Sustainability and Business Assignment
Added on 2021-01-02
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SUSTAINABILITY and BUSINESS
ContentsTASK 3............................................................................................................................................1Introduction..................................................................................................................................1Strategy of FLO...........................................................................................................................1Justification of strategy................................................................................................................2Conclusion...................................................................................................................................6TASK 4............................................................................................................................................6Introduction..................................................................................................................................6Aim..............................................................................................................................................7Objectives....................................................................................................................................7Review of literature.....................................................................................................................7Critical review of questions.......................................................................................................10Recommendation.......................................................................................................................13Conclusion.................................................................................................................................13REFERENCES..............................................................................................................................15
TASK 3IntroductionIn way of promoting fair and standardise trading of commodities which are especiallyproduced or manufactured in developing countries to help their producers at time when they areselling their produced products to developed countries. So for this practise, Fair Trade movementwas started so that under this, member nations could be provided higher and fair price for theirexported product to improve social and environmental standards (Nelson and Martin, 2015). Themain focus of this movement was in providing good price to traders of commodity which ismanufactured in their country and when they are exporting it to some other countries butdomestic nation is also consuming that on same way. So in this context in year 1997, Born,Germany Fairtrade International which is also known as Fairtrade Labelling OrganisationInternational (FLO) was established. Strategy of FLOThis Fairtrade Labelling Organisation International (FLO) is that organisation which isresponsible for giving certificate to food products, handicraft, coffee, flowers and gold. Thisorganisation is called to unite 20 labelling initiatives within 21 countries of world and producersnetwork. The Fairtrade coffee is certified coffee which is been produced to fair trade standards ascreating trading partnership that must be based on transparency, respect, equality and fair price ininternational trade. This type of partnership will be contributing into better trading conditionsoffered to farmers of coffee beans in developing countries like that of India, Brazil andBangladesh for sustainable developments (Fairtrade Labelling Organisations International(FLO), 2018). FLO is the organisation which is engaged into activities which is mainlysupporting farmers and producers of coffee bean with sustainable environmental farmingpractice and prohibiting forced or child labour. With the help of Fair trade, there was tremendous increment in demand of certified coffeeand banana in international market but still market share in most of the countries is very small.The major strategy for Fair trade coffee and organisation was going mainstream including salesof coffee through bigger brands like Starbucks in year 2010 sold 1/5th of Fair trade coffee inUSA. While it was also included that total value of Fair Trade certified coffee or other productssold in year 2011 was just $7 billion (Lernoud and Willer, 2018). So the organisation underlinedits growth strategy which is that of mainstreaming Fair Trade coffee into non-speciality brands1
like that of Maxwell House and Folgers sold in supermarkets. The standardised price of coffee inmost of countries is $8.99 per 10 ounce bag. It was believed that this strategy of FLO which isaiming at mainstreaming coffee is recognised to as most important strategy for the upcomingfuture of Fair trade. However, the strategy which is laid down by FLO concerning aboutmainstreaming is not that much helpful while it is increasing overall size of coffee market as it isnot stressing upon role of small producers. This mainstreaming trade means strategy which is helping to national and internationalsectors to strengthen trade among traders and consumers in way of achieving sustainabledevelopment growth (Nelson and Phillips, 2018). This will continuously increase trading systemin supporting growth of backward section of society like small farmers, providing jobs in sectorlike that of agriculture and reduction in poverty as well. This mainstreaming trade will becreating fundamental relationship between buyers and producers by giving better quality ofproducts at fair price to buyers and empowerment to the producers (Fairtrade International,2018). The mainstreaming of products will only be possible when retailers are playing certainrole in expanding markers in way of helping producers and workers as well. Fair trade is the onlyphenomenon which is dealing with social, economic and environmental aspect of trading yetthen also, popularity of this system is counterpointed with alternative commodity network.Justification of strategyIt is advised that mainstreaming of coffee will be successful only when FLO is promotingorganic coffee beans which will be both, changes in coming future and is based on initiativetaken by FLO. As this organic coffee is having sales of over 72000 tonnes each year which is77% of total fair trade. In this terms, USA is the largest and fastest growing markets of fair tradeorganic certified coffee which is selling about 24000 tonnes of coffee per year in USA. Soalternatively, FLO must be undertaking organic coffee in way that it becomes successful and willalso lead to sustainable change in future (Krumbiegel, Maertens and Wollni, 2018). This organiccoffee bean which is been traded in Fair Trade organisation is helpful for producers, buyers andenvironment as well. As for farmers who would be adopting this organic farming, it will be moreenvironmental friendly and sustainable as compared to pesticides. Whereas, organic coffee willalso be good for health of consumers who are consuming it as it would not be containing anytoxic residue or pesticides or fertilisers.2
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