UNITED KINGDOM

The structure of fair trade

In the United Kingdom, there are seven importers (i) and five wholesalers (w), four of whom are also retailers (r) of alternatively traded goods: Traidcraft (i, w & r), Oxfam Trading (i, w & r), Twin Trading (i & w), Equal Exchange (i & w), Tearcraft (i & w), Shared Earth (i & r) and Bishopston Trading (i & r).

The total number of points of sale, including independent shops, is estimated to be 3,000. Some world shops are in the process of forming a federation of world shops. Oxfam, Shared Earth and Bishopston Trading have their own shops. As a result, the retail network consist of world shops, chains of fair trade stores (mainly the 625 Oxfam shops) and some mail-order catalogues.

The only umbrella organization is the Caf‚direct consortium - a project of Oxfam, Traidcraft, Twin Trading and Equal Exchange to market a fair trade brand of coffee in the supermarkets. There is regular cooperation between the different fair trade organizations in the UK.

The sector employs about 650 persons (excluding the world shops which are run by around 30,000 voluntary workers).

There is one trademark, the Fairtrade Mark, operated by the Fairtrade Foundation for the labelling of coffee (roasted and ground and freeze- dried instant), teas and chocolate. Three licensees are currently involved in importing and trading Fairtrade Mark products.

Fairtrade Mark products are available from the major supermarket chains - Sainsbury's, Safeways, Tesco, ASDA, Waitrose, Somerfield (Gateway), Morrison, CWS and CRS (Co-ops) - and from a range of health food shops, smaller stores and independent retailers, totalling over 1,000 points of sale.

Fairtrade Foundation devotes about 15% of its total budget to education and promotion, with information disseminated through the media and campaigning activities performed by its member agencies.

The market for fair trade

Wholesale and retail turnover of the two biggest organizations are 3.2 and 5 million ECU respectively for Traidcraft, and 11.3 and 12.7 million ECU respectively for Oxfam Trading (Oxfam shops also sell second hand products but those are not included in these figures). Wholesale and retail turnover for products with a Fairtrade Mark generated a wholesale turnover of 4.8 million ECU in 1994 and expect a turnover of 7.7 million ECU in 1995.

In marketing surveys, 85% of respondents said they would like to see fairly traded products in their supermarket, while 40% were aware of the availability of fair trade products in supermarkets. According to another survey carried out by a marketing company, 68% of the public would be willing to pay a higher price for fair trade products.

Health food wholesalers have welcomed the introduction of Fairtrade Mark products. Because these products have sold better in the supermarkets than the supermarkets had expected, they are prepared to include new products carrying the Fairtrade Mark. The existing products are selling at about 5 to 10% above the retail price of equivalent non- Fairtrade products. Coffee prices were up to 25% higher.

The Cooperative Wholesale Society has declared its intent to launch a range of Fairtrade Marked Co-op brand products. The market share of Caf‚direct is said to be 2.8% for roasted and ground coffee.

On the whole, all alternative trade importers have achieved major improvements in design, quality and presentation of the products in the past few years, but the public still expect the quality of fair trade products to be lower than it actually is nowadays. The product range is improving, although changes in both availability and product innovation are hampered by supply and design constraints. World shops tend to be poorly located and under-resourced but are said to be improving. The goods traded are coffee, tea, chocolate, other food products, clothing, fashion goods, handicrafts, gifts, textiles, beverages, recycled paper and greeting cards.

Traidcraft's customers are mostly women, aged between 25 and 55, with above average incomes and often employed in the social sector. The customers of the Oxfam shops are more diverse, and it is almost impossible to give an average description due to widely varying situations around the country.

Traidcraft has been able to grow by increasing the range of products and value of sales on an existing market. Oxfam Trading sells mainly handcrafts (87%) with coffee as the main food product. Oxfam reports no growth any more in turnover, product range or points of sale.

Table 1: The structure of fair trade in the United Kingdom

Table 2: The market for fair trade in the United Kingdom

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