ten thousand villages annual report 2011-2012 report 2012.pdf · 2 ten thousand villages annual...

Fair Trade Retailer Since 1946

Creating opportunities

annual reportApril 1, 2011–March 31, 2012

2 TEN THOUSAND VILLAGES ANNUAL REPORT

“Our focus on opportunities for artisans and customers has propelled our continued growth.”

Craig R. Schloneger, Chief Executive Officer

The heart of our work is creating opportunities for artisans in developing The heart of our work is creating opportunities for artisans in developing countries. The income artisans earn through fair trade with Ten Thousand countries. The income artisans earn through fair trade with Ten Thousand Villages empowers them to improve their lives—whether that means Villages empowers them to improve their lives—whether that means putting a roof on their home or food on their table, sending their children to school, or improving processes putting a roof on their home or food on their table, sending their children to school, or improving processes in their workshops. Our purchasing is based on long-term relationships and consistent orders from year to in their workshops. Our purchasing is based on long-term relationships and consistent orders from year to year, meaning artisans can plan for the future and build better lives. year, meaning artisans can plan for the future and build better lives.

The goal of creating opportunities is what drives us to grow new markets, even when other retailers are not. The goal of creating opportunities is what drives us to grow new markets, even when other retailers are not. In 2011, we opened five new stores and launched a new e-commerce platform because we believe that our In 2011, we opened five new stores and launched a new e-commerce platform because we believe that our work is also about providing opportunities for our customers. work is also about providing opportunities for our customers.

By sharing stories about artisans and their cultures and helping our customers make a difference with their By sharing stories about artisans and their cultures and helping our customers make a difference with their purchases, we strive to engage our customers in an authentic experience. We understand that shopping at purchases, we strive to engage our customers in an authentic experience. We understand that shopping at Ten Thousand Villages is a choice—about a beautiful product created using sustainable practices and Ten Thousand Villages is a choice—about a beautiful product created using sustainable practices and purchased from an artisan at a fair price. We are proud to have provided this opportunity for more purchased from an artisan at a fair price. We are proud to have provided this opportunity for more than 65 years. than 65 years.

In our changed economy, consumers are increasingly conscious about the impact of their purchases, not only In our changed economy, consumers are increasingly conscious about the impact of their purchases, not only for their wallets, but in the lives of others. But, at Ten Thousand Villages, shopping with meaning and purpose for their wallets, but in the lives of others. But, at Ten Thousand Villages, shopping with meaning and purpose for their wallets, but in the lives of others. But, at Ten Thousand Villages, shopping with meaning and purpose isn’t a trend; it’s what we’ve been about since 1946, when Edna Ruth Byler filled the trunk of her car with isn’t a trend; it’s what we’ve been about since 1946, when Edna Ruth Byler filled the trunk of her car with exquisite embroidery from Puerto Rico to share with her friends.exquisite embroidery from Puerto Rico to share with her friends.

Our focus on opportunities for artisans and customers has propelled our continued growth. In fiscal year 2012, Our focus on opportunities for artisans and customers has propelled our continued growth. In fiscal year 2012, Our focus on opportunities for artisans and customers has propelled our continued growth. In fiscal year 2012, we posted record sales, employment levels and artisan purchases. Through sound management of expenses, we posted record sales, employment levels and artisan purchases. Through sound management of expenses, we maintain a strong financial position with growing assets. we maintain a strong financial position with growing assets.

As I prepare to step away from my leadership role, I realize what an incredible opportunity it has been to work As I prepare to step away from my leadership role, I realize what an incredible opportunity it has been to work As I prepare to step away from my leadership role, I realize what an incredible opportunity it has been to work at Ten Thousand Villages. I have been blessed by so much—the wisdom and creativity of artisans, the talent and at Ten Thousand Villages. I have been blessed by so much—the wisdom and creativity of artisans, the talent and at Ten Thousand Villages. I have been blessed by so much—the wisdom and creativity of artisans, the talent and professionalism of staff, the commitment of volunteers and the excellent reputation of Ten Thousand Villages professionalism of staff, the commitment of volunteers and the excellent reputation of Ten Thousand Villages and its mission. Thank you for the support you have shown me as we have worked together to expand the and its mission. Thank you for the support you have shown me as we have worked together to expand the marketplace for fairly traded products. marketplace for fairly traded products.

Ten Thousand Villages is unique, relevant and growing with a future that holds much promise and opportunity.Ten Thousand Villages is unique, relevant and growing with a future that holds much promise and opportunity.Ten Thousand Villages is unique, relevant and growing with a future that holds much promise and opportunity.

With warm regards, With warm regards,

Craig R. SchlonegerChief Executive OfficerMarch 2012

On the cover: Peruvian artisans Salome and Eulogio Medina share their cultural heritage.

Message FROM OUR CEO

at ten thousand villages

FAIR TRADE MEANS . . .A FAIR PRICE

We pay mutually agreed upon

fair prices for artisans’ creations.

CASH ADVANCES AND PROMPT FINAL PAYMENT

Advance payments help

build sustainable businesses.

LONG-TERM RELATIONSHIPSConsistent orders support artisans’

long-term planning.

DESIGN COLLABORATIONTrend and style information

helps artisans adapt traditional skills.

ENVIRONMENTAL RESPONSIBILITYWe emphasize sustainable practices,

recycled and natural materials.

WWW.TENTHOUSANDVILLAGES.COM 3

OUR VISIONOne day all artisans in

the developing countries

will earn a fair wage,

be treated with dignity and

respect and be able to live

a life of quality.

“ Working with ethical, fair trade-minded groups like the Ten Thousand Villagesnetwork means access to North American markets, and a chance to obtain many of the goals that truly know no borders —

family advancement, university, a good job, a fair wage, pride in one’s work. Turns out that people like Juan Carlos in Cusco, Peru are just like us.” Tonya Klause, Board Member

our board of directorsleft to right, top to bottom: J. Ron Byler, MCC U.S. Executive DirectorLuke M. Roush

J. Alex Hartzler, Chair Gordon A. ZookM. Jacob Makoyo

Doug Dirks, Ten Thousand Villages CEOMarcus D. ShantzKaren Klassen HarderJohn E. Yoder

Kristy L. SchultzTonya Neff KlauseRyan D. Jacobs, Ten Thousand Villages Canada General Manager

at ten thousand villages

FAIR TRADE MEANS . . .A FAIR PRICE

We pay mutually agreed upon

fair prices for artisans’ creations.

CASH ADVANCES AND PROMPT FINAL PAYMENT

Advance payments help

build sustainable businesses.

LONG-TERM RELATIONSHIPSConsistent orders support artisans’

long-term planning.

DESIGN COLLABORATIONTrend and style information

helps artisans adapt traditional skills.

ENVIRONMENTAL RESPONSIBILITYWe emphasize sustainable practices,

recycled and natural materials.

THE TEN THOUSAND VILLAGES BOARD OF DIRECTORS convened its October Board meeting in LIMA, PERU. In addition to visiting artisan workshops and group leaders, the Board joined the 25th anniversary celebration for Allpa, a fair trade organization marketing the products of more than 100 workshops throughout Peru.

CEO Craig Schloneger with Fermin Vilcapoma, who works with artisan partners Allpa and Manos Amigas

In March 2012, Ten Thousand Villages’ board of directors appointed Doug Dirks to succeed Craig Schloneger as Chief Executive Officer. One of the fair trade movement’s most familiar faces, Dirks has been employed by Ten Thousand Villages for nearly two decades. He brings more than 25 years of experience in international relations, fair trade and senior leadership to the CEO position.

“ Workin


“I enjoy coming into the store to find unique gifts

for family and friends. It’s an interesting place to

shop because of the mission.”

Mary Sebold, Customer

Our unique assortment of handmade home decor, art, musical instruments, jewelry and personal accessories represents the diverse cultures of 37 countries in the Caribbean, Latin America, Africa, the Middle East and Asia.

While customers find our products affordable, they can also be assured they were purchased from artisans at a fair price — one that values materials and craftsmanship, and the cost and conditions of living in a developing country. As a nonprofit retailer, we use our net revenues to increase purchases from artisans, and to develop our markets, expanding opportunities for future sales of artisans’ products. In fiscal year 2012, the support of our customers allowed us to buy more from artisans than ever before.

Some say they find peace in the work of our artisan partners, others say our stores energize them. It is the life and achievements behind each beautiful craft that form the inspiring stories our staff works tirelessly to share — from buyers who visit artisans in their homes and workshops to a sales associate wrapping a gift for its recipient.

Whether purchasing a gift or shopping for themselves, our customers tell us they are excited to participate in fair trade by purchasing handmade crafts and helping someone thousands of miles away build a better life.

Shopping WITH MEANING

AND PURPOSE

www.tenthousandvillages.com 5 www.tenthousandvillages.com 5

ETHISPHERE AWARD

In March 2012, Ten Thousand Villages was named one of the World’s Most Ethical Companies by the Ethisphere

Institute for the fi fth consecutive year, recognizing our company as an industry

leader in ethics, governance, and responsibility.

Tenthousandvillages.com puts five continents at shoppers’ fingertips, inviting them to explore crafts and culture in comfort and convenience. In 2011, we introduced a new design and improved functionality for our website which greatly enhances this experience.

In keeping with our mission, our revamped website brings both products and stories to the virtual marketplace. Videos and photography allow customers to watch artisans’ hands create the product they are about to purchase or see a view from the village where the gift is crafted. Improved navigation and new features make it easier for customers to shop more than 1,000 handmade and fairly traded items, ultimately boosting sales, increasing orders to artisans, and improving lives.

Each new market is a new way to fulfill our mission; as we join new communities and meet new customers with whom we share

OUR MISSION To create opportunities for artisans in developing

countries to earn income by bringing their products

and stories to our markets through long-term,

fair trading relationships.

STORE NETWORK SNAPSHOTas of March 31, 2012

Ten Thousand Villages Stores 78Alliance Accounts 342States in which we hosted Festival Sales 47 Corporate Staff Members 319


MEMBER

products and stories, we create new opportunities for artisans to earn income. In fiscal year 2012, we also added fair trade shopping destinations in five new locations: 1. Charlottesville, Virginia’s Downtown Mall2. Church Street Marketplace in Burlington, Vermont3. Exchange Street in Portland, Maine4. Garden City in Cranston, Rhode Island5. Washington Street, the historic Freedom Trail, in Boston, Massachusetts

There are now 78 Ten Thousand Villages locations in 30 states across the U.S., where customers experience sights and sounds, from embroidered tapestries of India to singing bowls of Nepal, that transport them to another place and culture, where every purchase helps artisans earn income that will feed and house their families and educate their children.

OURMarketplace

Burlington, Vt. store


Gouri Adhikari, Keya Palm, BangladeshPhoto: © Habibul Haque/Drik/Ten Thousand Villages

Learning AND COLLABORATION


During our National Workshops in May, we welcomed Syed Fahad Ali, CEO, and Younus Masih, master onyx craftsman, of The Dominion Traders, a Ten Thousand Villages artisan partner located in Karachi, Pakistan. Mr. Masih demonstratedhis craft—shaping detailed figures from a block of onyx using just his two hands and a motorized grinding wheel. Mr. Ali spoke about life in Pakistan and running a third-generation business during a global recession. He explained to a group of more than 150 store and corporate staff members that, despite tenuous foreign relations, “a common man in Pakistan loves a common man in the United States.”

Gerardo Wijnant, founder of Chilean fair trading group Comparte, traveled around the U.S. in September for our Regional Meetings, sharing stories of the men and women who craft the jewelry and pottery sold by Ten Thousand Villages.

We seek such opportunities to learn from artisans about their processes and products, their countries and cultures, their hopes and dreams for their families. Artisans’ visits allow them to experience culture in the United States and to gain more thorough knowledge of North American markets where their products are sold. We also achieve a deeper understanding of our work by meeting the artisans in their homes and villages and seeing first-hand the effect of fair trade in their lives.

In February 2012, a group of 10 Ten Thousand Villages representatives, including staff and volunteers from our home office and stores, embarked on a two-week trip to India and Bangladesh, where they visited the workshops of 14 artisan groups, including Prokritee, HEED Handicrafts, Craft Resource Center and Asha Handicrafts.

Rajana Association lost its ceramics kiln when the landowner removed it to use the property for another purpose, effectively eliminating the group’s ability to produce a very successful product. Ten Thousand Villages partnered with MCC Cambodia to locate new property and finance, through the Artisan Special Needs Fund, the building of a new kiln. With the new kiln, Rajana is once again providing vocational training to Cambodian young adults and producing ceramic crafts for Ten Thousand Villages.

In Egypt, the incredible public demonstrations that brought the end of dictatorship also nearly eliminated the tourism industry. Drastically reduced domestic sales threatened the livelihood of craft producers, including those who work with Fair Trade Egypt, a Ten Thousand Villages trading partner that earns 60 percent of its annual revenue domestically. Our emergency order of a brass ring and cotton scarf from Fair Trade Egypt helped people in and around Cairo maintain their jobs and support their families.

The products that fill our shelves are made by people we know

and care about. We have visited each other’s homes, met each other’s children and shared meals together. Our buying relationships represent

far more than the promise of fair wages and consistent orders—they are commitments of learning, collaboration and problem solving,

and assistance in times of need.

Yoem Ratana, team leader at Rajana Ceramics Workshop in Siem Riep, Cambodia

Hamada Abugenina, artisan at Fair Trade Egypt’s alabaster workshop

Syed Fahad Ali, left, and Younus Masih, right, of The Dominion Traders, with Craig Schloneger at National Workshops, May 2011

Learning AND COLLABORATION

Problem Solving AND ASSISTANCE


FINANCIAL SUMMARY

“ At Ten Thousand Villages, we strive to maintain consistent purchases from producer groups year to year. With confidence they not only have work for today, but will also have work in the future, artisans can invest in their businesses and initiate

significant positive changes in their lives and communities.” Pam Raffensberger, Chief Financial Officer

BALANCE SHEETS

As of As of March 31, 2012 March 31, 2011ASSETS Cash $1,838,594 $932,322 Accounts Receivable 557,263 668,830 Inventory 6,242,290 6,678,838 Prepaid expenses and deposits 724,086 594,920 Advances to artisans 1,587,605 1,762,476 Long-term receivables 93,899 76,658 Equipment and Vehicles 1,123,710 947,165 Land and Buildings 1,473,125 1,588,276 Insurance Reserve Fund 288,897 289,395 __________ __________

Total Assets $13,929,469 $13,538,880 LIABILITIES Accounts Payable and Accruals 1,995,990 1,876,521 Long-Term Notes and Payables 239,067 326,176 __________ __________

Total Liabilities $2,235,057 $2,202,697 EQUITY $11,694,412 $11,336,183 Total Liabilities plus Equity $13,929,469 $13,538,880

STATEMENT OF INCOME AND EXPENSE

For Year Ended For Year Ended March 31, 2012 March 31, 2011SALESRetail Stores $13,947,365 $11,435,348Contract 7,857,027 7,346,694Alliance 2,562,361 2,703,985E-Commerce 1,518,599 1,451,301Festival Sales 937,477 998,218Rug Sales 516,069 646,081Other 391,350 395,194 __________ __________

Total Sales $27,730,248 $24,976,821

COST OF GOODS SOLD Purchases $7,797,816 $7,204,797Importing and Other Costs 959,164 1,044,584Decrease in Ending Inventory 436,548 523,817 __________ __________

Total Cost of Goods Sold $9,193,528 $8,773,198

GROSS MARGIN $18,536,720 $16,203,623GROSS MARGIN % OF SALES 67% 65%

EXPENSES Warehouse $3,430,951 $3,305,324E-Commerce 879,222 675,766Sales, Merchandising & Marketing 2,555,994 2,188,110Retail Stores 8,070,425 6,741,488Administration 3,239,968 2,946,048 __________ __________

Total Expenses $18,176,560 $15,856,736

NET OTHER INCOME/(EXPENSE) ($1,930) $389,126

NET INCOME $358,230 $736,013


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YEAR ENDING (MARCH)

U.S. AND CANADA FY12 Figures in U.S. Dollars

Combined U.S. & Canada Sales $42,000,000Combined U.S. & Canada Purchases $12,000,000

Ten Thousand Villages Canada is incorporated separately as a nonprofi t organization and is operationally and fi nancially independent from Ten Thousand Villages in the U.S.

BALANCE SHEETS

As of As of March 31, 2012 March 31, 2011ASSETS Cash $1,838,594 $932,322 Accounts Receivable 557,263 668,830 Inventory 6,242,290 6,678,838 Prepaid expenses and deposits 724,086 594,920 Advances to artisans 1,587,605 1,762,476 Long-term receivables 93,899 76,658 Equipment and Vehicles 1,123,710 947,165 Land and Buildings 1,473,125 1,588,276 Insurance Reserve Fund 288,897 289,395 __________ __________

Total Assets $13,929,469 $13,538,880 LIABILITIES Accounts Payable and Accruals 1,995,990 1,876,521 Long-Term Notes and Payables 239,067 326,176 __________ __________

Total Liabilities $2,235,057 $2,202,697 EQUITY $11,694,412 $11,336,183 Total Liabilities plus Equity $13,929,469 $13,538,880

ANNUAL SALES HISTORY

Percent Total Change

FY2003 14,624,475 16.1%

FY2004 15,243,106 4.2%

FY2005 16,085,865 5.5%

FY2006 20,135,080 25.2%

FY2007 23,487,984 16.7%

FY2008 25,513,297 8.6%

FY2009 23,948,726 -6.1%

FY2010 23,406,395 -2.3%

FY2011 24,976,821 6.7%

FY2012 27,730,248 11.0%

• We work with small scale artisan groups who bring economic justice and hope to the poor.

• We trade with artisan groups who pay fair wages and demonstrate concern for their members’ welfare.

• We choose handcrafted products that refl ect and reinforce rich cultural traditions, that are environmentally sustainable and that appeal to the consumer.

• We provide consistent purchases, cash advances and prompt fi nal payments to artisans.

• We build sustainable operations and market fairly traded crafts through a variety of sales channels.

• We use resources carefully and value volunteers and staff who work with us.

• We cultivate a strong brand identity that distinguishes us as a leading fair trade retailer and wholesaler.

• We market quality products that are crafted by artisans who are economically marginalized.

• We educate customers about fair trade, artisans’ lives and their cultural heritage.

• We seek to delight customers with superior service and beautiful, handcrafted, fairly traded goods.

PRINCIPLES OF OPERATION

Ten Thousand Villages is a business with a compassionate mission. We maintain integrity in our actions and relationships and market quality products from diverse cultures around the world. We build sustainable long-term trade relationships with artisans and strive to ensure fairness in all aspects of our work.

PURCHASES BY COUNTRY For Year Ended March 31

CRAFTS FY2012 FY2011India $1,842,046 $1,603,598Pakistan 627,559 726,821Peru 604,734 493,598Bangladesh 580,529 557,792Vietnam 475,886 467,483Kenya 435,274 407,923Philippines 406,945 333,215Indonesia 394,422 365,001Nepal 383,418 341,195West Bank 147,224 121,575Haiti 145,059 115,908Guatemala 142,521 113,337Chile 82,885 51,190Ecuador 78,858 81,025Mexico 76,128 78,861Colombia 63,880 62,441Burkina Faso 63,357 58,137Uganda 62,350 67,945Egypt 60,423 59,627Cameroon 55,984 24,905Cambodia 52,726 49,949Bolivia 45,694 32,717Laos 42,909 19,855Nicaragua 36,294 29,959Niger 30,666 36,022El Salvador 28,075 23,663Tanzania 26,041 33,705Ghana 24,911 26,313South Africa 24,095 14,205Honduras 14,819 21,222Zimbabwe 12,500 7,875Congo 7,898 20,430Israel 7,829 0Thailand 6,832 5,004Ethiopia 5,751 7,388Nigeria 0 27,740Sri Lanka 0 17,596 FOOD AND OTHER PRODUCTS Coffee, Tea, and Chocolate $343,586 $301,882Int’l Music, Books, and Miscellaneous 168,726 173,129 Store and Other Supplies $188,985 $224,568 __________ __________

TOTAL PURCHASES $7,797,816 $7,204,797

ARTISAN SUPPORT SNAPSHOTas of March 31, 2012

Countries from which we purchased 37Artisan groups 124New items introduced 545 Craft purchases from artisans $7.1 millionBuyers’ trips 54 groups in 13 countries


Do Thi Tam,Bamboo artisan,Hanoi, Vietnam

Sana Hastakala artisan Kalyan Krishna Tamrakar crafts a singing bowl, Nepal

Purchasing Director Kathleen Campbell and Buyer Jennifer Villella with artisans and families from Rashi Handicrafts, a workshop of CFM Market Linkages, India.

Photo: © Lynn Johnson

WWW.TENTHOUSANDVILLAGES.COM 11WWW.TENTHOUSANDVILLAGES.COM 11

Fair trade meansNamusisi Margret can use basketweaving skills she learned as a young girl to earn income to buy food and clothing, take her children to the doctor and send them to school.

PURCHASES BY REGION For Year Ended March 31

FY2012 Total FY2011 Total

South Asia $3,433,552 $3,247,002

East Asia 1,379,720 1,240,508

Latin America/Caribbean 1,318,946 1,103,919

Middle East 215,476 181,201

Africa 748,826 732,587

Other 701,297 699,579 __________ __________

TOTAL $7,797,816 $7,204,797

2012PURCHASES BY REGION

SOUTH ASIA44%

EAST ASIA18%

LATIN AMERICA/CARIBBEAN

17%

MIDDLE EAST2%OTHER

9%

AFRICA10%

2011PURCHASES BY REGION

SOUTH ASIA44%

EAST ASIA17%

LATIN AMERICA/CARIBBEAN

15%

MIDDLE EAST3%OTHER

10%

AFRICA10%

Use this logo for reductions only, do not print magenta. Do not reduce this logo more than 35%. Magenta indicates the clear area, nothing should print in this space.You may reduce the logo to 20% without the tag and strap lines.Color of Wood Block Motif critical match to Pantone 1805.Letters print Pantone Process Black.

harmony. made by hand.

www.tenthousandvillages.com

704 Main Street, P.O. Box 307

Akron, PA 17501

(717) 859-8100

A beautiful craft A fair wage

A brighter future

Fair trade means Surobi Biyaand her family have nutritious meals.

Photo: © Jonathon Bowman

ten thousand villages annual report 2011-2012 report 2012.pdf · 2 ten thousand villages annual...

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