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The Challenges of Marketing Fair Trade - Wynne, Sandy

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CHAPTER 1: Overview<br />

A) Brief Description and History<br />

1) What is <strong>Fair</strong> <strong>Trade</strong>?<br />

Nearly three billion people, half <strong>of</strong> humanity, live on $2 a day or less, according<br />

to Global Issues. “<strong>Fair</strong> <strong>Trade</strong> is a response to the failure <strong>of</strong> conventional trade to deliver a<br />

better deal” to the poor (<strong>Fair</strong>trade Foundation, Tipping the balance). <strong>Fair</strong> <strong>Trade</strong> is an<br />

alternative trade model developed to help disadvantaged producers in developing<br />

countries by improving their quality <strong>of</strong> life through trading partnerships. <strong>The</strong>se<br />

partnerships address trade inequities in the global marketplace. <strong>Trade</strong> inequities include<br />

lack <strong>of</strong> access to: markets, market information, technology, knowledge <strong>of</strong> best business<br />

and environmental practices, and credit resources. <strong>Fair</strong> <strong>Trade</strong> empowers the marginalized<br />

producers by investing in them, their communities and their environment through<br />

sustainable development so that they can lift themselves out <strong>of</strong> poverty.<br />

<strong>Fair</strong> <strong>Trade</strong> is “an innovative supply chain model which distributes its economic<br />

benefits more fairly among all stakeholders” (Nicholls & Opal, 2005, p.6). This<br />

innovative approach is based on the following principles:<br />

• <strong>Fair</strong> and stable prices covering production costs plus a livable wage<br />

• Transparent and long-term trade agreements<br />

• <strong>Fair</strong> <strong>Trade</strong> premiums for investments in the communities<br />

• Provisions for credit access and market information<br />

• Prohibition <strong>of</strong> labor abuses<br />

• Respect for the environment<br />

• Direct trade with producers, minimizing supply chain length

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