• Saturday, April 13, 2024
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Nigeria’s private sector and case for inclusive business

Nigeria’s private sector and case for inclusive business

Inclusive business is a conscious decision by a commercially viable enterprise to accommodate the poor, vulnerable and economically disadvantaged in an organisation’s value chain. As organisations struggle to get a fair share of the market to remain afloat, doing so could be a difficult task. We have seen businesses strive to make profit and influence consumption patterns in their sector to their benefit. Meanwhile, these businesses could do so by making an impact for the common good of society, hence a case for inclusive business.

The business model must cater for the needs of those at the base of the pyramid. Those at the base of the pyramid should be able to afford the goods and services of this economically inclusive business. Low-income people should be involved either as employees or earning more than the minimum wage. Those at the base of the pyramid can be engaged as distributors from the point of production to the end of the sale. The poor can be part of the retailers or end-users of the product or services.

An inclusive business model is synonymous with businesses that can make their product and service available to the poor without creating a product or service bias in an economy. Inclusive business is not the same as corporate social responsibility, social impact or philanthropy activities.

Small, growing or large businesses are the heartbeat of emerging global economies. If these businesses adopt an inclusive business model approach, its multiplier effect will yield a myriad of positive impacts on the economy, individuals, and businesses. An inclusive business model is a missing middle that can improve economic growth, address unemployment challenges, and tackle poverty for those at the base of the pyramid. Inclusive businesses will grow the level of economic activity in the economy. It is a sure route to equitable income redistribution from a region of higher economic temperature to a lower economic temperature.

The business model must cater for the needs of those at the base of the pyramid. Those at the base of the pyramid should be able to afford the goods and services of this economically inclusive business

Read also: ‘IFC working with governments to power private sector in Africa’

Unemployed persons willing and able to work will be engaged as enablers of inclusiveness, thereby assisting businesses in production, distribution and as consumers. The fee-for-service earned will better lots of the poor and vulnerable in society. Nigeria is in dire need of an inclusive business model. The economy is battling with rising poverty, stagflation and exchange rate shortage. Addressing these challenges would require businesses to redirect their business model to incorporate the poor in their value chain to scale, profit, while doing good.

Inclusive businesses will support the government if only the public sector calls for collaboration. It sounds good but requires the government taking the centre stage in setting the pace to make inclusive business acceptable and sustainable. There should be incentives for inclusive businesses working to improve the standard of living for the poor in Nigeria. We believe for this to be feasible, government must create and support companies with funds to scale up and do more.

Inclusive businesses should be adopted by the government to enjoy incentives like taxes, procurement patronage, and technical and managerial skills to appreciate their efforts. The government must do good to encourage good-doers. Business associations must encourage advocacy and transition to inclusive business models in Nigeria through their members. An inclusive business will yield a greater economic impact if a public-private partnership exists. The willingness and drive to address economic challenges like unemployment, huge income-gap and poverty is a task that requires a multi-facetted action and effort, according to Victor Alikor, an economist/policy analyst at the Nextier Group, in an earlier article.