

So what is Fair Trade?

At its essence, Fair Trade is a business model that ensures producers of goods are treated with dignity and given a fair and sustainable wage for their work.

In the conventional model of trade the focus is on profit margins for what may be several middle men or big businesses, generally at the cost of the producers. Because profits are the sole objective, there is no incentive to invest in improving working conditions which may be very poor, even dangerous, and the less they can pay the workers the better.  In many instances workers may make barely enough to survive, and some manufacturers even devise schemes that keep the workers in debt, locking them in a perpetual state of servitude. Not surprisingly the workers are mainly from the most desperate socio-economic strata, and a high-percentage are women and children.

Fair Trade flips this model on its head.  Fair Trade organizations and companies, such as Paisley Valley, seek to improve lives of the producer groups/cooperatives and work directly with them to provide them the highest prices possible.  The main focus of Fair Trade is not profits, but providing hope through trade.

Fair Trade organizations are committed to the long-term success of the groups/cooperatives they work with. Fair Trade organizations help producers with product development and distribution in markets they might not otherwise be able to penetrate by themselves. Along the way it is ensured that working conditions are high-quality, and that no child labor or exploitation takes place. 

Apart from the money and working conditions, Fair Trade organizations often encourage producers to shift to more environmentally sustainable practices. For example there are some paper mache products that have wood components; Paisley Valley is working with the producers to develop new moulds that would make all products from recycled paper. This is a great example of how fair trade can have some unexpected benefits that transcend economics, such as enviornmental sustainability.

The Fair Trade movement was started over 40 years ago and has recently picked up a great deal of momentum in the US.  All signs are that it is not a fad, but a trend that is poised for continued growth (in fact the Fair Trade Federation calculates 30-40% yearly growth rate).  It is an excellent initiative that has already been able to make significant impact on hundreds of thousands of lives, in the coming years it will hopefully reach even more, providing hope to those who historically have been the most exploited. Presently it is most common to find Fair Trade principles at work in the production of handicrafts and traditional items. A general commodity that has been a major success story from a Fair Trade perspective is the coffee industry, with dozens of companies ensuring that producers are compensated and treated fairly across the globe.

The following table compares the two models.


Fair Trade

Conventional Trade


Improving people’s lives through trade.


Working Conditions

Ensure they are safe and healthy for all workers.

Keep as cheap as possible.

Commitment to producers

Long term health and stability of producer groups-and workers in the group-is key component.

Will switch supplier/vendor if a cheaper source of goods is found.

Relationship with Producers

Transparent Partnerships that empower the end producers. Generally provide marketing and product development service to expand the business opportunities for the producers.

The retail business buys products from vendors or they own the factories. In either case end producers of goods have no representation and they get squeezed to manufacture as cheaply as possible.


Provide livable and meaningful wages.

As little as possible to increase profit margin.

Price of goods to consumer

Usually less expensive since cut out multiple layer of middle men. End consumer is buying almost directly from producers.

Price needs to support multiple layers, so generally higher. If it is lower, usually at expense of producers.

Who are the producers

Either individual producers, cooperatives of producers, or social service organizations that train destitute in production skills (Presently Paisley Valley works with the latter two).

Vendors who manufacture goods for the retail business, or the retail business owns the production plants themselves.

As one leader of a developing country recently said in an interview, ‘we don’t need aid, we need trade’. It is the mission of Fair Trade organizations to fulfill this need.

There is more excellent information on Fair Trade at the Fair Trade Federation's website:



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