Doing business with the Base of the Pyramid (BoP) isn’t exactly “business as usual”. From the start-up to the scale-up phases companies doing business with the poor come with their own set of challenges.
How to overcome challenges for scaling-up and replicating commercially viable inclusive business modelswas the focus of the first G20 Inclusive Business Workshop. The workshop featured the winners of the G20 Challenge for Inclusive Business Innovation: 15 outstanding businesses that offer innovative, scalable and financially sustainable ways of working with people at the BoP. These successful businesses present proven inclusive business models that have already created sizeable development results in various sectors including agriculture, affordable housing, health, education, water utilities, supply chain finance and retail.
After the winners had been announced at the G20 Leaders Summit in Mexico in June 2012, the workshop was the first in a series where the winners came together to discuss the challenges of expanding their businesses and replicating them in new markets.
The workshop convened around 100 participants and represented a unique multi-stakeholder forum where the winners of the G20 Challenge met with executives of leading inclusive and other international businesses, representatives of development agencies and governments, investors as well as other experts in the field of inclusive business. The objective of the workshop was to foster the spread of inclusive businesses through showcasing successful examples, developing solutions to their growth challenges, and encouraging new business relationships.
The workshop topics were based on the results of preparatory interviews during which the G20 Challenge Winners were asked to identify their most pressing challenges in the scaling-up and replication phase. Access to finance for the businesses and providing finance to the people living at the BoP emerged as the biggest hurdles. This observation is in line with the fact that 36% of the 167 firms surveyed during the G20 Challenge award process also named access to finance along the value chain as the biggest obstacle, according to the International Finance Corporation’s “Policy Note on the Business Environment for Inclusive Business Mod…(2012).
In addition, fostering value chain development and innovation in BoP markets were also recognised as pressing challenges. G20 Challenge Winners further identified lack of physical and information infrastructures as well as low levels of education and skills of supplier, distributor, and retailer networks and customers as crucial obstacles, next to specific regulatory hurdleswhich complicate scaling-up and replication on the national and international level.
The first G20 Challenge Workshop provided a platform to discuss these specific challenges and to develop strategies to overcome them in highly productive working groups. The results of the discussions will also serve as key recommendations for the G20 High-Level Development Working Group on the work of the Private Investment and Job Creation Pillar.
The workshop series is organised by Germany and Saudi Arabia, in their role as co-facilitators of the G20 Pillar “Private Investment and Job Creation”, with generous additional support from the United Arab Emirates and in cooperation with the Siemens Stiftung (Foundation). Following the workshop in Berlin, additional regional workshops will follow in Africa, Asia and Latin America between December 2012 and mid-2013.
For more information on the G20 Inclusive Business Workshop Series visit: http://www.g20challenge.com/about-the-workshops/
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