5 Fair Trade FAQs + Buying Guide

BY: Joyanna Laughlin and Everett Sizemore
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Buying "fair trade" products sounds like a good thing to do. But what is fair trade and what does it really mean? Does it make a difference? And how do you know your money is being used as you intend it to?


1. What is fair trade?

The answer might seem like a no-brainer. But it's actually challenging to define without generalizing.


According to the Fair Trade Federation, fair trade is “a more equitable and sustainable system of production and trade.” Wikipedia defines fair trade as “an organized social movement which promotes standards for international labor, environmentalism, and social policy in areas related to production of Fairtrade labeled and unlabeled goods.” The fair trade movement focuses in particular on exports from developing countries into developed countries.


In plain language, the fair trade movement promotes and supports wages that are fair in the local context, meaning they help artisans and crafts people earn a wage they can live on and that is relative to other skills and trades in their local economic system. Fair trade organizations benefit artisans they trade with by paying between 15 percent and 30 percent of the retail price of products to the artisans.


Fair trade also sometimes includes ensuring safe working conditions for artisans, creating sustainable livelihoods for communities in developing countries, and improving social and humanitarian conditions for those communities — which helps ensure that workers can keep earning uninterrupted wages. Fair trade organizations (FTOs) work primarily with small businesses and democratically run cooperatives that agree to reinvest a portion of profits in community projects like health care clinics and childcare programs. For example, Pachamama: A World of Artisans, a California-based FTO and a Gaiam supplier, trades only with groups that already have these programs in place and selects partners using the Fair Trade Federation (FTF) member screening process.


2. Why should you buy fair trade?

2007 brought an explosion of press about social, economic and environmental responsibility around the world. More of us are opening our eyes to socioeconomic inequality, environmental destruction and the exploitation of workers in underdeveloped countries. It can seem overwhelming; one person can only do so much. But it's easier than you might think to vote with your dollars and act on the fact that you're conscious of the impact your purchases have on the lives of other people.


Fair trade products also make great gifts. You can find a wide variety of products in fair trade versions anytime of year — and many retailers expand their fair trade product selection during the holiday gift giving season.


Certain types of fair trade products tend to be more readily available than others, including jewelry and accessories such as handbags, purses and tote bags; toys; crafts or handcrafts such as decor items, desk accessories, containers of all kinds, and trinket boxes; hats, scarves, shawls, wraps, skirts and clothing and apparel; bedding, home linens and other fabric items; and of course coffee, chocolate, rice and other food items.


3. Where can you buy fair trade products?

There are many places on the web to buy fair trade products, including here at Gaiam. Also check out Eco Mall for an impressive list of eco-conscious and socially conscious stores from around the world.


You'll find fair trade items in brick-and-mortar stores, too. Find shops in your area via the Fair Trade Federation’s Directory of Members by State and Territory. Or stop by your nearest natural foods store such as Wild Oats or Whole Foods, and ask the people who work there.


4. How do you know it's really fair tade?

Ask before you buy. While many fair trade organizations are members of fair trade groups such as FTF or of the International Federation of Alternative Trade, FTF requires members to provide detailed financial and business-practice information that's reviewed by a screening committee before being approved; the process can take up to six months. The products FTF members sell often indicate this affiliation (look for trade group logos on product tags).


Keep in mind that some companies that aren't members of trade groups still may pay their artisans a fair wage. Ask these companies what criteria they use to select their suppliers, whether they meet with suppliers in person, and how they verify the working conditions and wages of the artisans. Then make your own decision.

Do your research. Fair trade standards are improving every year, but they're not perfect. While it's often difficult to determine what is a fair wage in a local context, marketers and producers are learning how to work together in ways that benefit everyone. You can do your part by learning about fair trade. You'll find details on these websites:



5. Is this just a passing trend?

That answer depends partly on consumer demand. If you believe in the fair trade concept, spread the word. Each time you give a fair trade gift, make sure your gift recipient notices, and brag about how that item's sale is helping a community.


Tell your friends, family and coworkers that you're giving fair trade gifts this year, and tell them how to find out more. Try pointing out the fact that between 60 percent and 70 percent of fair trade product artisans are women — often mothers and the sole wage earners in their homes, and many widows of AIDS victims. Buying fair trade can make a powerful difference in these women's lives.


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