British consumers are likely to cut spending on expensive fair trade and organic items in response to the credit crunch amid widespread dissatisfaction over the variety of green products offered by retailers, new research has warned.
Almost half of 4,000 consumers questioned said they were unwilling or unable to pay more for environmentally sustainable food and consumer goods, a survey by PricewaterhouseCoopers found. A comparison of 75 food, clothing, household and personal care items at the top six grocers found shoppers on average paid 45% more for environmentally friendly and fair trade goods.
Shoppers said they are only willing to pay a premium of about 20% for greener products. Consumers surveyed also said they were frustrated at the lack of variety of greener products on offer; nearly 60% said they bought fewer environmentally sustainable products than they would like.
Mark Hudson, UK retail and consumer leader at PricewaterhouseCoopers said: “The credit crunch will act as a bump in the road and slow down the rate of customers switching to green products. In the short term, consumers are starting to make trade-offs such as feeding the family with environmentally friendly products or choosing something that is cheaper.”
PwC has calculated that organic and fair trade products have a 4% share of the total UK retail market, worth nearly £300bn. “Consumers want to buy more sustainably but are restricted by price, patchy availability and scepticism,” says the report.
Higher wages to producers of fair trade products and lower yields from organic products make them more expensive for retailers. But the PwC report argues that retailers can cut their manufacturing costs, and boost profit margins, if they use less energy and packaging.
Consumers surveyed also complained that retailers did not stock a wide enough range of sustainable items. Although 50% of the retailers surveyed stocked organic cotton T-shirts only 9% offered organic cotton blouses.
“Consumers want to make sustainable choices, but are hampered by unclear messages. Confusion, coupled with high prices, leads to a lack of trust among shoppers,” PwC said.
Six out of 10 consumers questioned said reducing the amount of packaging on products was the most important action retailers and consumer goods companies could take to help the environment.
Harriet Lamb, executive director of the Fairtrade Foundation, said: “The public are throwing the door wide open: they are saying they would buy more Fairtrade and sustainable goods if only companies would offer them. It can only be blinkered and old-fashioned attitudes that keep the big consumer goods companies out of touch with where their customers are on Fairtrade and sustainability more generally. And if they don’t get their act together, they will get left behind.”
She added: “Why wouldn’t any company do its part: it’s good for poor farmers and workers, their consumers are crying out for Fairtrade products and so it will be good for the company too.”
[Guardian]
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