Positive Power of Principled Profit
Volume 4, Number 9—May, 2007

Positive Power Spotlight: The Old Creamery Grocery

This is so cool and so different that I have to write about it right away. This past Friday, my hometown newspaper (the Daily Hampshire Gazette) ran an article about an initiative at Old Creamery Grocery in tiny Cummington, Massachusetts, about 30 miles from me in the Hampshire County Hilltowns (a rural area in the Berkshire foothills).

I've been to that store a few times. It's a cute little grocery/café/gallery, the meeting place for all the locals, with a nice line of staples and gourmet stuff (including a lot of organics and even ethnic specialty items that you wouldn't expect to find in a rural village. A number of Hilltown communities in the area boast similar establishments.

But this is what caught my attention. This store did some research into the environmental impact of all the paper bags even a tiny place like this goes through: 49,000 per year, or about 70 mature trees' worth of lumber.

Encouraging customers to bring and reuse their own bags was a first step, but it can be hard for shoppers to remember that. So in addition, the store started a sewing project, creating reusable cloth totes that customers can use and then bring back later on the honor system. (The bags include a note reminding the shoppers to return them.) A passel of volunteer seamstresses, including kids, have so far created 80 bags, each unique, out of everything from jeans to old curtains.

And the idea is taking root; several other Hilltown businesses have started bag projects of their own.

What kind of environmental impact are we talking about? After it's used just 11 times, a reusable bag (even made from scratch) has less environmental impact than individual plastic grocery bags--and a good cloth tote can be used many dozen times. Only 20 percent of paper bags and one percent of plastic bags are currently recycled--but every ton of paper bags reused or recycled spares up to 17 trees and saves at least 40 cubic feet of landfill space--and that doesn't even count the energy savings.

The Creamery doesn't seem to have a website, but there is a nice directory profile at http://www.hidden-hills.com/oldcreamery/

Another Recommended Book: The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits, Enabling Dignity and Choice Through Markets by C.K. Prahalad, Wahrton School Publishing, 2006.

With endorsements by Bill Gates, former U.S. Secretary of State Madeline Albright, the CEO of VISA Inernational, and One-Minute Manager co-author Ken Blanchard, this book sets up high expectations. And it meets them--with a dramatic and (dare I say) revolutionary approach to empowering the poorest of the poor around the word: not through handouts, but through a clever reinventing of capitalism. In other words, corporations can lift up the bottom through good old fashioned self-interest.

As much an economics text as one on marketing, this book has the potential to drastically change the entire world economy.

Among Prahalad's key points:

* Poor people in developing countries crave the same lifestyle enhancements as the rest of us, and will spend money if they can demonstrate sufficient improvement in their condition

* Companies that understand and harness the cultures where they operate can make handsome profits serving this underserved sector--especially where they enable massive saving of time, productivity, travel, etc.

* When properly structured, offers to the bottom of the pyramid can actually be more secure, with lower default rates (especially when using self-help groups as in the well-known microlending model pioneered by Grameen Bank and others)

* The bottom of the economy is a fantastic proving ground for new processes and products that can then be "exported" up the economic ladder (as one example: a prosthetic technology that created a superior artificial foot that can be manufactured and installed for $30 or so, versus several thousand dollars in upper-class cultures)

* In many cases, the bottom can leapfrog some of the popular technology infrastructure in more developed locations and go to something better (e.g., skipping petroleum fuels and grid-based power lines and going directly to on-site solar, avoiding not only the significant infrastructure costs of rural electrification but also the issues of global warming and ongoing consumption cost)

While he's a bit too rah-rah for my taste about the positive role multinational corporations can play in all this, and he's willing to tolerate financing plans that would be usurious in a modern consumer society (though still far cheaper than dealing with unregulated local moneylenders), he shows over and over again, both in the technical/theoretical part of the book and in the much more readable case studies, that profit can provide a great incentive to improve the lives and facilitate empowered decision-making among the very poor.

As someone who has spent my entire life focused on improving the world, I find this very exciting, and would love to see this as a required text in every class on economics, marketing, and international policy.

If you'd like to buy this book, please follow this link to buy from a BookSense independent bookseller:
http://www.booksense.com/index.jsp?affiliateId=FrugalFun