Flushing Out Sanitation Market Failures – PSI

Flushing Out Sanitation Market Failures. by Aprajita Singh, John Sauer and Bikas Sinha, PSIIMPACT, November 2017. psi

A third of the world’s population — 2.4 billion people — live without sanitation facilities. Not having access to even a basic toilet exposes millions of men, women, and children to risks of morbidity and mortality.

During World Toilet Week, PSI is excited to announce its participation as a member of the Toilet Board Coalition, in large part because we see solutions to this overwhelming problem in the sanitation economy itself.

PSI has begun looking at market-based solutions in Benin, Cote D’Ivoire, Ethiopia, Ghana, Senegal, and India. In India, alone, 524 million people lack access to any kind of toilet. A problem of this scale necessitates a market system response with the government and the private sector complementing each other to address market failures preventing sanitation access.

Through the Supporting Sustainable Sanitation Improvements (3SI) project, launched by the Bill & Melinda Gates Foundation (BMGF) and Unilever in 2012, PSI and partners found that 84% of households without toilets wanted to own one.

Here’s an insight into how the project identified and addressed critical market failures as well as provided solutions that worked in the state of Bihar.

Addressing a Fragmented Supply Chain

After conducting market research, the 3SI team learned that people wanted to purchase a toilet, but the components were too expensive. They found that 13-15 different actors existed in the sanitation value chain. Maneuvering this supply chain meant that a customer interested in purchasing a toilet was required to separately transact with multiple players. This made toilet construction a difficult and more expensive than necessary process. It meant a dramatically long wait times for customers to ultimately have functional toilets.

Read the complete article.

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