The first BOP Global Network Summit kicks off in Sao Paulo today where attendees will discuss leading-edge bottom of the pyramid (BOP) business practices from around the globe.
The concept of BOP became well-known over a decade ago when a paper called The Fortune at the Bottom of the Pyramid spread the idea that big corporations, neglecting to provide products and services to poor people, could both profit and help alleviate poverty.
Since that time, big corporations remained idle with respect to their engagement in BOP initiatives, yet the concept has begun to attract the attention of CEOs of big corporations.
But even with a rapid increase of practitioners and projects, there is a lack of case studies documenting BOP projects that have positive impact, create financial results, empower local communities, and enable more inclusive and sustainable markets, explains Fernando Casado Cañeque, the associate director of the BOP Global Network.
In response, a new report will be presented at the Summit which documents 16 initiatives in the areas of adaptive product design, value chain business models, employment generation, distribution channel improvement, and access to basic needs.
Yukiguni Maitake, a mid-size food company in Japan, is one example in the report developing a value chain business model in Bangladesh. Bean sprouts, which are made from mung beans, are one of the company’s major products. But 95 percent of their mung beans are imported from China, causing them to face the risk of future limitations on mung bean imports from China.
Yukiguni Maitake mitigated this risk and improved their global supply chain through a joint venture launched in 2010 with the Grameen Group in Bangladesh. The company provided microfinance for farmers while the Grameen Krishi Foundation gave agricultural advice. Their joint venture, called Grameen Yukiguni Maitake (GYM), purchased mung beans at above-market price and allowed farmers to sell a portion of their own harvest locally.
To date, the business has doubled the yield of crops, increased sales price by up to 50 percent, and helped 7,000 farmers more than double their income.
The real fortune for farmers, though, is that GYM helps solve, albeit temporarily, the issue of decreased cultivatable land as a result of climate change. Since 2012, with funding from the Japanese Ministry of Economy, Trade and Industry, GYM has developed methods for harvesting crops on land that is affected by salinity from climate change. But it’s estimated that 17 percent of Bangladesh will be submerged under water and crop production will fall by 30 percent by 2050, posing a further risk to the livelihoods of farmers.
