This document summarizes a social franchising project to improve sanitation facilities in Kibera, Kenya. It finds that the facilities have had positive financial results and increased usage over time. However, consistent water access is key to sustainability. Next steps include improving the facilities, increasing water and revenue sources, developing marketing, and revising governance strategies based on lessons learned.

1. Dr. Renée Botta, Media, Film & Journalism Studies
Dr. Karen C. Loeb, Daniels College of Business
University of Denver
.
March 2012

2. Overview
 Kibera Context
 3-Legged Stool Model
 Problem Statement
 Business Model
 Training & Implementation
 Usage, Accounting &
Financial Results
 Facility Management
 Conclusions
 Lessons Learned
 Next Steps
Maji na Ufanisi

3. Kibera, Kenya
• Kibera is an “informal settlement”
situated in the southwestern part of the
city of Nairobi. There are over a half
million people living in slum conditions in
one square mile:
• Virtually no access to toilets
• Limited access to clean water
• “Flying toilets” abound where people
defecate into plastic bags that they throw
onto the streets.
•In Silanga, our village, one pit latrine
serves about 272 people, while the WHO
recommends a maximum of 40 persons
per toilet.
•In Kibera, the mortality rate for children
under 5 is 19%.

5. Problem Statement
Extensive data collection and analyses
reflected major gaps in the flow of
value and resources:
Funder
 Breakdowns in:
 Managerial Oversight
Corporate /
 Business Training
Implementer
 Standardization
 Communication
 Innovation Sharing
 Revenue Sharing
 Hygiene Education
 Governance Processes
 Recognition of Gender Issues/Roles
Facility Operator
Customer

6. Business Model of Social Franchising
Philanthropic
Funder/Grantors
Project Management Oversight
Local Partner/Implementer
Community-Based
Governance
Facilities
Franchises/Local Governance

7. Business Training Elements
 Process Flows
 Standard Operating
Procedures
 Usage Records
 Accounting Records
 Finance Models
 Supplemental
Enterprises

8. Implementation
 Had planned quasi-experimental design varying
degree of project management oversight, degree of
hygiene messaging/training and introduction of
supplemental enterprises
 Revised business focus became (1) making facilities
operational , (2) obtaining consistent water flow (3)
consistent record keeping and (4) adaptation of and
adherence to SOPs
 Data collection on usage rates, accounting, finances
and business management

9. Results-to-date: Usage Rates
TOTAL TOILET USAGE
6000
5000
4000
# Uses 3000
2000
1000
0
Sep Oct Nov Dec Jan Feb
Month
 As facilities become operational, overall usage generally increases over time,
though impacted by water shortages/closures.
 Daily overall average usage ranges from 53 (Oct) to 198 (Feb) across facilities.
 Shower usage was limited primarily by water availability, but also lack of pumps to
upper tanks and lack of water heaters.

10. Results-to-date: Usage Rates
TOTAL TOILET USAGE PER FACILITY
1400
1200
1000
800 Sep
# USES
600 Oct
400 Nov
200 Dec
0 Jan
Feb
FACILITY
• Generally, usage increases at each facility over time (41 exception; attendant
change).
• Jola introduced monthly family usage fee in February, so actual usage
(conservatively) derived, rather than recorded.
• Holiday away trips and serious water shortages (forcing closures) affected usage.
• Location matters: proximity to cheaper pit latrines dampens general usage (MSF),
while proximity to a bar enhances usage (41)!

11. Results-to-date: Accounting
Misc Total Expenses Enterprises Total Revenue
5% 6% Water
Showers 9%
1%
Water
27%
Attendant
56%
Toilet
Tissues 84%
6% Soap
6%
 Biggest expense is payment of attendant, followed by purchase of water.
 Toilet usage is biggest contributor to revenues, with the sale of water and
liquid soap enterprises at facilities emerging as additional revenue streams.
 Water shortages restrict revenue opportunities significantly.
 Planned enhancements to water storage capacity should significantly affect
water and shower revenues.

12. Results-to-date: Financial
NET AVERAGE MARGIN ACROSS
FACILITIES
600
500
400
Rev-Exp Avg
300
KSH
200
100
0
Sep Oct Nov Dec Jan Feb
Month
• Across facilities, there is evidence of profitability.
• Decrease in November reflects new facilities
starting up, while February decline reflects impact
of water shortages and closures.

13. Results-to-date: Financial
NET AVERAGE MARGIN PER FACILITY
1000
800
600
REV-EXP AVG
400
KSH
200
0
-200
FACILITY
• Each facility reflects overall profitability except
Wamunyu, which recently restarted operations.
• Jola uses monthly plan and pays their attendant
the most.

14. Results-to-date: Financial
NET MARGIN PER FACILITY PER MONTH
2000
1500
1000 Sep
Oct
Rev – Exp Nov
500
KSH
Dec
0 Jan
Feb
-500
-1000
Facility
• Water shortages in February adversely affected every facility.
• Alternative monthly pay-for-family-use model at Jola emerged as most
effective in maintaining positive margin (if water is available).
• Current toilet usage alone appears insufficient in most cases to cover
attendants’ expected salaries.
• Increased water capacity could impact revenue stream significantly for
increased water sales, water purification enterprise, and shower usage.

15. Results-to-date: Facility Mgt
 Project Mgt oversight has facilitated centralized problem solving
(e.g., attendant supplies, water issues).
 Project Mgt oversight and profitable facilities has sparked re-
evaluation of Community governance strategies.
 Priorities shifting due to identification of critically needed repairs
and water shortages.
 Gathering data on facility/attendant conformance to SOPs.
 Will correlate SOP conformance ratings (by CBO and Project
Manager) with Net Margin data to test hypothesis that higher
conformance is positively associated with net margin.
 Once facilities are fully operational with new enterprises and
increased water capacity, the degree of project management
oversight will be varied to examine appropriate span of control.

16. Conclusions
 Residents do use facilities when available.
 Monthly passes per family yield consistently higher net
margin (JOLA).
 Consistency in facility functionality and water access is key
to long-term profitability.
 Structural repairs are needed to extend functionality and
increase revenue.
 Need to expand “marketing” by meeting users’ basic needs
first (e.g., greater access to clean water).

17. Social Franchising: Lessons Learned
 Business model yields positive net margin at facilities, critical for
operational sustainability.
 Improved communication up and down the value
chain, facilitated by the project manager, contributed to
financial gains and sharing of local innovations.
 Defining “social” concept means adapting to ever-changing
needs of the community:
 Monthly family-usage fees
 Local governance strategies
 Critical need for greater access to clean water
 Additional data gathering will enable determination of:
 Appropriate project management span-of-control
 Impact on health outcomes and hygiene practices
 User perceptions of influence of local governance

18. Next Steps: Improve Facilities
 Structural/functional
integrity
 Cosmetic Appeal
 Enhancements to
increase usage
(e.g., pumps, water
heaters, handicap
rails, sanitary
bins, incinerator)

19. Next Steps: Increase Revenues
 Expand significantly
capacity for water
access and sales
 Promote water
purification and
liquid soap sales
 Develop marketing
campaigns
 Create consistent
“branding” of
facilities

20. Next Steps: Manage Facilities
 Revise and implement
new local governance
strategies & structure
 Evaluate high/low
project mgt oversight to
determine appropriate
span-of-control
 Evaluate residents’
attitudes towards facility
oversight (CBO post-
survey)