In our modern world, there is without a doubt, a necessity for a free market economy and supply chain. But in today’s world of rapidly growing populations, it is also vital to have intermediaries who get products and services to the marketplace in a principled manner where as much value is kept by the producer as possible.
The simple reason price gouging occurs between the producer and the consumer is the middleman; they might demand excessive profit margins or take advantage of the producers’ poor living conditions. Fair Trade aims to create more sustainable and equitable transactions along the supply chain between these parties.
Not all corporate business giants conduct exploitative transactions. For example, Patagonia and Seventh Generation are brands that are built upon socially responsible business practices. The main difference between companies like those and Fair Trade companies is the Fair Trade’s end product is either hand-harvested or handcrafted, based in homes or in rural workshops. This allows traditional craftsmanship or growing practices to continue to be carried on in a community.