Home Fortification of Foods: a Sustainble Business Model?
As part of the Business Innovation Facility's work looking at opportunities for inclusive business approaches in nutrition, we have developed a report that explores the regulatory and political environment for commercial home fortification products in Bangladesh in more detail, and will be useful for those interested in exploring this approach. The report can be found at: http://bit.ly/WuYz7q
To date, the sheer size of the global malnutrition problem remains staggering - nearly 50 per cent of the world's infants and young children suffer from anaemia alone caused by a lack of the right nutrients. The direct effects that this and other nutrition deficiencies can have on a child's health and growth can be extreme. And beyond that, a simple lack of the all the needed micronutrients can affect a child's ability to learn in school, undertake work as an adult effectively and fight off disease throughout their life. It is not surprising therefore that both treatment and prevention of child malnutrition is high on the agenda of Governments, NGOs and companies alike.
International guidelines agree that exclusive breast feeding for six months and continued breast feeding with adequate and increasing complementary feeding over the first two years are crucial for healthy child development. Effective complementary feeding, however, remains a major challenge, particularly for mothers on very low incomes who can lack both access to information on what constitutes a balanced diet for their growing child and also the means with which to buy protein and nutrient rich products including meats and fish which tend to be expensive. Often times, children will eat largely carbohydrate rich grain-based meals, which will fill them up, but not provide the balanced diet needed.
Added to this, even with access to food and information, it is very difficult to get the complementary feeding diet right and pack enough nutrients into a child's meal, given the size of their stomachs. In this regard, under-nutrition and micronutrient deficiency are not just restricted to developing countries, though the impacts are seen there most acutely.
A range of aid, development and commercial initiatives have seen some significant successes in addressing various micronutrient deficiencies, whether through individual vitamin or mineral supplementation schemes, fortification of rice or grain crops or whole fortified foods.
One potentially promising approach that NGOs and companies are starting to investigate across more and more countries where malnutrition is still a major problem, however, is home fortification. Examples of these products include micronutrient powders ('Sprinkles') and nutrient-dense pastes or spreads - both of which are added to locally produced meals just before they are served.
These products have the advantage that they are convenient, being added to the food that a mother is already preparing for the rest of her family, they are easy to use and they can be easily adapted to suit local tastes and local raw materials. They can potentially also be used to support local supply chains and champion breast feeding and local complementary feeding given that they require locally cooked or prepared meals to be effective.
As an inclusive business opportunity, such products offer a very interesting opportunity - the potential size of the market makes it possible to sell the product at a price point which makes it accessible to those who are at greater risk of malnutrition and will benefit most from the product, whilst maintaining a commercially sustainable, profit-making business. That is not to say the business case is not easy to get right, however, given the low margins and relative newness of this type of product in the market. This is a prime example of why donor funding in addition to NGO support can be useful in acting as a catalyst for socially beneficially commercial initiatives which may not yield a return on investment immediately.
There are still major hurdles to address with home fortification products beyond the business case, however. One aspect of this is that the technology is moving far more quickly than the international regulatory or governance bodies, and products are being developed which do not easily fit with existing local or international standards and safety guidelines. This can lead to confusion or distrust at a local level over what the product really is and how it should be used and some stakeholders argue that countries have erred on the side of over regulating or over restricting the products.
The key major challenge in any commercial organisation working around this type of product, however, is that child nutrition is an incredibly politically sensitive environment. Previous (and in some cases on-going) aggressive marketing of baby foods and infants formulas in violation of international codes, as well as high price imported food products aimed at children have led to a distrust of the private sector working in any capacity in this area. This has in some cases led to an environment that risks deterring genuinely responsible companies from exploring initiatives which can have tangible and sustainable health benefits for consumers, particularly those in developing countries.
There is certainly a need for on-going debate around this area - getting the right balance of micronutrients in supplementary products, educating people on using them correctly and ensuring that they don't undermine or replace local food sources or breast feeding are of key importance. It is encouraging to see that organisations from all sides are piloting projects and undertaking clinical trials to understand and evaluate how home fortification could really benefit mothers and children. It is key that the private sector should be engaged at this stage. To leave them out of the debate risks missing a major opportunity to help reduce malnutrition and micronutrient deficiency for the children of this generation.
This blog is part of an Inclusive Business Insights Series, brought to you in partnership with the Business Innovation Facility and Innovations Against Poverty.
Working closely with companies at the ‘coal-face’ of inclusive business, the Business Innovation Facility and Innovations Against Poverty aim to share lessons learned and insights gained from over 100 projects across the developing world. Each month, this blog series will feature selected articles written by members of the team working on the ground, to highlight the challenges and opportunities of implementing inclusive business and to spark fresh thinking and innovative approaches to leveraging business for development.