While both Tom’s shoes and Solerebels may both pursue similar goals, the mechanisms used by both organizations to achieve these goals differ both in their execution and effectiveness and in this regard, Solerebels comes out on top.

Blake Mycoskie’s one-to-one strategy in action

Tom’s Shoes is a Californian company that sought to use an innovative approach to improving social welfare for those impoverished abroad; this involved aligning their company around their one-for-one sales model. Under this model, Tom’s Shoes promised to donate a pair of shoes to the impoverished for every pair bought by customers. The company hoped to provide direct relief to poor communities and solidify itself as an ethical philanthropic social enterprise.  In contrast the Ethiopian company, Solerebel, has an approach that differs from this model by seeking, not to simply donate shoes to the needy, but to incorporate marginalized individuals in the manufacturing of their products. Additionally the company also focuses on shoe styles that are derivative in some way of traditional Ethiopian footwear. Solerebel aims to create sustainable development for Ethiopian industry by taking a grass roots approach to social entrepreneurship. Both these mechanisms aim to harness the efficiency of a private business structure to accomplish a social good, however while Tom’s Shoes hoped to have an immediate and direct approach to alleviate poverty, Solerebel’s approach aims to aid in more long term development.

Shoerebels’ approach involves hiring marginalized individuals in the production process

However, each mechanism has had incredibly contrasting results despite their seemingly minuscule differences. While Tom’s Shoes’ one-to-one approach was wildly successful from a marketing and sales perspective, its social impacts reveled unintended consequences. Donated shoes would commonly put local shoe makers out of business and whose intermittency would make investment in these businesses exceedingly risky. Additionally, this strategy creates dependence on foreign aid which kills the incentives for local development. Shoerebel differs in this respect as their production is local and seeks to employ those who are less fortunate. Instead of simply handing out aid like Tom’s Shoes, Shoerebel improves social conditions for the poor through mutually beneficial exchange.  The company is able to create long term social welfare by improving local industry from the ground up as opposed to simply giving handouts. Ultimatley it is Shoerebels’ mechanism that targets the roots of poverty and disenfranchisement by making communities more self-sustaining rather than simply giving a band aid solution. For this reason I support Shoerebels’ strategy, but they also have a great selection to boot.

References:

The One-for-one Business Model: Avoiding unintended consequences:

http://knowledge.wharton.upenn.edu/article/one-one-business-model-social-impact-avoiding-unintended-consequences/

Image 1:  http://cdn.shopify.com/s/files/1/0072/9942/t/101/assets/vl1.jpg?5388232059900618732

Image 2: http://cdn.shopify.com/s/files/1/0072/9942/t/101/assets/vl1.jpg?5388232059900618732