When TOMS first started selling shoes in 2006, it had an attention-grabbing business model that most people hadn’t heard of. The idea was pretty simple: for every pair of shoes bought by a TOMS customer, the company would donate a second pair to someone in need. Help our business succeed, and in turn we will help someone who can’t afford our product and would benefit from it.

Blake Mycoskie, the founder of TOMS, came up with the idea after a visit to Argentina, where he saw communities with families so poor that the children didn’t have shoes. The horror Mycoskie felt at witnessing such wealth disparity was the catalyst that led to the one-for-one business idea, but unfortunately this very common knee-jerk personal reaction to seeing poverty also led to the chief criticism of the TOMS model.

Why One-for-One is Problematic

On the surface, the reasoning is that it’s a band-aid at best, covering up a symptom while ignoring the actual problem

The issue critics have with the basic one-for-one system is twofold. On the surface, the reasoning is that it’s a band-aid at best, covering up a symptom while ignoring the actual problem. Yes, you can give children shoes, and it’s wonderful to want to do so, but it doesn’t solve the larger matter of why the families can’t afford shoes in the first place. After all, it’s not just clothing items they need – it’s everything else in their lives, too.

These families are lacking the basic financial independence to support themselves in every way, and giving a child a pair of shoes, while a nice gesture, isn’t going to help much in the long run. Once the child outgrows the shoes, they’re back to square one.

The second argument against one-for-one is that it may actually be hurting the very communities it’s trying to help. It’s a system that plays on the emotions of consumers in more affluent areas, rather than taking into account the needs of the people who are receiving the products. Consumers feel good when they buy something and someone else gets the same thing, but what is also happening is that by importing products, local manufacturers and producers lose out, which actually harms the overall economy of the area in question.

Again, while an aid-based framework might look good and feel good in the short term, it’s not indefinitely sustainable, and ends up causing increasing dependency on outside aid as time goes on.

That’s not to say that the original idea behind one-for-one models is bad – it simply needs modifying to become something both truly helpful and sustainable. The criticisms have not gone unheard. As journalist Amy Costello, host of the Tiny Spark podcast has pointed out, these companies are in the business of wanting to do the right thing for the communities they help, so it’s in their best interest to examine their methods and fix any flaws. Costello was one of the more vocal critics of the TOMS direct one-for-one enterprise model, but she was also quick to praise the company when it announced it was experimenting with newer, better ways to help communities in need.

The Challenges of Moving Forward

The dilemma with fixing the one-for-one model goes back to Blake Mycoskie’s initial reaction to the poor in Argentina. For most people it’s emotion that provokes a desire to help, and a continued emotional connection leads to continued support. One-for-one is easy to understand, and it’s easy to picture how it helps people in a direct way, which makes supporters feel good and want to continue participating.

Traditional humanitarian frameworks, on the other hand, are much more complicated and not as easily explained to the public.

Traditional humanitarian frameworks, on the other hand, are much more complicated and not as easily explained to the public. This nebulous idea of “our organization helps in many complex ways” doesn’t always trigger that same urge to jump in and be a part of it. So given that traditional channels of philanthropy don’t have the immediate gratification that one-for-one has, how can these social enterprises evolve their business models while remaining popular enough to sustain themselves?

Finding the Balance

By communicating with experts in the respective areas they’re trying to help and forming lasting partnerships, one-for-one social enterprises are finding new ways to assist communities while not straying too far from the original idea that has become so popular. The new shape of the one-for-one model is not just to provide goods for those in need, but also to contribute to the local economy, and to give families and workers access to the infrastructures that will help them break the cycle of poverty.

TOMS, for example, is now manufacturing shoes in Haiti, employing local workers at a local factory and distribution center. By the end of next year, the company has pledged to be manufacturing at least a third of all donated shoes in the areas where they will be distributed. In addition, the TOMS brand is expanding into other goods like coffee, using sales from these products to help develop community-owned clean water systems in areas that are lacking.

The new shape of the one-for-one model is not just to provide goods for those in need, but also to contribute to the local economy

Other one-for-one companies have been watching the pioneering work that TOMS is doing, and are finding their own ways to balance financial viability with the desire to do good. Oliberte, for example, is a direct competitor to TOMS, and makes all its shoes in Ethiopia at the world’s first Fair Trade Certified shoe factory, with a company slogan of “trade, not aid.”

Warby Parker, an eyewear company, uses the proceeds from its sales to train people in developing nations to give eye exams, and to give them the means and products to sell affordable eyewear in their own communities, thus creating both jobs and better health care.

Some enterprises are tackling related social and economic issues by helping in areas related to their product, while not strictly following the original one-for-one model. Better World Books does give a book away for every book sold, but in the process they also rescue books from landfills, divert them to communities in need, and fund literacy programs across the world.

Some enterprises are tackling related social and economic issues by helping in areas related to their product, while not strictly following the original one-for-one model

Two Degrees Food feeds hungry children, but also works with international nonprofit partners to address the nutritional needs of communities where chronic malnutrition is an ongoing issue. As the one-for-one model becomes more popular, the definition of the model is expanding to include new approaches, and companies joining the trend are finding innovative ways to help those in need while solving bigger socioeconomic issues and remaining profitable.