Business in a Bag

Peter Eliassen, Vice President of Sales and Operations, recently went to Nicaragua to visit VisionSpring Franchise Partner Cause for Hope.  Reporting back on conversations with Vision Entrepreneurs, Peter reminds us that the VisionSpring model is unique because not only are we a Social Enterprise, the businesses we create are too. While making money is a main driver for all of our Vision Entrepreneurs, many of them stay with the program because they also have the opportunity to help our communities.

“Yesterday and today I met with a bunch of Vision Entrepreneurs (VEs) here in Nicaragua, and I asked each one what motivates them.  Although the women generally want to discuss their sales – how much money they make, and how they would change this or that style – when I ask them about what motivates them, it always brings a smile to their face.  Each has told me mas o menos the same thing, that the best part of what they do is sharing the joyful moments when their customers can see clearly for the first time in many years (the “ah-ha!” moment).  The VE’s are given titles by their customers like “Savior of Sight”, or “Angel of Vision” and that’s what really fuels them.

Today in Managua we brought three new potential VEs to a vision camp for them to see what it actually looks like.  During our brief interviews in the morning, the focus was primarily on how much money the VE could earn by participating in the program.  Then, when we got to the camp, the active VE explained to the three new potentials that the primary goal of the program is to expand the access to affordable glasses. When asked what motivates her, she told the new potential VEs that she is driven by the joy that she brings to her customers and that the money is like icing on the cake.  She explained in detail the referral process, the screening process, and her favorite VisionSpring models. 

I applauded afterwards. It is so great to see how the dedication and excitement about our work is adopted by the program coordinators, trainers, and the VEs.

With support from the Rockefeller Foundation, VisionSpring had the opportunity to partner with the design firm IDEO to develop a model for integrating eye care for children into our existing work in India. Anitha Gopalan, Sales Innovations Manager for VisionSpring India, reflects on the experience.

When our team was called to design an approach for our Vision Entrepreneurs to screen and sell eyeglasses for children, a completely new model for rural India and for VisionSpring, we knew we would need to take an innovative approach in order to listen to the market and ensure we design a program that really works. We reached out to IDEO, pioneers of Human Centered Design, and were lucky enough to have Jocelyn Wyatt and Sandy Speicher conduct workshops and training sessions centered on this challenge.

IDEO provided us us valuable insight on the processes behind ideation and prototyping. With their help, we conducted field research and identified key barriers to the challenge of empowering our Vision Entrepreneurs to screen children for eye conditions. Some of the results of our research were unexpected; for example, we learned early on that kids are afraid to reveal their imperfections. Through the design process, we came up with innovative ways to help kids overcome their fear and embarrassment, such as having children practice screening other children and putting up pictures of movie stars who wear glasses on the walls. We found that these tools helped children feel empowered in the screening process, as well as helped to destigmatize eye problems.

We also learned that children can be a major lever in providing eye care to families. This is a lesson that had already been learned in relation to other health care issues; for example, parents we interviewed explained that many of them learned to boil water from their children, who learned about the benefits of this in school. Thanks to the success of campaigns such as these, many parents now look to their children for guidance on basic health and hygiene issues. We believe that if we can educate children about eye care and empower them to get their own eyes screened, we may well be able to access their parents as well. These insights proved to us that, while we still have a ways to go in designing our model, we are well on our way to establishing a new model for effectively serving children in need while strengthening our overall sales.

Thanks to our work with Jocelyn and Sandy, as well as our past work with Acumen Fund Fellow and IDEO employee John Tucker, we have come a long way with our innovations processes. In the last year, we have tested and successfully launched a line of photochromic glasses. We also designed a flip chart for our Vision Entrepreneurs to standardize our communication and win credibility in C-Towns (mid-size rural cities in India). We are excited about our ability to continue replicating the Human Centered Design process to create and bring to scale new approaches to providing eye care in the developing world.

Net Impact’s Josh Cleveland interviews Vice President of Sales and Operations Peter Eliassen on working in base of the pyramid markets. 

Over the years, VisionSpring has worked to refine the model that enables it to provide a much-needed healthcare product while empowering entrepreneurs to make significant returns. In this six-minute podcast, Peter sheds light on mechanisms that make this possible. From sourcing structure to sales format, learn about how VisionSpring has become “the holy grail of social enterprise” and its plans for moving forward.

Listen to the podcast here.

Research on the huge economic gains that would come from providing glasses to the developing world was recently published in the Bulletin of the World Health Organization. 

According to the paper, the estimated loss of global productivity due to vision impairment is over $269 billion.  This number, however,  does not incorporate the 400 million people in the developing world with presbyopia (the loss of close-up vision). Imagine how much greater the loss must be with this condition included! *

Citing the developing world’s lack of infrastructure for distribution and training as challenges to fixing the problem, the WHO report brings attention to the very issues VisionSpring strives to address. We are thrilled that eye care as an economic intervention is finally getting the attention it deserves.

 Download the WHO’s research paper on glasses and global productivity here

* Visionspring, in partnership with the University of Michigan, currently has studies underway to quantify global economic loss attributable to presbyopia.

BRAC recently highlighted the VisionSpring partnership on their blog. Check it out here.

Peter Eliassen reflects on his experiences visiting glasses manufacturers in the high-growth city of Wenzhou, China, including what goes on behind the scenes of the factory floor.

Recently, I had the opportunity to visit Wenzhou, China with the goal of finding a glasses supplier that can help us deliver on our strong growth plan over the next few years.  Wenzhou is located in southern Zhejiang province, about an hour’s plane flight south of Shanghai on the east coast of China.  Just 20 years ago, it was a modest city with only a few restaurants and minimal infrastructure.  Recently, Wenzhou has greatly benefited from globalization, becoming one of the richest cities per capita (3^rd highest disposable income) in China by supplying the world with affordable eyeglasses, cigarette lighters, and Italian shoes (among other exports).  Wenzhou now produces 80% of the world’s affordable glasses and its citizens are known throughout China as some of the country’s best entrepreneurs.

While visiting the factories of our current and potential suppliers, I at first felt saddened by the large numbers of young workers I witnessed slaving away at menial labor. I saw countless young men and women ages 18-24 sitting in the same chair and performing the same task for up to 11 hours per day, 6 days a week. The employees were so concentrated on their labor that only a few of them took the time to glance up at us; most continued working on pair after pair. I couldn’t help but think that they should be in university right now, building a better future for themselves.

Yet as with most issues, there are two sides to the story of young factory labor.  In each of the factories we visited, I asked about salaries and employee benefits for the workers.  I learned that employees are paid by the pair or task completed, so their intense focus began to make sense.  Each of the factories provided a similar wage range — between 1300-3000 RMB ($191-$441 USD) for the month — depending on their experience and the type of job.  Most of the factories provided free food and lodging to workers, housing them in dormitories connected to the factory, which enabled the workers to save most of their monthly salaries.

A good majority of the workers come from poorer western China to work for 1-2 years, save up their earnings, and return home to their villages with money in their pockets to pay for a wedding or aid their families.   One supplier told us that wage inflation has been at least 30% over the past 3 years, and the cost of health insurance has quickly risen for employers (some pay as much as 370 RMB, or $50 per worker per month). While these factors may not bode well for maintaining prices at a level that our Base-of-the-Pyramid consumers can afford, they are certainly positive changes for the young Chinese workers. 

At the end of the trip, none of our team members ever felt the “sweatshop” experience, and after hearing both sides of the story, I feel proud that the global demand we are generating for affordable glasses is enabling these factory workers to earn and save money.  This, to me, is an almost pure definition of the term “market maker,” and a key reason why social entrepreneurship holds so much promise for the BOP.

VisionSpring received this email from a supporter in India, who shares his perspective on why the VisionSpring model is so important for the rural poor.

I live in Chennai, India. I would like to congratulate you for your noble efforts. I can afford medical care, and know the importance of using reading glasses.

Most eye doctors collude with shops that sell glasses and make people pay atleast Rs. 1000 each year for their glasses. Glasses that should normally cost Rs. 100 to 200 cost 10 times that price. In cities, most eye doctors prescribe “progressive lenses” which cost anywhere between Rs. 5000 and Rs. 20000. City folks who work in Information Technology can afford these.

I know many poor people in my native rural village who simply cannot afford to buy reading glasses paying Rs. 1000 or 2000 every year, and therefore choose not to read after 40. The quality of their lives come down drastically and people go into a semi-retirement at about 45 years. Your efforts in addressing this segment of population is laudable.

I was told that VisionSpring used to sell reading glasses through Apollo Pharmacies in Andhra Pradesh (India), but not any more.* The model adopted by you to sell glasses through medical shops (pharmacies) is wonderful, and I hope you’ll revive that model.

I hope you’ll revive selling your reading glasses through Apollo pharmacies or other agencies again.

Good luck in your endeavor.

– Venkatarathnam

* Note: As Venkatarathnam mentions, there is a market failure for low-cost glasses even in urban centers in India, and in other developing countries where VisionSpring works. VisionSpring has begun to address this issue in India by making glasses available through Apollo Pharmacies on a trial basis. This effort has not ended, as he had heard, but at the moment remains a small trial program. VisionSpring plans to develop and expand this delivery model in 2009. 

BRAC, the largest non-profit organization in the developing world, is a dream partner for a small organization. But landing the partnership is only the first part. What happens next is where it gets interesting…our Franchise Partner Manager Lalit Kumar reports from the field.

We often joke here at VisionSpring that working with BRAC is like landing a contract with Walmart. It’s the kind of opportunity that every small NGO dreams of – BRAC is known for its massive scale and incredible efficiency. This partnership will allow us to reach a huge new market of people in need in a time frame that would have previously been impossible. Now we just have to deliver!

We’ve been working with BRAC for two years now.  For the last six months, we’ve been selling about 500 glasses per month by empowering BRAC’s network of Shashto Shebikas (community health volunteers) to sell our eyeglasses. Now, with our new plan to scale up, we will provide affordable glasses to almost ten million people in Bangladesh over the next three years.

Our biggest challenge by far is managing the inventory that BRAC needs. At the moment, we’re delivering about 30,000 pairs of glasses every four months, but soon we will need to deliver 30,000 every month. We are mainly focused on getting the glasses into Bangladesh, a complicated process involving multiple inspection agencies.  A 2006 Doing Business (http://www.doingbusiness.org) report from the World Bank notes that when a Bangladeshi company imports goods, it has to prepare 16 types of documents and obtain 38 signatures, and that the whole process takes 57 days. I can tell from our experience that it hasn’t improve much in the last few years.

For example, we received a Letter of Credit from a bank in Bangladesh that was valid only from April through June. Simply getting it updated meant that we had to get signatures from BRAC’s bank in Bangladesh, VisionSpring’s bank in New York, VisionSpring’s offices in India and New York, and our vendor and inspection agency in China.

We at VisionSpring are working hard to understand the whole process and constantly improve our delivery time. The first order took us more than 9 months to clear customs and make it in to Bangladesh, and the next order took about 6 months. Our goal is to get the process down to 3 months, which we are able to achieve in other developing countries where we work. We are certainly going through a period of adaptation, but it has been a very exciting time and I look forward to making more leaps of improvement.

After business school at the Institute of Rural Management Anand (IRMA), I was surprised to find that the challenges we face are the same as private sector businesses, only we are addressing them in some of the most challenging markets in the world. There is a reason that most private-sector companies haven’t tried to reach rural markets in Bangladesh; the start-up and logistics costs are simply too high. However, if our partnership with BRAC is successful, we will be able to provide affordable glasses and business opportunity to millions of people in Bangladesh. For us, it is well worth the struggle.

Microfranchising at the Base of the Pyramid: David Lehr’s paper provides an in-depth analysis of microfranchising as a development tool. The paper highlights three leading microfranchising organizations that partner with Acumen Fund: Drishtee, VisionSpring (formerly Scojo Foundation) and Sustainable Healthcare Foundation. It’s one of a series of written articles that Acumen Fund has produced about the ways market-based approaches are changing the way we think about poverty alleviation.

Read the paper here: http://www.acumenfund.org/uploads/assets/documents/Microfranchising_Working%20Paper_XoYB6sZ5.pdf

This post originally appeared on the Acumen Fund Blog http://blog.acumenfund.org/2008/11/10/new-on-acumenfundorg-ambulances-clinics-and-microfranchises/

This is a guest post from Corey Harris, a student at Stanford Graduate School of Business, who shares his experiences working with VisionSpring in India to continue making our business model more robust and sustainable by addressing key business challenges. 

I first heard about VisionSpring on a Stanford Graduate School of Business (GSB) Service Trip.  I was intrigued by VisionSpring’s business model and wanted to learn more about their operations and sales network of entrepreneurs, and to understand how they were able to deploy their services in rural areas.  Particularly in rural areas, the problem of distribution of services is oftentimes the biggest hurdle to get over.  In order to learn more and hopefully provide some insight, I decided to spend a few weeks on a GSB-funded trip learning more about VisionSpring and completing a small consulting project based on my observations in the field.

I had often assumed that non-profits are less disciplined organizations than for-profit businesses in part because non-profits are not responsible to shareholders or for showing quarterly profits.  I gained a different perspective during my time with VisionSpring.  For non-profits like VisionSpring, their shareholders are their philanthropic investors and their profit or bottom line, at least in VisionSpring’s case, is balancing social mission/impact with business sustainability.  What I learned firsthand was that the challenges facing non-profits like VisionSpring are no different and no less complex than challenges facing any client I would work for in my current job as a consultant with Booz & Company.

In particular, based on my observations in rural villages in Andhra Pradesh where VisionSpring’s outreach in India is concentrated, I addressed two VisionSpring challenges: 1) how to retain salespeople or “vision entrepreneurs” who conduct the vision screening “camps” or sales days, and 2) how to conduct more targeted marketing campaigns so that the customers who showed up at the camps were experiencing the problems that VisionSpring is geared towards handling, and so they attracted customers who were willing to purchase the reading glasses they need.  The complexity of the VisionSpring model is built on aligning incentives between the vision entrepreneur who makes a $1.50 commission on every pair of glasses sold, the social mission of the organization to provide reading glasses to the rural villagers at the bottom of the pyramid, and the goal of achieving self-sustainability for the VisionSpring business.  The convergence of these three things makes it even more important to align VisionSpring expectations with the value of getting the vision entrepreneur to remain committed to the organization’s mission and to maximizing sales of the reading glasses.  VisionSpring is considering a host of innovations, for example, a hybrid salary/commission-based model, which is aimed at getting these components of their business even better aligned.  Moving forward, VisionSpring’s success in the vision entrepreneur sales channel will depend, in part, on the degree to which these innovations around better alignment are successful.