Going the extra mile
Durable, innovative technologies such as clean cookstoves, solar lanterns and other life-changing products deliver their promised benefits only if they are properly delivered, adopted and serviced over time. Moreover, many of these technologies never make it into the hands of people who need them most. In rural India, their accessibility is poor, uptake limited and after-sales support virtually non-existent.
Essmart works with small local retail stores in rural southern India to help them stock, sell and service life-improving products. Based on feedback about local needs and wants, it first sources products to include in its catalogue. These range from fuel-efficient cookstoves and time-saving pressure cookers to solar lanterns and rechargeable torch lights. It then builds relationships with shopkeepers, showing them how to promote the products, delivering shipments on a per-order basis and facilitating returns and replacements. Trusted shopkeepers receive flexible payment terms for orders, which enable them to provide informal financing to their customers.
Essmart operates through a hub-and-spoke model, with offices and stocking points in towns from which rural areas can be reached by motorbike to achieve last-mile distribution. Movement of durable products and money collection are managed using a proprietary offline mobile application and back-end logistics software.
A wholesale mark-up on products sold to shopkeepers comprises Essmart’s primary revenue stream. Secondary revenue comes from leveraging its distribution network for market testing and research. This helps new technology designers obtain much-needed feedback on design, pricing, branding and more, ensuring customer-sensitive product development.
GOALS AND IMPACT
As of December 2020, Essmart had a staff of 117 and reached about 705 000 people through the sale of 170 000 life-improving products, saving users an estimated 101.8 million hours, USD 2.5 million, 41.4 million kilograms of CO2 emissions and 2.9 million litres of kerosene consumption.
The goals achieved during this project include the opening of 12 new distribution centres – more than doubling Essmart’s geographic footprint – and the expansion of the centres’ operational capacity. From 2018 to the end of 2020, Essmart grew its network of shops from 685 to 3 472 and diversified its offer from 177 to more than 300 products.
Internally, Essmart added 97 new employees during the project period. The new staff include 10 regional sales managers who are empowered to open and operate new distribution centres as well as to hire sales executives. Essmart’s proprietary software has also been developed to allow for rigorous data capture and real-time response to customer needs.
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