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Monday, January 20, 2014

How to Build a Market for Eyeglasses: More than 600 million people have serious vision problems and they -- and society -- pay a steep price

By Paul Polak and Mal Warwick

Photo by Colin Spurway for Mercy Corps.

On Jan. 2 this year, The Guardian revealed that a German physics teacher had been inspired by the book, "Out of Poverty," to produce $1 eyeglasses and market them in Rwanda. 

Martin Aufmuth, founder of OneDollarGlasses, created a hand-operated milling machine that allows opticians to produce his glasses at a cost of $1 apiece after 14 days of training. To enable the local specialist to turn a profit, the glasses sell for between $2 and $7, according to The Guardian.

According to Vision Aid Overseas, some 10 percent of the world’s population are vision-impaired, and eyeglasses could correct the vision problems of virtually all of them – sometimes making an enormous difference in their lives. For example, for a tailor in a hill village in Nepal who no longer can see to sew, a pair of affordable eyeglasses makes the difference between earning a living and becoming a beggar.

Usually beginning in their forties, many people become unable to focus their vision on near objects, a condition called presbyopia. Today you can go into a drugstore in Denver or Amsterdam and select an $8 pair of reading glasses that will correct your vision problem. Why not make a robust version of this display stand available to the nearly 700 million poor people in the world who need eyeglasses?

 

Give me a market so I can see

Adaptive Eye Care, a UK-based company, uses the invention of an Oxford physics professor, Joshua Silver, to bring self-adjusting eyeglasses to people who need them. The constraint here is the cost – $15 dollars now, perhaps $10 or less with volume, but still not affordable to people who earn less than $2 a day.

New Eyes for the Needy, a U.S.-based organization, shipped 355,000 donated used eyeglasses in good condition during 2005-06 to medical missions and charitable organizations in developing countries. The problem here is that giving away glasses is not a scheme that can be scaled up to reach more than a tiny fraction of the people who need them.

In the first five years alone, New York–based VisionSpring (formerly Scojo Foundation) and its partners sold 50,000 reading glasses, at prices from $3 to $5, in India, Bangladesh and El Salvador. And they referred 70,000 people to eyecare professionals through a network of 600 vision entrepreneurs, 26 franchise partners and a number of urban wholesalers distributing to pharmacies and other retail outlets. Now, eight years after its founding, VisionSpring glasses are being worn in 26 developing countries. The organization employs a systematized partnership model that works with microfinance institutions, NGOs, for-profit businesses and social enterprises.

Graham Macmillan, former executive director of what was then called Scojo Foundation (now VisionSpring), told Paul that a surprising number of small-acreage farmers were enthusiastic customers for affordable eyeglasses, because without these glasses they can’t read the labels on seed packages. Some of them don’t know what crop they are planting until it begins to come up.

 

"The combined efforts of VisionSpring, New Eyes for the Needy and Adaptive Eyecare have reached less than one percent of the 670 million poor people who need eyeglasses. The rest live with serious visual problems, paying a significant price in lost income because they can’t see straight – while society pays the price of their lower productivity."

 

A simple solution, and healthy profits

This is outrageous, because there is such a simple solution in taking advantage of uncomplicated eyeglass display stands that already sell affordable eyeglasses to millions of wealthier customers. It would take $5 million to $10 million in venture capital to start an international company that would buy a million eyeglasses in mainland China at around 50 cents apiece, design robust, visually appealing mobile display stands pushed by people or pulled by bicycles or motor scooters in poor areas, perhaps forming partnerships with major corporations such as Tata in India, developing an effective global distribution and marketing strategy.

The company’s goal would be to reach sales of 50 million $2 eyeglasses within five years, and make a healthy profit doing it.

 

 

One-acre, $2-a-day farmers and their urban brothers and sisters are already hard-nosed, stubborn survivalist entrepreneurs ready to take advantage of marketplace opportunities if the price is right, the return is high and the risk is low. But they need private-sector supply chains to furnish them with the tools, materials and information required to create high-value products, and private-sector value chains that sell what they produce at an attractive profit. As their incomes increase, they become customers for products like affordable eyeglasses, houses, solar lighting, health care and education.

New markets that serve poor customers will provide opportunities for hundreds of millions of dollar-a-day people to move out of poverty. But a revolution in design is needed to create the range of new income-generating tools that will make this move possible.

 

 

Paul Polak and Mal Warwick are the co-authors of the book: "The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers"

 

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