MicroConsignment

The MicroConsignment Model (MCM) establishes profitable income generating opportunities (and the infrastructure and network for a national, local social enterprise) for primarily women that to date are selling products such as wood-burning stoves, reading glasses, water filters, seeds and gardening techniques and energy efficient lightbulbs to villagers.

Through the MCM local individuals with entrepreneurial qualities can start their own business through “sweat equity” and realize profits from inception.

In essence, the MCM strives to intervene at all levels by creating an “ecosystem” whereby problems are diagnosed and products are encountered/designed which are then inserted into the distribution model via the locally trained and supported entrepreneurs.

The key to the MCM is that local women (AC's) and organizations (SC's) are given the opportunity to become entrepreneurs by selling goods and services in their communities using a consignment mechanism.

However, a model that addresses a wide spectrum of issues, including chronic conditions such as pulmonary and gastrointestinal illnesses, vision problems, malnutrition, water scarcity, lack of energy, and the like, has not been effectively implemented at scale to date.

Access can only be created if the product, place, price, and people work in concert to serve those in need in a manner that takes into account their cultural, social, and geographic conditions.

Local transportation networks already reach vulnerable communities, and microcredit organizations are already dedicated to solving the problem of access to needed funds.

The MCM aims to solve this puzzle by delivering essential products and services at affordable prices to the rural poor in the developing world.

The MCM first emerged in 2003 when Greg donated money to a wood-burning stove project from the profits of tourism businesses he created in the town of Nebaj, where he was working during the Peace Corps.

Relief agencies had determined that the construction of inexpensive, locally manufactured, concrete stoves could immediately and dramatically reduce energy costs and improve the health and safety of family members.

Upon finishing their Peace Corps responsibilities, Greg and George stayed in Guatemala and formed New Development Solutions as a means to provide consulting services to USAID, Chemonics, Soros Foundation and the like.

In March 2004, they were contracted by Scojo Foundation (now VisionSpring) to work in El Salvador to help them find an effective way to distribute reading glasses to low income villagers.

VisionSpring was utilizing a microcredit model at the time to provide local women with a means to distribute the glasses but it wasn't working effectively.

Greg and George noted that microcredit is very effective for people who already have established businesses and purchase raw materials from a local distributor to meet unmet demand.

Greg and George realized that the MCM could work as a unique means to get villagers potentially myriad products and services that addressed health, economic, environmental and educational needs.

It was this realization that led to them to establish the US non-profit 501 (c) (3) Community Enterprise Solutions in 2004 as the engine to test, develop, implement and expand the MCM in Guatemala and ideally other countries in the future.

[5] As of September 2009, through the combined efforts of Community Enterprise Solutions and Social Entrepreneur Corps (which offers opportunities for students and recent graduates to volunteer in Guatemala), Soluciones Comunitarias (the social business carrying out the MCM in Guatemala) has trained over 180 local entrepreneurs who have executed approximately 1,800 village campaigns and sold over 35,000 products.

[6] As well, a new entrepreneurial channel has been created whereby local community organizations are provided with product kiosks and training in order to serve their constituents in new ways and earn extra income in the process.

[12] As James Surowiecki writes in his article for The New Yorker, “Hanging Tough,” referencing economist Frank Knight, “Risk describes a situation where you have a sense of the range and likelihood of possible outcomes.

[14] Consequently, the MCM was designed to fill the gap for previously unknown and/or inaccessible products from the perspective of both entrepreneurs and the villagers — their potential customers.

For example, MCM entrepreneurs have helped thousands of village weavers who thought they were going blind to solve their problems instantly by getting a free eye exam and buying a $5 pair of reading glasses.