Dear Will,

The economic and environmental issues faced in the last decade have promoted improved collaborative mechanism for the SE, VCD, MFI and Pro-poor business. While each one is distinct with its own purpose, it can work effectively through an alternative partnership mechanism.

We talk about aid effectiveness to know whether interventions are contributing to poverty alleviation in a sustainable manner. Climate change, globalization, HIV & AIDS, terrorism and oil crises have contributed to the complexity. This requires a multi-stakeholders partnership including an integrated approach – looking into the backward and forward requirement of an industry.

Value chain development

Should be pre-requisite in the local/national/regional economic development plan. This would also include an industry plan that would tackle other issues such as socio-infrastructure support, policy issues and impact of deregulation or liberalization in order to facilitate innovative strategies/adaptations at the country level (macro, meso and micro). The government sector is a critical stakeholder.

Value chain promotes a holistic assessment, promoting strategic interventions to a specific industry/growth area. Even if the project only address the backward approach then collaborative mechanisms should be initiated. This would also include LGUs cluster to which the community driven development approach (CDD) is important where local stakeholders (multi-sector) are involved in the planning, implementation and monitoring economic development plans.

SEs.

Aside from existing business models, village craft, business incubators or common service facility, new models (including MF products ) have evolved such as franchising, subcontracting/outsourcing not only in the manufacturing but as well as in the service sector where SEs have a niche in the industry sector.

Successful SE’s have tapped hiring personnel from the private sector to improve the skill inside the organization. Using the supply chain, taps the private sector (advertising, product design, warehousing, trucking, processing, lease-agreement, etc.) to be COMPETIVIVE in the local/global market in order to achieve its social objectives. The impact goes beyond its target group, because it contributes to the local/national economy. The entreprenuers supported graduates from micro, small and eventually, a medium enterprise shifting away from subsidies.

Pro-poor business

Pro-poor business also support SEs directly through purchase of raw materials(contract growing or subcontracting), semi-processed goods or finished projects – sometimes, using cooperatives, associations or community-based organizations as a conduit. Or even a household approach (tourism). Or support a research and development (either in partnership with the academe or government sector) related to their core business.

This does not only mean multinational or big businesses.

It is surprising to note that a small enterprise exporter I have met last year, was willing to subsidize BDS training to the micro’s because of the initial support provided to her. And is herself an advocate against child labor. With the projects diminishing budget (due to peso appreciation), savings would mean more micro’s to be supported.

The promotion of CSR in the MSME sector is being considered.

MFIs

Shifting form traditional micro-finance products, MFI can pursue value chain financing in which SEs and private sector (single proprietorship or corporation under the MSME category) are provided with financing. Other innovations is providing credit access to BDS Providers.

Rural based Small and Medium entrepreneurs access MFIs credit (huge volume of orders or the need to stock up raw materials) due to its recognition of track record – character asset. ( should the concept of asset should be re-defined in SEs?). With MFIs requiring less paperwork and transaction cost. than the formal banking institution.

Am attaching a case study on innovations on the coffee sector.

Preview	Attachment	Size
	Barako coffee Figaro.pdf	192.06 KB

Hi,

I have been reading the contributions to this and the other threads with grat interest.

It seems to me that social enterprise can most powerfully be used alongside the other approaches that Will mentions – in particular Value Chain Development and Microfinance – if we are talking about building assets for poor communities and not bottom of the pyramid (BOP) social enterprise.

I would be very intersted in hearing about Social Enteprises create significant enterprise and employment opportunities – microfranchises, distributed production, processor / marketer targeting marginalized producers. These could be greatly enhanced by VC and MF approaches.

Sorry I won’t get to participate more in this discussion….leaving for the east coast of Canada, camping and no computers :-)

Best regards,
Linda