What is fair trade? Look Deeper into One Shop's Story | dignify
January 17, 2013

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What is Fair Trade? A wide range of what people call fair trade


I recently received a very direct and honest question: A friend had popped into a well-known fair trade shop and noticed that they were selling the same type of kantha-stitched throws as she had just purchased from dignify…for $24 less. “Of course I support you,” she affirmed, “but it might make someone ask… why are yours $98?”

Indeed.

Of course, I had heard vaguely about this before, and I knew from the start of the project that the cost-to-sale price of our blankets were considered “less than ideal” for importers/sellers like me. But I didn’t know the details, and I didn’t have an answer. Now I was asking, too! Not because I thought $98 was high, but because knowing that it takes 2 - 6 days of labour to make one throw, how could they sell them for so little?

Well, as Robin, the managing director of BASHA – who make our blankets – said: “What is Fair Trade? There seems to be a wide range of what people in Bangladesh call ‘fair trade’.”

She offered many insights into the industry and how others, including that specific producer, compare to her operation. Read on for a more detailed look (in her own words) at the operation behind our own “fair trade” kantha blankets. 

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On wages:

We set our wage to exceed the minimum wage for those in the garments industry. We also pay piece rate, and as we've had such demand for Christmas, we've paid extra bonuses in cash and savings for any blankets they make at home which allows them to have a little nest egg. Everyone who comes every day and puts in effort receives over the Garments Industry minimum wage. Some women who are really motivated are earning closer to a managers salary year-round (some 3 or more times the minimum wage), and closer to a high manager with the Christmas season bonuses.  

On benefits:

We pay medical and we have a good day care for all ages. Right now we have 30+ children in the day care; those costs, as well as the women’s ongoing education, are currently funded by blanket sales, but we are working on establishing a foundation to fundraise some of those costs [a standard practice among similar social enterprises].

 

On alternative organizations (specifically the one selling the much cheaper throws):

I support their work; they are giving jobs to a lot of women who have a new lease on life because of it.  They provide work where people live so they don't have to immigrate to the garments areas, and they provide work that is pleasant and safe. But, I think it's time they re-evaluate their employee policies and pay scales.

They pay a steady wage that is actually under the Garments Industry minimum wage.  They also hire outsiders to sew the blankets for less than half of what we pay.

There are a lot of products based in Bangladesh that would call themselves fair trade which do not pay a living wage, in my view.  Maybe if they did pay that the businesses wouldn't survive and it's better to pay less than nothing, I don't know.  I don't think the garments wages are high, in fact they are probably the lowest in the world (they are trying to raise them in the near future, as they are pretty hard to live on as it is.)  I think we should be exceeding them.

On the blankets:

[Looking at the cheaper blankets,] I think you'd find the quality of the fabric and the patterns matched a bit different to ours. And they do sew their rows of stitches about twice as wide as ours as well, so they would take less time.

Our blankets are 6 layers of repurposed sari-cloth, stitched together using the kantha stitch. A $98 throw takes 2-6 days to finish (depending on the experience of the seamstress). Spreads are twice the size and take twice as long to sew.

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Since launching dignify, I have received a number of emails, soliciting my business with similar products for import from India and Bangladesh. The cost of similar products is less than ½ of the cost of our throws from BASHA, but their origin, production, and process are completely unknown to me.

I have also seen similar products for sale from large department stores and trendy US chains, selling for much higher.

There is certainly opportunity for us to make much more money, but I keep coming back to my own questions… “How can a person handcraft these items for such a low price?” “How much money are stores making whilst the value of the person making the goods remains so low?” “How can it be good to do it any other way?”

So, what is fair trade? Well, I am confident that we have sourced and priced our products in a way that is good, and, as we forge through this new model of business, still profitable, too.

Feel free to continue the discussion online on our facebook page, on the blog comments, or directly to me at keepup@dignify.ca.

 

- Shelley

 

dignify has provided over 50,000 hours of dignified employment to women around the world, AND has been transforming shopping habits at home for good, all because
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