Coca-Cola's distribution channels to open up to aid with ColaLife's pilot project

Sipping on a Coca-Cola may not immediately bring to mind ideas of social enterprise. However an inspiring idea from a former British aid worker may be changing that. ColaLife is an organization working to harness the vast distribution channels of Coca-Cola to deliver life-saving social products to the poorest and remotest people of the world. In my previous article 'Coca-Cola and the enterprising social venture' I introduced ColaLife and talked about their concept of 'AidPods' - wedge shaped containers that fit between the Coke bottles in a crate of Coca-Cola. ColaLife have been successful in building a dialogue with Coca-Cola about the implementation of their concept. They have also taken significant steps towards setting up a pilot scheme in Zambia.

This week I was lucky enough to talk to Simon Berry, the founder of ColaLife, about the organization's recent field trip to Zambia.

Q: During your trip to Zambia you met with 45 different people from 15 different organisations. That is a lot of people. Was this planned or did it happen as you were out there?

A: We already had meetings set up and then when we got there people said: "Are you speaking with so and so? You must meet with them." And then we went to meet with them and they would say the same thing. It was a really nice feeling.  The interest was such that people were very generous with their networks. At one point I was speaking to one of the granddaughters of Kenneth Kaunda who was the first president of Zambia. She is now working in the rural hospital in Mpika, which is where we used to live.

Q: What sort of organisations were you talking to? Were they government organisations, NGOs, charities or social enterprises?

A: All of those. We had a big meeting with people from the Ministry of Health, on the government side. Then we met with international NGOs - from UNICEF to people running USAID projects. But we also met with local NGOs. We spoke with mothers to get their view on the sort of thing we were thinking of doing. We met with the private sector. We also met with the bottlers.

Q: The bottlers are crucial to ColaLife's idea as they will be the distributors of the AidPods. How did that go?

A: The bottlers are the most important thing in Zambia because although we've got Coca-Cola's approval to go ahead with the trial that is conditional on the local bottler being onboard. The local bottler in virtually every location is independent of Coca-Cola. It's a separate organisation. In Zambia it is SAB Miller. They are the ones that actually bottle Coca-Cola in Zambia.

Q: In general it seems the response was positive. Did you have any problems or any negative responses?

A: It was surprisingly positive. My experience in this country (UK) is when you come up with an idea or try and promote a particular project you get resistance; often quite strong resistance from other third sector organisations who perceive that you are treading on their toes. Well, we virtually didn't get any of that. We went to one organisation and there was one person who was not encouraging. On analysis we said it would be quite surprising if they had been totally positive because it could be perceived that we are actually treading on their toes. Having said that the same organization sent a person to the workshop we ran and that person was incredibly positive. So nothing at all to worry about. We are in a quite interesting position because we don't have any implementation capacity, at all. So it's quite obvious to everybody that all we're going in there with an interesting idea and some relationships that belong to us; i.e. with Coca-Cola & SAB Miller; that you can't just create overnight, they take a while to form. So that's what we're bringing to the party. And we need everyone else's collaboration to do anything. In a funny way it's quite a powerful position to be in because the most valuable thing for us moving forward is a strong partnership.

Q: How will the logistics of the project work? Who will be responsible for that area of the operation?

A: Medical Stores Limited (MSL). It's a quasi-governmental organisation but it's privatising. We went to Zambia with the scenario that they would carry the AidPods to district level because that's what they do. They themselves said in the workshop: "let's just feed this through the private sector." So MSL might bid to do some of the distribution, but it might be done solely through the private sector. Their response was to put it through the private sector right from the beginning.

Q: Is this because there is then this possibility of people making profit right along the chain creating an element of social enterprise?

A: I think it is. It also means that the motivations throughout the system, right from the very beginning, are consistent. So you're not doing public sector for the first bit and then private sector. You're doing private sector right from the very beginning.

Q: In the pilot scheme you will have in place a system that will allow the delivery of the AidPods and where people will make profit right along the chain. For the end users, the mothers, to be able to afford the cost of an AidPod there will be a subsidy. Have you looked at how this will work?

A: Well that actually is being done already in a project in Zambia called the 'Zambian Access to ACTs Initaitive' (ZAAI). ACTs are the new form of anti-malarial drugs. There's a project that is trying to clear Zambia of all the old non-effective anti-malarials and to get ACTs throughout the system. It's a very new project, and they are doing that purely though the private sector. So they were keen to do the same with our project.

Q: What sort of subsidy will be needed to make the AidPods affordable for the end users?

A: Well let's assume the mothers can afford to pay the value of one egg - that's what people are saying. A good rule of thumb is that when a child gets ill, and there are medicines available, then the price mothers can afford to pay is about the value of an egg. Anyway the unit would be a theoretical 1. Then the retailer would have to buy it for 0.85, so he or she makes 15% on that last bit of the transaction. The wholesaler would have to buy it at 0.75. So therefore it would have to be given to the distributor at 0.65. Now if the 'world price' of the AidPod is 2 units then there would need to be a subsidy of 1.35 units pumped in at the top level. So in other words an organisation would have to buy them on the open market at 2 units but sell them to the distributors at 0.65 units. And that difference would have to be made up with a subsidy of some sort.

Q: Where do you see this subsidy coming from?

A: For the pilot: from Foundations. This is already an established technique being used on other pilot programmes. Longer term: we are exploring Buy One Give One models, where consumers in more developed markets in the West, and the rising African middle classes, will be able to buy AidPod related products (e.g. travel kits, presents for new mums in AidPod shaped bags/boxes). Buying on of those might fund the manufacture and distribution of 1 or 5 or 10 AidPods - we still need to do the maths on that, and a lot of that information will come from the trial.

Q: When do you hope to implement the pilot project?

A: We hope to finish the plan (funding bid submission) by Feb/March 2011. Then we will send it to funders and foundations.  That may take three months to get a reply. We are hoping to start a pilot by the middle of 2011 and it will be likely to run for a year.

If you would like to know more about the ColaLife project or support their work visit their website www.colalife.org

Photo Credit: ColaLife