Wednesday
June 24
2015

Sophia Witte

Perfecting BOGO to a T: ‘Buy One, Give One’ is established, now let’s make it better

With the promise to donate a pair of shoes for every pair purchased, TOMS has shown that for-profit companies can thrive by focusing on social impact. Beyond just tacking on a pledge of corporate responsibility, TOMS built its brand entirely around the “buy one, give one” deal – a powerful and marketable concept that has inspired many mainstream companies to integrate philanthropy into their business models. The TOMS value proposition even attracted Bain Capital, which last year took a 50 percent stake in the company, which it valued at more than $625 million.

Despite TOMS’s success, many in the international development community have criticized the effectiveness of the “one for one” model. Consumers can easily understand a model that equates one purchase to one donation, but looking deeper into the production process reveals the consequences of delivering free items to communities in need.

At its start, TOMS manufactured abroad and then donated the products to people in other countries. While the free items reached thousands of people in poor regions, critics charged that these “donation drops” disrupted local economies and fostered dependency, rather than sustainable growth. Local shoe vendors most acutely suffered because the “drop” of free TOMS shoes often negatively impacted business.

Even accounting for these legitimate criticisms, one cannot deny that TOMS has set an incredible precedent for a growing industry of mission-driven businesses. But beyond helping to set this precedent, TOMS may be most influential in its decision to use the criticism constructively.

TOMS founder Blake Mycoskie responded to the wave of negative voices by proactively revamping the company’s model. In 2013, TOMS committed to manufacturing one third of its donated shoes in the regions where they are delivered. Since altering its production strategy, TOMS reports that it has created more than 700 jobs in communities that receive the donations.

The point should not be to attack companies that pioneered the “buy one, give one” (BOGO) concept, but to encourage their efforts to adapt the model and address its weaknesses. Now that TOMS has experimented with the model, emerging companies should hit the ground running with the goal of improving on the traditional “one for one” concept.

Founded by Liberian-born entrepreneur Chid Liberty, Liberty & Justice (L&J) is a for-profit social enterprise that began with the vision to overcome the setbacks of the conventional BOGO model. L&J (where the author is an intern) has launched a 45-day Kickstarter campaign for UNIFORM, an original clothing line that uses a model dubbed the “one for one remix.” With each purchase of a UNIFORM T-shirt, the company gives a free school uniform to a child in need – all while sustaining jobs in the communities that receive the donations.

The UNIFORM “one for one remix” directly addresses the most common criticisms of the traditional BOGO model, including three of the most common critiques highlighted a few years ago in an article by Mark Hand published in NextBillion.

First, giving things away for free can have a disempowering effect on the individuals receiving the donations, as they may begin to see themselves as passive recipients of aid, rather than active participants in their communities. Second, BOGO models distort local markets by hurting local businesses that sell products in competition with the donations. Third, companies following the model often do not allocate donor dollars based on the highest priorities of the poor.

UNIFORM overcomes the first two critiques by empowering local women with dignified jobs in the community. Rather than just dumping free things into Africa, the UNIFORM model employs Liberian women as active participants in the sustenance of local business, as well as key agents in enabling the next generation of Liberians to get an education.

All UNIFORM T-shirts and donated school uniforms are manufactured at L&J’s Fair Trade Certified apparel factory in Liberia, where 98 percent of employees are working mothers. These local women receive living wages, free health care, literacy classes and 49 percent equity in the factory. By creating jobs and integrating the factory into the local economy, the UNIFORM model creates sustainable development in the communities that receive school uniforms.

(Above: An a sample uniform made by garment workers employed by Liberty and Justice.)

In addition to being criticized for not creating local jobs, TOMS and others following in their footsteps have been challenged for the third critique: donating shoes, rather than other items that would arguably address more crucial needs in poverty-stricken regions. Though it is impossible to create an objective hierarchy of need, L&J chose to donate school uniforms because it was one of the most common concerns voiced by the Liberian mothers working in the factory.

Throughout sub-Saharan Africa, uniforms are mandatory for all children, even at public schools that have eliminated school fees. Because a uniform costs around $10 USD, school uniforms are one of the main financial barriers to children’s access to education. According to research and studies by the Poverty Research Lab in partnership with ICS Africa, providing children with school uniforms increased attendance by 62 percent, raised test scores and reduced the likelihood of teen pregnancy by keeping girls in school.

L&J launched UNIFORM in response to the impact of the Ebola crisis on its factory workers in Monrovia, Liberia (read more about the plant here). When the outbreak forced the factory to shut down in 2014, 303 Liberian mothers were left jobless and their children could not go to school since all schools were closed for eight months. In the context of this nationwide standstill, Chid Liberty conceived of the idea of UNIFORM in order to restart production at the factory and get kids back to school in post-Ebola Liberia.

We believe that by employing Liberian mothers to manufacture uniforms for Liberian children, UNIFORM has put an inventive twist on BOGO. Those who purchase a UNIFORM T-shirt are helping to send a child to school, while also empowering women with productive jobs in the local economy. Now that TOMS has laid the framework for conscious consumerism in mainstream business, UNIFORM is showing that social entrepreneurship has the power to continue updating the model to most effectively tackle the world’s most complex problems.

And, we think UNIFORM also happens to be making the world’s softest tees from a premium fabric blend featuring silk and recycled beechwood. And with each purchase, a child is sent to school. UNIFORM has already raised more than $140,000, which will dress more than 4,000 children in uniforms across 18 schools. Until July 17, you can shop UNIFORM exclusively on Kickstarter.

Sophia Witte is a press relations and events coordinator intern for Liberty & Justice’s UNIFORM Campaign.

Categories
Education, Entrepreneurship, Technology
Tags
consumer products, crowdsourcing, education, social business