Craft Beauty « CONTIGO WordPress Prod

Motto: Bring happiness to other people and happiness will create happiness.

1 Profile of CONTIGO´s partner Craft Beauty
1.1 Supply chain
1.2 Products
1.3 Location
1.4 Founded in 2003
1.5 History
1.6 Cooperation with CONTIGO since 2010
1.7 Structure of the business
1.8 Sales
1.9 Goals
1.10 Special features
2 Fairtrade classification
3 Fairtrade aspects
3.1 No child labour
3.2 No discrimination
3.3 Fair wages
3.4 Humane working conditions
3.5 Transparency
4 Monitoring
5 Country information
6 Photos

Profile of CONTIGO´s partner Craft Beauty

Supply chain

Trading partner: Craft Beauty, medium enterprise
Function: Producer
Structure: Own production plant, affiliated production groups
Tradeway: Direct import CONTIGO

Hanoi to Göttingen (Source: Google Earth)

Products

Bags and accessories made of different fabrics

Location

Hanoi (district of Long Biên), Vietnam – distance to Europe: 8,600km

Founded in 2003

History

Hoai Nguyen studies marketing and business administration and volunteers at a rural development organisation from the U.S. during her studies. Her task is to prepare local artisans and their products for the international market
2002: She changes from voluntary work to professional self-employment
2003: Hoai Nguyen and her husband Diep establish Craft Beauty to support local artisans to market their products: focus on silk accessories, bags and garments; participation in trade fairs and first exports, at that time only few employees for quality control and packaging
2004: Craft Beauty hires a sample maker in order to design own cuttings / patterns for workshops in rural areas: a small sewing workshop is set up in the private house of Hoai and Diep
2005-2009: Craft Beauty becomes member of Fairtrade Federation in the U.S.A. (membership ends, as from 2009 on only American Fairtrade companies are allowed to become members)
2006/2007: Purchase of a workshop building and construction of an own production site
2009: Craft Beauty moves to a bigger production building in the neighbourhood, the former workshop is still used as an accommodation house for commuters
2009-2017: Participation in international trade shows and establishment of an export customers base
2010: CONTIGO meets Craft Beauty for the first time, since then annual orders and continuous product development
2015: Cooperation with artisans of ethnical minorities in the provinces of Mai Chau and Nghe An
2017: Second designer is hired
2019: The CONTIGO e.V. finances the purchase of five modern sewing machines, which significantly improve the quality of their sewing work and increase productivity
2020: under Covid pandemic economy declined, orders cancelled and reduced, number of internal staff and external groups reduced, 35% less employees than 2019, but consistent work for indoor staff

Cooperation with CONTIGO since 2010

Structure of the business

Number of employees:

55 employees
- 31 employees in the central workshop in Hanoi
  - 31 full-time, no part-time
  - Production, processing, packing: 22
  - Design, product development: 3
  - Quality control: 4
  - Administration, marketing, sales: 8
- 24 employees outside the central workshop, in the provinces of Ha Tay, Hung Yen, Hai Phong

Organisation of workforce / work environment:

Main tasks at Craft Beauty internal workshop:
- preparation of production (e.g. cutting of fabrics for external workshops)
- production (complex sewing tasks)
- quality control
- packaging
- administration, product development
CEO Diep and production manager Oanh Hoang
- visit all production locations on a regular basis
- accompany closely every single production step
- train new staff
- enforce quality standards

External producers
- Groups (mainly 3-5 people, biggest group counts 15 people) and individuals (housewives, who combine work with child care and farming). In 2020 focus on cooperation with individuals and housewives
- Due to the pandemic and less order volume most of the groups accept orders from local fashion shops, they do not work exclusively for Craft Beauty any more
- Tasks: sewing, printing, embroidery, crocheting
- Structure of small producer groups: 1 woman leads a group of 3-5 women, leader plans production steps, divides and allocates tasks, is responsible for quality (and therefore receives a bonus for good quality and meeting the delivery time)
- Equipment:
  - bigger groups are fully equipped with cutting machines and sewing machines, they do not need prepared materials from Craft Beauty; they receive an advance payment in order to purchase the materials
  - smaller groups and individuals receive prepared material packages, expensive equipment like sewing machines can be leased from Craft Beauty (will be billed with future orders)
Weekly meetings with all employees (on Saturdays)
Regular meetings with leaders of small producer groups
Designs, salary, working conditions, business development, and productivity issues are discussed
Bimonthly meetings with team about optimising work processes, successes, difficulties, and business outlook of the company

Sales

Exports (75%) to the U.S.A., UK, Australia, the Netherlands, Canada, Germany, Italy
Home market (25%)

Goals

To increase education and job opportunities for women and minority groups
To preserve and promote traditional crafts
To increase income
To establish new business relationships
To create new product lines

Special features

Focal point: creation of job opportunities for people with disadvantages and no school education
Outsourcing of small sewing tasks to small producer groups to provide income opportunities for rural women
Principle: work tasks should be arranged around child care
Housing with sleeping spaces, fridge, etc. available for women with a long commute (can be used for free), house is also used for women from villages when they visit for further training

Why does CONTIGO work with Craft Beauty: Product development with Craft Beauty has been very easy and successful from the first collection onwards.

Fairtrade classification

FTA = Fairtrade Approved

Fairtrade aspects

Craft Beauty complies with the following Fairtrade Principles:

No child labour

No discrimination

No discrimination due to gender, disability, religion, ethnicity, sexual orientation, political orientation, or infection with HIV

All women have the same opportunities, some women with disadvantages work in high positions.

Fair wages

Minimum wage in Hanoi: 4.42 Mio Dong/month
Wages at Craft Beauty: US$ 180-450/month, depending on responsibility
- In the central workshop:
  - Office workers, manager, employees in the cutting and quality control receive fixed wage
  - Employees in production receive piece-rate wage
- External employees receive piece-rate wage depending on orders and performance, piece rate is agreed on before order
Higher wages in case of overtime (100%)
Bonuses are paid for high performances
Annual wage adjustment, depending on the work performance and the rate of inflation, for example:
- 2012: wages were increased dramatically to match the inflation rate of 20%
- 2014-2016: bonus payments for best quality and compliance with completion deadline of orders
- 2020: under pandemic situation all staff forego the annual wage increase

Humane working conditions

Working hours:

8 hours/day
1 break (1 hour)
6 days/week ( 5 days/ week in 2020 due to less work)

Social benefits:

For the 31 employees who work in the central workshop in Hanoi:

Paid holidays (10 national holidays + 12 annual leave holidays)
Payment of contributions to „Social Insurances“, consisting of
- Pension fund
- Continued payment of wage in case of sickness, accident and maternity leave
- Accident insurance
- Employer pays 21,5% and employee 10,5% of monthly gross wage

For all 55 employees:

Payment of contributions to health insurance (employer pays 3% and employee 1,5% of monthly wage)
Free housing provided for women who can only go home during the weekend due to long commutes (currently 6 women use the accommodation)
Financial support available in case of need
- Loans provided to employees for important purchases (house) or important family matters
- Loans provided to small working groups for tools, machines, and materials
- Sewing machines are handed out as long-term loans
Workplace health promotion: offer of a free yoga course in-house once a week, especially for women who work at the sewing machines

Educational opportunities:

Trainings in computer skills, management skills, design, fashion, Fairtrade and export
Educating external producer groups in quality standards
Vocational education of disadvantaged women as seamstresses