Friday, March 02, 2007

Creating Markets for Fair Trade Gifts: An Interview with Priya Haji of World of Good

If you are going to buy something anyway, as a gift, or for yourself as a decorative item, or for your home, then why not buy something that has the hope or a dream of another person embedded into it, and by purchasing that thing, you are joining with them to pull that forward.--Priya Haji

This Christmas I bought a lot of my gifts from World of Good, a Bay Area company that creates opportunities for hundreds of artisan cooperatives around the world to share their work by serving as a bridge to the U.S. retail market. Recently, I got to talk with Priya Haji, the CEO and co-founder of World of Good about their work and her advice for aspiring social entrepreneurs.

You can hear the interview on the Big Vision Podcast, or read the transcript below.

Priya Haji: My name is Priya Haji. I am the CEO and co-founder of World of Good, and also World of Good Development Organization, which is our non-profit sister organization. The mission of World of Good, as a company, is to create the largest distribution system for fair trade, handmade items from artists' and women's cooperatives around the world. What we really believe is that there is a kind of new consciousness to consumerism in the United States, and as consumerism is sort of evolving, people are really thinking about how to purchase or consume, but at the same time make a constructive impact on the world and express their social or other kinds of values into the world.

We are seeing this in the food industry, with things like the growth of the organic movement. We have seen it in energy, and increasingly now with energy technologies. And we think that one of the forward movements in this space is really going to be around conscious consumption in terms of ethical sourcing and really thinking about the impact that the products we buy have on the countries and the communities where they are made, and really thinking about social justice and environmental justice in relationship to those products.

So, that is the big market trend that we see, but really World of Good was started, as a company, to figure out how to harness that trend to do the most good for women around the world. In particular, what we have seen over the last 15, 20 years is that there has been this tremendous investment in using crafts and handmade items as a form of economic development for women around the world. We have seen investments from microfinance organizations as well as the UNDP, Peace Corps, Ashoka, and this incredible supply-side stimulation, but not enough demand.

You have thousands of women working in the informal sector, making handmade items and oftentimes under exploitative conditions, and we really believe that there is a big opportunity to create a distribution system for ethically-sourced, fair trade, handmade items, and therefore help create sustainable economic development in thousands of communities around the world, increasing their livelihoods, improving the opportunity for their children, and ultimately bringing beautiful, amazing products to the consumers in the United States.

The way that World of Good has really gone about this is, we have done it in a two-part model. We believe that, like every consumer movement, it is going to be the first-mover companies and the early brands that build a distribution system. With that in mind, World of Good has really launched a kind of retail strategy, looking a lot like Hallmark. So what you find is, for conscious retailers we offer a plug 'n play gift offering. So you, as a consumer, can walk into a store like Whole Foods, or walk into a Barnes & Noble College Bookstore, and find a whole section of these fair trade handmade gift items. It ranges from jewelry, and accessories, and bags, and scarves, and schoolbags and journals to, we also do a whole line of housewares like bamboo bowls and placemats.

Each one is made in a community where it is actually creating a sustainable economic development opportunity in that community. They are all made from natural materials, sustainably harvested, and every product has not only a beautiful quality, and you can really see the handmade aspect of the product and at the same time it is stylish and fashionable, and it has a great little story on it that tells you where it comes from, how it was made, how it benefits that community. So it really helps connect you, as the person purchasing this product, to the sense of impact that you are making not only through your purchase but also on that community through its sustained work.

So anyway, it is really exciting. We started about two years ago with that commercial mission in mind, and we now have 1,000 stores across the United States that have a small section, a World of Good "footprint" in their store. And we invite you, if you know a store in your neighborhood that you think should definitely have a World of Good section, please email us or tell them to contact us. But we have had amazing response from consumers all across the United States, really buying the product and writing us emails, and sort of getting involved, and also referring artists and groups to us. We now work with 140 artists and cooperatives in 34 countries around the world, and it is starting to make a really sustainable impact in those communities as year after year we are able to order, and order larger numbers. This year we will grow to 1500 of these stores around the United States. So it is a really exciting time for us as a company, and a lot of exciting growth.

So as we have launched this business initiative, we have done it in partnership with some amazing retailers like Whole Foods, like Barnes & Noble College Bookstores, as well as with many independent retailers, also, Wild Oats and Wegmans. So we have kind of had a whole lot of stores say, "Hey, this is the wave of the future. We believe. We want to support it." For them it is a viable business which is part of our goal, is that we want them to see this like any other business decision, but at the same time that they make a business decision they can do a good thing with it.

What we also believe will start to happen is that you create an environment of sort of inspired competition. The more retailers that participate in this way, the more consumers that buy this way, the more that there is a real market demand for it, the more that other retailers will start to say, "Hey, we should be offering things like this. We should have fair trade. We should have ethically-sourced product in our stores. We should be able to tell the story and communicate the mission."

What we believe is going to happen at World of Good is that over the next five to ten years, this movement is going to grow a lot, and in that process World of Good will certainly be one of the businesses that will benefit, but we actually think many more will enter, and many more will benefit as a result. So in that vein, what we think is really important is that you have to have very good, clear standards, and you have to have really replicable ethics, essentially, so that anyone can join this movement and say they are doing it, and we can trust what they are doing.

With that in mind from the very beginning, we started our non-profit sister arm, which is World of Good Development Organization. You can find it on the web at worldofgood.org. What we really started out with there is that in this movement around ethical sourcing and fair trade, these are all products that are made in the informal sector. So they are not made in big factories where there are ILO regulations like there would be for a Nike factory.

These are really products that are made in people's homes and villages, mostly by women, in countries--well, you know, women's work is never captured in GDP, and we all know this. So women cook, clean and take care of their children, and these are all uncompensated activities. So oftentimes if a woman is doing something that has economic value, it often gets undervalued in society, and in particular in these kinds of countries and communities, where she may be uneducated, have very limited access to the market. The likelihood of exploitation is much higher. We entered into this thinking about, "How do we really help create stronger wage standards in informal markets?"

We are not thinking about this alone. We partnered with all of the large fair trade organizations in the United States and in Europe, and around the world in Asia, Africa, and Latin America, through IFAT and through the Fair Trade Organization and through the Fair Labeling Organization, to think about, how do we really create wage standards in informal markets, and then how do we implement that in a consistent basis?

One of the biggest challenges has been, when you think about fair trade coffee or fair trade tea, those are items that are commodity pricing; so when you buy or sell a pound of fair trade coffee, you are really buying it or selling it based on a market price, and then the fair trade price is X percent above that and a social premium. So the pricing models are all based on commodity pricing. In handmade items, you don't have that same kind of model; you don't buy and sell a bushel of embroidered skirts. It doesn't work that way. So the problem that happened was that a lot of organizations were saying, "Well we don't have a standard way of pricing. We don't know how to think about the pricing so that you could actually compare a basket in Cambodia to a basket in Africa and make sure both artisans had been paid fairly."

The logic that we really proposed is that, well, what really matters, the one common input, is the time of the artisan who made it; and if the artisan took two hours to make it and you paid that person a dollar, that could be a very good price. If it took the artisan two days to make it and you paid them a dollar, that could be a very bad price.

So with that concept in mind, we developed a technology called the Fair Trade Wage Guide, which helps groups in 178 countries, actually--you can go in real-time on the Internet and say, "OK, this is how long it took me to produce this product. This is the country I am in, " whether it is a rural or urban environment, "and now I want to calculate, how does the amount I was paid for this article compare to the minimum wage, the average wage, a non-poverty wage in my country?"

We built this technology--Holly Harbour is the Executive Director of the non-profit side--and we built it in partnership with all these other fair trade organizations and governing bodies, and it has been a really amazing and sort of transformative tool, because what it has done is help people create a measurable standard for purchasing in informal markets. Holly has now been out meeting with the International Labor Organization and thinking about different ways that you really help create empowerment for women who work in informal markets.

In most developing countries, 75 to 80 percent of the informal workforce are women, whether they are cleaning homes, whether they are milking cows, or whether they are making a bracelet or weaving cloth in their home. So finding how to develop standards to support that sector of the economy is extremely important to the long-term life and health outcomes of not only these women but also their families.

So that has been this huge, exciting progress. And as the Fair Trade Wage Guide is growing, what we are seeing is there is kind of a strengthening of the standards in the space around fair trade. There are a lot of other principles that compose fair trade besides just the pricing. It is also committing to pre-financing, which is like microfinance for the artisan groups, it is long-term relationships, it is really providing technical assistance and design, and getting engaged with that community and participating in the sustainable economic development. So all of those things are critical to fair trade, and adding a very clear wage standard is extremely important. So, that is a very important accomplishment that we had over the last year-and-a-half.

Now, this year actually, it is moving forward to a process through IFAT to hopefully become adopted as an international standard around fair trade pricing. It is a free web tool that any trading organization or artisan group can use. I think one of the most amazing things has been some of the letters we have gotten from artisan groups. For them, they have never thought about their craft in a very, you know, thinking always around the economic strategies.

For example, we have had women's groups write us from Thailand and say, "You know, that's so funny. We make these beautiful weavings that take us days, and we earned a really high price for them, and we thought, 'Wow, this is what is really making us money.' But when we put it through the calculator and we realized, for how long it takes us, the amount of money, even though it is our higher-ticket item, it isn't really making us that much money. Meanwhile, we also use the same traditional technique and we weave something that goes on the back of a barrette. The barrette only sells for much less, but it takes us such a short time; so if we could actually market more of our barrettes, we are earning more per day or more per week than when we market these weavings that are essentially getting underpaid in the market."

That is a big realization, and a big way to gain control of your economic earning and your future, if you start to really understand how the payback on your products works for you. That may seem very intuitive to many of us, but it is actually, for the person who is the producer group or for the buyer, it can be a fairly game-changing interaction.

The other thing we do through World of Good Development Organization, is we make grants back to the communities for economic development projects. That really is money what comes from our business side, and comes into supporting things like building wells, and building schools, and making small improvements to help support this livelihood and the improved community opportunities in the artisan communities that we work in.

Britt Bravo: Can you share an individual success story of a woman artisan that World of Good has worked with?

PH: Well, I think for me it is really about, World of Good is really about, thousands of stories. We are very lucky that we get letters, and we have partners around the world that are benefiting from the work that we are doing. For me, personally, what is so inspiring is that World of Good is a company that is all about bringing women entrepreneurs together, and that means literally from the artisan level--a woman who takes the risk to earn money, to change her outcome in her own life and change the path of her family--to, many of the organizations we work with are these really powerful women entrepreneurs and leaders in their communities, who have come together and created a cooperative, or organized hundreds or sometimes thousands of women.

There are so many examples of them, women who I have met that I feel just inspired to have the chance to represent their work to the market. One of them is a woman named Zoe who runs an organization in Swaziland, where there is a really devastating rate of HIV among, particularly, the men but also the women. It is a community where there are almost 75 percent HIV positive rates. So there is also a very high rate of orphans, and most of the women are supporting anywhere from five to eight children, most of whom are not their own.

Zoe is a local entrepreneur, and this really amazing woman, who had a vision for how to create beautiful handmade items using just, literally, the grass around the houses where the women live. And she has found a way to bring in international dyes, so that they can dye the colors of the grass to be really beautiful colors, and then they weave everything from coasters, and placemats, and baskets, and bowls, and keychains and all kinds of stuff. And World of Good is one of the go-to-market partners. They also have other go-to-market partners, they also sell in the local region in Swaziland; but as they look for market expansion, World of Good is a partner to help them to do that.

And World of Good, if you look all around the world in the 34 countries we work, it is really hundreds of stories like that, of Zoe, and of communities composed of women, each courageous enough to do something in their own lives and to change their own circumstances. I think that is really inspiring, and that is really powerful, and I feel like that is something that women here can relate to, and can appreciate. And I think all of us, if we are going to buy something anyway--and for me this isn't about encouraging more consumption, but it is about saying, "Consume differently."

So it is really saying that if you are going to buy something anyway, as a gift, or for yourself as a decorative item, or for your home, then why not buy something that has the hope or a dream of another person embedded into it, and by purchasing that thing, you are joining with them to pull that forward. I think that is a kind of transformative market opportunity that is really exciting, and I think it is really the future of kind of a new wave of making things, and a new wave of consuming them.

BB: What is the biggest challenge of your work?

PH: The biggest challenge of my work is building, quickly enough, a demand structure, and really connecting with the people who want these products quickly and conveniently enough so that we can really help build against the supply. I mean there are so many more of these projects and so many more women like these in the world, who would love to find a way to sell their products to a bigger market. In reality, in the United States, the gift market was $55 billion. I mean, that is a phenomenal number; but all the fair trade product in the United States was only $250 million, I believe.

So that is like a rounding error. It is not a meaningful number, and we have to create a way to really say, "OK, how do we change it so that of $55 billion, at least $1 billion was made in this kind of a way, brought to the shelf in a way that the consumer can realize it?" So that even one out of every 50 choices that we make are things that we buy in this kind of way. I mean, eventually I would love to see it be one out of ten, or maybe even become 50 percent, but at least really moving the needle.

So for me, that is really what I see, is that we have to get hundreds and thousands more stores, we have to get bigger sections, we have to build--we're working on a great strategy on the Internet and a great partnership on the Internet to build a much bigger opportunity. So for me, the challenge is really in seeing that vision of how to create the biggest possible opportunity, so that we can forward this into a bigger space.

BB: What is the path that brought you to this work?

PH: My own journey to this has been... Well, I have always been, I guess, an entrepreneur as they say, a social entrepreneur. My first kind of startup was with my Dad, starting a free health clinic when I was in high school. My parents are definitely part of my inspiration, my Dad especially. He is just a really, really amazing person in his sort of walk in the world, both his joy and his balance, and also his generosity and kindness and social justice work.

Then I went to school at Stanford, did my undergrad. And then, at that time, got engaged in a lot of work in East Palo Alto, which is a low-income African-American and Latino community here in the Bay Area, that was addressing a lot of issues around substance abuse at that time, and there were really no alternative solutions. Like many communities in the United States, the primary solution that was being applied was a criminal justice one. I was lucky enough to meet several community leaders--David Lewis and Vicki Smothers--who had a vision for really how to change the community, because they had changed their own lives in that community, and I was able to join step with them.

I became the Executive Director and co-founder of an organization there called Free At Last, which serves people that have substance abuse issues. We built a whole continuum of care, everything from mobile health clinics and street outreach programs, jail and prison intervention programs, residential facilities for women--women with children, affordable housing. I had the chance to lead that for six years--it was an incredible experience--and really helped build it up. The vision of that organization is really for it to be led by the community and run by the community, and that has really been, as I transitioned out, the leadership that took over are all people from the community of East Palo Alto taking it over and really running it. It still serves about 3, 000 people a year and it is an amazing organization.

Then I went back to school and did my MBA, and this time I really wanted to focus on--I'm from an international family, my mom is from India, my dad is from East Africa--and I really wanted to think, after my MBA, about how do you create market-driven social solutions, so the market itself pulls the product or pulls the company forward through its revenue structure, and through that it generates inherently a social good; and that cycle then is eternally renewing and growing and helping more people just by accomplishing what the market wants it to do.

So that is the promise, I think, of World of Good. There are a lot of young companies in this space that are thinking about using market models to create change. So I feel really excited to be one of them, and I have had great mentors from Haas, and also from Stanford, who have really helped me. So I think that is how my path came to this. Then I started this with a few of my best friends, Siddharth, who is the co-founder of the business with me, was one of my classmates from business school. He is an awesome guy and has the creative vision of the brand and sort of the marketing strategy of World of Good, and Holly, who is the Executive Director and co-founder of the non-profit and the Calculator with me, also one of my very good friends. And then David. So there are, like, four of us who kind of came together to make this thing happen, so I feel really excited to do it.

BB: What advice do you have for aspiring social entrepreneurs, or anyone else who has an idea for how to make the world a better place?

PH: For a person who has a dream to do something in the world, I think the most important thing is to follow that. It is not always easy, and it is not always clear, and it is not always balanced, but I think sometimes when you feel something deep inside of you, it is sort of beyond your control and you have to pursue that passion and you have to work it out and see what is going to come of it. I mean I feel like World of Good has the seed of something great in it, and yet there are so many unknowns, and so many ways that we could still make mistakes, or that the company might not make it. Those are all very real vulnerabilities, and part of my role is to champion that and steward that through to becoming what it can be.

And now, you know, we started it, but now we serve it, in a lot of ways. I think that is what is so interesting. So I think for the person who has a vision to do something in the world--and it doesn't always mean you are the actual entrepreneur; sometimes you are the person joining someone's idea, sometimes you are the person volunteering or supporting what someone else does--but it is that collective action that shifts everything.





1 comment:

  1. Yes It's correct article I understand There are so many examples of them, women who I have met that I feel just inspired to have the chance to represent their work to the market. If you are interesting visit the site business strategy

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