THE fairtrade pioneer Traidcraft has announced a rescue plan in which the company will slash its product lines and keep just 12 employees to stay afloat.
The company announced in September that it was facing closure unless it could come up with a profitable business model (News, 28 September).
The slimmed-down company, announced this week by the board of Traidcraft, will focus on a core range of grocery products such as tea, coffee, and lavatory paper, and fewer handicrafts. But it also promises to continue to challenge the conventional market by adopting a more radical approach to labelling, and ensure that all its products have a cost breakdown that shows customers how much money has gone to the producer.
It is part of a new commitment togreater transparency, inspired by feedback from younger people who said that they admired Traidcraft, but wanted more accountability and transparency, the chief executive, Robin Roth, said.
“We will fully inform customers where their money goes, to make their decision on what to buy easier. We will be honest about the price of a fairtrade cup of coffee, and a non-fairtrade cup of coffee. It will be disruptive to the market,” he said.
The rescue plan, which was put forward by a group of staff last month, also sets out a proposal for a membership scheme for customers, which will encourage people to get together to buy products to save money on delivery and cut down on packaging waste.
Mr Roth said: “We are looking to tailor our offer to make sure we make available large sizes of coffee and rice and sugar, and other products for people to buy in groups and share out. If you look at the moment at the cost in food miles and packaging to deliver one bar of chocolate to one person, its just not good stewardship of our resources. If people can be encouraged to buy together, through a membership scheme, then we can lower our prices.”
Traidcraft’s model of selling through volunteers in churches will remain “at the heart of our sale strategy”, he said. Currently about half of Traidcraft’s sales come through its volunteers, who run stalls in churches and community events.
The slimmed-down company will inevitably mean that some of its small-scale producers in the developing world lose a contract which may “make them go under”, he acknowledged. But he said that the company’s charitable arm, Traidcraft Exchange, was committed to working with these producers to help them find other outlets for their produce.
“There is a great sadness amongst staff that we haven’t been able to save the world, “ he said. “Traidcraft has transformed shopping in the UK, and now you can find fair trade everywhere, from online shops to petrol stations. But as times change, so must we. When new markets are searching for goods that are ethical, vegan, and organic, as well as fair trade, we need to be there. As younger people demand co-operative models of doing business, we need to strive for that too.”