SN Whole Health: Club Stores Trade Up

Fair Trade Values

With their limited assortment of carefully selected products, club stores have a history of nurturing brands and their supply chains. Fair trade values align with this philosophy by providing training and higher wages for workers.

“There are far fewer SKUs in a club store than in a mainstream grocer, so they put a lot more care into each product,” said Sri Artham, director of strategic accounts with Fair Trade USA, the country’s largest certifier, which has worked closely with Sam’s Club.

Part of that care and maintenance means traveling to the regions where fair trade products are produced. Walker, along with Sam’s coffee buyer Jeff Seyfarth, recently traveled to Colombia to meet with avocado, plantain and coffee farmers. Reflecting on the trip, Walker said the fair trade program brought local farmers together and gave them access to a seed stock that increased their crop yield.

“One farmer mentioned that fair trade provided a forum in which farmers can gather and share information,” he said.

Improvements like this, Walker noted, have increased the quality and efficiency of the products he sells. But club stores still have an uphill battle on the opposite end of the equation — selling to the customer. Research shows that, while they like the concept, most consumers don’t fully understand what the label itself means. And many are skeptical of fair trade’s expansion into mainstream products and stores. Fair Trade USA’s decision to expand certification to large-scale plantations last year, for instance, was criticized by many consumers and advocacy groups.

Infographic: Fair Trade Volume Grows

“The fair trade movement has to find its position in the conventional market environment without any mission drift,” wrote Marion Struber, a research analyst with Credit Suisse, in a recent note to investors.

Artham believes the movement into mainstream is a sign of success for fair trade. He stressed the importance of educating shoppers on what the label means by connecting them to the farmers.

“I think consumers really respond to seeing the farmers and hearing their stories,” Artham said.

This is right up the alley for club stores, which are known for their generous sampling programs. Sam’s Club plans to offer tastings of select fair trade products over the holiday season. The majority of its promotional efforts appear online through dedicated web pages, blog posts and social media. To celebrate Fair Trade Month in October, the Sam’s Club website hosted a page featuring Green Mountain Coffee’s educational campaign, called “Great Coffee. Good Vibes. Pass it On.”

Earlier this year, Walker wrote a blog post on Wal-Mart’s sustainability website, walmartgreenroom.com, discussing Sam’s Club’s efforts to source sustainable palm oil and expand its fair trade footprint. He mentioned that an acquaintance had asked him if the company was moving too quickly on both fronts.

“We’re helping create livelihoods for small- and medium-sized farmers while protecting habitats for orangutans and other animals,” Walker wrote. “And we’re doing it in a way that we can still provide affordable, high-quality food to our members. Why wait for that?”