April 2009


Elsewhere on this Blog we have seen how mobiles are opening up markets all over the emerging and developing world. We have seen how Kerala fishermen are using them to check prices and auction their catch to the highest bidder. We have seen how villagers once cut off from food supplies can now place orders and check on availability. There is a world of difference between walking a few miles for food to find that the wholesaler is out of stock and, making a call before you set out to check on availability. Then, there is the whole new world of telemedicine whereby remote diagnosis can be made, prescriptions monitored and supply chains set up and improved.

These examples have enabled remote communities to have market access and, it is paving the way for more environmentally sound supply chains. Think of the wasted miles and resources when you don’t know and can’t check what to expect elsewhere.

Now, the use of computers to tap into other markets is moving fast. Approximately 6 million computers were sold in Nigeria’s informal sector last year, the Lagos newspaper This Day reports. More Nigerians are looking to purchase laptops, to take advantage of wireless set ups available through mobile phone services. In a related development, the mobile phone company MTN increased its share of the Nigerian market to 40 percent. Nigeria’s mobile phone companies make the bulk of their money through informal kiosks and hawkers who sell recharge cards and air time.

Now, we are about to witness a quantum leap in terms of what this market share and the examples used above can mean. For example, (more…)

Retail, in the developed world, has long been the forcing house of logistics change. From the work of Walmart and P&G to explore mutually beneficial initiatives to the case studies of movements such as ECR, logistics has mined organised retail to build the toolkit that can deliver a better, cheaper and faster supply chain.

Some would point to logistics as the new rocket science and reach for analogies such as the flat world coined by Tom Friedman as an illustration of how connectivity and the congruence of technologies has brought us all together.      

Transformational Logistics sees this as all too simplistic. As Mauro Guillen makes plain in The Limits of Convergence, countries and organisations do not gravitate toward a supposedly universal model of economic success and organisational form as theyattempt to cope with globalisation. Maybe it is time to ask three basic questions:

  1. Accessibility. Is the product or service available locally or, at the very least, with regional reach. Take fruit and vegetables sourced globally to maintain supply during the off season. This leads to local produce losing out even when the season is right. Flat world connectivity may be route one to a homogenous world. Is this what we want or, even need? 
  2. Adaptability. Can the product or service adapt to local context? Why should the world be created in the same image? Is there scope to promote connectivity that serves local differences rather than seeks to flatten out the individuality of local culture. Such differentiation works well for brands so why not for development and logistics supply chains?
  3. Affordability. Why design high tech into the solution when less ambitious approach can deliver and, be more cost effective. We need to be aware that cost cutting can lead to a race to the bottom using connectivity to enable footloose Corporates to move to the next cheap location. Maybe we need to review this and factor in all costs – including the environmental impacts. And then, take out the features of a product (packaging and design) that are simply not needed. Again, it depends how we want to use connectivity – it could mean dumping products and this can kill local industries.

Indian Retail is a case in point. A combination of the demographic dividend; growth rates that have slowed but remain at 5%;  and greater disposable income will all see modern retail grow to about 30% of the story in the next 5 years. However, Kirana (mom-and-pop) stores are far from over and, ways in which to reach them will see even more innovation than a developed world model allows. As Buckminster Fuller once said: “monological thinking looks for single answers – and there are none.” (more…)

Angadia, in Gujurati, means “one who carries valuables” and ever since the time of Emperor Akbar, angadias – couriers before the term was invented – have moved diamonds from Surat to Mumbai for export onto the world diamond market. These days, a troupe of Angadias – plainly dressed, unarmed and carrying unmarked canvas bags – carry $4 million in diamonds on this journey every day; that is, an estimated 90% of the world’s diamonds. They earn less than $50 per month. 

Like the dabawallahs in Mumbai who carry lunchboxes, angadias are testimony to simple yet effective supply chains that respond to local context. And yet, the global diamond trade and the jewellery market as a whole is far from simple and there are many challenges that make this industry a fascinating case study from which many lessons can be drawn. From ancient skills to high tech machinery; from traceability and security to environmental concerns and sustainability, jewellery is worth a closer look. 

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Transformational Logistics is an umbrella term for Logistics and the informal market. It has relevance for developed, emerging and developing markets alike and we champion any initiative that explores the transformative power of logistics and supply chains in the Majority World. Here’s an initiative worth looking at …

WEBINAR: Putting market access into practice: reaching the bottom billion through corporate supply and distribution chains.   (more…)