The Sexy in Powerbars

Restore

Blog Post #5

Yesenia Gomez

Economic side of Consumption- Powerbars

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The Sexy in Powerbars

The Restore can be described as PLNU’s very own mini-market. Students are constantly in and out of this venue. I was able to talk with Irene Alvarado, Manager of the Restore, about the best-selling products. The Powerbar was one of the top 2 selling products in the Restore. Most people would agree that the energy bars are quite expensive but the satisfaction one receives from eating a filling, healthy bar is better than a bag of chips. The benefits of the taste and nutritional gains have obviously outweighed the financial costs. As a school, we have proved it by making energy bars one of our top 2 selling products.

Since 2004, energy bars have made steady gains even with the relatively high prices on the energy bars. In 2011, Food Management wrote an article titled Food Bars Growing Fast; Packaged Facts reported that the retail market was $5.7 million dollars in cereal and energy bars.

Energy bars, such as Powerbar, have expanded their markets from the sports nutritional market to recreational and life-style users. A 2010 Market analysis report from the International Market Bureau says that niche markets in sports nutrition are selling products in grocery stores and market outlets; they are no longer just seen at nutritional or sports stores. Sport nutrition markets are using new ingredients in new products to incorporate different target markets. The general American population has athletes, recreational users, and life-style users. The consumption of each of the groups has a different intention and purpose of purchase. Just like the general population, PLNU is a small sub-scale of the energy bar consumption; there are students, faculty, and staff that engage in different sub-categories of exercise.

According to the International Market Bureau, there are 3 specific trends seen in the consumption of energy bars. First, Powerbars have included innovative ingredients such as protein and nutritional boosts like energy; this attracts the athletic population. Second, appearance and fitness concerns have become more openly common. Third, the accessibility of these bars has grown; they are in mini-markets like the Restore and supermarkets like Walmart. The last two trends attract the general population.

The United States has become the biggest consumer for sports-related products. In the global market, it is estimated to consume two-thirds of both the value of retail transactions and volume sales. Consumer behavior has pushed sports nutrition markets to make a variety of energy bars with new specific flavors and purposes. This is why Powerbar has a total of 37 bars in 8 specific categories. Taste is a significant factor and ingredients like cocoa and whey or soy protein can manipulate whether consumers will continue to purchase bars.

Nestle, owner of Powerbar, has easily outstripped cocoa supply from plantations in the Ivory Coast. Corporations like Nestle know the value of cocoa; they know it can be transformed into a great tasting bar with high demand. The problem is cocoa farmers are not receiving a fair share of the end product being sold. Percival’s article, From bean to bar: Why chocolate will never taste the same again, discusses the problem with local community farmers being at the bottom of a multi-layered supply chain. The cocoa-nomics do not allow these farmers to economically benefit from what has become an increasingly demanded market in the United States.

This means that either Powerbar comes up with a new supplement to replace cocoa or they change the way their supply chain is currently operating. If they choose to keep cocoa, they need to be paying farmers a fair amount of the profits gained. This also means better working conditions and the stop to child labor. If they do not choose to keep cocoa, they will lose a large number of consumers, and it would not be the same product anymore.

We know that energy bars have become increasingly popular and trendy. Is it more important to the consumer to buy trendy food items? Are consumers that shallow? Is it our duty to investigate where the ingredients of a Powerbar come from? Are corporations like Nestle using our own consumer behavior for their own economic benefit?

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Nestle’s Marketing Strategies

Restore

Blog Post #3

Yesenia Gomez

Economic side of Distribution- Powerbars

Nestle’s Marketing Strategies

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Recently, Nestle has broadened its marketing strategy by working as a franchise machine across the world. It is a global multinational corporation that exists within local communities. Nestle brands everything locally and works regionally. Most of its plantations are abroad while corporations are in the US and Europe. They have a global approach in technology and are very advanced in the way it enters new markets. Rapoport’s article, Nestle’s Brand Building Machine, calls Nestle the modern day “Roman Empire School of Marketing” for its tactic in settling in, colonizing as much territory as possible, adapting to the new land, and keeping away competition that trying to intervene for resources.

Nestlé’s business approach consists of traveling across open markets to discover new markets. Its persistence in entering markets in China has led it to reach a leading role as a food company in China and Vietnam. Nestle has already branded many products and resources in Mexico, Brazil, Chile, and Thailand. Nestlé is considered one of the most powerful food companies in the global economy. There is a give and take with the companies it makes business with. For example, Rumble the Jungle explains the extraction of palm oil in Indonesia is hurting the local communities. Yet, the Indonesian government benefits from the income gained from the extraction of palm oil; it goes towards the corrupt elite. Why?
Well, when every metric ton in Indonesia forests are priced at $900 and there is an annual 24 billion dollars made from exporting palm oil from Indonesia…it is tempting for those who want more money and power.

Nestle does not always buy directly from “damaging” markets. It is careful about its reputation. It has been humiliated and media-bombed for its engagement in labor exploitation and destruction of natural environment resources in the past. For example, farmer’s beans are bought by other middlemen which later exports goods to Nestle. The supply chain goes through a series of distributors and as the cocoa or coffee beans gain market value, it is too late for the primary farmers to receive their proper share. They are forgotten and left at the bottom of the value chain. Farmers are left with little to nothing.

Rapoport, C. (1994). Nestlé’s brand building machine. Fortune,130147.

Gilbert, D. (2013). Rumble in the jungle. Earth Island Journal, 27(4), 40-45.

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How much Power do you give the Powerbar?

Restore

Blog Post #6

Yesenia Gomez

Social side of Consumption- Powerbars

How much Power do you give the Powerbar?

Powerbars are associated with athletes and in many cases people will even substitute an energy bar as a “healthy” meal option. Powerbars attract a large target market especially with all the specific types of bars it offers. To narrow it down, college-students and professors are among some of the biggest consumers of energy bars. They live fast-paced lives and are always on the go! When left with little time to eat, it can be easy to get a filling Powerbar. These small, packaged energy bars are easy to stuff in a backpack or purse. They are highly marketable and trendy especially when associated with personal health and exercise.

How much power do you have as a consumer over the purchase of a Powerbar? There are pitfalls and benefits to consumption in the social aspect. The consumer can end up being all about the product to the point of one of Karl Marx’s terms “commodity fetishism”. This will not necessarily happen with a Powerbar, but it can become a necessity. Consumption can separate the relationship between the consumer and laborer, or it could also create bondage.

Powerbars contain cocoa along with many other ingredients. The CNN Freedom Project highlights in their article From bean to bar: Why chocolate will never taste the same again how laborers in the village of Kouadio-Yaokro are a perfect example of the separation of laborer and consumer. Many Kouadio-Yaokro villagers do not know the cocoa they pick will be made into a Powerbar; many consumers do not know of the hands that picked the cocoa pods.

There are a variety of cases showing the separation of consumer and laborer; for instance, Nestle the owner of Powerbar has for many years dismissed the child labor in cocoa plantations. Also, many villagers picking the cocoa themselves have never tasted a piece of chocolate from Nestle products. A village elder was surprised by the sweetness of the bar in this video.Image

On the other hand, there could be bondage in consumption. Nestle has chosen to listen to the Fair Labor Association by turning the tables and eradicating child labor for the long-term. Nestle has claimed that they will work with The World Cocoa Foundation and the International Cocoa Initiative to raise awareness about the importance of education and government polices in rural communities.

You could give power to the Powerbar to change its supplier code and stick to its responsible sourcing guidelines, or you could give it power to keep harming rural communities.

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You pay $2.39 for a Powerbar. How much does the laborer get from your pocket?

Restore

Blog Post #1

Yesenia Gomez

Economic side of Production- Powerbars

You pay $2.39 for a Powerbar. How much does the laborer get from your pocket?

Child Labor and Nestle videoImage

It’s  a long Tuesday.

There is no time for the Cafeteria. The next best option is the Restore. Let’s see…something quick, filling, healthy, and tasty. There it is—the Powerbar.
You pay $2.39. The price does not even matter at that point.
However, does the price matter somewhere else or to someone else?

How much does the laborer get paid to open cacao pods all day with a machete in the Ivory Coast? How do they combat their opposition for forest clearings due to palm oil exports? How can they see their children and tell them they barely make ends meet?

Many of the ingredients and resources needed to produce a Powerbar are found in countries “abundant” in cacao, soy, palm oil and sugar. In many ways, the excessive use and exploitation of laborers affects the economic stability of a community and the global economy.

Nestle, one of the biggest multinational chocolate producers and owner of Powerbar, recently agreed to let the Fair Labor Association (FLA) trace and assess their cocoa supply chain. More than a third of the cocoa around the world comes from the Ivory Coast in West Africa; yet, many of the laborers in the Ivory Coast live in poverty. There are local Ivory Coast individuals like Jean in From bean to bar: Why chocolate will never taste the same again who inherit land but gain little to no profit from it. Some of the poorest rural regions have these coffee and cocoa plantations, but they are easily exploited. The growers are positioned at the bottom of the cocoa value chain. Therefore, workers only see a small proportion of the profit gained from Nestle’s supply of bars containing chocolate. The local governments and nation-state politicians know the troubles with implementing higher working standards for cocoa workers. In this video, Quest talks with Prime Minister Daniel Duncan about the income of cocoa farmers in the Ivory Coast. In addition, take into consideration that the annual GDP per capita in the Ivory Coast is a little over $1,000. How is it that the GDP per capita is so low in a place where cocoa holds up 3.5 million people?

Farmers prefer to hire children since they cannot afford to pay adults. However, Nestle is slowly recognizing its power and position in positively impacting the lives of workers in cocoa plantations. Nestlé’s article, Nestle Action Plan on the Responsible Sourcing of Cocoa from Cote d’Ivoire shares the 11 recommendations the FLA believes will eradicate child labor from the cocoa supply. Nestle believes this will produce greater returns.

Nestle’s Responsible Sourcing Guideline has approached ways to implement international standards to their supplier code. On the other hand, there are still products in the Powerbar other than cocoa that need more in depth investigation. For example, there is the still questioning of where Nestlé’s palm oil comes from. The cheapest vegetable oil is palm oil, and it is even considered “green”. Nestle has been publicly humiliated for its consumption of palm oil. Although Nestle reports that it has stopped purchasing from Indonesian palm oil growers or any other damaging markets, it still acquires palm oil from private markets. Rumble in the Jungle uncovers Nestle’s purchasing of palm oil tanks from Rotterdam’s spot market. Rotterdam does not report an origin of its palm oil; they claim to be untraceable. It is that easy for Nestle to remove its bad reputation. As long as it is not directly connected to damaging markets, it can claim “blissful ignorance”. This is just a touch of make-up for Nestle. The demand for palm oil is high, so Nestle continues to purchase from third-party suppliers.

The production of Powerbars in the economic realm is questionable. There is enough evidence to support that laborers are receiving the bare minimum or nothing at all due to their little or no bargaining power.

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You pay $2.39 for a Powerbar. How much does the laborer get from your pocket?

Nestlé’s Secret Ingredients Not So Secret

Restore

Blog Post #2

Yesenia Gomez

Social side of Production- Powerbars

Nestlé’s Secret Ingredients Not So Secret

Imagine yourself for a second. You are munching through the last few bites of your Powerbar; does your mind ever wander and think of what is in that energy bar? What makes it so mouth-watering, satisfying and (can’t forget) trendy to eat?
Let’s rewind to the moment you looked at all those Powerbar flavors in the Restore.

Before you buy it, you may want to know who owns the Powerbar, what ingredients it contains, and who is picking the ingredients and how their lives are affected. After you find out, you will rethink the purchase of one again.

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The PowerBar official website provides information regarding the products including all the flavors offered. There are a total of 37 Powerbars! There are 8 types of energy bars: performance energy, harvest energy, pure and simple energy, protein plus 20g, protein plus 22g, recovery bar, protein plus 30g, and triple threat. Who knew there were that many options and flavors?

A famous Canadian athlete, Brian Maxwell, and two friends made the first Powerbar in their kitchen in 1983. They were a hit! Nestle bought Powerbar in 2000. What started off as very organic and environmentally-conscious product became another of Nestlé’s mysterious products.

Powerbars contain high levels of cocoa, isolated protein, and fractioned oils such as palm oil as described in the Organic Authority article, 5 Reasons To Ditch Those Energy-Sucking Energy Bars. There are major social issues that individuals face in the making of Powerbars such as oppressed labor, effects of destruction in the natural environment, and broken dreams for the future of their education.

Cocoa
Some of Nestlé’s cocoa supply chain comes from the Ivory Coast, and it has participated and continues to participate in its production cycle. Laborers in these local rural communities are challenged by the consequences of the working conditions. The use of machetes causes 72% of injuries in the opening of cocoa pods. There are far too many small hands working with hazardous tools. The article From bean to bar: Why chocolate will never taste the same again highlights the continuous problem of child labor cases and Nestle’s dismissal of these cases throughout the years. If children are working in these cocoa plantations, it can be assumed that they are not accessing education. Children and other laborers are working excessive hours and are underpaid or not paid at all. The CNN Freedom Project- Ending Modern Day Slavery reported in their article, Nestle advances child labor battle plan, the Fair Labor Association’s (FLA) proper investigations proving the violations of Nestlé’s own supplier code.

Nestle argues that there are many “systemic and cultural challenges” since many children have grown up in communities where child labor is accepted and engrained. Due to the FLA’s persistent in banning child labor in production, Nestle has been able see the positive social impacts it could engage in if it begins to support the education of children and eradiction of child labor.

Soy Protein
Soy and whey are genetically modified into protein isolates. Rabobank’s report on the The Soy Supply Chain Policy lists Nestle as one of the key player’s of soy processing.

Rabobank lists these specific social issues in Amazonian rural communities due to soy being extracted for products:

1. corruption or bribery
2. employee discrimination
3. forced labour
4. harmful child labour
5. poor working conditions
6. violation of the rights of indigenous peoples
7. pollution
8. irresponsible depletion of scarce natural resources
9. cruelty to animals/ disproportionate reduction of animal welfare
10. products or services that impose severe health and/ or safety risks to consumers and communities in the neighbourhood of plantations

Palm Oil
Lastly, palm oil is often sourced from areas with slave labor, and it is contributing to the destruction of rainforests and endangering wildlife. Indonesia produces 51% of the palm oil in the world. Nestle is included in the one-quarter of companies using palm oil in their products. In 2010, as described in the article Nestle Takes a Beating on Social Media Sites: Greenpeace Coordinates Protests Over Food Giant’s Palm-Oil Purchases, Nestle was attacked by Greenpeace environmental activists calling Nestle “The Killer” of orangutans. Jamaludin, an Indonesian native, talked about the struggle the villages face with the extraction of palm oil such as: extinction of tigers and orangutans, loss of land, climate changes, and the likelihood of his children not getting an education.

The effects of the palm oil used in Nestlé’s energy bars contribute to the less than 14% of orangutans remaining in Indonesia. In the past 20 years, over 2.4 million acres have been lost due to the expansion of palm oil plantations. Indonesia has been placed third in emission of greenhouse gases. People like Jamaludin directly experience the negative changes, and he is left worried even after his repeated complaints to the local governments about the forest clearing.

While we have the option to choose from different flavored Powerbars in the Restore, there are people being radically exploited by Nestlé’s use of their local resources. Jamaludin is a clear case of the suffering and exploitation. Jamaludin knows this is wrong; he can see the damage it is causing his village and later his kids.

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Will Nestle Ever Make it in the Fair Trade World?

Restore

Blog Post #4

Yesenia Gomez

Social side of Distribution- Powerbars

partnersblend

Will Nestle Ever Make it in the Fair Trade World?

Let’s go back to the 1950s. Why? Well, the movement towards fair trade products began in the 1950’s. However, many believe fair trade has broken away from its original purpose. Back in this time it was called “alternative trade”. Its focus was to ensure fair wages were being paid to those who were sowing and reaping coffee beans, cocoa beans, and other products enjoyed by consumers. Have multinational corporations like Nestle  made progress?

Before 2005, Nestle declared itself to “fairly trade” cocoa and coffee, when in reality it refused to comply with fair trade regulations. Nestle discarded any intentions to change its “marketing, labor, or pricing strategies” for that matter. For over a decade, Nestle continued to be at odds with fair trade. Suddenly in 2005, it released a “fair trade product” called Nescafe Partner’s Blend. The Fairtrade Labeling Organization immediately certified Nestle as a fair trade corporation. This singe action from the FLO was enough to spark tension in the fair trade movement. Many European fair trade movements claimed that the FLO gave into Nestlé’s whims due to the fact that Nestle held a powerful position in the coffee and cocoa industry. There were angry outburst and many criticized the intentions of Nestle in the realm of fair trade after all they only had one fair-trade product in the market. Many were in disagreement with FLOs actions to label Nestle a fair trade company. Nestle has been called the problem much more than the solution. The treatment of the FLO towards Nestle was overtly one of interest. Nestle was selling only one-tenth of one percent of their fair trade coffee. Many began to question FLO and its betrayal by making fair trade a niche market far way from its original purpose to reform the global trading system.

O’Nions article, Fair Trade and global justice, reports that in 2002 while many fair trade coffee industries suffered from economic downfall, Nestle made 26% profit margins with their supply of instant coffee. Many coffee farmers and growers were selling fair-trade coffee for such low prices, and Nestle took advantage of it. The corporation was able to look good for selling fair trade coffee, and it did not even have to spend excessive amounts of capital on fair trade coffee. Nestle also participated in the distribution of low wages in Colombia in 2003. Columbian union leaders even accused Nestle of threats and murder. In the Philippines, Nestlé also undermined the working rights of people. Many reported abuse in the work place and extreme low wages. Nestlé’s infamous reputation in unethical business methods has pushed many to feel uneasy about their “fair trade” label.

Nonetheless, the article “Fairtrade Coffee: Nestle Enters the Ethical Frey” explains the new connotation fair trade products have acquired. Americans, as well as Europeans, were asked about their take on fair trade products. There was a total of 57% who responded that it was very important to purchase products ethically obtained. Nestle, in response, “jumped on the ethical bandwagon” causing many supporters of fair trade to worry about negative effects a notorious corporation such as Nestle could have on the value and meaning of fair trade. On the other hand, if Nestle whole-hardheartedly adopts fair trade regulations, smaller companies may suffer due to the Nestlé’s established power and influence in the cocoa and coffee industry.

Lyon, S., & Moberg, M. (2010). What’s fair? The paradox of seeking justice through markets. Lyon, S., & Moberg, M. Fair trade and social justice: global ethnographies (1-23). (Eds.), New York: New York University Press

Nestle: fair trade?. (2004). MarketWatch: Global Round-up, 3(6), 43-44.

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