THE NETHERLANDS

The structure of fair trade

Of the 26 import/wholesale organizations in the alternative market, Fair Trade Organisatie - the Dutch EFTA member, which was formerly called SOS Wereldhandel - is by far the most important one. The others, such as Goed Werk, Cohan, Miel Maya Honing etc., mainly import handicrafts.

The Max Havelaar fair trade mark organization has 22 licensees for coffee, cocoa and honey.

Retail channels include world shops and fair trade shops, mail-order catalogues, a few commercial shops, 50 supermarkets selling a complete range of fairly traded food products, and, for the Max Havelaar products, 90% of the Dutch supermarkets - adding up to some 7,000 points of sale for Max Havelaar coffee and other labelled food products.

The alternative market consists of 1,250 points of sale, including 380 world shops organized into the National Association of World Shops (or Landelijke Vereniging van Wereldwinkels) and the 6 shops managed directly by Fair Trade Organisatie.

Considering the whole range of import organizations, world shops and labelling initiatives, the fair trade sector employs an estimated 200 persons.

Fair Trade Organisatie's budget for education is 280,000 ECU and that for marketing 1.1 million ECU, i.e. a total of 1.4 million ECU.

The market for fair trade

According to recent surveys, 80% of the Dutch public are familiar with the name "world shop" and 70% of the public know the Max Havelaar trademark, whereas 15% of the public are said to be willing to buy fair trade products and pay a higher price for them compared to regularly traded products.

The leading coffee roaster, Douwe Egberts, has a rather rejective attitude towards fairly traded coffee but spreads a so-called fairly traded coffee (5% of all its purchases) over all its regular blends. While Max Havelaar blends are 100% "fair", Douwe Egberts uses on average only 5% fairly traded coffee, and even this small percentage is not purchased according to the criteria set by Max Havelaar.

Most commercial coffee importers appear to perceive fair trade as a threat, but at the same time as a chance to win back lost market shares. The "cold feet" of commercial traders and "fair" traders about doing business with one another are getting warmer on both sides.

Due to the rise in coffee prices on the world market, some commercial types of coffee have become more expensive than Max Havelaar since October 1994, while normally Max Havelaar is up to 40% more expensive. Crafts products are generally up to 10% cheaper in world shops compared to commercial retailers. The attractiveness of the products seems to be good. Availability of food products is never a problem, but handicrafts may involve stock problems.

Over 200 world shops have adopted the "corporate" style of the Landelijke Vereniging van Wereldwinkels. The Fair Trade shops are highly appreciated for their good locations, regular opening hours and modern image. Fair Trade Organisatie imports some 2,500 food and non-food products. The Max Havelaar trademark is presently applied to coffee, honey, cocoa and chocolate and will be extended to include other products soon.

Average customers of the fair trade sector are women with a higher level of education and above average incomes. The market share of Max Havelaar coffee is 2.3%, the institutional market taking up 40% of that percentage. In the world shops, food and non-food products contribute equally to the total turnover. Growth in turnover of world shops: 15% per year, growth in sales outlets 5% per year. The market share of Max Havelaar coffee seems to stabilize now at 2.3%.

Table 1: The structure of fair trade in the Netherlands

Table 2: The market for fair trade in the Netherlands

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