* Any views expressed in this opinion piece are those of the author and not of Thomson Reuters Foundation.
John Sauer is assistant director, thought leadership, Water for People. The opinions expressed are his own.
It’s often said that the solutions exist today to solve the challenges of the lack of access to water and sanitation.
After visiting Water For People’s Sanitation as a Business programs in Uganda, Rwanda and Malawi over the past three weeks I think it’s time to partially challenge that message.
One of the reasons is that local businesses – throughout the World -- have not entered this market.
Successfully addressing this challenge will require bringing products and services such as latrine construction and pit emptying to mass customer markets.
This is not something government and nonprofit organisations are traditionally good at because they measure success by the number of beneficiaries they reach and not by the amount of money they earn.
This means there is no incentive or vision to reach market penetration, because the number of beneficiaries is pre-set.
This is a problem because resources get spent on specific outputs, like a latrine slab, that may or may not be used by a household, instead of a supporting market development that generate and respond to demand by the customer.
Businesses have been slow to enter this market for a number of reasons. One of these is that the market is distorted by government and NGOs giving away goods like toilets. This should stop.
If there is a reason for subsidizing it should be a smart subsidy; like a rebate. Another reason business is hesitant is that there are still innovations and support needed to lower the entry costs for businesses to start water and sanitation businesses.
This could be as simple as a cheaper, more practical toilet design.
This is a niche that nonprofits and governments should explore more widely. To lure business into this market it’s necessary to carry out research and development and help (behind the scenes) with market and business development support.
Non-profit resources spent on these actives as opposed to direct project implementation arguably have a better chance of resulting in sustainable systems that could stand on their own.
Such an approach is a departure from the status quo of nonprofits controlling the relationship with the beneficiaries, but necessary to reach scale.
Steve Sugden, Water For People's senior program manager of sanitation, is pioneering this market development model for sanitation. An example is how he is trying to adapt a piki-piki (motorcycle pickup) in Uganda to be able to haul 200 liter drums of sludge. The market opportunity is there.
Over 400,000 households in Kampala, Uganda, require pit emptying services.
The challenge is that vehicles, especially cesspool tanker trucks, are very expensive. A pickup truck is about $20,000. Another challenge is that many of these trucks are too large to reach near the latrines.
The promising practice: a motorcycle pickup or piki-piki adapted to be able to lift the heavy 200 liter drums of sludge off the ground without tipping.
Piki-piki’s cost about $2,000 in Uganda. A much lower cost for a business interested in penetrating this market.
What Steve has done is identify that businesses are interested in this market but couldn’t afford the larger trucks. The price was a barrier for them to enter the market.
Another barrier was that the piki-piki was not adapted to pick the heavy containers of sludge off the ground.
So he’s working with the Vocational Training School in Nakawa, Uganda, to design and retrofit a piki-piki with a platform capable of lifting the 200-litre (53-gallon) drums of sludge from the ground.
When completed they will have business development services test this out with existing businesses to see if there is a demand to purchase this product with the retrofit.
The adapted piki-piki could be an innovation that helps businesses enter the sanitation market and make money addressing unmet sanitation services.
A couple of other ideas being tested by Steve to lower the transaction costs of businesses entering the sanitation marketplace include creating more desirable latrine designs and do-it-yourself interlocking brick models.
Advances in technology alone will not solve the water and sanitation challenge, but innovation—of all shapes and sizes—has the power to bring needed new actors, like local businesses, into the picture.
