Wal-Mart and Fair Trade

Wal-Mart is getting into Fair Trade? Wasn't Wal-Mart the reason Fair Trade got started in the first place?

Supporting fair trade presents a paradox for Wal-Mart. It is a tacit admission that there is a point at which no more efficiencies can be squeezed out of the system without harming the people who make it work. Fair-trade beans are sold at a minimum of $1.26 per pound, compared with the world average last month of 90 cents. But Wal-Mart is still determined not to pay more than it must.

It's part of the new corporate philosophy outlined by chief executive H. Lee Scott Jr.: "Doing well by doing good."

At Wal-Mart, executives say a rebirth is occurring inside their no-frills headquarters. "Sustainability" and "trend-right" have entered the corporate lexicon alongside "everyday low prices." Chief executive Lee Scott drives a Lexus Hybrid.

Interesting. More power to them. I have always been impressed by Wal-Mart's use of technology to improve efficiency, but I have questioned whether their relentless drive to lower prices also came at the cost of the environment and workers wages.

Would I buy Fair Trade products at Wal-Mart? Probably not. My big grip with them is that they should pay their workers a similar wage to Costco or union grocery store workers. If they raise their wages, then I just might.

Pereira's co-op depends on Bom Dia and Wal-Mart for fair-trade prices. For most fair-trade farmers, finding a willing buyer is the most difficult part of the process. About 35 to 45 percent of fair-trade-certified coffee is actually sold at fair-trade prices, according to TransFair USA. The rest goes for market value, indistinguishable from regular coffee.

Huh. Who decides who gets paid the fair trade price and who gets the regular price?

via Washington Post