Dropshipping for Fair Trade: Benefits to the Artisan
Artisans in emerging nations and third world countries suffer from a variety of issues. They often are unable to provide for the basic needs of food, shelter and housing for their families. Access to healthcare is limited and often inadequate. Exploitation from the sex trade that preys upon vulnerable children is an ever-present risk around the world.
- Fair Market Value
- Artisans in remote villages all over the world as well as cities and towns deserve a fair value for their creations. Buyers in the Fair Trade industry seek to reward artisans for the quality of their work rather than leverage their negotiating advantage.
- Often many artisans work as employees of small local businesses and likewise deserve a fair wage. Their skills in art and design are passed down through generations, honed over years of hard work, attention to detail and trial and error and should be rewarded.
- Fair Business Practices
- Because of their remote location or understanding of markets or business principals, they become prime candidates for financial exploitation by middlemen.
- Fair Trade protects artisans from being preyed upon by unethical buyers seeking to benefit from their advantaged position in the supply chain.
- Young people, orphans and widows all face the risk of exploitation in labor practices, compensation, safety and exposure to harmful elements.
- The sex trade industry is active around the globe and all are vulnerable to exploitation. Just this last week, one of our business partners, Eternal Threads, reported a raid in Delhi that rescued 12 Nepali women that were being trafficked to the Middle East.
Pray for these 12 women as they begin trauma counseling and guidance. Partners in Nepal have expanded their anti-trafficking efforts to India where young Nepali women are rescued from “brothel” hotels and apartments in Delhi.
Sharing Best Practices
Artisans in these emerging economies also suffer from access to ideas, innovation and role models.
- Just like entrepreneurs in the US, artisans need financial support. From having cash to source raw materials to paying employees to inventory carrying cost, purchasing Fair Trade products means artisans have the cash flow to continue building their small business.
- Because of the remote locations of many artisans, there is a frequent lack of availability of raw materials and related equipment. Imagine the impact interruptions in the US supply chain would cause. Plants would be temporarily shut down, productivity would fall, unemployment would rise and shortages of products and materials in demand would further impact businesses downstream. Artisans who can gain access to other artisans, Fair Trade organizations and tap supplier networks fare much better in solving this challenge.
- While most artisans operate on a very small scale, they still need to operate efficiently. And as their product demand grows, scaling to meet demand is a critical success factor. Often this involves purchasing capital equipment. Access to financing is always a challenge, particularly in third world countries. However, artisans tend to be resourceful by nature. Much of art design and methods are passed down through generations when machinery and refining equipment were not even around.
- Capacity and lead-times are likewise a challenge when confronted with large orders from buyers seeking to import their products. Because of the capacity constraints (i.e. labor, equipment, raw materials, working capital), opportunities are often limited to their limited capacity and lead-times.
- Controlling cost is critical as well in maximizing the profits the artisans receive. Input cost, labor cost and thoughtful investments in capital coupled with competitive and adequate pricing often determines the long-term viability of the artisan. Just like small businesses in the US, managing cash flow is key to survival.
- Technical Information
- Access to technical information on raw materials, process improvement, construction techniques and methods are also key for emerging economies with artisans in remote locations.
- As the global marketplace continues to become available through eCommerce and other platforms, they need to remain up to date of the latest trends, designs and construction techniques to produce products people buy while at the same time maintaining their ethnic beauty.
- Process Improvements
- From raw material extraction or sourcing to processing to construction, Fair Trade organizations seek to share best practices and provide assistance to artisans enabling them to make improvements in quality and productivity.
- Repetition of popular products, styles, materials and color are a challenge for remote artisans. eCommerce companies utilize images and description to sell products. Consumers expect the products to match the image, design and description. Achieving this requires significant improvements in the processes artisans must employ to deliver on expectations and build a scalable business vs individual works of art.
- Design and functionality
- Artisans in remote locations often lack access to learning about product design and development. Being exposed to global trends, techniques, raw materials and best practices enables them develop skills and produce products for larger markets.
- Maintaining the unique beauty and design of products, materials and techniques handed down through the generations is key to maintaining authentic designs indigenous to the region.
- Because most lack access to feedback, Artisans could be producing products global consumers don’t want and wouldn’t even know it. Here in the US, we take for granted access to marketing data and consumer feedback, sales trends etc., that companies pour over. Without this feedback loop, Artisans are flying blind. And what if the market demand for a color, texture and style change? What about demand planning so the artisan can schedule production to match demand. Imagine the impact if artisans around the globe could maintain production at a steady pace while meeting demand. The opportunity for all Fair Trade organizations is to enable these information pathways to the market and consumer trends.
- Organizational and Business Development
- As demand for products grows and the small business begins to develop, Artisans operating in remote locations (and often a family business), suffer from being isolated and having access to best practices.
- Fair Trade companies seeking to build and enhance their supply chains will engage with artisans in bringing information, ideas and real-world examples of changes needed to run their business. A business that learns and applies new business practices has a better opportunity to grow profitably.
The women from Ollantaytambo, Peru use alpaca wool to weave colorful clothing and accessories. The beauty of these unique designs is preserved while integrating design standards for replication supporting replenishment of popular designs.
Access to Markets
- Market Access
- Artisans, particularly those in remote villages, suffer from geographic isolation. They also lack the expertise to solve these problems. Fair Trade organizations (and unfortunately others not committed to Fair Trade), seek to provide this access which left in isolation is a crippling limitation.
- Artisans have always provided their wares to their local market. Where tourism thrives, those artisans often fair better, however, the market for tourist is still limited to only those who visit their village or town.
- The challenge, and the opportunity, is to connect with these local artisans, usually through an exporter. Fair Trade organizations seek to ensure these middlemen are fair and equitable in their dealings with the Artisans. Understand, these buyers, exporters (aka middlemen) play a key role. Done fairly, everyone shares in the sale of the Artisans wares.
- Gaining access to global markets via eCommerce and wholesale to the trade, artisans are able to provide for their families and thrive in their local community lifting the economic condition of their villages.
At Trutogs, we believe the best long-term strategy to building viable and sustainable economies around the globe is through tapping the immense potential within every human. Artisans in remote villages and disadvantaged economies are a great place to start as they often produce art, collectables, clothing, jewelry and other useful products.
Working with Fair Trade organizations devoted to providing fair wages and fair working conditions, access to markets and sharing best practices, the social and economic welfare of artisans will continually improve. Artisan communities that grow and develop are seeds of prosperity. With global economies opening up with internet access, proliferation of eCommerce, transnational shipping companies and secure transaction processing, opportunities for Artisans to reach well beyond the local markets have arrived.
- Robert Winter