The influence of Fair-Trade practices on the export performance of World Fair Trade Organizations in Kenya

Abstract

The objective of the study was to evaluate the influence of fair-trade practices on export performance of world fair trade organization members in Kenya, with the specific objectives being to investigate the influence of; affording opportunity for the disadvantaged, transparency and accountability, fair prices for producers, capacity building for producers and environmental conservation practices among the fair-trade members on their export performance. The population of the study were the 17 fair trade affiliated members in Nairobi from whom the questionnaires were distributed to. The findings suggest that with regard to offering opportunity for the disadvantaged, the fair-trade members discourage use of child labour and also that the local people are recruited during the production process. Further, the findings reveal that with regard to transparency and accountability tenet, the fair-trade organizations involve producers in all matters affecting them and the product production is based on equity. In order to improve fairness in pricing, the findings suggest that the fair-trade organizations had strived to eliminate middlemen in the production value chain and that the aimed to fetch prices that cover all the production and marketing cost. During the production process, the results suggest that the fair-trade members work towards ensuring that the water resources are conserved during production and that all these practices have resulted in increased volume and revenue from exports. The influence of fair-trade practices on export performance was found to be strong at R2 of 80.5% with a strong positive correlation r=0.897. Further, it was found that the transparency and accountability was found to be the only significant variable affecting the export performance with a p of 0.26. Based on the study findings, it is conclusive that fair trade practices are one of the significant practices that can be adopted by producer organizations, especially in developing countries, to access export market in the developing countries who are concerned with the production of farmers.