The Do-Gooder Business Model Gets Complicated

By Matt Kempner
The Atlanta Journal-Constitution

WWR Article Summary (tl;dr) In a world of guilt, political correctness and a growing attention to issues that are important, consumers increasingly focus on how the things they buy are made. It can be tough though to make sure you are always buying socially conscious products.

The Atlanta Journal-Constitution

Jeff Shinabarger, who made your clothes?

His Nike shoes: an overseas factory. J.Crew shirt: another overseas factory. Jeans: Made in America, so the workers probably got paid more, he told me.

I think that last item is the only one he really feels good about.
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Consumers increasingly focus on how the things they buy are made and whether people, the environment or animals were helped or unnecessarily hurt in the process.

Even for Shinabarger, a middle class guy with a busy life, two young kids and a job running a non-profit. He founded an Atlanta event (Plywood Presents) that each year assists hundreds of social entrepreneurs intent on helping the world, often while they make a profit.

They focus on things like giving a hand to the homeless and refugees, improving education, producing handcrafted-wares, connecting with artisans, working in an environmentally sustainable way. And, the biggie: Selling stuff, often for higher prices, so that the people who made it get fair wages.

Shinabarger and I chatted when he had a break during the latest Plywood gathering. He’s an inspiring advocate for people’s ability to spark change.

I asked about his buying habits.

“I currently don’t have a lifestyle where every decision can be the purist,” he said.

It takes time, money and energy. And is it wise to spend lots of cash on clothes or toys for his kids, when he knows they will soon outgrow them? Shinabarger told me he knows where 30 percent of what’s in his closet was made. One pair of jeans cost $140, but what he’d like to pay is more like $40 or $30.

Honesty is a beautiful thing.

Especially in a world of guilt, political correctness and growing attention to issues that are important but take extra effort.

Zach Hogue was among the entrepreneurs who had set up shop at the Plywood event. He told me he loved his previous job working for Georgia-Pacific selling paper towels and the like to international customers.

But, now, at 26, he’s decided that if he’s going to work incredibly hard, he wants it to be for his own business helping people with fewer resources. So he connected with craftsmen who produce hand-made leather shoes in Guatemala. He markets their wares in the U.S. (under the name Ambos) to people willing to spend nearly $400 for a custom pair of leather boots.

He jots a handwritten note to each customer, explaining how their purchase supports Guatemalan artisans.

“It makes them feel good. It makes them look good to their peers,” he told me. “It’s social capital.”

He said he’s embarrassed to admit that when he used to vacation in other countries he often assumed the “handcrafted” local products were really Chinese knockoffs. “I would bargain them down like it was some game I was playing,” he said.
Which, I’m now embarrassed to admit, is also what I have done.

Even as small companies pop up to offer us fresh do-good options, big companies are shifting too, highlighting things like environmental contributions. Sure, some of it is marketing nonsense. But some is certainly real.

Competing to be good isn’t a bad thing.

Some of “social enterprises” devise ways to make products and services that are less expensive.

But plenty of social startups aim at consumers willing to pay more for a pricey product that helps fund a social mission. A Douglasville-based outfit called Lamon Luther employs homeless people and recovering addicts to make hand-crafted tables from recycled wood. (It recently landed a deal to build tables for the Atlanta Falcons’ new Mercedes-Benz Stadium.)

Other social enterprises base their mission solely around donating a certain percentage of sales to a nonprofit. Which seems like a shaky idea.

Why wouldn’t consumers just skip the middleman and donate directly to a nonprofit? (There are, after all, nearly 1.6 million tax-exempt organizations in the U.S., according to the National Center for Charitable Statistics.)

Peter Roberts, an Emory University business professor who studies social enterprises, doesn’t always focus on socially good purchases in his personal life.

“That’s challenging,” he said, “all the time thinking about the social benefits of everything we are buying.”

He does, though, focus on getting good food from local farmers and finding specialty coffee companies that pay growers fair wages.

His 20-something-year-old son gives him a hard time about the prices he pays. And at Atlanta farmers’ markets Roberts often overhears shoppers in full sticker-shock, muttering, “Are you serious?”

But he told me he tries to spend at least $100 any time he goes. It’s his way of supporting something he cares about. Plus, he said, “I eat so much better.”

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