Focus on Fairtrade: Propositions for Integrating Fairtrade and Supply Chain Management Research

Driven by increased consumer interest and stakeholder pressure, the number of Fairtrade (FT) products has been steadily increasing. The mainstreaming of FT means that the products are now facing stiff competition within the generic product categories in which they operate. While consumers may pressu...

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Bibliographic Details
Published in:	Journal of business ethics 2013-08, Vol.116 (2), p.267-282
Main Authors:	Karjalainen, Katri, Moxham, Claire
Format:	Article
Language:	eng
Subjects:	Business and Management Business Ethics Consumer behaviour Consumer goods industries Consumers Corporate responsibility Economic efficiency Economic models Education Ethical consumerism Ethics Fair trade Labeling Management Market penetration Operations management Philosophy Price premiums Prices Purchasing Quality of Life Research Social responsibility Stakeholders Studies Supply chain management Sustainable agriculture Willingness to pay Working conditions
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Summary:	Driven by increased consumer interest and stakeholder pressure, the number of Fairtrade (FT) products has been steadily increasing. The mainstreaming of FT means that the products are now facing stiff competition within the generic product categories in which they operate. While consumers may pressure organizations for ethical conduct, they are less willing to pay premium prices for fairly traded products. For FT to continue to grow, more efficient operating models are required to offset the premium prices paid to producers to ensure competitiveness in the market. One such improvement approach may be the management of FT supply chains. To investigate the feasibility of this approach, this article systematically combines literature on FT with key supply chain management (SCM) constructs and theories. We discuss existing SCM paradigms in the context of FT and demonstrate aspects where the efficiency of FT chains needs to be improved to ensure their viability. We present propositions that demonstrate the key limitations of the FT model from the point of view of SCM theory and practice and suggest the potential changes needed in the management of FT supply chains. The article provides a timely first attempt to systematically combine FT with SCM constructs, thus establishing a basis for the further development of FT chains and for the improvement of the operating efficiency within them.
ISSN:	0167-4544 1573-0697