Do TOMS shoes harm local shoe sellers?

(Flickr)

The idea behind giving away shoes to children and adults is that it will improve their health. TOMS is likely the best known shoe brand that enables the giving of a pair of shoes for each one purchased. The one for one model, as it is called, has led to the explosive growth of TOMS and the donation of more than 10 million pairs of shoes in 60 countries, since 2006. The brand has expanded into eyewear and coffee, and its founder Blake Mycoskie says more is coming soon.

August saw TOMS sell a 50% stake to Bain Capital (known best for its famous alumni, Mitt Romney) at a price that values the company at $675 million. That was followed by the announcement last week that TOMS was teaming up with Target for the holiday season by producing a limited-edition collection for the national retailer. Things are on the up and up for TOMS as a company.

However, the impact of donating shoes has dogged TOMS for years. Critics (including myself) have questioned whether giving away shoes helps improve the health of children as much as TOMS claims. Stronger concerns have been aired regarding how free shoes can harm local businesses. The thinking is that other aid programs, like food aid, can undercut the local producers in the countries that are on the receiving end. People will be fed, but opportunities for business growth, which supports jobs in a given community, is lost.

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While some research exists on second hand clothing sales and food aid, there were not evaluations on TOMS shoes or something similar. That is until now. Researchers from the University of San Francisco, led by Bruce Wydick, ran an experiment with a distribution of TOMS shoes in El Salvador. The paper, Do In-Kind Transfers Damage Local Markets? The Case of TOMS Shoe Donations in El Salvador, was recently published in the Journal of Development Effectiveness.

Children with their free TOMS shoes. Credit: TOMS

Children with their free TOMS shoes. Credit: TOMS

The good news is that there is finally some data on TOMS. The bad news is that the findings will likely not put to an end the debate over whether TOMS shoes are harmful to local markets. In an experiment involving 979 households (5,607 individual people), the research team gave roughly half of the people shoes at the beginning of the study and the other half the shoes when it was over. Everyone, regardless of whether or not they got the shoes initially, also received a voucher to purchase shoes of their choosing in the local market.

They found that there was in fact a reduction in shoe purchases for families that got the TOMS shoes. However, and this is the important part, the difference was not statistically significant when comparing the two groups.

“While all of our regression estimates lie in the direction of slightly negative impacts on household shoe purchases, they fail to reach statistical significance, and thus we cannot present conclusive evidence pointing to a negative impact on domestic markets from in-kind donations,” conclude Wydick and his co-authors.

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There are some caveats to consider. The survey only looked at a period of as long as four months. Some 88% of children in the region owned two ore more pairs of shoes or sandals. Most children had shoes and even the poorest families could likely afford at least one pair for each child. People who traveled around barefoot did so out of their own choice, not because of a lack of shoes.

It was also found that the majority of the children wore the shoes with an average of 4.54 days worn per week. Overall attitudes about the shoes were favorable, but there were concerns about their lack of durability. Parents say they would have prefered ” a sturdier, hiking-style shoe” for their children.

What remains after reading the study are more questions. What are the long term effects of TOMS shoes on local markets? How long do the shoes hold up? Does a short lifespan mean that families still have to buy shoes regularly for their children? How does the cost to produce and distribute a pair of TOMS compare to the vouchers?

The debate over TOMS shoes will continue, but at least both sides can admit that they might not be completely right.

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About Author

Tom Murphy

Tom Murphy is a New Hampshire-based reporter for Humanosphere. Before joining Humanosphere, Tom founded and edited the aid blog A View From the Cave. His work has appeared in Foreign Policy, the Huffington Post, the Guardian, GlobalPost and Christian Science Monitor. He tweets at @viewfromthecave. Contact him at tmurphy[at]humanosphere.org.

  • Katie G. Nelson

    I was a skeptic of TOMS shoes until the company donated several trucks full of shoes to schools and children’s homes in Bungoma, Kenya where I was working that summer. Bungoma is an area in the Western District that has a widespread infestation of “jiggers” — a parasite that can burrows into the tips of one’s toes or under their toenails if you don’t wear shoes. Jiggers can cause extreme infections, open wounds, insatiable itching and sometimes amputations if left untreated. BUT, more importantly, the treatment for Jiggers is literally digging the parasites out of one’s feet with a sharp sewing needle (even doctors use those). For children, that treatment is extremely scary and painful, and they avoid treatment at all costs. TOMS willingness to provide shoes as a preventative measure to children who couldn’t afford them otherwise (such as those living in children’s homes), changed my perspective on their company and impact. PHOTO: a piki piki full of TOMS shoes going out for delivery.

    • Thanks for sharing, Katie. I also saw them distributed in Western last year for the very same reason. However, there is some bad news. There is a study that shows that shoes do not protect against jiggers ( I will have to dig it up). So there is the question if the shoes did what they set out to accomplish.

  • Guest

    Yes, well the other problem is that there are only two or three Jiggers (i.e. Tungiasis) researchers in the world. On top of that, the only research about Jiggers focuses on preventative measures. So far, there’s only been a few organic mixtures that *somewhat* discourage Jiggers from burrowing, but by far, shoes have been the best way to prevent. But once you have them, you’re forced to face the needle.

    • Katie G. Nelson

      By the way, I’m the guest above.

      • I am quite happy that I did not get one when I lived there. They looked terrible when I saw children with them.

  • AmandaCBarnes

    Another question is whether the shoes are actually needed. if, as the research indicates, the vast majority of parents can manage to afford locally-sourced shoes for their kids – and the TOMS shoes aren’t very durable – then perhaps it would be better to focus efforts on meeting more important needs.

  • Mike Buckler

    Couple of thoughts on this study, with the caveat that I read it several months ago. Before getting into the study, dumping of goods is a well established economic harm. We have laws against it in the US, which is why China cannot export underpriced tires to the US, eroding our tire markets. The same basic principle is surely applicable to developing countries, like Malawi, where I served as a Peace Corps Volunteer. Poor people wear shoes, or something approximating shoes, when they want to. They go barefoot when they want to. In a free market, they can decide when they want to spend their hard-earned savings on shoes versus other available items. In a healthy market, dumping TOMS shoes in a NGO-free village should cause harm. The first problem with the study is that most, if not all, of the village markets studied were already infiltrated by World Vision. Based on firsthand experience, I can attest that World Vision can alter markets by, for example, giving stuff away and paying villages to attend trainings supposedly for their benefit. It is often very hard to work in a village touched by them because local people can easily become disempowered by their spending. Second, TOMS has little grassroots credibility (I charitably call it “frat boy philanthropy”), so it partners with NGOs to dump shoes in poor countries (it’s now trying to rebrand by exporting coffee, which is a potentially hopeful sign and a story for another day). Many of the NGOs partnering with TOMS are of the evangelical Christian variety. These groups, in my experience, often drop in, drop money or stuff, and fly home, without a longterm physical presence in communities and an appreciation for what matters — personal relationships, language, culture, history and politics. When they leave, Peace Corps Volunteers witness the aftermath, sometimes misuse of funds left to the religious missions, sometimes flimsy shoes that put local shoe vendors out of business or end up being sold at the market by an enterprising recipient. The lead author of the study is, I believe (please check me) an evangelical Christian. While there is nothing wrong with being an evangelical Christian with an interest in grassroots development, how you conduct yourself as a development outsider matters — it matters a lot, in fact. It seems a bit fishy to me that the study was conducted by an evangelical in communities potentially economically depressed by the world’s largest evangelical “development” organization. Concluding that dumping shoes in markets already flooded with NGO freebies does not cause statistically significant harm is like saying that a man who eats at McDonalds everyday probably won’t worsen his health by having ice cream after every meal. The cream isn’t that bad relative to the condition of the patient. Just my two cents — in the interest of full disclosure, I found TOMS shoes on the feet of children in my home village when I returned this year. As a consistent critic of TOMS, and supporter of people-to-people grassroots development, I was pretty disgusted. An academic interest became personal.

    • A. Tasso

      wow. you were a short term peace corps volunteer and you’re calling out missionaries? that is some gall. where i work the *only* people who put down 10-15 year roots and really get involved with the community are the missionaries

      • Mike Buckler

        I didn’t say all missionaries. In my experience, Catholics missionaries generally “walk the walk” so to speak — learning the language, living off the beaten path, celebrating (not pitying) the people. My beef is with the evangelical community. Many come for brief visits and never see or appreciate the consequences of their actions. As for being a “short-term Peace Corps Volunteer,” I lived for 27 months in a rural village without electricity and running water. How many people, besides Peace Corps Volunteers, do that? I’ve also returned to Malawi several times since and have started a company to support the long-term funding of community-led, transparent, small-scale projects. Where do you work, Tasso?

        • A. Tasso

          So if we are talking about ideological conflicts of interest, doesn’t your allegiance to the Peace Corps render you ineligible to booster the Peace Corps (“Peace Corps Volunteers witness the aftermath…”) in the same way that you are insinuating the study author is no better than a doctor with ties to big pharma?

          I work in western Uganda. The problematic nature of summer trips is something that the evangelical Protestant church is grappling with, but in my observation those do not capture the cast majority of the work that is being done. From where I sit, it is mostly long term evangelical Protestant missionaries and a smattering of (Catholic) nuns and priests who hang out here.

          • Mike Buckler

            I’m a big fan of the Peace Corps as a training ground for grassroots poverty alleviation work. It’s a very sobering and humbling experience re what’s possible and not possible. I often don’t find the same realism and humility in people who operate at higher levels of the development food chain. That said, I’m an equal opportunity critic of the Peace Corps model — for example, it’s kind of a waste in development terms when volunteers return home and don’t continue advocating for poverty alleviation in their host countries and communities. A lot of Peace Corps Volunteers are fairly young and immature and don’t always provide a lot of value to local communities. I’m also dismayed by Peace Corps politics, such as the inordinate number of political appointees in the agency who have never served in the Peace Corps and, instead, get sweetheart appointments to the agency because of their work for influential politicians on Capitol Hill. I could go on. I want to make clear that I’m not impugning the reputation or work of the USF econ prof who conducted the study — I’m just saying that he, like any good researcher, should have revealed his potential conflicts of interest. The reality is that, despite possibly having good intentions, TOMS paid for a study that has some obvious methodological flaws and used a lead researcher who has a potential conflict of interest. The evangelical link is a decision that TOMS made to distribute its free shoes through a network of religious organizations. I’m not questioning the theology of those organizations, just their development philosophy. I think that some of their practices (e.g., giving away shoes, food monetization, paying villagers to attend meetings, spending liberally on vehicles, fuel and offices, flying in visitors to work instead of using locals, not appreciating linguistic, cultural and political nuances, replacing the roles of local, regional and national governments, trampling the dignity of local people in poverty-porn marketing campaigns). I’m sure there are great evangelical organizations that practice community-led, small-scale, transparent development but, in my experience, they are not the norm.

        • A. Tasso

          By the way I am not trying to cast aspersions on the Peace Corps as I met my wife while she was working as a volunteer. I’m simply saying that it is an unfair debating tactic to lob the “conflicts of interest” grenade without acknowledging your own biases.

    • Thanks for your comments, Mike. A lot of important things to consider when looking at the study. I am personally equally as skeptical of TOMS shoes, but I am not as quick to cast aside the study. It by no means offers a definitive answer about their impact, but I find it encouraging that evidence of impact is being sought. My hope is that future research will learn from this and improve upon its methodology and implementation to get more robust results.

      • Mike Buckler

        Very good stuff, Tom. I applaud you for raising these issues. I believe that the researchers were well intentioned, well credentialed, and ran a very sound study. My only concerns are (1) not identifying a potential bias (this, of course, was mitigated by having multiple authors on the study); and (2) not fully accounting for the existing environment in which the study was conducted. The study suggests that the study communities were quite familiar with development services, without fully quantifying the impact: “[a]ll communities had child sponsorship and community development programs operated by World Vision” and “[s]ome communities would acquire footwear from NGO donations, government handouts, or would purchase with remittance money” (it would be nice to know whether and to what extent the communities had previously received shoes from TOMS), but “they must not have received World Vision shoe donations in the previous year.” The one year limitation applied only to World Vision, so other NGOs could have been giving away shoes in these communities during the study, thereby suppressing the # of control group members buying shoes. Further, it could be that, over a year later, previous World Vision shoe donations were still suppressing shoe purchases by the control group. It would also be interesting to know the average lifespan of local shoes found to be the best market substitutes for TOMS Shoes — if local shoes last awhile, the study might not have lasted long enough to account for the market suppression caused by TOMS (“The follow-up survey was undertaken 3 to 4 months after baseline.”) It would also be interesting to know the income level of the local people because “[n]early every child owns a pair of shoes or sandals, and in our sample 88% of children owned two or more pairs of shoes ….” That’s about 3700 shoes floating around for 6 to 12 year olds before the TOMS donation, which undermines TOMS marketing pitch (perhaps implied) that it is putting shoes on the feet of shoeless children. One plausible explanation of the results (just speculation on my part) is that the local market was already suppressed by donations and that the adverse impact of more donations was not statistical significant because of that suppression and because locally purchased shoes lasted longer than the study’s time window, thereby masking future suppression. It might also be that TOMS had little impact on the market because its shoes didn’t last long — “[m]others frequently reported to us that the TOMS shoes would wear out very quickly due to the environment and heavy use by the children. Many parents and children would have preferred to have a sturdier, hiking-style shoe” — and that a sturdy shoe TOMS donation would cause real harm, even to a suppressed market evaluated for a short period of time.

        Just my thoughts — my background is patent litigation, where good people with PhDs in economics are hired by corporate litigants to write reports that, while not factually inaccurate, often do not tell the whole story, in such a way that favors the client. I assure you that my skepticism about the study is not a general pessimism about the nature of human beings or their good intentions to help others. I just think we need to see this debate from every possible angle.

        To satisfy me, all TOMS needs to do is take an economically sound approach to helping others. For example, applying a BOG$ — buy one give cash — model that moves money, not shoes, and supports local vendors and supply chains by providing cash for poor families to buy shoes of their choosing. Perhaps not in a place where the average kid has 2.5 pairs, but certainly elsewhere.