FairBuy - 50 ct for Fair Wages

FairBuy - 50 ct for Fair Wages : Donate 50 cents per fashion item to introduce fair wages in the fashion industry

Munich, Germanyworldwide
Year Founded:
2014
Organization type: 
hybrid
Project Stage:
Start-Up
Budget: 
$10,000 - $50,000
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

FairBuy provides an app to donate 50 cts per fashion item (representing the additional costs for living wages) to garment workers. They are registered as statements to encourage fashion brands to pledge their commitment to higher wages. This enables unions/governments to negotiate/set higher wages.

WHAT IF - Inspiration: Write one sentence that describes a way that your project dares to ask, "WHAT IF?"

What if they payment of living wages to the workers would increase the price of a fashion item only by 50 ct - would you be willing to pay them? What if you could start now to help make that happen?
About Project

Problem: What problem is this project trying to address?

​The problem is manyfold. Many textile workers live in extreme poverty. Knowing, that the additional costs of living pages are 50 cts per item, fashion consumers would happily be willing to pay that. They don't have this choice, so they suspend the thoughts of production conditions while shopping. Some fashion companies know that, but not even those can simply set higher wages. This is due to the long, complex supply chain in this industry.

Solution: What is the proposed solution? Please be specific!

For immediate relief, the donations are forwarded to initiatives for the workers, which are selected by criteria of urgency (such as trust funds for relief after accidents) and impact - such as informing the workers about their rights (e.g. the minimum wage) and about touchpoints to which they can turn to (anonymously, if they like) in case the feel these rights are violated. For long-term impact, the donations are also registered as statements that the users care for the workers' well-being and are willing to carry the additional costs for living wages. The statements are published in order to encourage fashion brands to pledge their commitment to pay higher wages. This enables goverments/unions to increase/negotiate higher minimum wages.

Awards

"Filippas Engel" (to the co-founder for her work); 2nd place in an idea contest by IVE (institute for value-based enterprize); mini scholarship by the Werner Jackstätt Foundation for FairBuy.
Impact: How does it Work

Example: Walk us through a specific example(s) of how this solution makes a difference; include its primary activities.

You think you know about Rana Plaza? It also hosted a shopping mall, offices and a bank. It looked safe until a day before, when it was evacuated. On april 24th, only the garment workers went back in. They were threatened to loose the payment of their extra hours for the month (which is about 50% of their total wages) - they couldn't afford that. Yes, building safety is a problem. But the tragedy was caused by (1) wages so low that they don't leave room for choices, (2) workers who don't know their rights, and (3) the lack of touch points to which the workers can turn for help. FairBuy will use the donations to provide information about rights and touch points, and use the statements to accelerate the introduction of living wages.

Impact: What is the impact of the work to date? Also describe the projected future impact for the coming years.

FairBuy had 2 prototypes of apps, based on which the current version is being programmed now until mid november. With only prototypes, we have not generated any direct impact, yet. I will use the provided space to explain the impact logic of the statements. Due to the system of indirect sourcing, the brands cannot simply increase wages. But they can pledge their willingness to do so. Some pioneer brands (including fast fashion brands) have successfully tested this approach in Cambodia and Myanmar, resulting in minimum wages. More brands need to join these pledges, and for more countries. To encourage them to do so, FairBuy bundles and publishes the users' statements. Since the statements derive from donations in the height of the average price difference, they have a credibility which other initiatives and postulations lack: The demonstrate the users' willingness to carry the costs.

Spread Strategies: Moving forward, what are the main strategies for scaling impact?

We want to increase our presence in markets and channels, and our impact in various steps of the value creation. In 5 years: Available and used in all major markets. For international expansion we need to add languages, currencies and payment methods (now avialable: EN, DE; EUR; PayPal & charity SMS in DE). For marketing we use media coverage and social media, endorsed by targeted adds. We want to move closer to the buying process by adding plug-ins at the checkouts of online-shops. In 10 years we hope garment workers will receive living wages - we move on the the material production then.
Sustainability

Financial Sustainability Plan: What is this solution’s plan to ensure financial sustainability?

Our operation costs are low and currently covered by ourselves. In order to grow (add country versions to the app, implement our incentivation system to keep usage rates high, and initial marketing campaigns for each country launch), we need to rely on our revenue model. Sponsors who increase the users' donations will get the thank-you-screen to communicate their message for a small fee. This is a very valuable moment for brand contact.

Marketplace: Who else is addressing the problem outlined here? How does the proposed project differ from these approaches?

Currently no-one specifically tries to encourage brands to make their statements, nor collects consumers' donations for workers. Several projects (eg fashionrevolution.org or EcoAge's Green Carpet Challenge) ask for change and gain a lot of attention, so the problem gets continuous attention. FairBuy adds credibility to the postulations (by having the users paying the 50 cts in advance) and asks for specific action (join the pioneer brands' pledges), which should make it easier for the brands to react. We want to inform about the complexity of the problem instead of blaming singular brands.
Team

Founding Story

It all fell into place, really. Carbon offsetting systems have been around for years. In 2011, we already had developed a gamification-based incentivation system for offsetting programs in general. In 2013, Muhammad Yunus had published his postulation about the 50 ct for a garment workers' welfare trust. In late 2013, rounding-up donation systems ("aufrunden") had been introduced and accepted in several (food) retailers. In January 2014, some brands had demonstrated the power of their statements in pledges to withdraw production from Cambodia if the military continued to shoot workers on strike. When we had the idea to put everything together we couldn't not do it.

Team

Johanna v. Ramin(1984): The project initiator graduated from the University of St. Gallen with the Master of Strategy and International Management (SIM). Additionally she successfully completed a master in Entrepreneurship and New Business Venturing (EUR-RSM). She then gained experience in two e-commerce start-ups and as a consultant for online-shops.  For over ten years now she observed closely the fair-fashion-market and worked on several projects in this sector, but nevertheless never met with an approach for the mass-market. As co-founder and managing director, she works full-time for FairBuy and is mainly responsible for communication, for the app and its features. Roman Wachtel (1982): FairBuy’s co-founder has substantial experience (for example as leader of MINI Russia and at the business consultancy Stern Stewart & Co.) in several leading positions such as the installation and reconstruction of enterprises. Additionally he founded and manages the business consultancy RW SMC. He holds a master’s degree in International Management from the University of Vienna and a bachelor both in Japanese Studies and Sinology. With FairBuy he is as Co-Founder responsible for the legal and commercial aspects (partner relations with sponsors).  He works part-time. Till Haunschild works as freelance developer and is responsible for the thechnical aspects of the new app.
Value Chain: Where does your work fit into the apparel value chain? [check all that apply]

Manufacturing, Consumption.

Your Role: What is your relationship to the apparel industry? [check all that apply]

Consumer, Other [please specify].

Target Population: What stakeholder groups do you engage or empower in your work? [check all that apply]

Brands, Consumers, Corporations, Designers, Factory Workers, Factory Owners, Policymakers, Retailers - Department Store, Retailers - Specialty Store, Retailers - Mass-merchandise Chain, Retailers - Discount Chain, Sourcing Manager / Supply Chain Manager, Supplier - contractor, Supplier - subcontractor, Trading Companies, Women.

● Intervention Focus: What are you trying to achieve / influence? [check all that apply]

Conscious Consumerism, Labor Rights (i.e. Collective Bargaining, etc.), Disaster and Humanitarian Relief, Other, [please specify].

Lever for Change: Select up to 3 ways your work is helping to transform the industry.

Advocacy, Other, [please specify].

Is your project targeted at solving any of the following key barriers?

Hidden from View: Conditions in Forests, Farms, and Factories are Only Visible to a Select Few, A Job is Not Enough: Low-Income Workers Cannot Secure Long-Term Well-Being, Consumers Aren't Motivated to Care: Neither Compelling Reasons Nor Easy Means to Change Consumption Habits.

Does your project utilize any of the innovative design principles below?

Disrupt Business as Usual: Target Key Players Who Can Influence the Bottom Line.

Innovation Inspiration: When you first conceived of your project, did you think of it as applicable to the apparel industry?

yes

If you answered "no" to the previous question, which industry was your project originally aimed at transforming?

● Replicating in the Apparel Industry: If your project didn't initially target the apparel industry, how are you specifically tailoring it to do so now?
Are you nurturing or inspiring others to be changemakers? If so, how?

We inspire all to become FairBuyers, wherever they shop

● Tell us about the partnerships that enhance your approach. How have you collaborated with others in the industry to increase your impact?