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need the right partners. And we would no longer be able to position Fairtrade as a product only suitable
for the idealistic consumer. Because if we kept focussing on that Fairtrade would never be big. We
would, therefore, have to focus much more on the average consumer; the customer who does his or
her shopping every day in the supermarket.
Quality, availability and price are all very important, and with Fairtrade these have sometimes proved a
problem in the past; the quality has not always been optimal, availability was not always 100 per cent
all year round, and even the price could be a barrier. Just suppose, if we could solve these problems
and also link in with the PLUS formula and maybe even with our own label products under that same
PLUS formula; and suppose we also had the guts to strongly back this with a large-scale introduction
to the consumers.
Take the plunge
We made that choice at the beginning of the year, after three months of orientation with a firm in
England, a supermarket organization, and we ultimately made the choice to go ahead with bananas.
Why bananas? Bananas are actually one of the biggest selling products in our supermarkets. With one
product we achieve 0.8 per cent of our turnover. That is already eight times as large as the total Fair -
trade turnover. Eight per cent. Just suppose that in one fell swoop we could turn that into Fairtrade,
we would increase our total Fairtrade turnover by a factor of 8. But then looking at the situation as it
was – why was it so small? The consumer price was 35 per cent higher that year, than the major brand.
At that moment we were floundering. The cost price was only 5 per cent higher. In other words, we,
as supermarket organizations, were earning far more than on the major brand. But because the turn -
around speed was so slow, the quality was very poor. The rotation was too low and in our shops we had
100 per cent distribution of bananas – in other words in all of our shops. But half the shops could not
even sell Fairtrade due to the low turnover speed. The proportion of turnover at that point was 97 per
cent. for major brand bananas, selling for Euro 1.69 per kg, but for Fairtrade bananas you had to pay
Euro 2.29; they were not fresh, and the proportion of turnover was a lowly 3 per cent.
With great power comes great responsibility. That is to say, we chose to take the plunge and go for the
case of the bananas, taking the decision out of the consumers’ hands. We ditched the brand-name
bananas from one day to the next, and you may be wondering whether that was such a good idea. We
had the nerve to do this with bananas since we did not feel that our turnover was specifically based on
the Dole brand; their bananas were always yellow, but the Fairtrade bananas next to them were always
grey or black. If we could supply optimum quality Fairtrade bananas, without raising the price, we felt
the customer would not really bother if they were buying a particular brand or not. The Fairtrade premium
was actually 0.10 cents. We said we would not pass this cost on to the consumer, and even if we had
it would only have meant a price rise of 5 per cent, and as far as we were concerned we would still
have gone ahead with the bananas. We tied everything together with an integral consumer campaign.
We involved our customers, independent retailers, in our decision so that they would be able to explain
on the shop floor why we would no longer be offering consumers a choice, and why we made the
decision, on behalf of the consumer, to go 100 per cent Fairtrade. We introduced the system at the
beginning of this year, and no longer sell crooked bananas. Initially we sold the bananas at a temporary
special offer discount, this was subsequently backed up by TV advertising, strongly backing the choice
of 100 per cent Fairtrade bananas.
Results. The choice of 100 per cent Fairtrade bananas resulted in100 per cent distribution of Fairtrade.
The increase in turnover amounted to 9 per cent, and I can tell you this was in a falling market for
bananas, and the PLUS turnover was not on this level. If only that were true, as far as the total turn -
over is concerned. In short, the customer did not abandon us, and started buying more bananas from
us. Not unimportantly, we gained a lot of publicity, a lot of free publicity, and the customers did not
seem to mind that the choice had been made for them. Due to the limited sales of Fairtrade we
previously paid $1,200 on a yearly basis; now we pay, willingly I might add, $400,000 on an annual
basis. With this decision, we have moreover also become, in one fell swoop, the country’s largest seller
of Fairtrade. So, on this point, we are bigger than Albert Heijn. And now we are turning our sights on
tea, coffee and cocoa, all under the PLUS own brand label, because we believe linking the PLUS own
brand label and Fairtrade will also turn these products from niche to mainstream. We will shortly also
be introducing 100 per cent Fairtrade pineapples into our PLUS supermarkets. Soon you will also be
able to buy 100 per cent Fairtrade tea, with our own brand label.
Concluding
Production must continue to meet the requirements of quality and availability, this is incredibly
important. My visits to the banana plantations have convinced me that large and small businesses
are very well able to meet these requirements. The price should be acceptable, and the example of
the bananas has shown that 5 per cent is definitely acceptable. The formula must be chosen with
care, and communication and investment must be continuous. Ultimately the decision is to appeal to
the mainstream target group instead of focussing on the niche market. Dare to make the consumer’s
choice for him. Fairtrade as a brand, in combination with our own label formula, in our point of view,
differentiates it from the major brands. But as management you must be committed to the concept
and be prepared to go for it. Use your power right across the chain. And, finally, get involved, get to
know how the system really works. Among other things, my trip to Colombia with Peter, personally
really helped me in this respect. You have had the film, this is the last thing. PLUS is a commercial
enterprise which is willing to make decisions, after all we have a business to run – that much will be
clear. The responsibility for brand value within Fairtrade is not based on idealism, but on realism.
Commerce and Fairtrade for supermarket organizations can go hand in hand, and we ultimately
believe in sustainability and the improvement of working conditions, by means of a fair price. As far
as we are concerned this is well worth the effort.
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