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Seeing Sanitation as an Opportunity

BY JACK SIM Founder of World Toilet Organization SCHWAB FOUNDATION SOCIAL ENTREPRENUER The views expressed in this paper/presentation are the views of the author and do not & ASHOKA GLOBAL FELLOW
necessarily reflect the views or policies of the Asian Development Bank (ADB), or its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequence of their use. Terminology used may not necessarily be consistent with ADB official terms.

What We Know
Most Domestic Sanitation is funded privately by informal sector External funding for latrine hardware has made little impression & donations cannot solve 2.5 billion needs Toilets Provision does not equal Toilet Usage, Hygiene and Public Health improvement

Open defecation continues while we count toilets


Opportunity in a Financial Crisis

Market shrinkage at Top of Pyramid Over-capacities widespread Massive and growing unemployment Businesses desperately looking for new customers Base of Pyramid has 4 billion new customers Low Cost, High Volume

2.5 billion toilet-less people 500 million toilets A massive market opportunity

How big is the market?

500 million household toilets
2.5 billion people PER UNIT COST: Promotion, design, testing, manufacture, distribution, transport, etc: Multiplier Effect of each channel

Add Market for public toilets

- Schools - Religious buildings - Markets - Transport - Recreation

Add Market for services

- Installation
- Operation - Maintenance

Joe the Plumber

Add Market for consumables

- Soap - Slippers - Equipments - Toilet paper - Etc

Add Market for nutrients recycled

- Fertilizer - Soil conditioner - Biogas

Add Market for Innovative Financial products

-Big Banks -Micro-finance -Donors -Government

Add Market for Toilet Upgrades

Add Disaster Markets


Add Military Markets


Economic Benefits
Return on $1 invested = $9
Hutton, Haller & Bartram, WHO 2007

Potential $1 trillion

global BOP sanitation industry

How do we tap this market?

When China , India, Russian markets

opens up, they were BOP markets Chinas multi-billions New Socialist Countryside Program 30,000 New Grads as Rural Teachers Rubanization: Reducing Slums in cities by building multiple small ( 1km diameter) Ruban Centers in farmlands. Centers of Excellence growing, eg Stanford, Singapores LKYSPP, Skoll in Oxford, Sussex, Wharton, UNC, etc

Transform The Donor Model

The Poor is not helpless, and incapable. No cut & paste approach Top-down donor-decided programs approach not working There is not enough donors anyway.

Customers Centered Model

Customer involvement is critical for long term sustainability Subsidize market development instead of hardware costs Develop rural markets for sanitation services empowering local entrepreneurs Facilitate linkages between demand and supply

People at BOP are:

- Intelligent - Discerning - Able to choose - Quality/brand

conscious - Prudent with

- their money - Clients with

differing needs - Entrepreneurial

Aspiration Marketing
Object of Desire & Status Symbol

Driving Demand Through Community Led Total Sanitation

Cost-Effectiveness IDE Vietnam

2002-2006: 200% increase in sanitation access

Every $1 spent in promo & marketing leveraged $3.6 Market Value of Latrines Built without subsidy
Source: Frias & Mukherjee 2005

Building Supply Chain + CLTS Bangladesh

On track for MDG: 10,000 private rural workshops, national CLTS program

Success Models in NonDomestic Public Toilets

Indias Sulabh International Pay Toilets: Cross-Subsidizing Locations Kenyas Iko-Toilets Toilet Mall: Cross-Subsidy from other services income

From silos
Global Organizations Policy makers Government Local government Community Leaders Technology & Research Financing Community Supply Chain Members End Users

Weave a market network

Develop new products at right price

Most of our toilet models are far too expensive for BoP
Source: Heirli & Frias

Appropriate Technologies Exist

EAWAG Compendium of Sanitation

Systems and Technologies WEDC Courses & Publications UNESCO-IHE Sustainable Sanitation Alliance Stockholm Environment Institute Gtz University of Life Science, Norway More


Bringing in Big Businesses

Sintex: already actively developing sanitation options for BOP marketplace Cost reduced using prefab plastic Bio-gas

4,000 Low Cost Distributors in Bangladesh

Scaling Benefits
Lower unit costs- economies of scale Lower transaction costs Scale up existing work Create new jobs & micro-enterprises Fill gaps, facilitate financing Link supply to demand Inspire innovation

Make sanitation: Goal - Easier - Faster - Cheaper - Better - Sexier - Trendy - Like Google, Ikea, Apple, Youth-oriented, Ipot, Ipee, etc

Star Government Policy

Support & CLTS Campaigns

with Leadership & Funding Partner with Private Sector, Facilitate Entrepreneurship Lend Legitimacy Leadership Reward community after successful implementation Regulate disposal & reuse Set up enabling conditions for investments in Sanitation

PPP Investment Returns

Consumer Demand key to success Government Economic Rate of Return can complement Private Sectors Internal Rate of Return Let Private Portion of funding earn returns even if the whole project appears unviable Cost of Inaction is higher than Investment


Health as an Economic Driver


WTOs Leverage Model

Strategy: Collaborate Synergize Deliver

-Delivering Sanitation through

bridging transactions

19 November World Toilet Day as Official UN Day

- Need to keep momentum of IYS - WTD already celebrated world-wide - Leverage on Officialdom & Legitimacy - 170 countries signatories needed - Submission in preparation now for

approval at the UN General Assembly 2010

Create global BOP market infrastructure

New markets New vocabulary New products New mindset

- Start imperfect &

improvise as matters become clearer

Theres No Downside.
jacksim@ worldtoilet.org