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Strengthening the sanitation supply chain

Published on: 21/08/2012

A chain is as strong as its weakest link. The supply chain analysis assesses each component of the chain. It identifies opportunities and constraints, and ways to overcome the latter.

Common constraints are the knowledge and skills of local providers. They may be general builders and good suppliers without a special “sanitation line”, who:

  • Are not aware of the presence, volume and segmentation of the sanitation market
  • Do not know how to tap into and stimulate this market
  • Do not realize the value of the market for their businesses
  • Lack knowledge and skills on the (lower-cost) designs and construction techniques that allow them to cater for a wider market
  • Do not yet market their sanitation goods and services to the unserved, especially to women
  • Lack business management skills

In Vietnam, providers increased their incomes by about 10% when, after training, they opened special sanitation lines of goods and services.

The SSH4A programme in Asia identified three types of business models:

  • The one-stop-shop model: a shop which provides sanitation goods as well as construction, repair and other services, or a (small) contractor, who also has a materials and goods outlet. One-stop-shops generally provide more goods and services than for sanitation alone.
  • The micro-franchising model: one leading business or entrepreneur in a central location links up with other individuals or micro-businesses in surrounding locations. The franchiser trains the franchisees on technologies, products and services; on construction and other skills, and on marketing; provides simple marketing materials such as leaflets, and supplies the products and materials, in return for a share in the profits.
  • The network model: a network consists of a group of producers, shops, masons and other related service deliverers (transport, emptying) who cover the whole supply chain, who work together for free. Each member refers their customers to other members along the chain for the other services that the customer is looking for. Members also refer customers to colleagues if they themselves do not have the wanted good or cannot deliver the service at the required time.

In the last century the governments of Bangladesh and India, UNICEF and local NGOs created sanitary marts. These are subsidised one-stop-shops that sell sanitation goods and services only. Studies have shown that few sanitary marts generate enough business to survive without subsidy. Survival is better when they diversify their products, have models for the very poor, and strong marketing and promotion, as in West Bengal. Subsidized marts have also inspired other small and often informal entrepreneurs to start to produce and sell pre-fabricated low-cost toilet components, such as toilet rings and slabs.

Strengthening sanitation supply is done through a, usually externally funded, training programme consisting of:

  • selection and training of trainers
  • selection and hands-on training of an initial, strategically chosen, batch of providers whose example others are likely to follow (trend-setters)
  • development, use and sharing of simple training materials.

Background information and materials referred to in the article:

 

  • The supply chain analysis assesses each component of the chain
  • In Vietnam, providers opened special sanitation lines
  • The SSH4A programme in Asia identified three types of business models
  • Studies have shown that few sanitary marts generate enough business to survive without subsidy
  • Survival is better when they diversify their products, have models for the very poor, and strong marketing and promotion, as in West Bengal.
  • Subsidized marts have also inspired other small and often informal entrepreneurs to start to produce and sell components

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