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PlaceWhere does MicroConsignment work best?
Where does MicroConsignment work best?
Mutual goals:
In order for the strategic partner and/or executing organization to be successful, the entrepreneur and the consigning organization must have complementary missions and priorities. In particular, the entrepreneur should share the consigning organization’s commitment to providing affordable and quality products and services to individuals living at the base of the economic pyramid, as well as the belief in market-based solutions to reduce poverty. In short, success will be determined by the desire and ability of the two parties to work together. Both organizations must have open lines of communication to take advantage of opportunities and to solve problems. A high level of professionalism and a strong sense of teamwork are indispensable.
Lack of access to quality resources (i.e. weak competition):
A MicroConsignment initiative will only achieve the desired success if the potential strategic partner and/or executing organization “needs” the program. There must be an objective financial and strategic need for the program, and this need must not only be intellectually understood, but also “felt” by management and field personnel. MicroConsignment exists to serve underserved markets as a “first mover” of resources. As a development organization, CE Solutions is not desirous of entering already competitive markets. In order for the program to work, there must presently be very limited access to targeted resources and a dearth of current and projected short-term competition for needed products and services.
Compelling target market size and demographics:
The target market within the reach of the potential strategic partner and/or executing organization and must be sufficiently large so as to create a long-term business opportunity. Furthermore, the quality of the demographics, specifically economic factors, community dispersion, and population density should be similar to regions where consignment organizations have proven successful.
Availability of referral services:
As the tertiary goal of MicroConsignment is to provide access to tools and services that cannot be addressed in the field, it is important that low-cost services exist within a reasonable distance from rural constituents and that referral mechanisms may be created and implemented.Compelling pricing options:
The MicroConsignment Model has established its pricing objectives to provide high-quality services and products to rural low–income consumers at an economical price that enables entrepreneurs and organizations to earn a compelling income. As such, the MCM is neither committed to being the lowest cost option nor is it interested in a luxury-pricing model, but rather it is desirous of establishing a balance between quantity sales, per unit income generation and quality service. It is critical that consumers have the ability to purchase products at a price at which the strategic partner and/or executing organization has the ability to collect a profitable income. At the same time, the price must provide value to the consumer. In each area where MicroConsignment is successful, it creates a consumer surplus by providing affordable and accessible products.
Logistical considerations:
A consigner relies upon the existence of or the ability to create an efficient logistical structure that can import products, train entrepreneurs, advertise to consumers, and deliver resources (products, services and funds) effectively. For example, it is of utmost importance that there exist adequate transportation options for both entrepreneurs and clients to travel. Ideally, the potential strategic partner and/or executing organization should have already established a means to achieve logistical success that is appropriate to reach the target consumer and a replicable model to grow intelligently without the burden of a high cost structure.
Secure environment:
As individuals, particularly women, will be traveling with inventory and cash, it is important that security not be an overriding concern or endemic problem.
Receptive culture:
The culture of the target market should not be discriminatory toward women. Rural leaders and constituents should be receptive to young, specifically trained entrepreneurs offering unique products and services in multiple communities. As well, in a general sense, the region should be past the “relief” stage of development and not dependent on donations and should be receptive to market-based solutions for basic problems.