After Mohammed Yunus of Bangladesh’s Grameen Bank won the Nobel peace prize, micro-credit has hogged the headlines. We now need to focus on the next big thing: micro-franchising. Micro-credit has certainly empowered poor women and helped alleviate distress in South Asia, but has severe limitations. Borrowing Rs 5,000 at an interest rate of 30% cannot move millions out of poverty. Micro-credit might have been born in Bangladesh but it is also true that he number of people below poverty line in Bangladesh has increased over the years despite Micro finance institutions (MFIs) being active in disbursing credit. Surely micro-credit can be a good beginning, but something extra is needed to take people to the next level.

That something extra is MICROFRANCHISING.

An example of micro-franchising has been highlighted in a recent issue of The Economist. Scojo Vision, an American company, is using micro-franchsing to sell spectacles to poor people in developing countries. Scojo provides a “business in a box” along with training for rural vendors, who learn to use simple testing charts for vision and then make appropriate spectacles. The vendors’ cost of production is $2 per pair of spectacles, and they sell these at $3 each.

This is affordable for Indian villagers, yet yields a decent profit for both Scojo, intermediaries, and rural vendors. Hence the scheme is viable, and can be scaled up to cover thousands, possibly millions of vendors across developing countries. Scojo has sold 50,000 pairs of spectacles so far, and hopes to sell one million by 2016.

Scojo Foundation was established by the partners of Scojo Vision, LLC, which donates a 5% of its profits to the foundation.Scojo foundation believes that when people are provided with the means to succeed, everyone prospers. Blurry up-close vision is often the only obstacle standing in the way of continued productivity and prosperity later in life. Readymade reading glasses are a simple, inexpensive solution to blurry up-close vision yet they are unavailable in many countries throughout the world.

This is a failure of both government and the marketplace," says Dr Kassalow, co-founder of Scojo Foundation. Government health clinics are understandably preoccupied with life-threatening maladies and urban optical shops typically shun simple reading glasses in favour of costly, high-margin prescription glasses. But this neglect takes a dramatic toll even on illiterates: farmers can no longer identify pests and choose the proper pesticides, craftsmen cannot manage fine handiwork, seamstresses cannot sew. As their sight fades, so does their income.

Scojo Foundation trains local entrepreneurs to give basic eye exams and sell low-cost reading glasses in their communities. By providing people with the tools to see, Scojo Foundation improves their health and doubles their working life. At the same time, it helps raise the standard of living for local entrepreneurs and their families.

Empowering Women

In the process of developing a country program, it works hard to identify potential Scojo Vision Entrepreneurs among local women who demonstrate an interest in starting their own businesses. Studies have shown that when women have access to their own capital, they use it to feed, educate, house, and provide medical care for their children. By giving women the opportunity to earn income through their own small eyeglass businesses, Scojo Foundation helps ensure that women and children have access to education, adequate nutrition, and the health services they need.

A good Business model

This business model shatters the long held myth that corporate social responsibility is an extra liability on the balance sheet of an organization. By empowering the people at the bottom of the pyramid (BOP), Scojo foundation has created a business model that is financially viable and also does not hurt the pockets of the destitute. On the other hand it helps to empower the people to start anew and create their own source of sustainable income, which goes a long way in the alleviation of poverty.

The notion that only subsidies or handouts can provide the world's poorest with essential services such as health care is wrong, says Jordan Kassalow, Scojo's co-founder and a health expert affiliated with the Council on Foreign Relations, a think-tank. Years of treating river blindness and other developing-world diseases as part of charity campaigns convinced him that such schemes often falter when the money or political will dries up. He believes the "bottom of the pyramid" would be better served by campaigns that involve some payment, so that costs are covered and the schemes are financially self-sustaining.

Scojo foundation in India

Rural Model

In rural Andhra Pradesh, Scojo Foundation identifies, trains and supports community-based women entrepreneurs as "Vision Entrepreneurs" through field offices in the districts of Mahbubnagar and West Godavari. Similar to Scojo El Salvador, local staff identify Scojo Vision Entrepreneurs through a highly-selective recruitment process and support their business activities by conducting bi-weekly meetings. In order to meet the market demands of these two districts, Scojo Foundation India is empowering 60 women to start their own small enterprises.

Urban Model

In cities such as Hyderabad and Vishakhapatnam, Scojo Foundation is creating a mobile unit distribution channel. A specially outfitted van with Scojo Foundation staff will visit high density areas, such as factories and government offices, to screen for presbyopia and dispense reading glasses when appropriate. This channel utilizes economies of scale in order to reduce operating costs and serve more customers.

Manufacturing Capacity

Scojo Foundation is planning to improve the local capacity to manufacture high quality reading glasses in India. Scojo Foundation will invest the capital necessary and transfer the appropriate technology to build a modern production facility capable of making reading glasses at lower prices than are currently available in the Indian market. This will create local jobs and enable Scojo Foundation to distribute reading glasses at a more affordable price providing greater access to the population.