On Fair Trade and Poverty: An Interview with Andrea Fütterer of GEPA Fair Trade Company

From 11 to 17 of October 2015, WFTO will observe Anti-Poverty Week, which will culminate on the 17th which is also the International Day for the Eradication of Poverty. On this occasion, we share this interview with Andrea Fütterer, Head of Policy Department of GEPA Fair Trade Company.  We ask Andrea seven questions about Fair Trade and poverty, GEPA’s philosophy as a Fair Trade company, and their secret to success. We are very happy to share Andrea’s interview, and we hope it will inspire businesses to follow GEPA’s Fair Trade journey. Enjoy reading!

  1. How many producer-groups is GEPA trading with presently and in how many countries?

At the moment, GEPA is working with about 160 trading partners in around 50 countries in Latin America, Africa, Asia and Europe.

  1. Any interesting facts and figures you like to communicate about your organisation? Fair Trade sales? Profit? Growth?

In 2014/15, the turnover of GEPA was 68 Million Euro  (+ 6,7 % compared to the previous year): Coffee is 44% of the total turnover, Chocolates 20%, other food products 33%, and handicrafts at only 3%.  We are selling through world shops and action groups (32%), supermarkets (36%), out-of-home service (11%), online shop (1%), and others (EFTA and Fair Trade processors, 20%). For years we have tried to improve our sales in handcrafts, but without much success. There are several factors for that, along the whole chain, from producers´ side, from GEPA´s side and from the shops´ side. One main constraint in Germany is the increasing competition from Fair Trade importers in handicrafts and the fact that we are all selling to the same world shops. At the moment we are (once again) developing a new strategy for handicrafts, including possibilities to enter some mainstream shops, we are still working on that!

  1. What is GEPA’s unique Fair Trade secret that has made it Europe’s largest Fair Trade importer? Could you tell us about your Fair Trade philosophy that makes GEPA successful?

This is a tricky question. We believe that there are several factors which have led GEPA to the point where we are now. I can point out some of them! Starting with the GEPA objectives, as defined by the shareholders, which are:

• To promote disadvantaged producers in the South

• To influence and change consumer awareness and shopping attitudes in the North

• To influence and change structures of international trade by means of lobbying and advocacy work.

These objectives include that we have to work on all three levels at the same time, directly with producers, with consumers, to make them buy the products AND become the “critical mass” pressing politicians, and lobbying directly on the political level (what we are supporting through the Fair Trade Networks).

It was surely important that many years ago, we started to develop a strong quality policy, talking about Fair Trade and ethical quality on one hand, but on the other hand also about product quality. During the time consumers became less willing to buy a product only because of solidarity, they also want a quality product. Furthermore, for producers it is not really helpful and sustainable to buy their products of minor quality for a niche market, instead, we support them to develop high quality products, more attractive and competitive in a niche market, and also for the conventional market.

Another important step was to enter into supermarkets, a decision which provoked very controversial discussions inside the movement, but was demanded by our trading partners. Besides the increase in sales, this was an important step to also increase our “radius” to reach mainstream consumers, who are often less informed and/or interested about trading conditions and Fair Trade, but are getting increasingly involved because of the public discussions and awareness about unfair and disastrous trading conditions.

The development of our Fair+ strategy is another point to mention. The message is that GEPA as an enterprise, as a brand has its own philosophy, that we are open to new ideas and developments, that we want to look and go beyond established schemes! We are paying prices, which often are exceeding minimum price schemes, considering national realities and qualities. We are putting a lot of effort in constantly increasing the % (percentage) of Fair Trade ingredients in mixed products. Including the idea of “Fair Trade Global – Regional” is contributing to this (e.g. the Fair Milk from Germany), but it is also contributing to the public discussion about increasing economic imbalances in the Global North. Of course, this whole development is not a constant and smooth process of improvement. We have also setbacks, years of crisis, unpopular decisions, years when commercial survival is the overruling mandate. But according to the small consumer inquiries we conduct from time to time, we were always able to maintain transparency, an open communication and our credibility, surely the main factors for our reputation.

  1. What is poverty for GEPA?

Poverty is obviously when people have to live without sufficient food, housing and health, without sufficient income, when the daily struggle is to survive, but not living. Beyond that, it means that you are not safe, that you have no liberty of choice: how to live, where to live, to educate yourself, to live a self-determined life. You don´t have access to the necessary infrastructure and you don´t have the power and/or the possibilities to fight for your rights!

  1. In Germany, GEPA has a strong brand, recognisable through their logo.
    Photo: E. Enderlein/GEPA
    What is your formula for combatting poverty? Do you have best practices in combatting poverty that you would like other organisations to follow?

As we often say, Fair Trade is a “tool” to combat poverty, it is a powerful one and the WFTO Principles for Fair Trade show clearly WHY! As Fair Traders we are tackling different aspects of poverty, starting with an income which covers the cost of production and family expenses. Most of the families invest in the education of their kids, so they can have the liberty of choice what to do in the future. With a decent income people have the time and the power to engage e.g. on community level or political level. Fair Trade is also about fair working conditions, about gender justice, it is NOT charity, but giving people dignity and self-determination.

We learned that (besides the prices) often the most important aspect of our partnerships has been the long term aspect, the fact that we are working ten, twenty or more years with our partner organisations, sharing the good times and the bad times, on both sides. Capacity building at different levels is crucial. Giving very small organisations the possibility to develop. One example to mention, a small Coffee Cooperative in Nepal was supported by GEPA for their first export. As they were the first small farmers organization in Nepal to export, the government became aware and supported them to build their own small coffee processing center, making them independent from private service providers.

Another example, 15 years back, GEPA supported a group of some twenty farmers in Honduras who were the first to grow organic coffee in Honduras, and bought their 22 organic certified bags. Today the organization has about 220 members, is producing around 45 containers of organic certified coffee and has its own processing facilities.  Of course, this development was not only due to Fair Trade, there was also a lot of financial support by different NGOs. But GEPA did the first step and supported in all necessary aspects regarding production and export.

For handicraft producer organisations, often the long term relationships and the technical support, such as compliance with EU regulations (e.g. AZO, PCP), are crucial.

  1. Fair Trade is often associated with helping producers in special areas where they are disadvantaged: - vulnerability to international prices, vulnerability to price volatility, competitiveness limitations and vulnerability to increasing food prices. In which of these areas do you think you contribute most for your producers?

Payment of fair prices, being flexible and realistic in the price discussions, and long term relationships are surely the main aspects to answer the different situations of vulnerability that producer organisations are facing.

  1. GEPA's warehouse in Wuppertal, Germany
    Photo: M. Bode/GEPA
    Can you tell us a success story of poverty eradication with your producer groups?

In my opinion, it would be difficult to say that with Fair Trade we can eradicate poverty, as we are only reaching a VERY small percentage of producers (one figure to compare: actually we are reaching through Fair Trade about 1,6 million families of small farmers and workers, worldwide there are around 540 million families of small farmers).  It´s also obvious that often the Fair Trade demand does not absorb all the Fair Trade supply, meaning that producers can only sell part of their production under Fair Trade conditions. Of course for the families we are working with, Fair Trade IS making the big difference.

In point 5, I pointed out the huge role Fair Trade has in combatting poverty. But Fair Trade can only tackle some of the reasons of poverty, there are other topics which are not in the core of Fair Trade Principles, like climate change or land grabbing.

That´s why poverty eradication is only possible when on a political, structural level the rules of e.g. economy, trade and agriculture are changed.

On the consumer´s side, and every person all over the world is also a consumer and a citizen, we have to rethink our way of living, consumption behavior and demands, and we have to increase pressure on politicians to ACT NOW!!

By Anthea Vigni