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For Wal-Mart, Fair Trade May Be More Than a Hill of Beans
On Rosevaldo Jose Pereira's farm, workers separate the leaves and twigs from the coffee cherries, which will yield coffee beans.
(By Ylan Q. Mui -- The Washington Post)
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Or, as Kirsten Moller, executive director of the nonprofit group Global Exchange, which supports fair trade, puts it: "Wal-Mart is probably the last place in the world that we would recommend anyone shop. That makes it complicated."
Switching Brands
When Hoffman tried to bring Bom Dia coffee to Sam's Club, the first question he got was, "Well, what are you getting rid of?"
The answer: Millstone Coffee, owned by Procter & Gamble.
The brand's Mountain Moonlight Fair Trade Certified blend sold on its Web site recently at $8.99 for a 10- to 12-ounce package of whole beans, or about 75 cents to 90 cents per ounce. Bom Dia's fair-trade coffee sells at Sam's Club for $11.77 for 40 ounces -- about 29 cents per ounce.
"Just look at the cost," Hoffman said. "They couldn't come close to what we were trying to accomplish."
Hoffman's efforts to switch coffees were two years ago. Sam's Club is now Bom Dia's largest customer and one of the top three U.S. retailers of fair-trade coffee, TransFair USA said. The companies have an arrangement that displays both brands -- Bom Dia's Marques de Paiva and Sam's Club's Member's Mark -- on the packaging.
Pereira says his profit has doubled since the co-op became fair-trade certified, and he expects to sell his entire harvest of 40 sacks of beans.
Pereira sat in front of the TV recently in his new house with tile floors and a spacious kitchen after a long day harvesting coffee cherries. He converted his old house into a fertilizer warehouse. His daughter Mariana Karina, 15, has braces on her teeth. Pereira has a cellphone.
The poorest coffee farmers in northern Minas Gerais have no electricity or running water, much less the satellite dishes sitting near several of the homes in Poco Fundo.
"We dreamt to have a good house," Pereira said.
At the end of the month, Wal-Mart dry groceries buyer DeDe Priest and 11 colleagues are to visit this small town at the bottom of the global supply chain. Fair-trade coffee is carried in about 1,000 Wal-Mart-brand stores. Millstone is its leading brand. But that can always change.
The Fair-Trade Label
The first thing Joe Alcantara, president of Cafe Bom Dia's North American operations, does every morning is check his coffee sales at Sam's Club. Before the deal, Bom Dia worked with several retailers, including Walgreens, selling conventional coffee. Now its strategy is "to optimize our relationship with Wal-Mart globally," Alcantara said.
