Tag Archives: Sanitation as a business

Designing the next generation of sanitation businesses

Designing the next generation of sanitation businesses: a report by HYSTRA for the Toilet Board Coalition, 2014hystrasanitation_4pp_web-1

Fortunately, a number of market-based models have emerged in both rural and urban areas to address the sanitation crisis. They all serve the Base of the Pyramid in a sustainable manner by offering improved solutions, at a price that the poor are willing and able to pay. In this Report, we analyze two models that combine an aspirational value proposition for low-income families and a strong potential for financial sustainability: projects that facilitate the creation of a local, sanitation market in rural areas and enterprises servicing home mobile toilets in urban areas.

Based on an in-depth analysis of 12 projects representative of these two models, the Report suggests strategies to overcome challenges to sustainability and scale. Finally, the Report explores how these models would benefit from corporate and industrial expertise and resources, opening up opportunities for large corporations to contribute to solving the sanitation crisis.

Unclogging the Blockages in Sanitation

Unclogging-Blockages-brochure

Perhaps one of the more ignored or misunderstood elements of water poverty by the general population and even the charitable sector is sanitation services. When you think about providing clean water, you conjure images of clear drinking water pouring out of a tap or buckets of well water used to water crops and serve livestock.

But then there’s the other stuff—the stuff that is not as pretty to think about or even to deal with, but is just as important—like unclogging toilets, and building latrines, and providing sanitary napkin containers and services for female students. That’s all sanitation.

The first Unclogging the Blockages conference organised by IRC, PSI, Water for People and WSUP Enterprises, took place on February 18-20, 2014 in Kampala, Uganda. More than 170 people from in and out of the sector and around the world came together to explore the various challenges for sanitation as a business (SAAB) and began working on short and long-term solutions.

Participants identified seven key components to SAAB: (1) public sector; (2) business models; (3) finance; (4) technology; (5) demand creation and behaviour change; (6) monitoring; and (7) intersectoral links.

For each component participants plotted out potential outcomes and ways forward based on their ideas and a 30-day challenge, for example:

Business Models
Blockage: lack of models that are pro-poor inclusive; lack of understanding of technology
Desired outcome: Consumer understanding/happiness: Families say, “The toilet is my favorite part of the house.”
30-Day Challenge: Know your customers deeply for better service and success. —Advocacy through creative formats, get to the point and make it attractive, prove we have results.

The full set of action plans with a detailed breakdown by tasks and groups responsible for each of the seven themes is in the Unclogging the Blockages report. The Conference report and an accompanying factsheet are available at: www.ircwash.org/resources/unclogging-blockages-sanitation-business

A full set of conference materials including Powerpoint presentations can be found on the SuSanA website at: www.susana.org/en/events/past-event-pages/details/8

Three articles published in the July 2014 edition of Waterlines emerged from the conference:

Mulumba, J.N., Nothomb, C., Potter, A. and Snel, M. 2014. Striking the balance : what is the role of the public sector in sanitation as a service and as a business? Waterlines, vol. 33, no. 2, pp. 195-210. DOI: 10.3362/2046-1887.2014.021

Rojas Williams, S.M. and Sauer, J. 2014. Unclogging the blockages in sanitation : inter-sector linkages. Waterlines, vol. 33, no. 2, pp. 211-219. DOI: 10.3362/2046-1887.2014.022

Sugden, S., 2014. Latrine design: go in peace. Waterlines, vol. 33, no. 2, pp. 220-239. DOI: 10.3362/1756-3488.2014.023

The business case for Base of the Pyramid sanitation

Ready for Funding: Innovative  sanitation businesses cover

The Sanitation Business Matchmaking Estafetta initiative has published a guide to business opportunities for sanitation in small towns and peri-urban areas in upcoming economies.

The sanitation sector offers long term, slow and stable return on investments and this can be a pearl in your portfolio. Moreover, sanitation services create social benefits which may be of interest for impact investors. The challenge of the sanitation industry is to access to the  right blend of financial products. Investors are invited to guide the sanitation industry in creating the conditions needed to realize ventures that prove to be attractive investment opportunities.

The guide targets investors, intermediaries and the private sector. It covers both household and public sanitation, as well as emptying & collection services, smart small sewerage, and treatment & reuse. Using Ghana as a case study, the guide presents a market analysis for sanitation investment opportunities for each of the before mentioned sanitation components and services.

Download Ready for Funding: Innovative sanitation businesses

Microfinance as a potential cataylst for improved sanitation

. Summary of sanitation lending and product delivery models. Water for People

. Summary of sanitation lending and product delivery models. Water for People

Microfinance allows middle- and lower-income households to invest in desirable sanitation products, so that public funding can be freed up to reach the poorest, according to Water for People (WfP). In a new report [1], WfP reviews their experiences in piloting various lending models in seven countries: Bolivia, Guatemala, India, Malawi, Peru, Rwanda and Uganda.

The report provides lessons and recommendations for donors wishing to engage in sanitation microfinancing. The four key recommendations are:

  1. Think like a business
  2. Support lending institutions based on the microfinance climate and capacity needs
  3. Build an autonomous sanitation microfinance market
  4. Track progress and lessons

The report is part of WfP’s Sanitation as a Business (SaaB) program, funded by a Gates Foundation grant.

Read the full report

[1]  Chatterley, C. et al, 2013. Microfinance as a potential catalyst for improved sanitation : a synthesis of Water For People’s sanitation lending experiences in seven countries. Denver, CO,USA: Water For People. Available at: <http://www.waterforpeople.org/assets/files/sanitation-microfinance.pdf>

Source: Christie Chatterley et al., Microfinance as a potential cataylst for improved sanitation, Water for People, 27 Dec 2013

BRAC WASH latrines will power business to turn faecal waste into energy

The BRAC WASH programme in Bangladesh is to conduct detailed planning to convert faecal matter from pit latrines into commercially viable fertiliser, biogas and electricity. The aim is to complete the sanitation chain by making material from millions of pit latrines safe and economically productive.

Babar Kabir, Senior Director of the BRAC WASH programme, says that there is a sound business case for investment in bio-energy units that could generate electricity on a large scale, but believes that investors must be in this for the long-term and that the most important payback will be improved health and sanitation.

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Is there a sustainable business case for sanitation?

Left to right: Radu Ban (Bill and Melinda Gates Foundation), Babar Kabir (BRAC) and Bernadette Blom (Goodwell Investments), panelists at the workshop Making Sustainable Business out of Sanitation. Photo: Peter McIntyre

Left to right: Radu Ban (Bill and Melinda Gates Foundation), Babar Kabir (BRAC) and Bernadette Blom (Goodwell Investments), panelists at the workshop Making Sustainable Business out of Sanitation. Photo: Peter McIntyre

The business case for sanitation in developing countries is testified by the thousands of small scale entrepreneurs springing up to tackle problems of open defecation and process faecal waste and urine.

Will these businesses be profitable and sustainable? Can they address the huge scale of the problem? Will they address the issues in rural areas as well as urban areas? These questions are much harder to answer.

The evidence from an event at the International Water Week leading up to the Sarphati Sanitation Award was mixed. The workshop Making Sustainable Business out of Sanitation, showed a high level of innovation and enthusiasm for businesses to address two of the most intractable public health and environment issues of our age – the 2.5 billion people who don’t have access to safe hygienic toilets and sanitation, and how to deal with human waste.

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Sanitation as a business – the poor will have to wait

Malawian sanitation entrepreneur Martius using

Malawian sanitation entrepreneur Martius using “The Gulper” to empty a pit latrine. Photo: Water for People

Providing toilets to the poorest may be “dear to the hearts of many non-profits, aid agencies and governments” but if you want to involve business you have to start with the better-off families first. So says business woman and sanitation entrepreneur Towera Jalakari who runs a pit emptying service in Blantyre, Malawi.

“We will get to Everyone in Blantyre one day, but the only way to make sure Blantyre actually solves its sanitation problems is to recognize that the market must function.  [...]  As we get better, as we scale city-wide, then costs will come down, services will improve, and pressure will build for all people to have a toilet.  We will get to the poorest, but they are not our first targets.  [...] If we rush too fast [...] then the poor will not have lasting services but rather a lot of useless toilets and nowhere to go to the bathroom.”

Malawi is one the countries in Water for People’s Sanitation as a Business program (2010-2014), which is funded by a US$ 5.6 million grant from the Bill & Melinda Gates Foundation. Water for People has contracted Tools for Enterprise & Education Consultants (TEECs) to support pit emptying businesses in Lilongwe and Blantyre.

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