H4O for Financial Sustainability

Although many developing countries are plenty of (human and natural) resources and a consistent economic potential, the world we live in has created a number of controversial dynamics that exacerbate inequalities.Around 75% of inhabitants is estimated to live below the poverty line of 1.90$ per day and the low purchasing power has opened the market mainly to low quality products (usually) from Asia. Madagascar’s economy is barely self-sufficient and it mainly relies on exporting raw material, tourism, foreigner investments and international aid. To date, there are almost no local enterprises enforcing local economy by creating jobs and processing local resources.

Within this worrying picture H4O makes its contribution by enabling local communities to take advantage and add value to their own natural and human resources. In order to do that, H4O has framed local enterprises able to turn the potential of raw materials into high quality products. The ability of processing raw materials ensures H4O projects the minimisation of both risks and costs and it is the key both to ensure affordability of H4O products for the entire population and to boost local economic development.In fact, the final products H4O put on the market are affordable to anyone but still profitable. What makes the enterprises very impactful is the profit, which is entirely reinvested (100%) in the other H4O WASH projects. This approach allows H4O to kick start a long-term financial sustainability in which the money is invested rather than spent. The aim is to maximise the overall Value for Money (VfM) by increasing the impact of each Euro spent. In addition to that, H4O enterprises ensure good work conditions to their employees, a safe and healthy workplace and also good wages, aligned to middle-income rather than low-income countries.

H4O strongly believes that financial and economic sustainability are crucial for a long-term development that enables H4O to scale the programmes and to reach more and more beneficiaries.

Social enterprises

Reinvesting the revenues exponentially increases the projects’ impact

Within the framework of financial sustainability, our social enterprises cover a key role that makes the projects sustainable on a log terms basis. The aim of the enterprises is to value raw materials by turning them into final goods to create an affordable, sustainable and eco friendly economy.

As a matter of facts, H4O products, such as toothpaste, soaps, or chocolate bars makes the enterprises profitable and enable the NGO to reinvest 100% of it in the other H4O WASH projects.
This approach allows H4O to kick start a long-terms financial sustainability in which donations are invested to generate other incomes rather than a one off gift. The aim is to maximise the overall Value for Money (VfM) of donations and to increase the impact of each Euro spent.

Beyond that, H4O social enterprises take great care of the wellbeing of their employees, by giving a number of benefits such as health covering, extra rewards based on results, and good wages aligned to middle-income rather than low-income countries. By doing that, all the employees with a particular focus on women, get economic independence which enable them to have agency on their own future.


Self production minimizes risks and costs

The key of boosting the Sanitation Programme that makes it scalable is the creation of dedicated fiberglass molds for the serial production of each construction component. By doing that, the building team is able to minimise costs and risks.

The scalability of the programme has been reached thanks to the serial self-made production of squat toilets, sinks, bricks and all the building parts made of concrete. As a matter of fact, one working toilet, comprehensive of the cost of raw materials, labour and logistics is built from scratch with only 160€.

The low cost of its production qualifies H4O to enlarge its impact in all the region till the time each house, school and healthcare facility will have access to improved sanitation facilities.


Affordable tariffs make Maintenance and Management sustainable

Also the single projects need to be financially sustainable by empowering beneficiary communities. H4O aims the community to have ownership and responsibilities of the facilities provided by the projects. For Water supplies we help to set  Community Management Committees (CMC) to take care of the facilities and to cover ordinary Operation and Maintenance costs.

Water has an incredible economic value and local inhabitants are called to choose the right tariff that needs to be paid by users to ensure its financial sustainability. In order to do that, people announce the affordable amount of money they are willing to pay and H4O helps them to make that amount matching the running costs of the facilities. Communities’ key informants collect the fees and take account of revenues and expenses.

This participatory approach makes the projects sustainable in the long-term.

Hygiene promotion

Knowledge and Awareness allow to avoid costs and save money

H4O interventions’ aim is to prevent communicable diseases. If people are sick is not only a health matter but is rather a huge economic barrier for community development. While sick, people cannot be committed to livelihood activities such as fishing and harvesting and it leads to major consequences for the whole household. In fact, although it’s hidden, the economic impact is huge. The WASH contribution to economic development is 1:4. It means that for each 1 € spent in WASH interventions 4 € are actually averted and saved. To avoid costs coincides with get revenues.

This is the reason why raising awareness on the risk factors and determinants of health covers a key role on the diseases’ transmission rate and it reduces all the economic consequences involved.

Hygiene, Sanitation and Nutrition Promotion aim to change people’s behaviour which represent one of the most important determinants of health that impact on communities well being and economic development.


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