VillageReach T&L

VillageReach T&L

Mozambique
Organization type: 
nonprofit/ngo/citizen sector
Budget: 
$1 million - $5 million
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

VillageReach T&L will establish a transport and logistics business which will serve NGO’s currently operating in northern Mozambique. We will provide a much- needed service in a low resource region, and use the proceeds to support our existing health system strengthening program in northern Mozambique.

About You
Organization:
VillageReach
Section 1: About You
First Name

Ethan

Last Name

Wong

Website
Country

, WA, King County

Section 2: About Your Organization
Is your initiative connected to an established organization?

Yes

Organization Name

VillageReach

Organization Phone

206-925-5200

Organization Address

601 N 34th Seattle, WA 98103

Organization Country

, WA, King County

How long has this organization been operating?

More than 5 years

Your idea
Country your work focuses on

, CD

Innovation
What makes your innovation unique?

Basic infrastructure gaps in Mozambique are numerous, and lead to needless additional costs and tremendous hardships for NGO’s working on improving lives in the country. Compensating for these gaps can absorb much of an NGO’s resources, limiting their capacity. Development program managers want to focus on their core activities, e.g. health-care provision, capacity building, and advocacy. The reality, however, is that they need to devote considerable time and assets to non-core but important and expensive activities such as transport and logistics.

VillageReach has the unique opportunity to enable other NGO’s to complete their missions by addressing a common gap in transportation infrastructure and helping sustain its own life saving program in country.

In support of its health system strengthening program in northern Mozambique, VillageReach has purchased dedicated trucks and hired drivers at 50% capacity to reliably deliver vaccines and other medical commodities to rural clinics. The remaining 50% capacity is an idle resource which can be allocated to provide service to other organizations, producing revenue for VillageReach to offset the expense of supporting its programs. The incremental cost to VillageReach to manage the transport service is minimal: the trucks and drivers operate in rural and urban geographies common to many NGOs, enabling the business to easily support other organizations.

Do you have a patent for this idea?

Impact
Tell us about the social impact of your innovation. Please include both numbers and stories as evidence of this impact

The greatest social impact of our innovation comes from the support it provides existing not-for-profits serving Mozambique. We seek to enhance the programs of existing NGO's while channeling the business income into VillageReach's existing program which delivers more reliable health-care to the rural poor.

Problem: Describe the primary problem(s) that your innovation is addressing

Basic infrastructure gaps in Mozambique are numerous, and lead to needless additional costs and tremendous hardships for NGO’s working on improving lives in the country. Compensating for these gaps can absorb much of an NGO’s resources, limiting their capacity. Development program managers want to focus on their core activities, e.g. health-care provision, capacity building, and advocacy. The reality, however, is that they need to devote considerable time and assets to non-core but important and expensive activities such as transport and logistics. Our business would address this burden NGO's face in Mozambique, providing a cost effective and reliable transport and logistic service.

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?

In support of its health system strengthening program in northern Mozambique, VillageReach has purchased dedicated trucks and hired drivers at 50% capacity to reliably deliver vaccines and other medical commodities to rural clinics. The remaining 50% capacity is an idle resource which can be allocated to provide service to other organizations, producing revenue for VillageReach to offset the expense of supporting its programs. The incremental cost to VillageReach to manage the transport service is minimal: the trucks and drivers operate in rural and urban geographies common to many NGOs, enabling the business to easily support other organizations. We are currently in communication with a handful of NGO's and organizations in the area to gauge interest in the service and refine our offering. Potential barriers to success include customer trust in the reliability of service, and operating in regions with poor road and communication infrastructure.

Results: Describe the expected results of these actions over the next three years. Please address each year separately, if possible

The expected result of these actions over the next three years would be:
1. Satisfied regular customer base - NGO's utilizing our service will find benefit in both cost savings as well as increased programmatic effectiveness from the ability to focus more energy into core activities.
2. Financially sustainable - Revenue generated would cover operational costs of the business with profits rolling back into our health system strengthening program currently serving the community in northern Mozambique.
3. Expansion - If the business proves successful, it would be replicated in other provinces where VillageReach health system strengthening programs operate (currently 2 provinces with program expanding to additional provinces in the near future).

How many people will your project serve annually?

What is the average monthly household income in your target community, in US Dollars?

Less than $50

Does your innovation seek to have an impact on public policy?

No

If your innovation seeks to impact public policy, how?

Approximately 150 words left (1200 characters).

Sustainability
What stage is your Social Enterprise in?

Idea phase

Does your organization have a board of directors or an advisory board?

Yes

Does your organization have a non monetary partnerships with NGOs?

Yes

Does your organization have a non monetary partnerships with businesses?

No

Does your organization have a non monetary partnerships with government?

Yes

Please tell us more about how partnerships could be critical to the success of your Social Enterprise

Many of the basic services provided to communities in sub-Saharan Africa are provided by local and international NGOs, in many case working in collaboration with government institutions, as VillageReach does. VillageReach looks to NGO customers to supply transport support services as it does to MISAU for its collaboration to improve the quality of the national health system. The complementary benefits of supply and demand for transport services is clear to our organization and our partners. Because demand for service can fluctuate over time, our goal is to develop as many client relationships as possible in order to ensure maximum demand and optimal use for the trucks.

Because we are an NGO, we understand the inherent risk other NGOs face in outsourcing such a critical component of their activities. Our commitment to our clients is to provide safe, and reliable service form VillageReach as a partner, and indeed as we would expect it to be for ourselves.

We would like to learn more about how your initiative is financially supported. Please explain your business plan/revenue model

This business plan capitalizes on resources we have already purchased and deployed in Mozambique to support our health system strengthening program, which can be reallocated when idle. The transportation infrastructure gap is characterized by a sizable barrier to entry, as reliable trucks are expensive in this capital-poor country. We are left with a supply vacuum and minimal competition. We supply a transportation service in the form of one-ton trucks, with drivers and fuel included to customers. We are open to various contracting options with customers based on their needs and our availability.

The Story
What was the defining moment that led you to this innovation?

Effective transportation is fundamental to the performance of health and welfare systems in low-income countries. In some countries, as much as 80% of the population lives in rural communities –disconnected from transportation networks that support commercial and public services. Improving transportation services for last mile health systems addresses critical gaps in health-care access for remote communities.
In December 2009, VillageReach was given a mandate by the Mozambique Ministry of Health (MISAU) to expand nationally the model it first pioneered in the north part of the country in 2001. The need for transport support was significant at a national scale. VillageReach was faced with the choice of purchasing trucks to give directly to the ministry of health (at a significant cost) or waiting for the ministry to attain funds for the truck purchases (which might result in significant delays). Instead a hybrid approach was adopted: VillageReach would purchase the trucks, maintain ownership and service quality management (supervising its drivers), and be able to sell excess capacity of the trucks – averaging two weeks per month - on the open market. In assessing the demand for transport services in Mozambique, NGOs were immediately identified as a compelling customer base. Many NGOs require transportation services support for their community and agriculture development programs, and operate on routes connecting urban and rural routes, as VillageReach does. Because if its social mission, VillageReach was most interested in aligning its for-profit transport activity with like-minded organizations that can create the maximum social impact from the business transaction.

Tell us about the person—the social innovator—behind this idea.

This idea was developed collaboratively between Allen Wilcox, President, Craig Nakagawa, Director of Social Business, and John Beale, Director of Strategic Development. Their bio's can be found here (http://villagereach.org/about-us/our-team/).

How did you first hear about Changemakers?

Through another organization or company

If through another source, please provide the information