Actions: Describe the steps that you are taking to make your innovation a success. Include a description of the business model. What might prevent that success?
Our standard expansion methodology is generally structured, for each country, along a three-phased approach :
- an Experimentation phase, based on ten experimental villages, aiming at testing the technology, refining the models by taking into account local parameters and verifying, through a "live" experimentation, its potential acceptance and workability by villagers. This phase was achieved for Cambodia between 2004 and 2007.
- a Roll-out model phase, based on forty to fifty additional new villages (in the same region), aiming at building the local skills needed to run the local platform as well as methodologies in view of a wide-scale dissemination. This phase started in Cambodia in 2008 and should be completed by end 2011,
- a Roll-out phase, planned for covering hundreds of new small communities over several years, in selected areas of the country.
The business model (for Cambodia) is hybrid :
- capital investment required for setting up each water production center in the village (US $ 20,000) is funded through charitable grants or subsidies,
- further operating expenses are self-financed through the turnover generated by the water sale.
A technical support platform is set up, serving 60 operating sites, and providing services such as managing the consumables supply chain, delivering education campaigns or (more important) performing a permanent (and independent) water quality control. In exchange of these services, each operating site pays a “service fee”, depending on its size, these fees enabling the support platform to be also self-financing and therefore sustainable.
This hybrid model has been adopted for Cambodia, in order to be able to sell drinking water for a price as low as $ 0,01/litre. Incorporating the initial investment amortization in the operating model would require a $0.015 /litre price, over the affordability level of Cambodian population. However, for other countries such as Viet-Nam (where a price up to $ 0.02 would be affordable) or even Bangladesh (where population density will lead to a much higher turnover while keeping the same $ 0.01 price), we plan to finance the initial investment through a classical commercial loan, therefore finalizing a complete social business model.