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[Work Update]: Solar Malawi: Where the project is at

Where the project is at:

Currently we have made 180 sales of our solar product. Methods of payment are upfront or on a payment plan, where the customer receives the product after paying an initial deposit, and then pays in instalments over a 6-month period.

 

Payment plans enable immediate access to the product to customers who do not have the ability to purchase upfront. The method of paying instalments on a payment plan is though ‘mobile money’, a digital payment system that is widely used in Malawi through mobile phones. Currently, around 70% of sales have been on a payment plan, enabling those who cannot afford the product upfront.

 

We are facing challenges with finance, mainly the default rate of customers at a rate of 50%. This is due to a number of reasons both on their end (change of circumstances, losing payment information) and on our end (not sending out reminder and confirmation texts, inaccurately tracking incoming payments). The current method of tracking payments is done manually and is thus resource intensive, therefore we aim to transition to an automated CRM (Customer Relationship Management) system.

 

This CRM is currently being developed and is a digital system that keeps track of customer data, payments and sending out automated text messages to customers. The areas we currently operate in are Nancholi, which is a rural region just outside of Blantyre city, and also in Blantyre city itself. In Blantyre city we have begun testing a market stall channel where face-to-face sales can be made. However, our main channel currently is community meetings in Nancholi.

 

In Nancholi there are many villages, and every village has a village chief. We work with a key stakeholder in the Nancholi Youth Organisation (NAYO), who arranges community meetings with village chiefs for us to come and demonstrate the product to a village. We are at a stage now where revenue is being generated and we can look at ways to scale. Past teams have started training agents to make sales with the aim being that they can allow us to run the business all year around when we’re not in-country. A USSD system has also started to be developed, which is an automated text messaging system for customers to report issues and provide feedback which is then stored on a database.

 

 

Where the project is going:

 

Research into procuring a higher quality solar product is underway, however this involves bulk ordering (1000+ units) and importation logistics and costs to be determined. For this transition to be viable, a number of project milestones must be achieved.

 

-       Business operations all-year around. This involves local agents being able to work autonomously when PEV are not in-country, and the logistics to support that such as payment structures, accountabilities, product procurement, performance metrics, etc.

 

-       Low default rate. To become sustainable, the default rate of customers on payment plans must be lowered. Risk mitigations such as incorporating a lay-by* system into payment plans could be further investigated.

*lay-by means receiving the product after paying a certain number of instalments.

 

 

-       A reliable and automated CRM system (Customer Relationship Management). This system must be able to reliably track payments for every customer, as well as sending out automated reminder and confirmation texts.

 

-       Scalable channels. Current channels, whilst effective, are difficult to scale due to reliance on key stakeholders as well as being time and resource intensive. One potential new channel that was discovered at the end of February was to use teachers as agents for distribution.

 

-       Automated feedback system (USSD). To be able to scale, a robust automated system that customers can use to provide feedback and report issues is vital. A USSD system will allow this information to be automatically stored onto a database.

 

 

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