The Good Karma Kitty: Update

Hello + Happy Weekend to anyone reading this post,

I wanted to announce a significant change in Encircled's business.

As of February 1, 2015, we will no longer be running our Good Karma Kitty program.

For those that are not aware, since our inception, we've been giving back 8% of the proceeds from the online sale of our Chrysalis Cardi to a variety of organizations, and most recently, exclusively supporting the Surfrider Foundation.

We also donate $5 per verified review completed by customers for our products to the Surfrider Foundation.

As Encircled grows, I'm realizing the need to refine our proposition and to simplify the way we go to market.

In recent surveys to our customer base, most people were not even aware of our charitable efforts -- a disappointment for us especially since over the years this has amounted to thousands and thousands of dollars of donations to worthy causes. For a small business, this investment is significant.

There has also been confusion whether the Good Karma Kitty applies to just online sale or retail sales, as questions as to why it doesn't apply to other products.

Additionally, the recent currency depreciation of the Canadian Dollar versus in particular the US dollar means we are getting anywhere from $15-20 less in profit per sale, and US sales are an increasingly high portion of our business. This currency has also affected our suppliers, some of which who source raw materials from the US, and increased their prices 10-20% over the past year.

Lastly, our production costs remain high - in addition to producing on shore, we run small batches and have hand-sewn details that are costly to scale. We are committed to keeping production in Canada but it does cost 5-20x more to make something here than abroad. For example, our headbands may even be 50x cheaper producing offshore in a sweatshop, but we refuse to compromise our values to do so.

I know our customers appreciate that, and love knowing that their goods are being made by workers treated with respect, and protected by employment and labour laws. I visit our production facilities regularly, and usually unannounced -- the workers are happy, healthy and get to go home to their families every night. Abroad, many production facilities make workers sleep on site, and work until 10pm every night. It's appalling.

All of this leads me to the decision to discontinue the Good Karma Kitty, and reinvest the money into environmental initiatives within the organization - such as the sourcing and development of new designs, eco-fabrics, and other initiatives to digitize elements of our business, and reduce our paper usage.

For our business, giving back to our community by producing locally, and the environment through minimizing our impact using eco-dyes, eco-conscious textiles and eco-friendly materials throughout our business will never change.

I appreciate your understanding of this change. We will continue our support to SurfRider through our Review program, as well I plan to continue to personally support Surfrider Foundation in their efforts to protect our world's oceans and beaches.

If you have any questions or feedback on this change, please email contact(at)encircled.ca

With gratitude,