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Chan-Lazardo, Edward. KickStart Questionnaire. 19 Dec. 2005.
Copson, Raymond W., 2004. AIDS in Africa. CRS Issue Brief for Congress, May 28, 2004.
EIU. “Country Report Uganda”. Economist Intelligence Unit Limited. 2006.
Fairbourne, Jason. “BYU MicroFranchise Development Initiative (BYU- MFDI).” MicroFranchise

Learning Lab. Washington, DC. 6 January 2006.


FINCA website. www.villagebanking.org.
Gibson, Steven W. and Jason Fairbourne. Where There Are No Jobs: The MicroFranchise

Handbook. Volume 4 MicroFranchise Case Studies. Provo: The Academy for Creating

Enterprise, 2005.
GF USA, “Grameen Technology Center.” Accessed on 19 Feb. 2006.
GF USA, “Grameen Technology Center-Village Phone.” Accessed on 19 Feb. 2006


“Global Employment Trends for Youth, 2004.” International Labor Organization. 12 Aug 2004.
Gordon, Raymond G., Ethnologue: Languages of the World, Fifteenth edition. Dallas, Tex.: SIL

International. 2005


Hatch, John. “Brief Primer on FINCA.” 21 Jul 2004. Internal document.
Hatch, John. “Practitioner Presentation: FINCA International.” MicroFranchise Learning Lab.

Washington, DC. 6 January 2006.


Hatch, John. “Slogging Toward a Poverty-Free World: The Need for Microfinance-MicroFranchise

Partnership.” January 2006. Internal document.


Holland, Rob. “Planning against a business failure.” Agricultural Development Center. October

1998.


Honey Care Africa “About Us” Accessed on 19 Feb. 2005.
Honey Care Africa “How we Work.” Accessed on 19 Feb 2005.
Honey Care Africa “Mission.” Accessed 19 Feb. 2006.
Honey Care Africa “Site Evaluation.” Accessed 19 Feb. 2006.
Institute for Security Studies. “Uganda”. Accessed February 17, 2006.

.
Kasi, Fabian. “Gender Targeting of Rural Financial Services: Is this Appropriate? Case Study of

FINCA Uganda.” Paper presented at Paving the Way Forward for Rural Finance, An International Conference on Best Practices. 2003


Keogh, Matt and Tim Wood. “Village Phone Replication Manual: Creating Sustainable Access to Affordable Telecommunications for the Rural Poor.” Seattle: Grameen Technology Center, 2005
KickStart “About Us.” Accessed on 19 Feb. 2006
KickStart “Building Technologies.” Accessed on 18 Nov. 2005.
KickStart “Oil Technologies.” Accessed on 18 Nov. 2005.
KickStart “Our Approach.” Accessed on 19 Feb. 2006.
KickStart “Technologies.” Accessed on 19 Feb. 2006.
Kirubi, Charles. “Fighting Poverty with Micro-Finance: Experience from Uganda.” Berkeley, CA: University of Berkeley, 2005.3.
Kumar, Vipul. Questionnaire. 14 Dec. 2005.
Lund, Francie and Caroline Skinner. “The Investment Climate for the Informal Economy: A Case

of Durban, South Africa.” 15 Sept 2003.


Macbeth, James. “Professionalism and Positioning”. Accessed February 22, 2006.


Magleby, Kirk. “MicroFranchising as a Solution to Global Poverty.” Omidyar Network. September,

2005. 19. Accessed on 2 November 2005.




Ministry of Finance, Planning and Economic Development, Republic of Uganda. Poverty

Eradication Action Plan (2004/5 – 2007/8). 2004.


O’ Higgins, Niall. “Trends in the Youth Labour Market in Developing and Transition Countries.”

World Bank. Oct 2003.


Pech, R. J. & Mathew, A. ”Critical factors for consulting to small business”, Journal of Management

Consulting, Vol. 7, Iss. 3, 1993. p 61-63


“Uganda Summary.” FINCA International. 2004. Internal Document.
Ugandan Bureau Of Statistics. “Labor Force Survey”. Accessed February 22, 2006.


UN-HABITAT. “Human Settlements Conditions and Trends. Country Profile: Uganda.” . Accessed

February 22, 2006.


U. S. Department of State. 2006. Background Note: Kenya. Accessed February 22, 2006.


The World Bank Group. 2005. “Country Brief: Uganda”. Accessed February 15, 2006.

http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/UGANDAEXTN/0,,menuPK:374947~pagePK:141132~piPK:141107~theSitePK:374864,00.html


APPENDICES

APPENDIX 1 – MICROFRANCHISE PARTNERS
APPENDIX 1.1 – TABLE OF MICROFRANCHISE PARTNERS WORLDWIDE
Potential MFO Partners

This listing includes all known MFOs in Africa and Latin America. MFOs were selected from this list for further analysis if they had a start-up cost of less than $600 and were close in proximity to FINCA offices.




Name

Location

Expansion

Start-up costs

KickStart

Kenya, Tanzania, Mali

People using products:: Uganda, Sudan, Rwanda, Mozambique, Malawi, Zambia, Senegal

Want to expand throughout Africa

Water Pump $75

Block Press $560



Oil Press $420

Honey Care Africa

Kenya, Tanzania

Uganda

$65 per hive

Grameen Village Phone

Uganda, Rwanda,




$100-200 per kit

Scojo Foundation

El Salvador, Guatemala

Honduras, Mexico, Nicaragua

$130

Micro-Sun-Bakery Program

Honduras




$25,000

Holcim, Cessa

El Salvador




$1,000

Shell breathing cooking Stove

Guatemala




$1,000

Amanco (Grupo Nueva)

Chile, Guatemala




$5,000

E-Bridge International, Ltd.

Mexico




N/A

Casa por Casa

Mexico




$3,000 min

Paleteria La Michoacana

Mexico




$2,000 min

Holanda (Unilever de México, S.A. de C.V. )

Mexico




$5,000

Hawaiian Paradise

Mexico




$5,000

Patrimonio Hoy

Mexico




Commission

Ingles Individual

Mexico




$4,000

Farmacias Similares

Mexico




$4,000

Sleep Centers

Mexico




$10,000 min

Afribike

South Africa




$15,000

Coca-Cola Entrepreneur Development Program

South Africa




$700

Collect-A-Can

South Africa




N/A

Vodacom Phone Kiosk

South Africa




$3,700 -7,400

Play Pumps

South Africa




$5,000-10,000

SC Johnson

Kenya




$55

Sustainable Healthcare Enterprise Foundation

Kenya




$1,200

Coconut Oil Production

Kenya




$1,000

Procter & Gamble PuR Water Purification

World Wide




N/A

APPENDIX 1.2 – BACKGROUND INFORMATION ON MTN VILLAGE PHONE (THE GRAMEEN VILLAGE PHONE PROGRAM)
Mission

The Grameen Technology Center (“GTC”) is an initiative of the Grameen Foundation USA (GF USA), a global non-profit organization that combines microfinance, new technologies, and innovation to empower the world's poorest people to escape poverty. GTC is working to eliminate poverty by leveraging the power of microcredit and technology. It focuses on technology that:



  • makes the delivery of microfinance even more efficient;

  • enhances income generating opportunities for the rural poor; and

  • provides poor communities access to information for better health and education3

GTC, in partnership with MTN Uganda, replicated the Grameen Village Phone (GVP) Program in Uganda and created MTN villagePhone. The program provides cellular phones via a sustainable financing mechanism to poor entrepreneurs who use the phones to operate a business in rural villages where no telecommunication services have previously existed.4
Organization

The GVP model is designed to circumvent the constraints to providing telecommunications service via more traditional mechanisms that are commonly found in rural areas. The model significantly increases the affordability of making and receiving calls while providing incentives and revenue opportunities designed to entice each partner to participate. Four partners are required to deliver the service to rural villages.

Perhaps the most important precondition to ensuring the program’s feasibility is enlisting a willing telecommunications provider. This company will provide the necessary communications infrastructure; guarantee and maintain communications coverage to the targeted rural areas; supply airtime that will be sold by the Village Phone Operator (VPO); act as a liaison with government to ensure that all appropriate licenses are completed, regulations followed, and taxes paid; provide customer support to the VPO; source equipment from suppliers; and engage in strategic planning with other partners.5

The second essential participant is a network of microfinance institutions (MFIs) that will act as a “channel to market” for the service, facilitating service delivery to difficult-to-reach users that lacked previous access.6 The MFIs identify and train VPOs; distribute equipment, marketing materials, and prepaid airtime to VPOs; provide financing to VPOs; provide on-site customer support when phones are inoperable; and monitor use of phones and phone cards. Grameen uses MFIs as a distribution channel because they have an existing network that maintains direct contact with poor villagers. This network can be used to identify potential VPOs, provide them with a source of credit, and market Village Phones to an MFI’s entire client base.

The third partner, the Village Phone Company (VPC), acts as the catalyst necessary to initiate the program. It establishes relationships with the other partners to bring the product to rural customers; negotiates airtime rates with the Telecom Provider; trains MFI staff in program implementation; oversees program expansion; oversees financial management to ensure that the program is meeting targets, maximizing efficiency, and moving toward sustainability; conducts program evaluations; and consolidates and disseminates knowledge gained as the program evolves.7 In the case of Uganda, the VPC, though legally and operationally independent, comprises an equal partnership between GF USA and MTN Uganda, the Telecom Provider.8 GF USA encourages other ownership models, including an ownership structure that includes VPOs, as long as the company can successfully serve the operation’s mission.

The final partner is the legion of VPOs who operate the phones and sell airtime. These are the people whom the program is designed to impact most directly, and through whom communities at large will be reached. The VPO purchases the startup kit from the MFI at a cost of approximately US$200 to $250. The VPO undergoes the training provided by the MFI and operates his or her own GVP business, which includes equipment maintenance, management of user billing and payment collection, and direct marketing to existing and potential customers.

Each partner must operate synergistically with one another in order to ensure systemic survival. Any breakdowns occurring among the partners can critically upset the balance of the system. However, if the system works as designed, then all parties stand to benefit. The Telecom Provider earns revenue in a previously untapped market and a return on existing infrastructure investments.9 It extends its brand recognition to a new class of customers who may at some point “graduate” to personal phone ownership. Public relations efforts around the program should also boost the company image, increase market exposure, and fulfill its social responsibility mandate. The VPC earns enough revenue to promote, expand, and sustain the program. MFIs receive a new product to market to customers while earning revenue from the sale of airtime and from interest on loans to VPOs. The VPO earns money to repay the loan and purchase additional airtime, a steady income that generates immediate liquidity, and the potential to create or improve the productivity of adjunct businesses, especially among VPOs who sell retail goods.10

INTERACTIONS AMONG GRAMEEN VILLAGE

PHONE CONSTITUENTS (Uganda Partners)

Phone User





Make & Receive

Village Phone Operator


Calls




Credit

Agreement



Training

Microfinance Institution


Support Support conduit


Service through to

Equipment Telecommunications


‘Other’ Equipment
Supply Company


Solar Equip,

Service &

Support Monitoring &

Telecommunications Company


Evaluation




Coverage Infrastructure &

Mobile Phones Coverage Support/Requests

Service & & Responses


Cell Phone Wholesaler
Support


Admin. Support

Services (HR, Strategic/

Licensing & Finance, Operational

Regulation Reporting, etc.) Planning

Village Phone Company

Financial &

Taxation Technical

Support

National Government



Source: Keogh, Wood 33
Impact

Although GF USA has carefully defined the framework and criteria for measuring impact, it has not yet conducted an impact assessment in Uganda (It plans to do so in early 2006). The only known assessment conducted is a small quantitative and qualitative field study by Charles Kirubi, a Berkeley PhD candidate, on twelve VPOs operating within FINCA Uganda’s MFI network in the Eastern Region Branch of Jinja. Kirubi concluded that operating the Village Phone is a loss-making business for the duration of the loan repayment cycle, becoming profitable only once the loan is repaid.11 Respondents cited the benefit of the immediate cash flow generated by the product in supporting other business operations as the primary value of GVP.12 Kirubi also noted that profitability increased with distance from urban areas because competition diminished and the distances traveled to reach a VPO created additional service opportunities.13 His comparison of daily per capita expenditure by VPOs as compared with other FINCA clients suggested that GVP can provide a measurable expenditure boost to very poor clients when operated in conjunction with other businesses.14 This conclusion supports GF USA’s recommendation that VPOs operate established businesses prior to becoming VPOs. However, the study’s small sample size and absence of baseline information or a control group limits the conclusions that can be drawn from it.


Expansion
According to GF USA, following the initial success of the Uganda Project, the Grameen Technology Center is now shifting its primary efforts to launching a replication project in Rwanda. A pilot program is currently underway in collaboration with MTN Rwandacell and three leading Rwandan microfinance institutions, creating fifty new phone businesses in rural villages.15

APPENDIX 1.3 – BACKGROUND INFORMATION ON HONEY CARE AFRICA
Mission

Honey Care Africa (“Honey Care”) is a Kenyan social enterprise, which was established to increase the income of rural farmers. Honey Care trains individuals in commercial beekeeping and then buys their honey at guaranteed, fair prices. It then packages and sells the high quality African honey. The overall objective of the company is to produce and market high quality honey that will successfully compete on the world market.16


Organization

Honey Care currently has offices in Kenya and Tanzania and a total of 53 employees (45 in Kenya and 8 in Tanzania).17 In addition to selling hives and other related beekeeping equipment, Honey Care provides basic training in beekeeping using the Langstroth Hives and assists communities and individuals in developing better organization and management skills, basic record-keeping and farm economics.


Tripartite Model

Honey Care’s operations are primarily developed on a “Tripartite Model-a synergistic partnership between Honey Care (private sector organization), development sector organizations (NGOs and donor agencies), and rural communities.18


19
Honey Care’s network of community-based organization and self-help groups, with which it has developed working relationships, has reduced its need to employ a large number of field staff and has allowed it to expand rapidly across Kenya.20
The Tripartite model arose from its recognition of the need for a more pro-active engagement of the private sector in Kenya’s development. Honey Care recognized that the set of knowledge and skills of the private sector was nicely complemented by the skill set of development sector organizations. Because of their different virtues, Honey Care believes that each party has a specific and complementary role to play.21
The private sector organization injects a degree of economic reality into the project and ensures that the project operates within realistic market conditions at all times and is sensitive to supply-demand dynamics.” 22
Honey Care guarantees to purchase all the honey a beekeeper can produce, at a fair and fixed price, and to pay on the day of collection. Honey Care then processes and packs this honey and sells it for a profit. It also provides the necessary and requisite training for the rural communities. In addition, wherever economically viable, Honey Care also provides extension support for the farmers, and where it is not viable, alternative structures and models are developed and established to ensure that the farmers have the required technical advisory support that they need to take care of their hives and maximize honey production.23
The development sector organization (NGO, donor agency, or international development organization) should have the experience in working with rural communities and should have an extensive outreach into the rural areas thereby making them the ideal conduit through which individuals in community groups and the private sector organization can communicate with each other initially.” 24
The development sector organization may also play an important role as arbitrator and mediator in the system; thereby helping to resolve any misunderstandings between Honey Care and the rural communities or any complaint for either of the parties. In some instances, the development sector organization also may act as the initial financier of the project, providing loans to individuals who want to buy beehives, beekeeping equipment, and receive training. The loans are then recoverable at the time when the honey is ready for sale to Honey Care, who makes agreed upon deductions from the honey as loan repayment for the hives and makes the agreed upon remittances to the development sector organization.25

The third set of partners comprises the individuals from rural communities who are the honey producers. These individuals are able to start beekeeping businesses through loans to buy beehives and other equipment, adequate training, extension and advisory support, a guaranteed market for their honey at mutually acceptable prices and cash-on-the-spot payments.


Training

Honey Care undertakes the responsibility of training people selected to be beekeepers, to ensure that the hives are properly maintained and to ensure maximum honey production. The training has the following key components26:




  • Basic Introduction to Ecology and the Biology of Bees

  • The Social Organization and Hierarchy of the Colony

  • Importance of Bee Keeping to the Environment

  • Importance of Bee Keeping to the Farmer

  • Bee Keeping Equipment and Tools

  • How Bees Communicate

  • Introduction to the Langstroth Hive

  • Choosing a Site

  • Hive Inspection and Supering the Hive




  • Pre-harvesting and Harvesting of Honey

  • Storage of Honey

  • Bee Products and their Uses

  • Absconding and Swarming of Bees

  • Merging Weak Colonies

  • Feeding Bees

  • Bee Foraging Plants / Crops

  • First Aid

  • Introduction to Apiculture Economics / Record Keeping


Collection

Honey Care does not have any field offices, but rather, project officers are supplied with mobile phones, which they use to communicate with the offices. Honey Care has historically collected honey from mobile extraction units, but is changing their structure to organize communities of beekeepers around community extraction centers. The community extraction centers provide a more reliable location for community member to harvest and additionally builds social capital among farmers.


Impact

According to Honey Care, “bee keeping has proven to be an ideal enterprise for small-scale farmers in many parts of rural Kenya because it complements existing farming systems, it is simple and relatively cheap to start, and it requires a very low level of inputs of land, labor, capital, and knowledge.” 27


With only four bee hives and just 20 minutes of labor every two weeks, a beekeeper can earn a reliable annual income between US$150 and 300, which is an amount that is often enough to make the difference between living above or below the poverty line in Kenya. Furthermore, often times the revenue from beekeeping is supplementary income, as beekeeping still gives small-scale farmers plenty of time to tend to other responsibilities such as farming and other small enterprises that they may operate.
Over the last two and half years, close to 2,200 small-scale farmers have become involved in beekeeping, each with an average of 4 hives, which amounts to an estimated projection of US$400,000 - US$450,000 per year in income that Honey Care will be helping these rural communities earn when all the hives are in full production and the farmers' loans have been paid off.28
Expansion
Site Evaluation

“Prior to commencement of any beekeeping project, Honey Care conducts a preliminary site evaluation of the proposed project site to assess the viability of financing each venture. Particular attention is paid to the geographical, climatic and agro-ecological conditions of the proposed areas, as well as other logistical considerations and local conditions. Suitable sites for placing the hives are also selected once it has been verified that the initiative will be viable in that particular area. These assessments primarily focus on whether the proposed area will be suitable for beekeeping using Langstroth hives, and whether the project will be economically, environmentally and socially sustainable in the long term. Honey Care Africa then issues its recommendations to the financier or development partner based on its findings and propose whether the project will be adopted or not.”29


Honey Care is currently working to expand their input sourcing to other countries in the region, including Uganda and Sudan. Moreover, international sales are also increasing beyond East Africa. The first exportations to Europe and the United States just began in 2006.
Products

Honey Care conducts research on developing better beekeeping technology as well as finding methods to extract other high quality products like pollen, beeswax, propolis, royal jelly, and bee venom. According to Honey Care, these improved methods will eventually be introduced through strategically selected beekeepers and community groups across the country.30


Honey Care has also been exploring other types of agri-based products such as dried fruits. The production of these goods has already begun in certain areas and could be more widespread in the near future31.

APPENDIX 1.4 – BACKGROUND INFORMATION ON KICKSTART
Mission

KickStart is an international non-governmental/non-profit organization founded in Kenya in 1991 by Nick Moon and Martin Fisher. The organization’s mission is to help millions of people out of poverty. It promotes sustainable economic growth and employment creation in Kenya and other countries by developing and promoting technologies that can be used by dynamic entrepreneurs to establish and run profitable small scale enterprises. KickStart believes that “self-motivated private entrepreneurs managing small-scale enterprises are the most effective agents for developing emergent economies.32 However, although these entrepreneurs can raise small amounts of capital (US$100-$1,000) to start a new small enterprise and can manage the day-to-day affairs of such a business, it is difficult for them to identify viable business opportunities, access the technologies required to launch the new enterprises, and widely market new products. Therefore, KickStart is dedicated to providing assistance in these areas. In addition to promoting small enterprise development, KickStart’s technologies, expertise and methods are widely applied throughout Africa to support programs in agriculture, shelter, water, sanitation, health, and relief.33


Organization

KickStart currently has 200 employees and five offices.34 Furthermore, in order to raise funds for the expansion of its operations to other African countries, it opened a new development and collaboration office in San Francisco, where it is established as a 501 (c)(3) non-profit organization.


KickStart has a single board of directors based in Kenya that oversees the entire organization and approves its strategy. The country offices are responsible for marketing the technologies and overseeing the regional offices within the country. The country directors report to the Africa Director, who is based in Kenya. The Africa Director reports to the CEO. The Africa office is in charge of developing the technologies and of testing ideas.
Regional offices have sales representatives who are responsible for overseeing retail outlets and marketing the products. KickStart has contracts with retail outlets stores that sell their products. Sales representatives train retail attendants on how to use the technologies and provide them with information to provide to clients. They also provide demonstrations on how to use the technologies in front of the retail stores. Currently 300 retail stores in Kenya are selling the irrigation pumps, but only a small fraction are selling the Oilseed Press and the Block press. Furthermore, many of these retail stores do not generally stock the two technologies due to their cost. Instead, they keep one or two on hand for demonstration purposes. They take orders and either go to KickStart or contact the manufacturer directly to source the technologies. Most of the retail stores also use KickStart materials to market the technologies. There are also 120 retail outlets in Tanzania, but most only sell irrigation pumps. Individuals who purchase the technologies are able to get assistance through any retail store that sells the technologies.

.
KickStart has a market and private-sector oriented approach to ensure that the impacts of its programs become fully self-sustainable in local economies. It installs locally appropriate technologies in the private sector. These technologies continue to be produced, marketed and used by entrepreneurs to create thousands of vibrant new businesses and jobs, long after KickStart’s interventions have ceased.35


36

Operations

(1) Research Markets

KickStart conducts market research in order to identify high potential small scale business opportunities. Their market and subsector studies identify profitable small enterprises that can be established by local entrepreneurs with limited capital investments. In addition, they specifically examine raw materials, competing products, potential market demands and constraints, and opportunities for small enterprises.37


(2) Design New Technologies

KickStart designs and develops the tools, equipment, manuals and business plans required for establishing the identified small enterprises. In addition, they also design and produce the tooling and quality control procedures required for manufacturing the new equipment.38


(3) Train Manufacturers

KickStart then trains private manufacturers to mass-produce the new machines and tools. They also train them to set-up production and assembly lines using the tooling they designed and training them how to do quality control.39


(4) Promote the Technologies

KickStart markets the new technologies to local small-scale entrepreneurs. It takes responsibility for promoting the new technologies to the private sector, which helps to ensure that these technologies are well known, easily available, and purchased by thousands of small-scale investors. To achieve this goal, KickStart recruits and trains a network of local retail shops (over 120 shops in Kenya alone) in cities, towns, and small market centers around the country. KickStart buys the technologies from the manufacturers and sells them with a mark-up to the retailers.40


Furthermore, KickStart develops and uses cost-effective marketing tools to promote and market the new equipment to local entrepreneurs. These marketing activities include:


  • Live demonstrations at retail shops

  • Radio and newspaper advertisements

  • Mobile truck-mounted demonstration in local villages

  • Demonstrations at local shows and exhibitions

  • Commissioned staff sales

  • Discounts and sales41

Local entrepreneurs simply buy the technologies from the retailers, and then receive training and a manual on how to use them. These entrepreneurs then use the technologies to establish new businesses or improve their current ones.


(5) Monitors its Impact

KickStart also monitors the cost-effectiveness and impacts of its program. It measures the number of new businesses and jobs created, as well as the amount of new profits and new wages earned by the new entrepreneurs and their employees.42 KickStart’s Impact Monitoring and Reporting Unit tracks and records key indicators. The new machines are sold with a one-year guarantee and the guarantee forms are used to track the number of technologies sold and the names and locations of the buyers. The purchasers’ details are recorded in a computerized database and the monitoring staff selects visits a random purchasers to interview.43


KickStart estimates that there are currently over 40,000 businesses that use their technologies in their main business operations and that these businesses are generating net profits of over US$34 million per year.44
Expansion

KickStart is now replicating its unique model in other African countries. The organization’s goal is to expand throughout East Africa and open new programs in southern and western Africa in order to help millions out of poverty. KickStart plans to open an office in Uganda towards the end of 2006. Businesses in over 20 countries are currently using KickStart technologies. Most of these countries are in Africa, such as Kenya, Tanzania, Mali, Uganda, Malawi, and South Africa and in some countries outside of Africa such as the Philippines and Haiti.45 The organization aims to sell 40,000 products annually and create 32,000 new businesses by 2009.46


Technologies

All of KickStart’s technologies are designed to be profitable to use, affordable to buy (under US$1,000), durable and easy to operate and maintain with minimum training. In addition, they are also designed so that they can be locally mass-produced in Africa. Considering that electricity and fuel are generally expensive and that labor is relatively plentiful in developing countries, most of the technologies are specifically designed to be operated manually.47


The technologies developed to date include:


  • Cooking Oil technologies- “Mafuta Mali” Oilseed Press

  • Building Technologies- “Actionpac” The Action Pack Block Press

  • Micro-Irrigation Technologies- “MoneyMaker” Pumps

  • Sanitation Technologies- Domed Concrete Pit latrine Slabs

  • Hay Baling Technologies- High-Pressure hay baler

  • Transport Technologies- Split rim wheels for animal carts



Other New Technologies

KickStart is constantly searching for new profitable small business models for Africa. As KickStart identifies more profitable models, it will develop and promote new technologies. Decisions to invest in creating new technologies is based on market research. The potential for new small business models that have been identified include low-cost well drilling, generation and sale of electricity, or the low-cost provision of communication and business services in small towns.48

The Capstone Team chose to focus only on the viability of starting new microenterprises using the Oilseed Press and the Block Press, because through our preliminary research these technologies appear to have the highest potential for easy and large scale replicability and thus function as potential MicroFranchise opportunities for FINCA clients.
APPENDIX 2 – BACKGROUND ON UGANDA
Uganda - Background

Uganda has had a troubled path since independence and still faces great challenges to development, but also has many reasons to be optimistic for the future. Uganda has been considered by many in politics and development to be one of Africa’s success stories. The country has had an annual real GDP growth rate of 5.8% since 2000 and is expected to grow by over 6% in coming years.49 This has been consistently above the average of sub-Saharan Africa. The World Bank recently commended Uganda’s developmental record noting that there have been significant increases in enrollment rates for primary school, adult and youth literacy and access to safe water in both rural and urban areas.50 More importantly, the country’s quick acknowledgement of the HIV/AIDS problem and thorough prevention campaign, have dropped infection rates by more than half in the last ten years.51


History

Before the arrival of the British in the 19th century, there were four main kingdoms and many tribes in the region that is now Uganda. This tribal history is still very alive in the culture and politics of Uganda today. Buganda, the largest of these kingdoms, is still a distinct region today with its people accounting for 17% of the population.52


Uganda became a British protectorate in 1896, achieved independence in October of 1962, but still faced a long road to stability. Milton Obote became the first Prime Minister of Uganda and by 1967 had implemented a new constitution, abolished traditional kingdoms and make himself leader of a new republic. In 1971, Idi Amin led a coup that overthrew Obote and took on absolute power. Amin’s rule is known for massive human rights violations and a reign of terror that took many lives. He was overthrown in 1979 and soon after replaced by Obote who carried out another murderous reign against his opponents. The current president, Yoweri Museveni, took power in 1986 after brief military control, and has largely ended human rights abuses and instituted economic reforms through his one-party democracy. 53
Relative stability has returned to the country with the exception of the insurgency of the Lord’s Resistance Army (LRA) which has been fighting the Ugandan Army and terrorizing communities in primarily northern regions. In over 19 years of conflict, LRA violence has led to thousands of murders and kidnappings and has displaced up to 1.4 million people. The LRA has been based in southern Sudan, but has recently begun operating in the Democratic Republic of Congo where the military has less advantage.54
A July 2005 national referendum set Uganda on the path to multi-party politics for the first time in 25 years. Elections were peacefully held on February 23, 2006 and have led to a contentious third term for Museveni.
Economy

The Ugandan economy has been growing steadily each year, yet GDP per capita is still at a low $1,700 (purchasing power parity) or $270 at the official exchange rate.55 This economic growth has been fueled by expansion in manufacturing and communications and augmentation of non-traditional exports including horticulture and fish products. Growth has also been hurt by below-average rainfall and disease in banana production.56


The most important sector of the Ugandan economy is agriculture, employing more than 80% of the workforce. A remaining 5% of the workforce is in industry and 13% in services. In spite of this, Uganda’s GDP is 31% agriculture, 22% industry and 47% services. The major food crops are roots, tubers, plantains, pulses, maize, millet, sorghum. Coffee is the country’s biggest export and has greatly helped the country’s finances due to increasing world prices. Traditional agricultural exports of cotton, tea and tobacco have remained slow. The country’s main export partners are Kenya, Rwanda and several EU countries.57
The implementation of economic liberalization policies are seen as a main source of the country’s continued growth. The country has been a model aid donor because of its success in trade openness. However, in recent years multilateral and bilateral donors have become discouraged with Uganda’s high levels of corruption, slow path to multi-party democracy, and overspending on public administration and defense. Many donors have cut aid or redirected aid for only humanitarian assistance purposes. Even AIDS funding has been cut in recent years, although much has been recently restored.58
Even so, the Ugandan government is moving away from loaned financial assistance and improving its international standing. It has recently reached a point of graduating from IMF financing and will now work under a Policy Support Instrument of the Fund which will provide financial advice and monitoring, but no financial support. Uganda has also benefited from debt relief of close to $1.5 billion under the Heavily Indebted Poor Country (HIPC) initiative and Paris Club debt relief.59 Due to this debt relief, debt service as a percentage of exports of goods and services was 47% in 1990 and only 5% in 2003.60
Population and Demographics

Uganda is a diverse country with over 20 different African tribal groups making up most of its 27 million citizens. Bantu groups are nearly two-thirds of the population and live primarily in the south of the country. Nilotic groups populate the north and remain very ethnically divided from the Bantu. Only 16% of the population lives in urban areas.61


The languages spoken and religions followed in Uganda are nearly as diverse as the people. Although English is the official language of the country, most people natively speak one of a variety of Niger-Congo languages including Ganda and Luganda, Nilo-Saharan languages, Swahili or Arabic. In total, there are 43 living languages in Uganda.62 Christians count for 66% of the population, half of which are Roman Catholics and the other half Protestant. Muslims make up 16% while indigenous beliefs are the faith of the final 18%.63
Current health statistics for Uganda are poor due to high HIV/AIDS infection rates and continued instability, but are at least improving. Life expectancy has increased 10% in the last decade, yet is still only 51.6 years. This is largely due to the 1990s 18% rate of AIDS infection dropping to between 6 - 4%. The mark of this disease is still easy to see. Only 2.2% of the population is over 64 years of age and 51% of the population is under 14 years.64 Food security and malnutrition are continuing issues for Ugandans. It is estimated that more than 1 million people are displaced due to food insecurity, war or abduction. The northern areas are most affected by malnutrition and communicable diseases.
Problem of Youth Employment in Uganda

Eighty-five percent of the world’s youth live in developing countries. According to the World Bank, the proportion of young people in the total population is falling in Europe, Latin America and the Caribbean, North America, and Oceania since 1980, and in Asia since 1990. On the other hand, Africa is experiencing the fastest increase in the proportion of youth of the total population.65 Unfortunately, the rapid increase has not been accompanied by more employment opportunities. The ILO reports66 that unemployment world-wide is now estimated at almost 200 million jobless, and that of this amount a disproportionate 47% represents young adults (ages 15-24). According to the ILO, there is an estimated 88 million unemployed youth worldwide. Today, youth in developing countries are 3.8 times more likely to be unemployed when compared to older workers. In East Africa, youth unemployment is 7 percent. Moreover, many youth are working in the informal economy and may not earn enough to live. Thus, underemployment is also a big problem.


Employment statistics reported by the Ugandan government and presented to the World Bank emphasize underemployment levels in Uganda, instead of unemployment rates. In their Poverty Reduction Strategy Plan, the Ugandan government states that in their country open unemployment is “relatively rare and is found mainly in urban areas, particularly among the most highly educated and amongst women”. Alternatively, underemployment is described as widespread because people are forced to earn a living in some way, but “would like to augment their current incomes with some extra wage-earning opportunities in their locality”. Underemployment affects 65% of all Ugandan adults, 75% of women and 55% of men. To reduce poverty and increase economic opportunities, the government states that a main goal is to create “an increase in locally targeted employment opportunities”.67
Youth have the worst statistics in the country. The Ugandan Bureau of Statistics (UBOS) states that youth unemployment and underemployment are both higher than the national average. 68 The German Government’s development agency, a major donor to Uganda, is placing a special emphasis on youth employment and has termed the problem “rampant”.69
APPENDIX 3 – EVALUATION SCORECARD
APPENDIX 3.1 – EVALUATION SCORECARD


Scorecard Design: Each potential partner will receive a score between one and five for each indicator identified. That score will then be multiplied by the wieght given to the indicator to obtain the weighted score. The weighted score for each indicator will then be added to obtain each partner's total score. As the bottom column indicates, a perfect score is 100.


































 

FINCA Client Demand for Each Enterprise Opportunity

Weighted Score (1.65)

Financial Risk to Franchisees

Weighted Score (1.65)

Model Replicability

Weighted Score (1.6)

Poverty/ Human Development Impact on Franchisees

Weighted Score (1.5)

Honey Care Africa

3.45

5.69

3.50

5.78

3.20

5.12

4.25

6.38

Kickstart Block Press

3.25

5.36

3.20

5.28

3.00

4.80

3.60

5.40

Kickstart Oil Press

3.10

5.12

2.60

4.29

3.00

4.80

3.50

5.25

Perfect Score

5.00

8.25

5.00

8.25

5.00

8.00

5.00

7.50
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