Saitex doing business in an inclusive and sustainable way
IKEA is always looking for ways to grow even more inclusively and contribute to a fair and equal society. A part of IKEA Social Entrepreneurship's strategy includes partnering with large-scale scalable social businesses. This allows our partners to manage large production volumes and involve local communities.
The partnership with Vietnamese denim manufacturer Saitex enables the co-creation of a range of products made from sustainable materials like natural fibres and waste materials which will be sold at IKEA. In the process job opportunities for marginalised groups such as women and differently-abled persons in Vietnam are created.
Large or easily scalable businesses such as Saitex have a big social and environmental impact because of their size. Saitex is known worldwide for being revolutionary in its holistic business approach where social and environmental work is seamlessly integrated throughout every aspect of the business. For example, recapturing heat to use for drying rather than relying on industrial dryers and water recycling. But also hiring more women and integrating people with disabilities and other vulnerable backgrounds into the workplace. For this, a special socially and environmentally focused division named Rekut was initiated,
Placing people first is something that Sanjeev Bahl, founder and CEO of Saitex, has been working actively on since the beginning, making issues such as gender equality, equal pay, respect and dignity cornerstones for Saitex. By 2025, Saitex aims to have 20% of their workforce be persons with disabilities and involved in production for IKEA.
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In Vietnam, people with different abilities are hidden and not heard. Our society still has no solution to the employment and inclusion of the differently-abled people that make up 15% of the world’s population. IKEA is huge, but it’s a humane and value-driven organisation. If this collaboration succeeds, then we have created a future formula for success that potentially could be replicated in other factories. Imagine what a huge, massive dent we together would create on this matter.
Putting people and planet first
The company has a direct relationship from farm gate to roasting, with no middlemen involved. The coffee beans are sourced directly from 1,800 registered smallholder farmers and processed by people who need the jobs most. Gora Coffee has fewer middle players, around 2-3, whereas the conventional business model has 8 layers. This means that Gora Coffee makes a positive livelihood impact by paying the farmers 20 per cent higher than the conventional market. Additionally, 48 per cent of their employees are women, who typically have no access to job opportunities or get poor monetary compensation due to gender discrimination.
Gora also focuses on sustainability and better care for the environment. It supports its farmers through different training programs to safeguard the quality of the coffee. In simple words, Gora Coffee helps its farmers get a good yield by making sure the beans are shade-grown, that the soil gets proper nutrients, and pollution-free water is used.
As a result of the partnership with IKEA, over 500 small scale certified farm holders will gain livelihood opportunities in the first year alone (2022). The impact and opportunities will further go up in future. We hope to grow this to 3,000 farmers by 2025, impacting 6,000 more people in the community.
Gora also focuses on sustainability and better care for the environment. It supports its farmers through different training programs to safeguard the quality of the coffee. In simple words, Gora Coffee helps its farmers get a good yield by making sure the beans are shade-grown, that the soil gets proper nutrients, and pollution-free water is used.
As a result of the partnership with IKEA, over 500 small scale certified farm holders will gain livelihood opportunities in the first year alone (2022). The impact and opportunities will further go up in future. We hope to grow this to 3,000 farmers by 2025, impacting 6,000 more people in the community.
Saitex plant in Vietnam.
Creating the business of the future
Since 2019, IKEA Social Entrepreneurship has supported social entrepreneurs and businesses worldwide through our development programmes and partnerships to upscale their impact and find new possibilities to create lasting change.
Collaborating with large-scale scalable social businesses allows social business partners to manage large production volumes and involve local communities. Adding Saitex as a supplier to IKEA’s range, will diversify the range in materials and techniques and allow for faster upscaling with both single products and collections.
Through this partnership, we will be offering an even more sustainable industrial setup in textiles, jute and other locally sourced materials to the many people in stores around the world. The first collection VÅRDANDE will be launched in June 2022.