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NextBillion News Vol. 24 April 28, 2008
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NextBillion.net on Microfranchising, Clean Energy for the BoP, Mobile Banking, Microfinance and More!

[Contents]

1. WRI Releases Case Study on Franchising Pioneer CareShop Ghana

2. Featured Blog Posts on Clean Energy for the BoP and Ongoing Discussions in the Microfinance Industry:

MicroEnergy Credits Corporation: Catalyzing Clean Energy for the BoP
By Grace Augustine

Making Biofuels Work for the BoP in Haiti
By Al Hammond

The Commercialization of Microfinance: The Good, The Bad and The Ugly
By Rob Katz

Glory and Riches? Unraveling Microfinance's Alure among Young Job-Seekers
By Lauren Withey

3. New Insights and Perspectives around the Mobile Banking Industry and its Potential: CGAP and New York Times

4. Featured Event: Executive Development Program on Inclusive and Sustainable Business Offered by the World Bank Institute

5. Jobs/Careers: Analyst, Ignia BoP Investment Fund

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1.WRI Releases Case Study on Conversion Franchising Pioneer CareShop Ghana

By Julia Tran

Though I'm no longer on WRI and NextBillion's staff, I'm glad to announce the release of WRI's latest What Works business case study, CareShop Ghana: Improving access to essential drugs through conversion franchising. This study is authored by Joel Segre (Harvard Business School, '08) and myself, and was made possible through the generous support of the Horace W. Goldsmith Foundation.

NextBillion has discussed pharmacy microfranchises in the health sector on numerous occasions, but CareShop is unique among them as a conversion franchise that recruits existing drug store owners, rather than a "green field" franchise model that establishes new outlets. A conversion franchising strategy has great potential especially in Ghana, where an extensive network of 8,000 individually run retail drug stores, known in Ghana as "licensed chemical sellers," already reaches every corner of the country.

CareShop's founders interpreted the prevalence of easily treatable infectious diseases in Ghana as significant unmet demand for better access to more affordable drugs, and endeavored to meet this demand by working with chemical sellers in a franchising arrangement. CareShop, as the frachisor, runs on a for-profit basis and generates revenue from product sales to chemical sellers as its franchisees. CareShop provides franchisees with valuable business and healthcare training, branded materials, and the convenience of having products delivered directly to their doorstep. CareShop is a program run by Ghana Social Marketing Foundation Enterprises Limited, which itself is a for-profit subsidiary of Ghana Social Marketing Foundation (GSMF), a non-profit organization.

To date, there are 276 CareShops operating in Ghana, the oldest of which joined the franchise in 2003. CareShop has been in operation longer than many drug store microfranchises, which afforded Joel and me the opportunity to work with a larger set of business records and observe clear trends in CareShop's outlook. In the case study, we endeavor to present a thorough analysis of both the inherent challenges of implementing a conversion franchising model and the benefits of such a model to franchisees and to some extent, the pharmaceutical retail market.

The case study may be of especial interest in light of the recent discussions on NextBillion regarding scaling strategies and on the value of fostering talent at the BOP. Franchisees eagerly embraced training opportunities at the time of their conversion. Indeed, GSMFEL's well received training program helped CareShop to scale rapidly during its first couple years of operation. Franchisees were selective, however, in which lessons they chose to apply. Changes in business practices that led to immediate payoff were more popular than changes that do not have readily apparent benefits. Yet some franchisees even resisted behavior changes that seem to offer advantages over old ways of doing business, such as using GSMFEL's delivery service rather than having to travel to wholesalers in the city.

The mixed success of GSMFEL's training program offers insight into the advantages and disadvantages of working with an existing group of entrepreneurs. Download the case study for more details on this topic and other lessons learned from GSMFEL's experience serving the base of the pyramid by engaging microentrepreneurs.

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2. Featured Blog Posts on Clean Energy for the BoP and Ongoing Discussions in the Microfinance Industry

MicroEnergy Credits Corporation: Catalyzing Clean Energy for the BoP

By Grace Augustine

Increasingly, people are calling for the new energy models in developing nations to be "sustainable" and drawn from "clean" and renewable sources. The accepted belief is that if we can get developing nations on a path of adopting clean technologies, they can completely leapfrog the dirty, self-perpetuating system we have created in the west. However, there are barriers to establishing renewable energy projects at the BoP, on both the supply and demand side. One recently-launched for-profit social enterprise that hopes to revolutionize financing in this field is MicroEnergy Credits Corporation (MEC), and I had the wonderful pleasure of conversing with its founders, April Allderdice and James Dailey, last week.

Read More


Making Biofuels Work for the BoP in Haiti

By Al Hammond

A new paper posted in our resources section gives a specific regional example of the potential benefits of biofuels for the BoP (this adds to our previous discussions on the subject here, here and here).

The paper - by Kathleen Robbins of the GreenMicrofinance Group - tells the story of a small NGO, aided by GreenMicrofinance and an enlightened multinational company, that is piloting an environmentally sound and economically sustainable approach to biofuels. The key element is a jatropha nursery that is incubating young plants and teaching a group of Haitian farmers how to grow them.

Read More


The Commercialization of Microfinance: The Good, The Bad and The Ugly

By Rob Katz

Today in New York, I had the pleasure of attending a round table organized by the Council on Foreign Relations entitled The Commercialization of Microfinance: The Good, The Bad and The Ugly. Moderated by CFR Senior Fellow Isobel Coleman, the discussion featured comments from Mary Ellen Iskenderian (of Women's World Banking) and Roshaneh Zafar (of the Kashf Foundation.)

Read More


Glory and Riches? Unraveling Microfinance's Alure among Young Job-Seekers

By Lauren Withey

It used to be that most U.S. college graduates, perhaps after spending a few years testing their penchants for various occupations or getting a second degree, would expect to settle into a consistent office job for the rest of their working lives. Attending a Microfinance Research Symposium at Georgetown University last week reminded me why such a smooth career path has become increasingly the exception rather than the rule among young job seekers today.

Read More

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3.New Insights and Perspectives around the Mobile Banking Industry from CGAP and New York Times Magazine

Manuel Bueno interviewed Mark Pickens from CGAP, and The New York Times asked the following question: Can cellphones alleviate poverty?

Interview with CGAP's Mark Pickens: Branchless Banking Sector "Exploding"

By Manuel Bueno

Mark Pickens is a Microfinance Analyst with the Consultative Group to Assist the Poor (CGAP), a global resource center for microfinance housed at the World Bank. We have quoted CGAP on NextBillion in several posts (see them here, here and here). They are arguably the most authoritative source of information about branchless banking services and are currently in the forefront of research efforts to understand and develop this market.

Read More

NYT Magazine Asks: Can Cellphones Alleviate Poverty?

By Derek Newberry

All of us at NextBillion.net were both humbled and thrilled to see the New York Times Sunday Magazine draw on our work - and the work of many colleagues - to write an extended piece on the impact of cell phone usage in emerging economies.

Sara Corbett's article follows Nokia researcher Jan Chipchase as he navigates the human terrain of countries like Ghana, Brazil and Uzbekistan, trying to figure out why a farmer in Kenya or a prostitute in Brazil is finding unique value in their cell phone. The article uses Jan's experience as a device for sparking a broader discussion on the potential for the booming cell phone market to increase incomes and quality of life among the BoP.

Read More

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4. Featured Event: Executive Development Program on Inclusive and Sustainable Business Offered by the World Bank Institute

Date: June 9 - 13, 2008

Location: Washington DC

From the program's website:

"The program is designed for business executives from larger companies responsible for managing business in emerging and developing economies, as well as public sector leaders, donor agency executives, civil society organization representatives, and staff from international development agencies who are actively interested and engaged in involving the private sector in meeting development goals."

Read More

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5. Jobs/Careers: Associate, SeaChange Capital Partners

Location: Monterey, Mexico

Organization: IGNIA is a $75 million venture capital fund and enterprise development organization focused on fighting poverty by investing in Small and Medium Sized Enterprises (SMEs) at the Base of the Pyramid (BoP) in Latin America.

Position Description: The Analyst will work with IGNIA's staff to help raise, research, invest and manage a $75 million base of the pyramid fund. He or she will have previous experience in the venture capital sector. Spanish proficiency, though not fluency, is required.

Read More

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NextBillion News Vol. 24 April 28, 2008

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Thank you,
New Ventures Team
World Resources Institute