How can we scale distribution and sales networks that create opportunities at the BoP?

Inclusive Business
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Panelists

Aminta Perez-Gold: Project Specialist, Inter-American Development Bank’s SCALA program
Elfid Torres: CEO, FUNDES International
Mauro Homem: Corporate Sustainability Manager, Danone Brazil
Jesse Kirowo: CEO, Pharmnet
Juan Céspedes: Social Channels Manager, Andean Region & Central America, Unilever
Beth Meadows: CEO, Supply Hope/ Mercado Fresco
Abby Mackey: Grants and Impact Manager, Solar Sister
Caroline Ashley: Director, Practitioner Hub for Inclusive Business

Expanding access to goods and services for the billions of people at the base of the pyramid (BoP) is not simply a growth opportunity – but a business necessity. However, reaching low-income markets often requires navigating fragmented - or in many cases, nonexistent - distribution and sales networks.

In recognition of this complexity and the challenges facing micro-enterprises in downstream value chains, a growing number of large companies are employing inclusive distribution network models that seek to empower low-income entrepreneurs and strengthen enterprises while helping companies increase sales and reach new markets. For the handful of these networks that have successfully reached scale, there are many more that have remained siloed CSR initiatives, morphed into non-profit entities, or simply faded away.

This online discussion is part of the Inclusive Distribution Challenge and coincides with the launch of a new discussion paper, which identifies three models of inclusive distribution and highlights eight emerging lessons on how to achieve scale. This online discussion aims to crowd-source more examples and input on business actions and partnerships and help prioritize Phase 2 of the Challenge focused on specific solutions to scale.

1. What are some examples of inclusive distribution networks, and how are they expanding opportunities at the BoP and creating value for businesses?

2. What are the most significant challenges to scale these models, and how do they vary across models, regions, and/or industries?

3. What are some emerging lessons and solutions on achieving scale, and where are there opportunities for more partnerships?

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Very interesting! looking forward to participating... :-)

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Glad you can make it, Fernando!

Fernando Casado said:

Very interesting! looking forward to participating... :-)

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Good morning / good afternoon everyone, and welcome to the live segment of this online discussion on how to scale inclusive distribution networks.

I’d like to start by asking our Panelists to introduce themselves

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Hello everyone,

My name is Abby Mackey and I am the Grants and Impact Manager for Solar Sister. Previously, I was at USAID working on the Power Africa program. Happy to be here today!

Jessica Davis Pluess said:

Good morning / good afternoon everyone, and welcome to the live segment of this online discussion on how to scale inclusive distribution networks.

I’d like to start by asking our Panelists to introduce themselves

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Hello everyone, I'm Caroline Ashley, Editor of the Practitioner Hub for Inclusive Business, and working with a range of entrepreneurs and facilitators across inclusive business.

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Hi Jessica. This is Elfid. I am CEO at FUNDES International a consultancy in Latin America specialized in SMEs development and its successful integration within large corporation value chains

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Good Morning - I am Beth Meadows - CEO of Supply Hope - Mercado Fresco - Our model is a MIcro-Franchise Model called Mercado Fresco -

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Thank you Panel. We have a few more people who will be joining but let’s kick of straight away with our first question:

Q1. What are some examples of inclusive distribution networks, and how are they expanding opportunities at the BoP and creating value for businesses?

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Aminta Perez- Gold, SCALA Program Coordinator, IDB/FOMIN

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Thanks Jessica. There are of course the examples you already mention in your paper, such as Living Goods. I was interested to see fantastic evidence come out a few days ago, about how Living Goods model can deliver a 27% reduction in child mortality.

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What's interesting about Living Goods is that they have a distribution model for multiple beneficial goods. Creating such networks is such a big ask that other companies want to use their network, not create their own.

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An example could be: Networks / Create or transform micro-enterprises into company affiliated businesses or microfranchises

  • FUNDES has developed networks of mom and pop shops. This solution provides consumer goods companies with valuable data for segmentation and micro-understanding, while allowing their independent and fragmented trade outlets to bring their businesses to the next level.
  • Concretely these networks allow mom and pop shops to be grouped together under one name and to benefit from a package of services including trainings and assistance in business administration and in-store execution – both in-person and virtually through simple technology -, standardization, common branding, as well as a platform for cooperation and mutual learning. In parallel, we gather key data not only on the members’ profiles and business performances but also on the markets and ecosystems, in which they operate.
  • An specific Example: In Bolivia, we launched a pilot project called “Mi Caserita” (together with FOMIN and Elea)



Jessica Davis Pluess said:

Thank you Panel. We have a few more people who will be joining but let’s kick of straight away with our first question:

Q1. What are some examples of inclusive distribution networks, and how are they expanding opportunities at the BoP and creating value for businesses?

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Hello! this is Juan, from Unilever. I work as Social Channels Manager for the Andean Region and Central America

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Another example is in Bangladesh: Jita. Jita began as a programme of Care - an NGO programme to provide livelihoods to marginalised women. It spun off into a social enterprise, which has enabled its growth. A network of thousands of women (aparajita's) sell a basket of goods door to door. The JITA sales network http://bit.ly/2hnqFDX

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Well Solar Sister is one example. We are building a clean energy last mile distribution chain that is made up of women run businesses in Uganda, Nigeria and Tanzania. Women make up the majority of the rural energy poor market in sub-Saharan Africa so Solar Sister has responded with a women-centered supply chain to meet this demand. We have found that more often, women are able to find female customers due to community involvement and strong social networks. Also, women make the majority of energy decisions in their household so it makes sense to target them as the consumers then.

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Living Goods is a great example of using product mix that includes durable goods like cookstoves and healthcare in the same distribution channel

Caroline Ashley said:

What's interesting about Living Goods is that they have a distribution model for multiple beneficial goods. Creating such networks is such a big ask that other companies want to use their network, not create their own.

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for more examples, we actually just published the publication on Inclusive Business for the Fast Moving Consuming Good Sector with IBAN from GIZ, and we address a whole section on distribution channels..

http://www.inclusivebusinesshub.org/wp-content/uploads/2016/11/IB_FMCG_Global-Guide.pdf

some of the examples we address are from Danone in El Salvador; in Uganda, Kenya, Myanmar, and Zambia, Living Goods as you are mentioning... or the Project Shakti’, Hindustan Unilever (HUL) in India.. (page 30 of the report..) :-)

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Under SCALA we are supporting the scaling of 6 IDN models: three form corporations (Kiterias, Danone – World Vision Brazil; Plan Barrio, Nestle – ADOPEM; Shatki, Unilever –FUSAI) and three from social enterprises: Mercado Fresco – Supply Hope; Chakipi –Clinton Foundation, Red MANU-Nutrivida.

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Hello everyone, this is Mauro Homem from Danone Brazil. I´m the Head of Public Affairs and in charge of all the Social Innovation platform.