Microfranchising: using markets, community to cure illness, poverty

Microfranchising: using markets, community to cure illness, poverty
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First Published: Thu, Jul 26 2007. 07 58 AM IST
Updated: Thu, Jul 26 2007. 07 58 AM IST
Gopalpet: Surrounded by measuring tapes and ornate paintings of Hindu gods hanging on the walls of his dimly lit workshop, Adimulam Devanand pushed the bridge of his glasses up his nose and hunched over a sewing machine to stitch a shirt. A year ago, Devanand, 42, had lost the ability to see objects as fine as a needle and thread, and his tailoring business was faltering. “I’d given up working altogether, and my wife had to do all the work,” he said over the hum of the sewing machine. Desperate to support his two children, he went to a local clinic where he was diagnosed with presbyopia, an age-related disorder due to which the eyes progressively lose the ability to focus. The clinic sold him a pair of corrective glasses for Rs150. Devanand was immediately able to return to his craft.
“Now I can share all the work with my wife,” he said, gesturing to the woman who sat at an adjacent sewing machine,” and business has doubled, thanks to my glasses.” Devanand’s eyesight and livelihood were saved through the efforts of an innovative microfranchise programme developed by the Scojo Foundation, a non-profit social enterprise that uses market-based solutions to distribute inexpensive corrective glasses in the developing world. Worldwide, according to Scojo, more than 700 million people who make less than $4 (Rs161) a day, suffer from presbyopia, limiting their ability to make handicrafts, read or find insects on crops and separate seeds.
Sufferers face the dark prospect of diminished productivity and greater poverty. But through Scojo, reading glasses that in the developed world can easily be found in any pharmacy or corner shop, are becoming available to the world’s poorest citizens, giving them the opportunity to regain their livelihoods. Scojo does more than just sell glasses. Operating in six countries, the foundation has trained more than 1,000 people to become microfranchise owners, or “vision entrepreneurs,” who conduct basic eye exams, sell affordable prescription glasses and refer those who need advanced eye care to clinics and hospitals. According to Scojo, many of the microfranchise owners have doubled their income and thousands of farmers, craftsmen and merchants have been able to return to work. “We create livelihoods for our entrepreneurs and sustain livelihoods for our customers,” said Dr Jordan Kassalow, the New York optometrist and Council on Foreign Relations health expert who co-founded Scojo in 2002. Using 5% of profit from the for-profit luxury eyewear company Scojo Vision, and grants from organizations such as George Soros’s Open Society Institute and the Acumen Fund, the Scojo Foundation addresses the most basic eye-care needs of local communities. It also trains its entrepreneurs to refer those in need of serious medical treatment to organizations such as Orbis, the global anti-blindness charity.
Across the developing world, non-profit organizations like Scojo and multinational corporations are revolutionizing poverty alleviation efforts by engaging the poor not just as targets for aid but as a lucrative global market wielding $5 trillion in actual purchasing power, according to the World Resources Institute, an environmental research organization in Washington.
Stephen Gibson, author of Microfranchising: creating wealth at the bottom of the pyramid, says that microfranchising turns beggars into businessmen by teaching them entrepreneurial skills and creating financial independence through ownership.
“We’ve been giving away products for decades and most of the poor are still barefoot and pregnant,” said Gibson, who teaches at the Center for Economic Reliance at Brigham Young University’s Marriott School of Business. “While aid organizations create dependence and can often leave the poor empty-handed when funding evaporates, successful microfranchises are self-sustaining and profitable for the social enterprise and the community.”
Microfranchising, say its advocates, provides men and women in urban slums and isolated villages with the training, products and marketing guidance to get small businesses up and running. By doing so, they connect millions of customers off the beaten path to telecommunications, health care and an array of other goods and services that improve the quality of life.
In Bangladesh, Grameen Phone, a pioneer in the microfranchise industry, runs a network of more than 220,000 “village phone operators,” rural women who buy the organization’s cellphones and then rent them out to fellow villagers on a per-call basis.
In Ghana, Fan Milk has sold 8,000 people the bicycles and dairy products to become distributors, and in India, Hindustan Lever has trained nearly 31,000 women in its Project Shakti network to sell everything from coffee to laundry detergent to toothpaste. Since its inception in 2002, Scojo has joined forces with more than 20 private companies and nongovernmental organizations in Bangladesh, India, Ghana, El Salvador, Guatemala and Mexico to train microfranchise owners, often linking up with existing networks of health workers, peddlers and shopkeepers.
In April, Scojo began collaboration with the non-profit health organization Population Services International to distribute glasses throughout sub-Saharan Africa. In five years, Scojo has sold more than 70,000 pairs of eyeglasses to the poor across the globe. Depending on the country, glasses are sold for $3-10, or about 10% of a customer’s monthly income. Since arriving here nearly three years ago, the India programme has become the organization’s largest and fastest-growing, training more than 450 Vision Entrepreneurs and selling more than $100,000 worth of glasses.Scojo forecasts cumulative sales of one million pairs by 2010 and 10 million by 2016.
In addition to overseeing 150 of their own Vision Entrepreneurs, Scojo India also trains partners like Hindustan Unilever; Drishtee, a company that sets up pay-per-use computer kiosks in rural areas; and Development Alternatives, an organization that sells environmentally sustainable technology. These partners then train their own health workers and entrepreneurs, who add glasses to their existing basket of services that include condoms, soaps and solar-powered lanterns.
Scojo Vision Entrepreneurs receive a “business in a bag,” a sales kit containing all the glasses, eye charts and other materials needed for marketing, screenings and data collection. In exchange for co-branding and an increased reach for Scojo’s products, the franchise partners make a small profit on each pair of glasses sold, as do their microfranchise owners. Because it is sometimes taboo for Indian women to travel outside of their communities alone, Scojo has created teams made up of husbands and wives, mothers and sons, or two women together to sell glasses in their villages and beyond.
More than 170 women are now Vision Entrepreneurs in India. In the village of Motakondury, Srilata, a Scojo microfranchise owner, shares the work of giving eye exams to customers and selling glasses with her husband, Srinivas, who still works as a machine operator at a local munitions factory. Srilata says that working with Scojo has not only afforded the couple the ability to send their learning-disabled son to a special boarding school, but has also given her a measure of financial independence and a position of leadership in the community. “I’m not just a regular housewife,” she said quietly, glancing at her husband.
“I don’t have to ask my husband for money, and I’m seen as an influential figure for other women here in my village.” Leaning closer, she added: “Even my mother-in-law is happy about it.”
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First Published: Thu, Jul 26 2007. 07 58 AM IST