Re: The Sugar Cane Machine (Godin)

30 Jun

“A small body of determined spirits fired by an unquenchable faith in their mission can alter the course of history. ” – Ghandi

For anyone who doesn’t read Seth Godin’s blog (you should), here is what he posted today:

A small island grows sugar cane. Many people harvest it, and one guy owns the machine that can process the cane and turn it into juice.

Who wins?

The guy with the machine, of course. It gives him leverage, and since he’s the only one, he can pay the pickers whatever he likes–people will either sell it to him or stop picking. No fun being the cane picker. He can also charge whatever he likes to the people who need the cane juice, because without him, there’s no juice. No fun being a baker or cook.

But now, a second machine comes to the island, and then three more. There are five processors.

Who wins?

Certainly not the guy with the first machine. He has competitors for the cane. He can optimize and work on efficiency, but pretty soon he’s going to be in a price war for his raw materials (and a price war for the finished product.) Not so much fun to be the factory owner.

And then! And then one cane processor starts creating a series of collectible containers, starts interacting with his customers and providing them with custom blends, starts offering long-term contracts and benefits to his biggest customers, and yes, even begins to pay his growers more if they’re willing to bring him particularly sweet and organic materials, on time. In short, he becomes a master of the art of processing and marketing cane. He earns permission, he treats different customers differently and he refuses to act like a faceless factory…

Who are you?

-Seth Godin, The sugar cane machine

I want to take a different approach in responding to this.  You see, last semester I was in a Marketing Creativity & Innovation course and for our final project, each group was given a social problem to tackle.  My group was assigned the issue of Fair Trade or rather, the continued practice of unfair trade and exploitation in the third world.

The scope of this type of project was obviously huge, so our professor encouraged us to begin with a high level analysis and then work towards narrowing our scope to something manageable.  This search eventually led our group to the problems with unfairly traded Shea Butter.  To condense a semester’s worth of research, basically the situation is as follows: shea nuts grow in abundance on shea treas that grow in a small region of Western Africa.  The oil from the nuts can be extracted and refined in a time-consuming process that creates shea butter, which is then used in cosmetics and (less publicly but in larger quantities) in the manufacturing process for chocolate.

Shea butter, like the cane juice in Seth’s story, is where the real value is found.  The problem is, because the process is time consuming and labour intensive, and chocolate manufacturers (by far the majority of shea butter users) require large quantities, that third party multinationals step in to buy all the nuts from workers in Western Africa and refine them into butter.

By now you should be reminded of Seth’s story, so let’s draw the parallels:  The African people are both the harvesters and the guy with the first machine – and its not a very efficient machine at that – losing their profits to the second, more efficient machine.  Unfortunately, like the cane pickers, they need to sell even if the prices are very low so that they can gain some value.

So how can this story have a happy ending?  Chocolate manufacturers need to step up like the final cane processor in Seth’s story.  As wielders of significant influence and purveyors of public opinion, they need to take responsibility for their suppliers to ensure that a fair price is paid to African producers.

How do we solve the problem of Fair Trade?  We demand better from our favourite brands.  We make the cost of ignoring the problem or redirecting blame too high to continue ignoring.

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