Editor's Note: The following article appeared in the March 2013 edition of the Denton Business Chronicle.
When Tara Smith returned to the United States in 2009 after serving in the Peace Corps in the Republic of Cameroon, she wanted every purchase to make a difference.
The University of North Texas alumnus also wanted to continue her work in Cameroon and help the women living in poverty.
“I fell in love with the people and the culture,” Smith said, adding that she was welcomed in by the people there. “I was integrated into the culture.”
She and Ryan Schuette, who also graduated from UNT, co-founded Cherie Amie, a fair trade lingerie business.
Cherie Amie employs women in Cameroon to make the lingerie.
It allows women to indulge in something and know they are serving a greater service at the same time, Smith said.
He and Smith are still working to secure a fair trade certification, which is offered by several independent organizations, including Fair Trade Federation.
There is a fee for membership to the regulating organizations, which are not regulated by the government.
With Fair Trade Federation, Cherie Amie will have to wait a year to receive a certification.
Defining fair trade
Fair trade isn’t easy to define. And the measures, while similar, are different depending on the product and the country.
Different business owners and those who are familiar with international business have different ideas surrounding fair trade and what it means. Some, like Cherie Amie, want to help specific communities and others just want to know that their product wasn’t a hindrance to the society it came from.
Business owners using the fair trade model want to improve conditions where they are purchasing product. The model seeks to offer fair wages, hours and working conditions for the people providing the product, whether it’s apparel or coffee.
They say it allows farmers and artisans better prices for their products.
Schuette calls fair trade a “progressive” movement.
“Fair trade is a system of exchange whereby one society is able to exchange fairly with another,” he said.
He sees it as a way of empowering people in developing countries.
Cherie Amie, which is French for “dear friend,” offers wages above the $2 per hour wage earnings the women would normally earn. It also seeks to give fair hours so the women have time for family.
The business is partnered with a seamstress center in Cameroon.
“It was important to us because both of us have served in Africa,” Schuette said. “We both saw that fair trade really unlocks the poorer of those struggling people in these countries.”
He said they are hard working and have an entrepreneurial spirit.
Paul Tanis, general manager of the Cupboard Natural Foods, has been selling fair-trade products at the store on West Congress Street for over 15 years.
The two main fair-trade products the store sells are coffee and chocolate, he said. Other products include tea, sugar, grain and spices.
Tanis said the goal of fair trade is cut out the middle man in importing the product into the United States. It allows the grower to earn more for the commodity.
Fair trade also promotes organic methods of farming, he said.
“Fair trade is teaching organic and sustainable growing habits and methods to smaller communities and people around the world,” Tanis said.
Growers can’t offer organic, fair trade products if they don’t get a good price and that’s why customers tend to pay more for both organic and fair trade items, he said.
Despite the increased cost, he said it’s good for customers because if growers use organic methods they won’t use pesticides and chemicals, which is good for the consumer and the grower.
He has some customers who care about fair trade and some who don’t.
“My shoppers are often a little more educated and knowledgeable about these topics than the average shopper,” Tanis said.
One of the fair-trade coffee suppliers for the Cupboard is the Denton-based Bookish Coffee, owned by Clay Rozell.
Fair trade is important to him because it shows that there is a standard the grower has to abide by, he said.
Rozell, a Denton firefighter who also runs a non-profit organization, i [heart] denton with his brothers, began roasting coffee more than a year ago.
He compares paying higher prices for fair trade products to paying higher prices for organic products.
“It’s better for you so you pay a higher price,” he said.
Rozell agrees that the higher prices ensures that the famer can sustain the fair trade, and often organic, methods.
Fair trade is important to his customers, he said.
“As a purchaser of coffee, it’s important for me to take care of the people we’re benefitting from,” Rozell said.
He works with importers in the United States that import the coffee from the different countries.
He purchases coffee from all over the world, including Central America, South America, the Pacific Islands and Africa.
“I think coffee as a commodity is unique in the same sense that you can trace straight back, not only to a particular farm, but individuals in the farm,” Rozell said.
Derrick D’Souza, a professor in the department of management at UNT, said when it comes to fair trade one must think about all parties.
“Does the term mean anything?” D’Souza said. “There is not common basis for fair trade.”
What’s fair to one country may not be what another country considers fair, he said.
D’Souza, who worked in international business for eight years, would argue that, in general, if countries get into an agreement it’s implied that each sees an appropriate value from the agreement.
“Trade agreements have always existed between parties, historically that is,” he said. “Trade agreements, by default, when signed, are fair to the parties involved or else they would not have signed it.”
The problem, D’Souza said, is that these agreements are made by politicians or administrators who are not impacted directly by the trade agreement. While the agreement may be fair to them, it may not be fair to those who are directly impacted by it, he said.
The International Trade Administration in the Department of Commerce regulates international trade.
According to its website, trade.gov, “Unfair foreign pricing and government subsidies distort the free flow of goods and adversely affect American business in the global marketplace.”
If that happens, the agency takes enforcement action.
When considering fair trade, people have to look at the overall cost to the society, D’Souza said. The cost of local resources must be included in the trade, he said.
“What is the total cost to the society that is selling that product?” D’Souza said. “And is the society being adequately compensated?”
The United States is losing jobs to China, he said.
“Is that a good thing or a bad thing?” D’Souza said, adding that’s a complicated question.
For a society to maintain its level of affluence, the society must look for the higher paying jobs instead of trying to hold on to the lower paying jobs, he said.
“The bottom line in this is the reality is we will lose jobs to other countries,” D’Souza said. “The challenge is to ensure the jobs we lose are the lower-paying jobs.”
He also asks the question of what businesses are trying to maximize by using the fair trade business model, giving the example of lifelong satisfaction.
He said that’s what fair trade is trying to do improve people’s lives.
“That’s the heart of it,” he said. “In each society people are trying to maximize their level of satisfaction.”
He said this is the lens through which a person can assess fair trade.
Individuals in one society must recognize that satisfaction is measured differently in another society, D’Souza said.
Rozell said he’s heard criticism about fair trade that some farmers can’t afford the certification to be fair trade and the certification is just a ploy to drive up prices.
“For me, criticism aside, I think it’s a step in the right direction toward having some type of regulations for how coffee is grown and traded,” he said.
Rozell said the new buzz term is direct trade, which means the buyer goes directly to the grower.
It has come about to address concerns related to fair trade, he said.
Direct trade is “probably coffee buying at its purist,” Rozell said.
RACHEL MEHLHAFF can be reached at 940-566-6889. Her e-mail address is firstname.lastname@example.org .