Socially Responsible Distribution: Distribution Strategies for Reaching the Bottom of the Pyramid

Abstract

While management scholars and development economists have provided a compelling case for greater attention to the bottom of the pyramid, few contributions have examined specific strategies for reaching the bottom of the pyramid. The majority comprising the bottom of the pyramid resides in hundreds of thousands of villages located beyond most multinationals' distribution networks. Its access to essential goods is limited not just by high prices, but also by inadequate rural distribution, which also restricts the poor in distributing its produce. We use the term socially responsible distribution to describe initiatives that provide poor producers and consumers with market access for goods and services that they can benefit from buying or selling, by helping neutralize the disadvantages they suffer from inadequate physical links to markets, information asymmetries, and weak bargaining power.

This paper examines three socially responsible distribution case studies of multinational company, government and NGO initiatives. It identifies how socially responsible distribution can be achieved by strategies that take cost out, reinvent the distribution channel or take a long-term perspective that invests for the future. It summarizes procedures and precautions for setting up distribution into the rural bottom of the pyramid, and the payoffs from socially responsible distribution strategies.