With the rise of the global economy, we have all become more aware of what’s going on around the world and all of the problems that people are faced with every day, and there are organisations and companies working fix the problems – micro franchising as a model can help.
Many of those problems have one common denominator and that is poverty – Globally, 10 percent of the world is living on less than $2 a day.
There are many non-government organisations, non-profit organisations, and governments that have put billions of dollars into fighting poverty but it has little long term sustainable success, social innovators and entrepreneurs have noticed this pattern taking place, and are starting to develop new ways to fight poverty, they’re thinking long term sustainability.
One of the most effective ways that they have come up with for fighting poverty is micro franchising. Micro franchising is a for-profit model that allows people from developing countries such as Kenya, Ghana, and Jamaica, become business owners, without the difficulties of being an entrepreneur such as finding funding, building a brand that is recognisable, distribution, etc.
This allows them to not only provide a better life for their own families but also create jobs and create opportunities within their community as well. So how are micro franchises created? There are four steps to creating a micro franchise:
- First, you identify a gap or a need in the market. There’s a micro franchise in Ghana, that noticed that the people weren’t getting the protein they needed in their diet, and they created Fan Milk, an ice cream vending business using bicycles.
- Second, you design and build a business model that can solve the problem you’ve identified, the people that created Fan Milk built their business model around bicycles, because they saw that the problem was people were having to walk several miles to find protein and bicycles were a solution.
- Third, you test your business model in the market. Fan Milk tested their idea in a small community, to make sure that it could be profitable and efficient.
- Forth, you scale the business. Once your business model has proven to be successful and profitable. You can take that exact same business model and replicate it over and over again, helping more and more people become business owners, Fan Milk continues to grow and be successful, and by 2009 they had 10,000 franchises that year they did $72 million in revenue. But most importantly, they helped millions of people improve their lives and find better opportunities.
To learn more about micro franchising as a model, how it can remove risks, and how it can benefit communities, see here.