Penny Newman Cafe Direct feature from the East Anglian Daily Times
Head of Cafedirect earns her stripes
The chief executive of Cafédirect started to go white at the age of 16 and now has her hair dyed every 10 weeks or so. Today she's sporting a purple stripe.
A year ago she tried purple with pink, but when she went to Tanzania the sunshine turned it a bluey/turquoise and she feared it didn't look so great when she had to make a presentation before the president.
It all started when she went to a wedding in Spain. She was getting a bit bored with her hairstyle at the time, and hats weren't terribly common on such social occasions, apparently, so a bold pink stripe was added.
There were a few wobbly moments early on - every time she caught sight of her reflection in a window or mirror she wondered what on earth had possessed her - but her husband thought it was great. Today, a bright stripe is as much a part of Penny Newman as her personality.
If truth be told, she'd really like to sport pink tips at the end of her locks; but her hair grows quickly and it would need doing again after about five weeks. Too expensive, she fears.
Would she feel comfortable having such a quirky approach if she were working for Barclays, say, rather than a company so overtly concerned with closing the gap between rich and poor?
Well, she says, she'd never want to quash her personality. It's almost immaterial, since - and with all due respect to a business such as the bank - she could never really see herself working for a firm like that anyway. When all's said and done, she'd hope people would look at the work she does, rather than the hue of her hair.
That work includes breathing new life into Cafédirect after joining in 1998. The company is the UK's largest Fairtrade hot drinks company, with turnover more than trebling, to nearly £22 million, during her time at the helm. (And, despite the name, it sells tea and drinking chocolate as well as coffee.)
It's the 6th-largest coffee brand in the UK. Teadirect, its tea brand, is the 7th largest.
Recent success have seen a 41% rise in what's called out-of-home sales, thanks to major efforts to get the firm's products into workplaces and schools.
It buys from 37 producer organisations in a dozen countries, ensuring that more than 250,000 growers receive a decent income from trading, says Penny.
Cafédirect's about “one thing and one thing only - quality products that bring a better quality of life to people around the world. And that's something I'm intensely proud of”.
So far, then, so peachy.
But Penny accepts there are challenges ahead: for the Fairtrade philosophy in general and Cafédirect specifically.
Probably the biggest is persuading consumers to buy Fairtrade products - and there are more than 2,500 lines in the UK that carry the Fairtrade mark - all year round.
Sales peak during Fairtrade Fortnight in the spring, but she says the movement needs to be pressing organisations to heavily promote their products during the other 50 weeks of the year.
And although Britons last year spent £290million on fairly traded food, furniture and clothing, up 46% on the previous year, there's still a lingering public perception that Fairtrade goods are a bit, well, “worthy” - and sometimes, whisper it quietly, not all that delicious.
The solution, Penny feels, lies in successfully banging the drum - not surprising, really, since she's a marketeer at heart. Before joining Cafédirect she worked in marketing for Avon, Schwarzkopf, Fabergé, Wella and, latterly, Body Shop International as regional product marketing manager for Europe and the Middle East.
“We've got to make sure those products are yummy. We all must have seen - certainly I've seen, and still do - people saying 'Fairtrade products . . . I tried that . . . don't like it' or 'It's a charity, and therefore it can't be good, because I've seen it in a charity shop.'
“We've very much led the campaign that our product must be really good, inside and outside the pack. We've worked really hard at that.
“That's quite a shock to the Fairtrade movement, because it did mean we had to invest in marketing and selling. I'm not saying they're big investments, but this was quite a change,” she laughs, “to say 'By the way, we're going to invest in branding.' We've led the way on that and certainly I've seen others follow the approach we've taken.”
The strategy she's employed at Cafédirect is to run the company as a business. That, she insists, is the only way to ensure there's the money to help farmers in developing countries.
“Because if you make a business out of it you can then start getting other bigger organisations thinking 'Oooh, maybe we should start doing that.' If you don't make it into a business model, people are still going to put it under the label of 'charity'. You don't want them to be buying Fairtrade because it's their Christmas donation.
“You know, profit can be seen as a dirty word, but the thing is it's what you do with the profit.
Talking to farmers, they know they've got to make their organisation profitable or they're not going to survive. If we're not leading the way for them by being profitable, how are they going to learn?”
Fairtrade the Cafédirect way is not about giving producers a handout.
“When I talk to farmers, what they want is what you and I have been lucky enough to have: to gain knowledge, to gain understanding, and be able to control their own lives; and control them for the future of their children and grandchildren, so that they can survive off the land that's been passed down from generation to generation. They don't want handouts.”
It's hard to slap a label on the Cafédirect philosophy. Penny opts for “alternative business - to show that our DNA is about helping producers get to that second or third step on the ladder, and then to go further”.
While she accepts there is a long way to go - only about 5% of coffee drunk in the UK is Fairtrade, for instance - there are signs of optimism. Not least the number of big-name companies getting involved.
Sainsbury's announced this year, for example, that it was converting its own-brand tea to Fairtrade, followed by 100% of roast and ground coffee. It would also source Fairtrade-certified cotton for its best-selling T-shirt. Its bananas are already from Fairtrade crops.
Penny is sure Cafédirect has been a catalyst.
“We know we have played a part in making that happen. The coffee and tea market has not been growing that fast; and where there has been growth it's been through companies such as ourselves.
“You could be saying 'Hmmh, are they doing it for the right reasons?' That will be interesting to see - whether they're going to be doing Fairtrade coffee in two years' time. That will show if they genuinely believe this is all about changing a trading model that benefits producers sufficiently and relevantly in today's market, so they don't suffer hardship.”
It's important to stress the important difference between Cafédirect and the wider Fairtrade philosophy. With the latter, producers receive the market price, plus a premium on top - so they get a fair and stable return for their crops and can make a decent living. Cafédirect follows that approach - and then adds an extra payment.
Over the past five years it's paid more than £10 million over and above the market price back to growers in 12 countries, and invested almost £2.5million in tailor-made programmes designed to strengthen grower businesses. From 2003 to 2006 this represented 60% of its profits.
In Africa, the Cafédirect premium has been used for building maternity huts, so women don't have to travel miles and can give birth in the village. “In Latin America they're starting to use those premiums either to make a second payment to producers or to actually help build their own organisation - to build the skills; to build the knowledge - so they know how to value their crop and improve their crop.”
Penny says: “Half the producers we've traded with didn't even know how to export - what forms to fill in, how you had to pack organic coffee in a different way etc when it's shipped. You and I are maybe fortunate to have had people to guide us through our careers and in our skills base; these guys, and women, don't always have that opportunity.”
The formula has worked very well: in some cases producers later feel able and confident enough to go it alone, once they've found their feet and have developed all the skills they need.
When Penny was persuaded to join Cafédirect she was actually having a bit of a career break following the death of both parents in quick succession, working out what direction to take.
She planned to stay for only three months, “but I'm here nearly 10 years later!
“I just feel very lucky and fortunate to do the job I do. We all have bad days; but when I have bad days I just think about my last visit, or the last conversation I've had with farmer groups.
“I was talking to the general manager of a group from Nicaragua yesterday, and hearing about their issues. They've got real problems with rain, and a lot of young farmers don't want to stay around. They want to go to the cities and towns and they think it's going to be great.
“What they've done with the premium is set it up in a way that it becomes a community premium. If the younger people want to go and get some education, the community funds that education - but with the reassurance they will come back and use those skills and knowledge for the benefit of the community. If they learn to be a doctor, for instance, they come back and work within the community.
“When you listen to that, you go 'Wow! This is what it's all about'.”
The Penny Newman file
Born August, 1956, in Colchester
Father was in the Army
Family moved away when she was four
Went to school in Epsom
Degree in business studies and marketing at City of London polytechnic
First job was marketing industrial clutches and brakes. “Still to this day I'm not sure I know the difference!” she quips
Lives in Surrey
Received the Dods and Scottish Widows Businesswoman of the Year in 2007
She's coming to Chelmsford today (Wednesday, October 24), 7.30-9pm, at Christ Church, New London Road, at a special evening on the Future for Fairtrade organised by Chelmsford Oxfam Campaigns and the town's Fairtrade Action Group
“This evening will hugely appeal to everybody interested in Fairtrade issues, including all business owners interested in seeing how ethics and business can work together,” says Malcolm Burgess, Oxfam co-ordinator
Penny Newman HAIR colouring is a pretty trivial issue when compared to the struggle of coffee producers in Peru or Ethiopia to escape the poverty trap. But it's Penny Newman's trademark look, so best to get it out of the way early on.
