Business Innovation Facility (2) : Pico Solar Products
Dates: 4/02/2014 - present
Lead office: PAC Southern Africa
The Business Innovation Facility aims to achieve poverty reduction by providing consultancy support to the private sector. BIF will work with companies to grow inclusive business models and tackle constraints that affect the whole market. The programme will operate for four to five years, initially in the selected markets of Pico Solar Products, Pigeon Peas and Rice in Malawi. The three markets were selected based upon their potential for growth, relevance to the poor, and where BIF could have the biggest impact.
The BIF programme is managed by PwC UK and Imani Development, the country manager for the Malawi markets. PAC is working as a long-term sub-contractor, managing the pico-solar product market development intervention.
Pico Solar Products (PSPs)
Technological advances bringing increased quality and lower prices, coupled with business innovation, has enabled a boom in the global PSP industry. There was a 300% growth in sales of quality-assured solar lighting products across Africa in 2013. 7.7 million people in Africa now enjoy access to clean, safe lighting using quality solar products. The products provide bright light and mobile phone charging, and the cheapest are now available for just $10.
Alternative methods of lighting such as kerosene, candles and torches provide low-quality light and are dangerous, damaging to health, and actually more expensive than modern electric lighting. However PSPs are yet to gain a significant market share in Malawi.
This project looks at analysing the market of pico-solar products for small electrical appliances (lighting, charging a phone). There are three intervention areas:
• To support PSP importers develop and implement Improved Marketing and Distribution Strategies
• To support PSP importers develop and implement Consumer Finance Models
• Support wider market development through provision of Market Intelligence in annual trend reports and business forums, and engage other initiatives and stakeholders for positive Influencing.
The PSP market in Malawi
BIF completed a detailed PSP market analysis and strategy in consultation with market actors and stakeholders. The primary identified constraints to growth include:
• Low levels of consumer awareness
• Affordability of products
• Market intelligence and lack of business partnerships
• Access to finance for enterprises and consumers
• Taxation and a lack of policy support
• Awareness of product quality and a lack of quality standards
BIF will be working closely to complement other key PSP market development initiatives targeting low consumer awareness and policy barriers. This includes projects in the pipeline being lead by SolarAid in partnership with the Scottish Government, and the Energising Development (EnDev) programme.