jsim presentation
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Seeing Sanitation as anSeeing Sanitation as anOpportunityOpportunity
BY JACK SIMBY JACK SIM
Founder of World Toilet OrganizationFounder of World Toilet Organization
SCHWAB FOUNDATION SOCIAL ENTREPRENUERSCHWAB FOUNDATION SOCIAL ENTREPRENUER
& ASHOKA GLOBAL FELLOW& ASHOKA GLOBAL FELLOWThe views expressed in this paper/presentation are the views of the author and do not
necessarily reflect the views or policies of the Asian Development Bank (ADB), or its Board of
Governors, or the governments they represent. ADB does not guarantee the accuracy of the
data included in this paper and accepts no responsibility for any consequence of their use.
Terminology used may not necessarily be consistent with ADB official terms.
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What We KnowWhat We Know Most Domestic Sanitation is fundedMost Domestic Sanitation is funded
privately by informal sectorprivately by informal sector External funding for latrine hardware hasExternal funding for latrine hardware has
made little impression & donations cannotmade little impression & donations cannot
solve 2.5 billion needssolve 2.5 billion needs Toilets Provision does not equal ToiletToilets Provision does not equal Toilet
Usage, Hygiene and Public HealthUsage, Hygiene and Public Health
improvementimprovement
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OpenOpen
defecationdefecation
continuescontinueswhile wewhile we
count toiletscount toilets
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Opportunity in a Financial CrisisOpportunity in a Financial Crisis
Market shrinkage at Top of PyramidMarket shrinkage at Top of Pyramid
OverOver--capacities widespreadcapacities widespread
Massive and growing unemploymentMassive and growing unemployment
Businesses desperately looking for newBusinesses desperately looking for newcustomerscustomers
Base of Pyramid has 4 billion newBase of Pyramid has 4 billion new
customerscustomers
Low Cost, High VolumeLow Cost, High Volume
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2.5 billiontoilet-less
people
500 million
toilets
A massive
marketopportunity
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How big is the market?How big is the market?
PER UNIT COST:Promotion, design,
testing,manufacture,distribution,
transport, etc:Multiplier Effect of
each channel
500 millionhousehold
toilets2.5 billion people
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- Schools
- Religiousbuildings
- Markets
- Transport
- Recreation
Add MarketAdd Marketforfor
public toiletspublic toilets
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-Installation
- Operation
- Maintenance
Joe the Plumber
Add MarketAdd Marketforfor
servicesservices
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- Soap
- Slippers- Equipments
- Toilet paper- Etc
Add Market forAdd Market forconsumablesconsumables
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- Fertilizer
- Soilconditioner
- Biogas
Add MarketAdd Market
forfor
nutrientsnutrients
recycledrecycled
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Add Market forAdd Market for
InnovativeInnovative
FinancialFinancial
productsproducts
-Big Banks-Micro-finance
-Donors-Government
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AddMarket for
ToiletUpgrades
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Add Disaster Markets
1313
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Add Military Markets
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Return onReturn on
$1$1
invested =invested =
$9$9
EconomicBenefits
Hutton, Haller & Bartram,WHO 2007
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PotentialPotential $1 trillion$1 trillion
global BOPglobal BOPsanitation industrysanitation industryHow do we tap this market?
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Opportunities
• When China , India, Russian marketsopens up, they were BOP markets
• China’s multi-billions New SocialistCountryside Program
• 30,000 New Grads as Rural Teachers
• Rubanization: Reducing Slums in citiesby building multiple small ( 1km diameter)
Ruban Centers in farmlands.• Centers of Excellence growing, eg
Stanford, Singapore’s LKYSPP, Skoll in
Oxford, Sussex, Wharton, UNC, etc 1717
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Transform The DonorTransform The Donor
ModelModel
The Poor is not helpless, andThe Poor is not helpless, and
incapable.incapable.
No cut & paste approachNo cut & paste approach
TopTop--down donordown donor--decideddecidedprograms approach not workingprograms approach not working
There is not enough donorsThere is not enough donors
anyway.anyway.
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Customers Centered ModelCustomers Centered Model Customer involvement is critical for longCustomer involvement is critical for long
term sustainabilityterm sustainability
Subsidize market development instead ofSubsidize market development instead of
hardware costshardware costs Develop rural markets for sanitationDevelop rural markets for sanitation
services empowering local entrepreneursservices empowering local entrepreneurs
Facilitate linkages between demand andFacilitate linkages between demand and
supplysupply
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People at BOP are:People at BOP are:
-- IntelligentIntelligent-- DiscerningDiscerning
-- Able to chooseAble to choose
-- Quality/brandQuality/brand
consciousconscious
-- Prudent withPrudent with-- their moneytheir money
-- Clients withClients withdiffering needsdiffering needs
-- EntrepreneurialEntrepreneurial
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AspirationMarketing
Object of
Desire
&
StatusSymbol
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Driving Demand ThroughDriving Demand Through
Community Led Total SanitationCommunity Led Total Sanitation
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CostCost--EffectivenessEffectiveness – – IDEIDE
VietnamVietnam
Every $1 spent in promo & marketingleveraged $3.6 Market Value of
Latrines Built without subsidySource: Frias & Mukherjee 200
20022002--2006: 200% increase in sanitation access2006: 200% increase in sanitation access
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Building Supply Chain + CLTS
Bangladesh
On track for MDG: 10,000 private ruralOn track for MDG: 10,000 private rural
workshops, national CLTS programworkshops, national CLTS program
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Success Models in NonSuccess Models in Non--
Domestic Public ToiletsDomestic Public ToiletsIndiaIndia’’ss SulabhSulabh International Pay Toilets:International Pay Toilets:
CrossCross--Subsidizing LocationsSubsidizing Locations
KenyaKenya’’ss IkoIko--ToiletsToilets ““Toilet MallToilet Mall””::
CrossCross--Subsidy from other servicesSubsidy from other services’’ incomeincome
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From silosFrom silos……Global OrganizationsGlobal Organizations
Policy makersPolicy makersGovernmentGovernment
Local governmentLocal government
Community LeadersCommunity LeadersTechnology & ResearchTechnology & Research
Financing CommunityFinancing Community
Supply Chain MembersSupply Chain Members
End UsersEnd Users
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Weave a market networkWeave a market network
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Develop new products at right price
Most of our toilet models are fartoo expensive for BoP
Source: Heirli & Frias
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Appropriate Technologies Exist• EAWAG Compendium of Sanitation
Systems and Technologies• WEDC Courses & Publications
• UNESCO-IHE• Sustainable Sanitation Alliance
• Stockholm Environment Institute
• Gtz
• University of Life Science, Norway
• More… 2929
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Bringing in Big BusinessesBringing in Big Businesses
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SintexSintex: already actively developing sanitation: already actively developing sanitationoptions for BOP marketplaceoptions for BOP marketplace
Cost reduced using prefab plastic BioCost reduced using prefab plastic Bio
--gasgas
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4,000 Low Cost Distributors in Bangladesh4,000 Low Cost Distributors in Bangladesh
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Scaling BenefitsScaling Benefits•• Lower unit costsLower unit costs-- economies of scaleeconomies of scale
•• Lower transaction costsLower transaction costs
•• Scale up existing workScale up existing work
•• Create new jobs & microCreate new jobs & micro--enterprisesenterprises
•• Fill gaps, facilitate financingFill gaps, facilitate financing
•• Link supply to demandLink supply to demand
•• Inspire innovationInspire innovation
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GoalGoalMake sanitation:Make sanitation:
-- EasierEasier
-- FasterFaster
-- CheaperCheaper
--BetterBetter
-- SexierSexier
--TrendyTrendy
-- Like Google, Ikea, Apple,Like Google, Ikea, Apple,
YouthYouth--oriented,oriented, IpotIpot,, IpeeIpee, etc, etc
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Star Government PolicyStar Government Policy – – Support & CLTS CampaignsSupport & CLTS Campaigns
with Leadership & Fundingwith Leadership & Funding
– – Partner with Private Sector,Partner with Private Sector,Facilitate EntrepreneurshipFacilitate Entrepreneurship
– – Lend LegitimacyLend Legitimacy
– – LeadershipLeadership – – Reward community afterReward community after
successful implementationsuccessful implementation
– – Regulate disposal & reuseRegulate disposal & reuse
– – Set up enabling conditions forSet up enabling conditions forinvestments in Sanitationinvestments in Sanitation
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PPP Investment ReturnsPPP Investment Returns Consumer Demand key to successConsumer Demand key to success
Government Economic Rate of Return canGovernment Economic Rate of Return cancomplement Private Sectorcomplement Private Sector’’s Internal Rates Internal Rate
of Returnof Return
Let Private Portion of funding earn returnsLet Private Portion of funding earn returns
even if the whole project appears unviableeven if the whole project appears unviable
Cost of Inaction is higher than InvestmentCost of Inaction is higher than Investment
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Health as an Economic Driver
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WTOWTO’’ss Leverage ModelLeverage Model
--Delivering Sanitation throughDelivering Sanitation through
bridging transactionsbridging transactions
Strategy: – Collaborate
– Synergize – Deliver
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19 November World Toilet Day19 November World Toilet Day
as Official UN Dayas Official UN Day
-- Need to keep momentum of IYSNeed to keep momentum of IYS
-- WTD already celebrated worldWTD already celebrated world--widewide
-- Leverage on Officialdom & LegitimacyLeverage on Officialdom & Legitimacy
-- 170 countries signatories needed170 countries signatories needed
-- Submission in preparation now forSubmission in preparation now for
approval at the UN General Assemblyapproval at the UN General Assembly
20102010
CC l b l
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Create globalCreate global
BOP market infrastructureBOP market infrastructure
New marketsNew markets
New vocabularyNew vocabulary
New productsNew productsNew mindsetNew mindset
-- Start imperfect &Start imperfect &
improvise as mattersimprovise as matters
become clearerbecome clearer