Dialog at IFC forum

IFCs Inclusive Business Solutions conference in Washington this month provided a forum for IFC clients, staff, donors, and partners to exchange experiences and insights on commercially viable, scalable business models that reach the poor.

At the event, IFC recognized 12 clients for their outstanding work to develop inclusive business models that expand opportunity for people who make up the base of the pyramid (BOP).

IFC client selection was possible by close cooperation between investment and advisory staff. Thirty seven representatives of client companies, 22 donor representatives and the Gates Foundation were in attendance. Several members of IFCs management team addressed over 120 participants during the conference.

“Businesses that serve the base of the economic pyramid are the companies with the greatest potential for growth in the future,” EVP CEO Lars Thunell said.

“IFC applauds these pioneering clients, whose work demonstrates that inclusive businesses models can be profitable and create opportunities for people who need them most.”

Collectively, these clients reach more than 30 million of the worlds suppliers, distributors, retailers, and consumers at the base of the pyramid. Dialog Axiata PLC Sri Lanka was also a participant at the forum.

Recognizing the base of the pyramid as an exciting frontier for innovation and growth, IFC has established a new Inclusive Business Group, headed by IFC Director Toshiya Masuoka, which is dedicated to exploring the IFC portfolio for lessons learned and connecting people, resources, and ideas in support of projects that meet the dual imperatives of growth and inclusiveness.

Tribanco, for example, offers over 150,000 retailers throughout Brazil with access to financing for inventory purchases. Ten percent of these retailers receive additional training and financing for store renovations, enabling them to be competitive and grow.

Through these retail clients, Tribanco has also issued over four million private label credit cards to shoppers at the base of the pyramid to buy needed food and basic goods. In this way, Tribanco provides the working poor with a way to smooth irregular cash flows over the short term, through a neighbourhood store card - often the only source of credit.

While the Tribanco model epitomizes key elements of inclusive business models, other common themes emerged from a series of vibrant panel discussions and presentations from during the event:

Clients validated the definition of inclusive business models as commercially viable and part of the core business strategy, distinguishing such models from corporate social responsibility initiatives.

Participants identified the need for appropriate distribution channels for goods and services to reach the base of the pyramid markets. Solutions included empowering entrepreneurs through micro-distribution models.

The Inclusive Business Group plans to launch a practice group for investment and advisory staff to serve as a support network for those working with clients implementing inclusive business models.