Question

In: Economics

Assuming a company found a profitable niche in serving the poorest 4 billion people in the...

Assuming a company found a profitable niche in serving the poorest 4 billion people in the world, how might such a breakthrough help the firm sell to the developed world at the top of the economic pyramid?

Solutions

Expert Solution

As multinatinal firms(MNCS) search for a profitable growth and radical innovation in the new 1000 years, they may find a unique opportunity - the 4 billion poor people that are at the bottom of economic pyramid. while converting the very poor people into active consumer and in techonologies and business models. Most importantly, conceiving of a market of 4 billion of the world's poorest people will force a reexamination of the price performance ,relationshps for product and services. it will demand a new level of capital effeciency.

FOR EXMAPLE:- Hindustan lever limited(HLL) a subsidiary of unilever ,it is considered as the best managed company in the india. it provide to the need of the elite of india- the top of the pyramid. A local firm, nirma challenged HLL in its detergent business, by creating a new business system- a new product formulation, new manufacturing process, distribution ,packaging and pricing. HLL like most MNCs, intially dismissed Nirma as a low end producer .

STRATEGIES FOR THE BOTTOM OF PYRAMID

1)CREATING VERSUS SERVING MARKET

2)CREATING PURCHASE POWER

3)INCOME GENERATION

4)CONSUMER EDUCATION

5)SUSTAINABLE DEVELOPMENT

6)DISTRIBUTION SYSTEM

Effective strategies for the bottom of the pyramid cannot be realized without active engagemnet ofpeople at local level. solve the problem of the poor have generallly met with failure. These is how we can help the firm sell to developed world at the top of the economic.


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