Spend Better < Spend Less < Make More
There are three fundamental ways to creatively collaborate with very poor people to improve their lives.
1) Spend Better: Improve the standard of living of very poor people at a price point affordable for them by developing useful and helpful products that are very inexpensive. Examples:
- Affordable water filter, which can enable the very poor to avoid the diseases typically associated with unclean water.
- Inexpensive improved roofing material to affordably improve their homes.
- Electricity-free refrigeration devices to keep food more healthy and nutritious for a longer period of time.
2) Spend Less: Reduce the costs of the necessities very poor people require by developing labor-saving and higher efficiency devices. Examples:
- Improved cook stove that reduces the amount of cooking fuel required for cooking, which in turn reduces the cost of purchasing fuel or the time required for gathering fuel.
- Water transportation devices that can free up some of the significant amount of time commonly required for gathering water.
- Solar lamp that eliminates the need for purchasing consumable lighting products (e.g., candles or fuel for lamps).
Some of these devices can pay for themselves via reduced expenditures within a relatively short time frame, such as several months.
3) Make More: Increase the productive power of very poor people so they can earn more income and STOP BEING POOR! This way approaches the poor not as consumers, but as businesses or producers. Producers improve by becoming more creative, or, in other words, more productive. Productivity can increase in a variety of specific ways including: better inputs, better processes, better skills, better equipment, and better marketing. Examples:
- Better inputs: seeds or fertilizer that produce higher agricultural yields, higher quality raw materials for cottage industry products to sell to higher value markets
- Better processes: add value to agricultural products through post-harvest processing such as dehydration, distillation of essential oils, etc., developing packaging and transportation strategies to connect with higher value markets, adding complementary processes (eg raise and sell chickens, whose manure becomes fertilizer for increased agricultural productivity)
- Better skills: improve craftsmanship skills to make higher quality craft items, learn techniques necessary to grow higher-value crops
- Better equipment: irrigation equipment to improve agricultural yield, transportation equipment to decrease produce damage, harvesting equipment for higher quality harvest and ability to harvest more land, tools and devices to increase efficiency and throughput
- Better marketing: connecting products with higher value markets, adapting or creating products to the tastes of higher value markets, adjusting production to take advantage of seasonal market changes
The first way focuses on working within the current financial circumstances of the poor to improve their standard of living.
The second way focuses on incrementally improving their current financial circumstances through better labor and financial efficiency.
The third way is an attempt at drastically improving their financial circumstances by increasing creative power and productivity.
Frontier Development focuses on this third way–attempting to collaborate with the poor to improve their productivity so they become more wealthy. The collaboration is basically this: exchanging payment for products, services, and training that will increase their productivity and earning power, though this exchange might happen in new and innovative ways.
Thus, Frontier Development is best thought of as focused on business to business (“B2B”) activity rather than business to consumer (“B2C”). Very poor people are our niche customer focus. We seek to partner with them as producers, not consumers, and work together with them to create wealth together.