BDS market development guide.pdf - PACA

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C For new product development, and
C For new market development;
# Information provision;
C Market information for service providers—new market/product development; and
C Service or service provider information for consumers.
Portfolio Approach: Working with More than One Partner
Elsewhere reference has been made to a portfolio approach to working with partners.
Working with more than one partner reduces the danger of distortion and unfair competition,
but an equally important benefit is that it permits leverage:
• Project support is spread more widely across the market; and
• An intervention’s risk is spread: the intervention is not tied to a single organization or
mechanism, so this approach can be more innovative and experimental without the fear of
losing everything if a partner fails to deliver.
Making Support Transactional (see Box 13)
If the objective of BDS intervention is to foster more effective, business-like BDS provision,
intervening agencies themselves must be more business-like in their approach to support,
making support more transactional to replicate conventional business relationships. Soft
support sends entirely the wrong messages to BDS providers, their clients, and the
marketplace; it undermines market signals or incentives and is more likely to distort rather
than develop demand-led service provision. The benefits of transactional support are that it:
• Requires reciprocity and thus has potential for leverage;
• Fosters business-like incentives, behavior, and attitudes;
• Links support to performance; and
• Attaches a value to support—that is, it encourages prudent and effective utilization.
Ultimately, any form of support, transactional or not, is artificial and carries the potential to
distort service provision away from business and toward the donor. One solution is to
transfer support itself to the marketplace, using market mechanisms and pricing. Some
initiatives have experimented with mechanisms such as leasing of equipment, debt or equity
financing for investment, and priced technical assistance.
Developing a Clear Offer
Chapter Four—How Do We Get There?—
Core Implementation Challenges