Page 239 - DMGT509_RURAL MARKETING

Rural Marketing

Notes profit. NGOs are structured for development purposes rather than for business purposes. There
is also a tension between local NGOs and the private sector, which tends to consider them as
troublemakers. These issues need to be resolved if they want to be effective as market actors,
and this is a role that Traidcraft Exchange plays through its capacity building activity.
Taking the typology of market roles offered by Practical Action, Maveen observed that Traidcraft
Exchange concentrates its efforts on the enabling environment and market services but has a
policy of staying out of the supply chain. It adds value by focusing on a few sectors and themes
and working with local intermediaries to achieve a multiplier effect. Its activities can be
summarised as:

1. Trade
2. Support
3. Influence

Experience with the Tea Sector

Traidcraft Exchange started with a difficult context given that both the private sector players in
the tea sector and the trade unions do not like NGOs intervention in this sector. There was also
considerable resistance to Fair Trade on the part of plantations and government bodies, which
view it as a non-tariff trade barrier in export markets. In order to increase buying from the
industry it worked through a multi-stakeholder process but it took a year to get the different
players to achieve a meaningful dialogue.
After three years of working on this sector, Traidcraft has had some success in increasing interest
in fair trade in the industry. Through its partners, it has organised 4000 small tea growers is
encouraging the private sector to source from small tea growers. Large companies like Tatas
and Hindustan Lever are considering buying from small growers.
Experience with the Cotton Sector

Traidcraft’s work has enabled the Fair Trade Labelling Organisation (FLO) to develop standards
for the cotton sector. It has had some success also in promoting organic cotton in dryland areas
through its partner, Agrocel. Marks and Spencer is now working with partners on the ground to
source fair trade & organic cotton products, while Traidcraft continues to work on crop
diversification to enable improved yields of cotton. An important factor in this success has been
the choice of business partners in India & Europe.

Traidcraft Exchange’s good links within the supply chain and the organisation of the farmers
were also important.

Reflections

Maveen presented some final thoughts on what Traidcraft Exchange has learnt. The key lesson
was the need to stay out of the supply chain, enable changes within the supply chain, influence
the enabling environment, while building service market for small enterprises.
This meant being aware of the organisation’s strengths and limitations and to be structured
according to what can be offered and add value to what exists on the ground. It was important to
ensure cross-learning by sharing experiences.

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