Global Health Presentation

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Presentation made to Global Health Conference on the CFWclinics franchise program in Kenya and Rwanda

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Global Health Presentation

  1. 1. Elements of Successful Franchising © MSA 2008 Michael H. Seid Member of the Board – HealthStore Foundation Improving Access to Quality Care and Life-Saving Medicines
  2. 2. The HealthStore Foundation’s Mission <ul><li>To improve access to essential drugs, basic healthcare, and prevention services for children and families in the developing world using a business that maintain standards, that scale geometrically, and that achieve economies of scale. </li></ul>
  3. 3. <ul><li>Approximately 30,000 children die each day in the developing world because they lack access to medicines that cost less than a cup of coffee </li></ul><ul><li>A short list of preventable and treatable diseases accounts for approximately 70% of childhood illness and death in a particular area </li></ul><ul><li>Deaths occur because people lack access to high-quality essential drugs , diagnostic and treatment services, or preventative health products </li></ul>The Public Health Crisis Photo courtesy of Scott Davis
  4. 4. What is franchising <ul><li>Franchising is </li></ul><ul><li>simply a method of expansion and distribution that ensures quality - consistently </li></ul>
  5. 5. What is a franchisor <ul><li>Grants right to use marks </li></ul><ul><li>Sets standards </li></ul><ul><li>Financial relationship </li></ul>
  6. 6. Franchising Provides <ul><li>Consistent Operations </li></ul><ul><li>Brand Recognition </li></ul><ul><li>Rapid Expansion </li></ul>
  7. 7. The “3 Point Test” <ul><li>Every successful franchisor including CFW must meet a 3 point test: </li></ul><ul><ul><ul><li>Must Maintain Standards : so that patients are properly diagnosed and drugs are pure and efficacious, ensuring effective patient treatment </li></ul></ul></ul><ul><ul><ul><li>Must be Scalable : so that there are many locations where patients can access drugs and services, each point of access maintaining consistent standards </li></ul></ul></ul><ul><ul><ul><li>Must Achieve Economies of Scale : so that the cost per unit of service rendered decreases as the network grows </li></ul></ul></ul>
  8. 8. The Franchisor Provides <ul><li>To meet the “3 point test” franchisors provide </li></ul><ul><ul><li>A Brand to its franchisees </li></ul></ul><ul><ul><li>A Brand Promise to its consumers </li></ul></ul><ul><ul><li>A high degree of consistency in each and every location </li></ul></ul><ul><ul><li>Initial and continuing support, training, monitoring, innovation and growth </li></ul></ul>
  9. 9. The Franchise Relationship <ul><li>Contractual in nature </li></ul><ul><li>Franchisor contributes </li></ul><ul><ul><li>System and initial investment to start system </li></ul></ul><ul><ul><li>Positive and negative experience of the franchisor - they survived the mistakes </li></ul></ul><ul><ul><li>Support of the franchisees </li></ul></ul><ul><li>Franchisee contributes </li></ul><ul><ul><li>Drive, ambition and local skills and management </li></ul></ul><ul><ul><li>Capital </li></ul></ul>
  10. 10. <ul><li>The HealthStore Foundation ® launched CFW as a franchise system in 2000. </li></ul><ul><li>The CFW franchise system distributes essential drugs and basic health services in rural Kenya (2000) and Rwanda (2008). </li></ul><ul><li>Each of the 70 drug shops and primary care clinics is owned and operated by nurses and health workers. </li></ul><ul><li>CFW has served an estimated two million + or - patients and customers. </li></ul>
  11. 11. Franchise Structure <ul><li>Initial and continuing support provided to franchisees </li></ul><ul><li>CFW outlets are primarily rented storefronts in rural areas </li></ul><ul><li>Outlets are geographically accessible to the communities they serve </li></ul><ul><li>Branded and signed CFW </li></ul><ul><li>Standardized design and equipment </li></ul>
  12. 12. Local Ownership / Economic Development <ul><li>Each outlet is owned and operated by a nurse or community health worker (franchisees) </li></ul><ul><li>Franchisees generate income to support their families </li></ul><ul><li>Franchisees employ assistants and community health workers </li></ul><ul><li>Franchisees follow franchisor pricing guidelines </li></ul><ul><li>Franchisees in business for themselves but not by themselves </li></ul>
  13. 13. Supply Chain <ul><li>The franchisor procures high-quality medicines from approved sources on behalf of all franchisees </li></ul><ul><li>Required batch testing using standard franchising protocols </li></ul><ul><li>All medicines and supplies delivered by closed supply chain to franchisee </li></ul><ul><li>Franchisees are prohibited from selling drugs from non franchisor suppliers </li></ul>Storage room in Nairobi office
  14. 14. Brand Standards <ul><ul><li>Franchisees are clinically assessed before training and brought up to brand professional standards </li></ul></ul><ul><ul><li>Standards are then maintained by effective clinical and business procedures supported by field consultants and advanced training </li></ul></ul>
  15. 15. Record Keeping <ul><li>Franchisee are required to keep detailed business and clinical records </li></ul><ul><li>Records are analyzed and used by headquarters and field personnel </li></ul><ul><li>Information is routinely provided to MoH </li></ul>
  16. 16. <ul><li>Each franchisee is assessed for clinical and business capabilities </li></ul><ul><li>Franchisees attend a four-week training program </li></ul><ul><ul><li>Brand standards – customer service </li></ul></ul><ul><ul><li>Clinical standards – drug management, diagnosis and treatment </li></ul></ul><ul><ul><li>Business management – record keeping, financial management </li></ul></ul><ul><ul><li>Marketing - community outreach </li></ul></ul><ul><li>Field consultants provide opening support and training </li></ul><ul><li>Continuing education requirements and opportunities </li></ul><ul><li>MoH standard treatment guidelines and updated protocols are incorporated into the franchise systems </li></ul><ul><li>Operating and Clinical Manuals developed, reviewed by medical professionals in country and U.S. </li></ul>Training and Continuing Education
  17. 17. <ul><li>Community outreach and education programs strengthen the health-seeking practices of the community while providing marketing exposure for the local franchisee. </li></ul><ul><li>In-clinic posters and other signage </li></ul><ul><li>Take home education material provided to patients on disease, treatment, medication and follow up care </li></ul>Marketing and Education
  18. 18. Community Health Outreach <ul><li>De-worming </li></ul><ul><li>Promotion of clean water including demonstrations of water purification products </li></ul><ul><li>Promotion, distribution, demonstration, and retreatment of bed nets </li></ul><ul><li>Promotion of ACTs as per new MoH protocols on malaria diagnosis and treatment </li></ul><ul><li>Free baby growth monitoring in the clinics </li></ul><ul><li>Promotion and sale of low-cost hygiene products: soap, toothpaste, water purification solution, laundry detergent, etc. </li></ul>
  19. 19. The Power to Reach Millions Total Patient Treatments • All Other • Bed Nets Sold • Diarrheal Disease • Worms and de-worming • Respiratory Infection • Malaria Patient Treatments: Clinics and Shops Open 349,018 145,305 14,542 18,064 40,033 77,763 53,311   62 Year 2006
  20. 20. <ul><li>Exploring Voxiva’s data system </li></ul><ul><li>Data transmittal via cell phones, PDAs, or laptops </li></ul><ul><li>Access and analyze data centrally </li></ul><ul><li>Improve speed and focus of support </li></ul><ul><li>Increased visibility into outlet performance </li></ul><ul><li>Track epidemiological patterns in remote areas </li></ul><ul><li>Aggregate data from all regions and countries </li></ul><ul><li>Improve franchisee financial results </li></ul>Data Management System Diagram from www.voxiva.com depicting diverse devices deeding data into a central database
  21. 21. Third Party Payment System <ul><li>Top-down donor funding measures success through amount of grants received. Maintaining standards is not a driving incentive </li></ul><ul><li>Developing an innovative health financing mechanism for use in communities served by franchisees will change paradigm </li></ul><ul><li>Franchisees will be reimbursed for the full cost of drugs and services through a combination of a patient co-pay and 3 rd -party reimbursement </li></ul><ul><li>Donor funds will be focused to pay for care delivered ensuring system will sustain high quality standards to attract customers </li></ul>
  22. 22. Third Party Payment System <ul><li>Franchisor will operate as any other franchisor in the world earning its continuing revenue primarily on royalties </li></ul><ul><li>Franchisor organization will remain small and efficient as is routine in franchise systems worldwide </li></ul><ul><li>Patients pay what they can afford </li></ul><ul><li>Balance paid by third party </li></ul><ul><li>The money the world now spends on health in developing countries would achieve more by directing it through franchise systems enabled by third-party payment mechanisms (e.g. health insurance) </li></ul>
  23. 23. CFWshops and CFWclinics <ul><li>Largest Franchisor in East Africa </li></ul><ul><li>70 clinics and drug stores </li></ul><ul><li>Provides access to essential drugs, basic healthcare, and prevention services </li></ul><ul><li>First clinic opened in Rwanda in May 2008 </li></ul><ul><li>Efficient, effective, expandable </li></ul><ul><li>Franchisee’s profitable </li></ul><ul><li>Multi-unit franchisee ownership </li></ul><ul><li>Local job creation </li></ul>
  24. 24. Expansion into Rwanda <ul><li>We will take advantage of lessons learned and mistakes made in Kenya </li></ul><ul><li>CFW in Rwanda is designed to meet the needs of rural Rwandans and fill gaps in existing health infrastructure </li></ul><ul><li>The Kenyan model will be leveraged and adapted to the market in consultation with Rwandan health experts and our franchise advisors. </li></ul><ul><li>Our model in Rwanda will comply with all Rwandan regulations and existing systems. </li></ul>
  25. 25.
  26. 28. <ul><li>Visit our website: </li></ul><ul><li>http://www.cfwshops.org </li></ul><ul><li>PBS program NOW detailing our work in Kenya – it won an Emmy: </li></ul><ul><li>http://www.pbs.org/now/shows/321/index.html </li></ul>The HealthStore Foundation®
  27. 29. Michael H. Seid & Associates (MSA) 94 Mohegan Drive West Hartford, CT 06117 (860) 523-4257 (860) 523-4530 – Facsimile [email_address] www.msaworldwide.com

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