Distribution is most often considered something that a business does with its product. But distribution itself can be the product, as well. In remote, impoverished areas, distribution can also be a solution to poverty, illness, and other problems.
JITA began in 2004 as a non-profit funded by CARE to create a distribution network employing some of the poorest, most isolated women in Bangladesh. When they join JITA, the women are earning less than $12.50 per month.
Through their network, JITA women provide distribution for products such as shampoo, laundry detergent, disposable razors, and sanitary products. These products are designed, packaged, and priced to fit the needs and budgets of other poor, rural women. Women in the JITA network earn a commission for the products that they sell. Commission sales help to raise their income to more than $20 per month.
There are currently 2.7 billion people worldwide living on less than $2 per day. They often live in places that traditional distribution networks don’t reach. Hence the need for, and the value of, the distribution services JITA offers.
In The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers, Paul Polak and Mal Warwick argue that government-funded efforts and non-profit organizations cannot be effective at reducing global poverty because they cannot attract the investment capital needed to reach a scale commensurate with global poverty. JITA shows that non-profits are capable of conceiving, incubating, and growing the types of enterprises needed to scale product and service delivery to reach isolated, impoverished consumers.
According to this case study, in 2011, JITA was spun out as an independent, for-profit business. In the first 18 months as a for-profit, JITA nearly doubled its number of women distributors.Since its independence, they have developed complimentary services to generate additional revenues.
JITA now provides market research and market creation consulting. For-profit and non-profit organizations hire JITA to advise them on how to serve the rural poor. Understanding the global poor is potentially key to success for large, multinational corporations looking to expand, and for entrepreneurs wanting to build large customer bases.
Polak and Warwick would argue that JITA’s growth as a for-profit supports the superiority of for-profit enterprises in poverty reduction. But JITA remains jointly owned by the non-profit organizations that originally created it, and retains its strong social mission of inclusiveness and poverty reduction.
(The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers and other books mentioned in this blog are available in the bookstore.)