Fairtrade product market over the 2009-2014 period.

Learn about how volunteer activists and development NGOs are spreading awareness of Fairtrade and the problems of poverty it is attempting to solve.

Hear some of the criticisms that have been leveled at the Fairtrade concept.

Reasons to buy

Why is it difficult for producers of agricultural commodities in developing countries to escape poverty?

How does the Fairtrade scheme aim to alleviate the problems of producers?

How popular and trusted is the Fairtrade brand around the world?

How valuable is the global Fairtrade market, and which countries have the largest market?

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Table of Contents

OVERVIEW

Catalyst

Summary

MANY PRODUCERS LACK MARKET POWER

Coffee, cocoa and sugar are mainly grown in low- and middle income countries

Producers lack economic options

Incomes are low

It is hard for producers to add value

Growers are exposed to volatile commodity prices

Diversification of crops can be difficult

Labor practices can be exploitative

Use of child labor is economically dubious

Some cocoa production uses slave labor

THE FAIRTRADE SCHEME AIMS TO REDRESS THE BALANCE

Fairtrade ensures minimum prices are paid to growers

The Fairtrade Foundation requires price risk management strategies

Standards are set out for workers and employers

The Fairtrade Premium is paid into a communal fund to improve living conditions

Products are certified and labelled for consumers

THE FAIRTRADE MARKET IS GROWING STRONGLY

Sales of Fairtrade products are increasing strongly globally

Why is the Fairtrade market expanding so rapidly?

The Fairtrade logo is well-known to consumers

The adoption of certification by major brands is boosting the market

Buying the products is presented as activism

Development NGOs provide free "marketing" in their educational and campaigning activities

There are some criticisms of the scheme

Does Fair Trade encourage oversupply?

Does Fair Trade focus too much on cooperatives?

Is the Fairtrade brand leaving other schemes in the shade?

CONCLUSIONS

Fairtrade is one of the strongest ethical consumer brands

APPENDIX

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