by Michael Smith (Veshengro)There appear to be signs on the horizon that indicate that shoppers may abandon ethical shopping in the fact of rising prices, especially cost of food and fuel.
Organic foods and fair trade goods are being bought less, already, it would appear, than it was only a few weeks back.
Concern for others less well off and especially for growers and producers of coffee, tea, cotton and such, and concern for the environment are the first to suffer and go out of the window when it comes to prices, in general and especially for food, going up. Then even BOGOF offers not longer cut it and it is straight forward price reductions that shoppers look for.
Where does this leave Fair Trade and organics and green produce and products, as well as services and suppliers?
Considering that, more often than not, fair trade and other ethical products, goods and services are somewhat more expensive – in some case a lot more expensive – than “ordinary” ones people vote, in times of economic “hardship” and recession, even if it is only perceived “hardship” and recession, with the pocketbooks and their feet. That is to say they buy other goods that are not fair trade or organic or green or ethically produced. They will then go, mostly, for non-fair trade products which are significantly cheaper that any ethical goods and products. This is with the exception of some produce such as tea and bananas at Sainsbury's in the UK, for instance, where all of their own brand tea and all of their bananas are fair trade and the price remained the same as before.
While I am well aware, as I am sure other people are too, that a fixed price and premium is paid to the producers under the fair trade agreements, ate times, I am more than certain, retailers do put a nice little profit margin onto fair trade and other ethical goods, knowing that the ethical shopper is prepared to pay extra to have the money go to the producers. Most are not aware of how high that profit margin is, at times.
Not surprising at a time when such products are demanded by the buying public and the same is true for anything recycled and “green” and for any environmentally friendly goods. Here too, in the recycled and environmental friendly product sector, because of demand, many makers, manufacturers and sellers have added a rather big margin to rake it in. Is that ethical? No!
It is therefore not surprising that at times like these when fuel and food costs are going up and up shoppers are not prepared to pay through the nose often and therefore go for the non-fair trade and other products.
While the fair trade premium paid to the producers is one thing, in many of the other cases the costs are that high because the sellers know full well that people want to be and be seen to be green and to have a conscience. People who want to be seen to be thus are therefore also quite willing to pay such premium while the economy is more or less booming but, as it seems to ease their consciences to do so and to do “their bit” for the poor or for the environment. However, when there is a downturn and the economy throws a wobbly such ethical principles soon are abandoned and no such goods and produce are being bought, or at least they are bought less.
I must say that, with some of the prices charged for “green goods” I am not surprised that under conditions of perceived hardship people will not buy them. Some are a rip off as far as costs are concerned. There was a saying that one cannot get money for old robe. Today this, however, no longer holds true. I am not sure about getting money for old rope but some green “designers” and crafts people sure ask money for old rope (see my article
elsewhere).
Sainsbury's has recently fought, it would seem, a price war with the likes of Tesco and ASDA as regards to “Delight” chocolate and, as far as can be seen from the restocked shelves, has now deselected the Divine fair trade brand and has gone for a much more expensive brand that is not all fair trade and I am sure we can see here, yet again, that money begins to speak against the principles that that company was claiming it had.
The truth is, and that applies to supermarkets and retailers as much as to the shopper, that the bottom line is all that the majority are concerned with and only when it suits them will they, the majority that is, be interested to be seen to be green or ethical. There will remain some that will stay true to their principles but I doubt that many retailers will. The same will also be true for many shoppers. To the seller any fair trade that does not sell is a loss-leader and something to be replaced, period. To the shopper who has to watch his pocketbook it is the price that counts for the food or what-have-you in times of economic wobble and not whether or not he is green or does good. That is the bottom line. Now where does that leave fair trade and the green sector?
© M Smith (Veshengro), May 2008
