health staff from center for preventive medicine of hoa binh ... training...3 health staff from...

EDITORS

VIHEMA

Nguyễn Huy Nga

Dương Chí Nam

Nguyễn Bích Thủy

Đỗ Mạnh Cường

Nguyễn Huy Cường

Phạm Hồng Quang

Nguyễn Công Huy

Nguyễn Thị Hồng

Hoa Binh DoH

Trần Quang Khánh

Lê Xuân Hoàng

Trần Thị Ái Hương

Trần Minh Đức

WSP

Nguyễn Diễm Hằng

Nguyễn Thị Hiền Minh

Trần Ngọc Thịnh

SNV & CODESPA

Javier Costa Garcia

Đoàn Triệu Thành

Nguyễn Thuý Hà

Inés Vázquez Ríos

Vinh Prag

Ngô Ngọc Tuân

Đặng Đình Thám

Raúl Ortiz de Lejarazu Machin

Nguyễn Bích Hạnh

3

Health staff from Center for Preventive Medicine of Hoa Binh Province can benefit from this

manual when preparing the training course for One-Stop-Shop – retailers specialized in

complete latrine products, with the objective of establishing a supply chain of low-cost and

locally suitable latrines, and furtherly creating expanded impact to change rural population’s

sanitation behaviors, thus contributing to improve health conditions of all rural households.

The Center for Preventive Medicine of Hoa Binh Province would like to express our sincere

thanks to the Netherlands Development Organization (SNV) and CODESPA Foundation

(CODESPA) for developing the materials, and the Water and Sanitation Program - World

Bank, and the Vietnam Health Environment Management Agency - Ministry of Health, for

their strong support and contribution to the development of this manual.

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BCC Behavior Change Communication CHS CHW

Commune Health Station Commune Health Worker

CPM CLTS

Centre for Preventive Medicine Community-Led Total Sanitation

DoH Department of Health HoV Head of village INGO International Non-Governmental Organization MoH Ministry of Health M&E Monitoring and Evaluation PCERWASS Provincial Centre for Rural Water Supply and Sanitation NTP National Target Program OD Open Defecation ODF Open Defecation Free OSS One-Stop-Shop PC People’s Committee RFG Revolving Fund Groups RWSS Rural Water Supply and Sanitation RWSS – NTP 3 National Target Program for Rural Water Supply and Sanitation III SaniFOAM Sanitation-Focus, Opportunity, Ability, Motivation SNV Netherlands Development Organization USD VHW

United States Dollars Village Health worker

VBSP Vietnam Bank for Social Policies VND Vietnamese Dong WB World Bank WSP Water and Sanitation Program (World Bank) WU Women’s Union VIHEMA Vietnam Health and Environment Management Agency

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Preface ....................................................................................................................................... 3

List of abbreviations and acronyms ........................................................................................... 4

Contents ..................................................................................................................................... 5

I. Introduction ........................................................................................................................ 6

2.1. Introduction of the manual ......................................................................................... 6

2.2. General introduction ................................................................................................... 6

2.3. Introduction of the training course ............................................................................. 8

II. Preparation ................................................................................................................... 12

III. Implementation guide .................................................................................................. 13

Part 1: Introduction .............................................................................................................. 13

Activity 1: Opening ........................................................................................................... 13

Activity 2: Introduction of the training and participants .................................................. 13

Activity 3: Introduction of the sanitation context in Hoa Binh province ......................... 14

Activity 4: Introduction of the Rural sanitation development strategy to the trainees .. 15

Part 2: One-Stop-Shop and its actors ................................................................................... 17

Activity 5: Introduction of the OSS model – Instructions for its actors managing ........... 17

Activity 6: Supporting activities for the OSS ..................................................................... 21

Activity 7: Procedure for Business planning ..................................................................... 22

Activity 8: Meeting between the OSS and their Sales agents network ............................ 44

Activity 9: Exercise: Supporting OSS with the business planning ..................................... 45

Activity 10: Training summary .......................................................................................... 46

IV. Annex ................................................................................................................................ 47

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OBJECTIVES

According to the strategy for rural sanitation development of Hoa Binh province for the

period of 2015 – 2020, activities for demand creation, sanitation market development and

enabling environment strengthening are planned with the objective of creating expanded

impact to change rural population’s sanitation behaviors, thus contributing to improve

health conditions of all rural households.

TARGET USERS

- Provincial and district health workers, who will be trainers of this training

- Other target can use this manual to design and facilitate a training for OSS on

business planning

One of the Millennium Development Goals that Vietnam government has committed to is to

guarantee the sanitation and water supply, and this goal has since then played an important

role in the local socio-economic development. The Vietnamese Communist party,

government and people have been trying to improve their infrastructure conditions and

living conditions, thus contributing to poverty alleviation and to socio-economic

development. However, many sanitation and water supply-related problems are still

pending and their solutions will require more efforts from all stakeholders. Whilst

considerable investments have been made to address these problems, Vietnam has not

been able to achieve the planned targets. In many regions, basic water and sanitation

facilities as well as sanitation behaviors are limited, and causing many negative

consequences to the community and environment.

Despite intervention and support from local authorities, international and national

organizations, communication activities have not been able to create the sufficient impact

on hygienic latrine use, hygienic and sanitation practices. Unhygienic latrine and its use are

still very common in the rural areas, especially in mountainous regions with EMG, difficult

transport conditions and underdeveloped economy. People in many places are still

defecating in open air and using fresh feces as fertilizer for their paddy field or feeding for

fishes. The transition to hygienic latrine at household level is slow.

Provinces with high hygienic latrine coverage are mostly lowland provinces, in the delta area

of Red River, Central coastal area and Eastern South area. Meanwhile, this number is lower

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among provinces in the northern mountainous region, and Hoa Binh is one of the provinces

with low hygienic coverage at nation level.

According to a recent assessment report carried out in Hoa Binh, the most common types of

unhygienic latrine are bridge, bucket, hanging latrines, unimproved pit latrine and single

vault latrine. Meanwhile, septic tank is the most popular type of hygienic latrine, followed

by double vault and soakage pit latrine. However, the observation results indicated a

number of deficiencies in latrine construction, use and maintenance, indicating that many of

the hygienic types of latrines do not meet the MoH’s standards of hygienic criteria. The

assessment also exposed a problem with the hygienic latrine-related information provision.

Many households have reported that they have not received information about the

construction techniques and prices of different types of latrine and they do not know where

to access them. In recent years, the people have known of the hygienic latrines and their

benefits through village meetings or loudspeakers communications. Nevertheless, these

activities are still considered ineffective.

Besides people’s awareness, the household sanitation improvements are also affected by

the supply chain for hygienic latrine construction, including construction materials, sanitary

equipment suppliers, transporters, and masons with technical knowledge. In the local area,

these suppliers are mostly of small scale, without the capacity to provide a complete latrine

product. Meanwhile, the people are not aware of the specific price for their latrine

construction. They would have to waste time and efforts to purchase different materials

from different suppliers, even transport the materials by themselves. Local masons lack

technical knowledge, which would cause negative impact on the latrine construction quality.

And family members’ unawareness of how to use and maintain the latrine properly

contributes to the reduction of their latrine’s durability. All of the above-mentioned factors

are the main causes for the low hygienic latrine coverage in Hoa Binh.

In order to reach sanitation targets and create more opportunity for the poor to access

improved sanitation, the Centre for Preventative Medicine of Hoa Binh (CPM) has

developed an Orientation for Rural Sanitation Development that consists of 3 main

components: i) Enabling environment; ii) Behavior change and awareness raising

communication; iii) Sanitation market strengthening.

The proposed activities in the provincial strategy have been shifted from the one-way, low-

efficiency communication approach which has been used for years, to a participatory

approach that aims to encourage households to participate in the improvements of their

own sanitation conditions, bringing health benefits to not only their family members but

also to the whole community and their surrounding environments.

As this is a new approach, the health workers and stakeholders’ staff are required to

participate in a training course for capacity building. Especially for the sanitation marketing,

which is a completely innovative component for all participants in the sanitation program of

Hoa Binh. There will be new actors participating in this component to strengthen the

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sanitation market, including the One-Stop-Shop, sales agents and masons, who will work

together in order to develop a supply chain capable of providing low-cost and appropriate

hygienic latrine to local households.

This document is developed with the objective of supporting provincial and/or district

health workers in the organization of training courses for One-Stop-Shop (OSS) on managing

and administrating their business and other participating actors in the development of the

local sanitation market.

OBJECTIVES

- The OSS understand the characteristics of the new business model, and know how to

select and develop participating actors in the network (sales agents and masons)

- The OSS understand the administrating mechanism of these actors in order to ensure

the model’s sustainability

- The OSS know how to develop a complete business plan, which will be the basement for

a better management and a tool to facilitate bank’s loan application when necessary

- By having a business plan, the OSS can estimate the sanitation market, develop a market

development plan, calculate the cost and provide financial solutions which will help

them prepare for their business’ operation.

- The OSS can develop their own credit terms such as deferred payment, discount, etc. for

their customers

PARTICIPANTS

- Trainer: Staff from Provincial/District Center for Preventive Medicine - Trainees: Representatives from One-Stop-Shop

TRAINING APPROACH

- The training will apply the participatory approach, with trainees being the focus of the

training. The practice activities will be the most important tasks during this training, in

order to support trainees witth real experience before working for OSS.

- Notice: In case the OSS are unable to participate together, the trainer can change the

approach: the training will take place at the OSS’ site instead of the training hall.

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# Content Duration Approach Results Tools

Part 1: Introduction

1 Opening 5 minutes Speech

2 Introduction of supporting activities for OSS 15 minutes Questions – Answers

Presentation

The trainees know of the activities

that the district are going to

implement to support the OSS

3 Introduction of the sanitation context in Hoa

Binh province

20 minutes Presentation Trainees understand the

sanitation situation of the local

area

4 Introduction of the Rural sanitation

development strategy to the trainees

15 minutes Presentation

Brainstorming

Questions - Answers

Trainees have an overview of the

Rural sanitation development

strategy and the targets

The OSS understands the business

opportunity of hygienic latrine

and market potential

Provincial Strategy

on Rural sanitation

market

strengthening

Summary of local

latrine

Part 2: One-Stop-Shop and its actors

5

Introduction of the OSS model: Roles and

responsibilities of the OSS; Actors in the OSS

network

Instructions for the sales agents and masons

networks management


Brainstorming

Questions - Answers

The trainees understand the roles

and responsibilities of the actors

in the OSS network.

Procedure for

masons selection

Procedure for sales

agents selection

10

Break

6 Supporting activities for OSS 15 minutes Presentation

Questions - Answers

OSS knows of the program’s

support and understand the

benefits of being an OSS

Part 3: Business planning

7 Introduction of the Procedure for OSS’

business planning

(Each of the content listed below come with

an exercise for the OSS)

Market projection

Costs estimation


Exercise: Calculating

real costs

Trainees know how to calculate

the production costs

Trainees understand why it is

necessary to develop a business

plan and know how to develop

their own business plan

Instructions for

business planning

Lunch

7 Introduction of the Procedure for OSS’

business planning (cont.)

Price calculation

Financing options for OSS

Financing options for customers (including

the Procedure for Linkage between One-

Stop-Stop and Sanitation Revolving fund

groups)

Annual sales and revenue estimation

130

minutes

Part 4: Connecting OSS with sales agents network

8 Instructions for the organization of the

meeting between the OSS and the sales

agents network

30 minutes Presentation Trainees know how to organize

the meeting and how to establish

the agreements with sales agents

Instructions for the

meeting between

OSS and Sales agents

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regarding the OSS’ sales policies

Lunch

6 Exercise: Supporting OSS with the Business

planning

180

minutes

Exercise:

Business planning

Trainees can apply the training

contents into the development of

their business plan

Business plan form

7 Training summary 15 minutes

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Duration: 2 days

- 1st day: The above training program

- 2nd day: Practices: The OSS will prepare information and data of their business and

complete the business plan.

- If the OSS can participate in 2 days consecutively, the training course for OSS can

follow the normal structure as other training courses

- Otherwise, the trainer can organize a half-day training for all the OSS and then visit

each OSS to instruct them to develop the business plan for their business (one and a

half day for each OSS)

Preparation:

- Training hall: sufficient space for 10 participants, sufficient lights and screen/wall for

projection

- Training materials:

o Business plan form

o Manual for One-Stop-Shop

o Price quotation

- Stationery:

o Laptop, projector

o Markers of different colors

o Scissors and duct tape

o Paper in different colors

o A0 paper: 10-15 sheets

o A1 paper: 250 sheets

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Objectives

- Trainees know each other and know of the OSS in the district/province

- Trainees understand the main contents and objectives of the training

- Trainees understand the objectives and activities in the Strategy for rural sanitation

market strengthening

- Trainese understand the local sanitation situation and the business opportunities in

the local sanitation market

Preparation

- Write down on paper main training objectives

- Powerpoint presentation with the following contents

o Current sanitation situation of Hoa Binh

o Main contents in the Provincial sanitation strategy

o Main objectives of the strategy

ACTIVITY 1: OPENING

Representative from the District Center for Preventive Medicine will introduce the training’s

objectives and participants

ACTIVITY 2: INTRODUCTION OF THE TRAINING AND PARTICIPANTS

# Content Duration:

15 minutes

1 Introduction of the training objectives 5 minutes

2 Introduction of the participants 10 minutes

2.1. Introduction of the training objectives

- Trainer use the prepared paper with the training objectives to explain to the

trainees:

o After the training, the trainees will:

◦ Understand the business model, and how to select and develop the

participating actors in the model, which are the sales agents and

masons

◦ Understand the administrating mechanism of these actors in order to

ensure the model’s sustainability

◦ Know how to develop a complete business plan, which will be the

basement for a better management and a tool to facilitate bank’s loan

application when necessary

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◦ Estimate the sanitation market, develop a market development plan,

calculate the cost and provide financial solutions which will help them

prepare for their business’ operation.

◦ Develop their own credit terms such as deferred payment, discount,

etc. for their customers

2.2. Introduction of participants

- The trainer will ask trainees to introduce themselves with the following information

Introducing themselves: Name, address, family (optional)

Introducing the business: Name and address, services provided, number of

workers, etc.

ACTIVITY 3: INTRODUCTION OF THE SANITATION CONTEXT IN HOA BINH PROVINCE

- The trainer can start this activity by giving a brief introduction of the objectives of the National Target Program on Rural sanitation:

o The National Target Program (NTP) on Rural water supply and sanitation is an important program started by the government that focuses on improving the water supply and sanitation facilities for the rural population. This program is a part of the national strategy for poverty reduction and development and also a tool for Vietnam in the implementation of the Strategy for Water supply and Sanitation by 2020. Since 2012, the NTP has entered its 3rd phase with the objective of achieving nationwide hygienic latrine coverage of 65% by 2015.

- Ask trainees: o Do you know the current latrine coverage of Hoa Binh? o And how is the hygienic latrine coverage?

- Invite 1-2 trainees to answer and then provide reported data on the sanitation situation of Hoa Binh using the PowerPoint presentation (Slide no.3 and 4: Sanitation context in Hoa Binh province – Presentation for the Training for OSS). Emphasize that the latrine coverage in Hoa Binh is lower than other provinces and point out the districts with lower hygienic latrine coverage than the provincial average.

- Ask trainees: o In your opinion, why is the hygienic latrine coverage in Hoa Binh lower than other

provinces? - Summarize the answers:

o The latrine coverage in one district is quite high but the hygienic coverage is low with big gaps among communes. The further a commune locates away from the district’s center, the higher its poverty rate and unhygienic latrine coverage get

o Most people do not understand the connection between latrine construction, use and maintenance vs its impact on human health. Many people are not aware of the harms caused by untreated feces

o The authorities only have promoted latrine construction, without carrying out promoting or encouraging activities for hygienic latrine

o The people face many difficulties when buying latrine, especially when they want to investigate prices of different types of latrine

o The people do not have complete information of the market price of hygienic latrines and consider that only septic tank have the characteristics of hygienic latrine

o Masons do not know construction techniques for hygienic latrines and can’t guarantee construction quality

o The people have not received proper instructions on hygienic latrine construction, use and maintenance, which leads to an elevated number of damaged and unhygienic latrines.

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ACTIVITY 4: INTRODUCTION OF THE RURAL SANITATION DEVELOPMENT STRATEGY

# Content Duration:

15 minutes

1 Provincial Rural sanitation strategy 7 minutes

2 Hygienic latrine business

opportunities

8 minutes

4.1. Provincial Rural sanitation strategy

- The trainer will introduce the Provincial strategy for Rural sanitation using the PP

presentation (Slide no.5 – Presentation for the training for OSS).

- The main contents to be explained are:

3 main components in the provincial sanitation program: i) Demand creation;

ii) Supply chain development; iii) Enabling environment strengthening. The

sanitation program will promote private sector’s participation in the market

development by applying a market-based approach, in which the market

actors will encourage rural households to invest in hygienic latrine; the public

authorities will accelerate the development of latrine-specialized businesses

and integrate marketing activities in the communication campaign to create

demands for hygienic latrine.

Overall objective of the program (Slide no.6) Increase the hygienic latrine

coverage in Hoa Binh Province under an inclusive market-based approach.

Indicator 1: Hygienic latrine coverage increased to 75% by 2020.

Indicator 2: At least 30% of the villages are declared ODF in each of the

intervention communes by 2020.

Indicator 3: Gap in the hygienic coverage between poor households and

the total average is reduced to 10 percentage points.

4.2. Hygienic latrine business opportunities

- The trainer will present the table of sanitation market opportunities in Hoa Binh

province (slide no.7 and 8). Explain the meaning of the numbers in the table

- Slide 7:

Column “Increase of hygienic latrine coverage” shows an estimation of

hygienic latrine coverage’s increase from 2014 to 2015.

Column “Potential market” shows the number of households who will build

hygienic latrine each year.

- Slide 8 shows an example of the market opportunities in the districts of Hoa Binh in

2014, assuming that the annual increase of hygienic latrine is 10%:

Column “Number of hygienic latrine increase each year” shows the number

of households who will build latrine (calculated by multiplying the annual

increase of 10% with the total number of households in the districts)

Column “OSS customers” shows the number of households who will buy

latrine using the OSS’ services

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Column “OSS annual market” shows a concrete number of customers for

each OSS in the OSS (the table assumes that there are 2 OSS in the district)

- Ask trainees:

o What do you think when looking at this table?

- Invite 1-2 trainees to answer

- Conclude

o With the support from the province and district in the implementation of

communication activities, the demand for hygienic latrine

construction/upgrade will be very high. This is the opportunity for OSS to

develop the complete latrine provision service.

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ACTIVITY 5: INTRODUCTION OF THE OSS MODEL – INSTRUCTIONS FOR MANAGING ITS

ACTORS

# Content Duration:

45 minutes

1 One-Stop-Shop and its actors 10 minutes

2 Roles and responsibilities of the OSS, Sales agents and

masons 5 minutes

3 Sales agents and Masons selection 30 minutes

5.1. One-stop-shop and its actors

- Start the activity with this question

o As you can see, the number of potential customers in the sanitation market of

our province is quite high. Let us see how existing businesses like yours are

currently serving this market

- Ask trainees:

o Please describe the current provision of materials for the latrine construction

in the local area.

- The trainer can provide some suggestions, such as:

o What types of materials are you selling? Do you provide all the necessary

materials for the latrine construction? What difficulties do households

normally face when they want to build a hygienic latrine?

- Ask 1 – 2 trainees to answer. Then summarize the answers;

Current businesses only provide some specific materials. There are no

businesses that sells all the materials for a complete latrine construction,

including cement, gravels, ceramic pan, plastic tube, etc.

The shops do not provide transportation service, thus forcing customers to

find transporter on their own. This is time, effort and money consuming

The customers must find masons or build the latrine on their own even

without knowledge or techniques of latrine construction

The customers do not know how to use and maintain their desired latrine

properly

- After that, ask trainees:

o How can retailers get the most efficient access to the sanitation market

(meaning the household can save time, cost while the retailers still can

expand their business)

- Summarize:

o The solution for this is the business model proposed in the Rural sanitation

strategy for Hoa Binh province, which is the One-Stop-Shop

- Explain the definition of a One-Stop-Shop (Slide no.10 in the presentation).

- Show the demonstrative graph of the One-Stop-Shop model (Slide no.11) and ask 1

trainee to describe the graph

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- Summarize the graph, emphasizing the the masons and sales agents are the 2 main

actors in the OSS network (using Slide no.13)

o In order to provide a complete latrine construction service, the One-Stop-Shop

will manage their masons (in charge of latrine construction) and sales agents

(in charge of product promotion and sales) networks. These are the 2

fundamental and important actors in the implementation of OSS’ activities in

the local sanitation market

- Ask trainees:

o From this definition, can you tell what services will be provided by the OSS in

order to offer hygienic latrine products to the market?

- Summarize the OSS’ services (using Slide no.12)

Materials provision

Latrine construction and installation service

Transportation service

Financial support for households living in difficult conditions

5.2. Roles and Responsibilities of OSS:

- Ask trainees:

o As you already know, each OSS will have 2 supporting actors, just like their

right and left hands. Then, what are the roles and responsibilities of the

masons and sales agents?

- Invite 1-2 trainees to answer.

- Use slides no.14 to 18 to briefly explain the roles and responsibilities of each actor.

5.3. Masons and sales agents selection

5.3.1. Masons selection procedure

a. Masons selection criteria

- Before explaining the selection procedure, ask trainees :

o In your opinion, are there any requirements to become the masons for OSS?

What are these requirements?

o Who will be responsible for the selection?

- Write down trainees’ answers to the board

- Discuss the mason selection criteria: Briefly discuss with the trainees on their ideas.

After that, select only the ideas that coincide with the criteria in the procedure and

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add the missing criteria that have not been mentioned. Emphasize that these criteria

are the one to be used in the mason selection. Divide the criteria into 2 groups:

Mandatory criteria and secondary criteria. (Use slide no.20 to present the criteria)

(See more details in the Mason selection procedure – Manual on rural sanitation

planning and implementation for District health worker).

- Explain the reason of establishing mandatory criteria:

Criterion 1: To live permanently in the commune and not working seasonally

in the city or district town

The selected masons who regularly work in other districts/provinces will

possibly not have time to complete their role in the local area.

Criterion 2: To be a respected member of the community

A respected mason will be trusted and listened, and then he can easily

convince others.

Criterion 3: To have experience in construction

An experienced mason in construction is a mason who has mastered basic

construction techniques and can quickly acquire the hygienic latrine

construction techniques from the training course.

- Explain:

o A set of questions are developed to support qualifying a mason whether

he/she meets these criteria. The questions are included in the Mason selection

procedure in your Manuals.

- Ask trainees to use the manual and invite 1 trainee to read all the questions.

- Explain the selection method: The selected masons meet all the mandatory criteria

and achieve the highest scores with the secondary criteria.

b. Selection procedure

- Ask trainees:

o In your opinion, who will be the main responsible for the selection?

- Summarize:

o The masons selection in the responsibility of the commune health workers and

OSS owners as the mason is a main actor participating in the OSS network.

The OSS will manage and coordinate their masons and guarantee the latrine

construction quality for the household customers.

- After that, explain which steps in the procedure that require OSS participation (Use

slide no.21) (See more in the Mason network management – Manual for OSS).

c. Procedure summary

- Ask trainees to repeat the mason selection criteria

- Ask:

o How will the masons and OSS owner cooperate after the masons selection?

- Summarize:

The OSS will cooperate with the D-CPM to organize the training course on

latrine construction techniques for masons.

Both actors will agree upon the salary and the work quality required by OSS.

The OSS can select new masons if the existing can’t guarantee the work

quality.

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5.3.2. Sales agents selection procedure

a. Sales agents selection criteria

- Before explaining the selection procedure, ask trainees :

o In your opinion, are there any requirements to become sales agents for OSS?

What are these requirements?

o Who will be responsible for the selection?

- Write down trainees’ answers to the board

- Discuss the sales agents selection criteria: Briefly discuss with the trainees their

ideas. After that, select only the ideas that coincide with the criteria in the procedure

and add the missing criteria that have not been mentioned. Emphasize that these

criteria are the one to be used in the sales agents selection. Divide the criteria into 2

groups: Mandatory criteria and secondary criteria. (Use slide no.22 to present the

criteria) (See more details in the Sales agents selection procedure – Manual on rural

sanitation planning and implementation for District health worker).

- Explain the reason of establishing mandatory criteria:

Criterion 1: Have good communication skills

One of the sales agents’s responsibilities is to visit local households to

promote the benefits of having a hygineic latrine, explaining different types

of hygienic latrine and convince households to improve their sanitation

conditions by using the services provided by the OSS. Therefore, the sales

agents are required to have communication skills like presentation skill,

persuasion skill, etc., in order to encourage customers to listen, share their

opinions and motivate them to make the change.

Criterion 2: To be a respected member of the community

A respected sales agent in the community will be trusted and listened, and

then he can easily convince others.

- Explain:

o A set of questions are developed to support qualifying a sales agents whether

he/she meets these criteria. The questions are included in the Sales agents

selection procedure in your Manuals.

- Ask trainees to use the manual and invite 1 trainee to read all the questions.

- Explain the selection method: The selected sales agents meet all the mandatory

criteria and achieve the highest scores with the secondary criteria.

b. Selection procedure

- Ask trainees:

o In your opinion, who will be the main responsible for the selection?

- Summarize:

o The sales agents selection in the responsibility of the commune health

workers and OSS owners as the sales agent is a main actor participating in the

OSS network. The OSS will manage and coordinate their sales agents.

- After that, explain which steps in the procedure that require OSS participation (Use

slide no.23) (See more in the Sales agents network management – Manual for OSS).

c. Procedure summary

- Ask trainees to repeat the sales agents selection criteria

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- Ask:

o How will the sales agents and OSS owner cooperate after the masons

selection?

- Summarize:

Both actors will agree upon the commission rates.

The OSS will explain clearly their deferred payment and discount policies.

The OSS will explain to the sales agents about the product order process and

their requirements on work quality.

The OSS can select new Sales agents if the existing can’t guarantee the work quality.

ACTIVITY 6: SUPPORTING ACTIVITIES FOR THE OSS

- Ask trainees efore explaining the supporting activities for OSS

o In your opinion, what kind of support will an OSS need in order to develop into

a complete latrine provider with profitable results?

- Write down trainees’ answers on the board. Analyze and select correct ideas and

add missing answers. Then explain each of the supporting activities for the OSS:

Establishment of the One-stop-shop network and their participants:

After having identified the demand and selected the OSS from existing

businesses, the CPM will help the OSS invest in the latrine production,

equipment preparation. The CPM will help the OSS develop their sales agents

and masons networks as described in the procedures.

Capacity building

the CPM will support the OSS to ensure that they have the necessary

knowledge and information to develop their business sustainably. The OSS’

masons will also receive training on hygienic latrine construction techniques

in order to guarantee the construction quality. The OSS’ sales agents will be

trained on sales and marketing skills, household visiting procedure. The OSS

will be trained on business projection, business registration, access to credits,

business planning, so that they can develop a profitable and sustainable

business.

Facilitating access to customers through village meetings, household visits

and Revolving fund group’s meetings:

The Head of village and village health workers will promote the hygienic

latrine model through the village meetings, promotional household visits. The

sales agents will carry out their product marketing visits to households and

convince local villagers to buy latrine from the OSS.

Communication materials support

In order to support the marketing activities, the P-CPM will design and

produce all the printing and communication materials, such as the Manuals

for Sales agents, Manuals for OSS, banners, posters, etc.

Quality supervision

in order to guarantee the latrine construction quality, the local health staff

will supervise the OSS’ latrine construction and distribute an instruction

22

sticker to the household customer so that they know proper use and

maintenance techniques for their latrine.

ACTIVITY 7: PROCEDURE FOR BUSINESS PLANNING

# Contents Duration

1 Objectives of the business planning 15 minutes

2 Market identification and potential market

projections

- Definitions of market and potential market - How to estimate the potential market for

OSS

30 minutes

3 Costs estimation

- Fixed assets - Other costs - Calculating the production costs for 2

complete latrine options - Calculating the total cost of each option

30 minutes

4 Price 15 minutes

5 Financing supports for OSS and financial costs 30 minutes

6 Financing supports for customers 30 minutes

7 Calculating OSS’s annual sales, revenues and profits 40 minutes

8 Introduction of the Business plan 15 minutes

7.1. Objectives of the business planning

7.1.1. Definition of the Business plan

- The trainer will start the training with a game “Egg throwing”: each group of trainees

will have to throw “eggs” made of paper rolls into a bin from different distance.

- After the game, the trainer will ask

o What experience do you gain from playing this game?

Every activity needs a target. The further the target is, the harder it gets. It is

easier to achieve targets that are suitable with our capacity

- Connect the game to the business activity and confirm the necessity of the business

plan.

o Having a business plan will facilitate a better financial and infrastructure

preparation, and especially will help the business define suitable targets with

their capacity. Like the game we just have played, who has a better

preparation and knows where it is best for him to throw the egg will have a

better throw and win the game.

23

- Provide the definition of the Business plan:

- Ask trainees:

o In your opinion, why do we have to develop the business plan? (In other

words, what are the benefits of developing the business plan for retailers?)

- Let trainees think and express their points of view. After that, explain the benefits of

having a business plan:

A business plan help us

o Predict the market: The OSS can estimate their business’ development in the

future, such as the scale of their future market, the potential profit from the

market for their business.

o Estimate costs, revenue and profits: the OSS will know how much they have to

invest into the business and their potential profits. In case the profits do not

meet our expectation, price adjustments can be made in time to avoid losses.

However, the price adjustment depends on the product’s price in the market.

Too high price will lead to lower competitivity and interest from customers.

o Reduce risks: What are the risks in business? These risks can be lack of capital,

the production capacity cannot satisfy the demand, obsoleted/backward

technologies leading to low efficiency or loss of reputation, business losses,

competitions, etc. A business plan will help us predict these risks and minimize

them.

o Facilitate access to low cost financial sources, in order to provide similar

financial supports to customers: the business plan is one of the requirements

for business when applying for loans. Loan providers are like investors, who

expect realistic and attainable goals from the business plan. The bank, for

example, will base on the business plan’s analysis to approve the loan

application or not. If the business plan can convince the bank to concede the

loan, it’ll be an advantage for the business, helping them invest better in their

production and then attract more customers.

THE BUSINESS PLAN

• The Business plan is a manual for any one participating in the any product

or service business

• The Business plan focuses on sales promotion, provision, organization,

management, and cost accounting

• The Business plan is a general plan for the business’ production or

product/service supply

The Business plan is the plan for the business’ future

24

7.1.2. Necessary information for an effective business planning

- Ask the following question to help trainees understand the importance of preparing

information prior to developing the business plan

o What contents do you think that a good business plan that satisfies the

aforementioned requirements should have?

- Encourage trainees to propose their ideas and write them down on the board or A0

papers.

- Emphasize the following main contents that should be in a business plan:

Information to identify the market and estimate the potential market

Information to identify the production costs

Information to determine the price

Information to develop the financial plan

Information to develop the financial support options for customers (Deferred

payment, credits, discounts, etc.)

Annual revenues, sales and profits

- Summary

o This information collection is the preparation for the business planning. The

more accurate the information is, the more realistic and persuasive the plan

gets.

7.2. Market identification and potential market projection

7.2.1. Definitions of Market and Potential market

- Firstly, explain the definition of Market and Potential market by asking trainees:

o How would you define Market and Potential market?

- After the trainees have answered, provide the correct answers so the trainees

understand and can separate these 2 definitions:

“The market is a specific place where buyer and seller meet to exchange products and

services”

- Based on this definition, we can see that the OSS’ market consists of one or more

communes where they are going to provide their products

“The potential market is a market that includes potential customers with demands,

payment capacity and willingness to pay to satisfy their demands”

- With this definition, the potential market for OSS is the group of customers without

hygienic latrine, who has demand for this product, payment capacity and willingness

to build a hygienic latrine.

- Ask trainees:

o Who will be the customers for OSS?

Households without latrine or with unhygienic latrine will be the potential

customers for OSS.

25

o So how can we know if the potential market has sufficient customers for the

OSS?

- The trainees will provide their answers. The correct answer is investigating the

market through Commune Health Station or District CPM.

7.2.2. Calculating the potential market for OSS

- Ask trainees:

o Which communes will be your OSS’ market?

- Let trainees answer, then show the information table of those communes with

intervention in the district (if available) or of all communes (See Table 2 – Market

information of Kim Boi District in the Manual for One-Stop-Shop). Discuss and

assign the communes to each OSS (depending on the distance and transport

conditions)

- Explain Table 2:

o The customers for OSS will be those households without hygienic latrine (the

sum of households without latrine and households with unhygienic latrine)

- Provide some examples to help trainees know how to calculate the potential market

(See Table 3 – Potential market for each OSS in Kim Boi in the Manual for One-

Stop-Shop)

o Once the communes are selected, the OSS will contact with those communes’

CHS or with the District CPM to ask for the number of households, households

without hygienic latrine, the commune’s annual target on hygienic coverage

increase.

- Provide the table of households without hygienic latrine in Table 3 and explain how

to calculate the number of potential customers per commune:

From the number of households without hygienic latrine in the commune,

who possibly have demand for hygienic latrine construction, the OSS will take

50% as their customers. The other 50% are estimated to purchase the latrine

from other retailers.

Potential customers for OSS in one commune = 50% of the total households

without hygienic latrine in the commune

- Determine the number of potential customers of each OSS:

Total OSS’ potential customers = total potential customers in all OSS’ market

communes

- After that, provide an example with detailed calculation of potential customers:

How to calculate the number of potential customers each year

For example: Vinh Tien commune of Kim Boi has 1,575 households, of which 619 HH do

not have hygienic latrine. These 619 households will not build a new latrine all at once

but sporadically throughout the years. The target for hygienic coverage increase is 10%

26

in 2015 and 15% in 2016. Therefore, we will have the estimated number of households

who will build new latrine in 2015 and 2016 as follows:

2015: Total households x 10% = 158 HHs

2016: Total households x 15% = 236 HHs

However, only 50% of these numbers are considered potential customers for OSS. In

Vinh Tien, there will be 158/2 = 79 HHs in 2015 and 236/2 = 118 HHs in 2016 who will

purchase the latrine from OSS. These numbers are the total annual estimated sales of

OSS in one commune.

Continue to calculate the potential number of customers in other OSS’ communes to

have the total number.

Total potential customers for OSS (estimated sales) = total potential customers in the

market communes of OSS

- Summary: Ask trainees

o In short, what do we have to do to identify and estimate the potential market

for our business?

Identify the market communes

Contact with CHS or DCPM for sanitation information

Calculate the potential customers

- Exercise 1: Ask each trainee to estimate the number of potential customers for their

OSS, using the Table 3 as reference (this table can be printed before the class to

distribute to trainees)

# Commune

Total

number

of HHs

(1)

Total

number of

HHs

without

hygienic

latrine

(2)

Hygienic sanitation

coverage increase

Potential market for

OSS

2015 (3)

(=1x10%)

2016 (4)

(=1x15%)

2015 (5)

(=3x50%)

2016 (6)

(=4x50%)

1

2

3

Total

How to complete the table:

o Fill the commune table with the OSS’ market communes

27

o Fill the number of HHs and HHs without hygienic latrine with the numbers

provided by the Commune Health Station annually

o Calculate the annual increase of sanitation coverage and the potential market

for the OSS using the provided formulas

7.3. Cost estimation

- Introduce the following content:

o After having estimated the market and potential market, we will continue to

calculate the production costs.

- After that, ask trainees:

o In your opinion, what costs will the production and provision of the latrine

product include?

- The trainer can provide some suggestive questions:

o Do we need to invest in any fixed assets to produce the concrete rings?

o Do we need to invest in materials for the latrine construction? Which

materials are they? Do we need labour force?

o Will there be other costs for the production, such as electricity, water or

transport?

- All trainees’ answers will be written on the board or A0 paper. The trainer will then

comment and summarize into 2 main kinds of costs, which are costs for fixed assets

and other costs, including materials cost, labour cost, water cost, electricity cost, etc.

7.3.1. Fixed assets

- Explain that the costs for fixed assets only include the new investments, not

investments that have been made previously such as means of transport,

warehouse, etc.

- Ask trainees to list out their investments:

o What fixed assets will the OSS have to invest in for the new business?

- Write trainees’ answers on the board and discuss with them on the necessary

investments to be made, such as machinery, construction tolos, and concrete ring

production tools (molds, concrete vibrator, etc.)

- After having the list of necessary fixed assets for the OSS, the trainer will ask:

o Why do we need to list and calculate the price of the fixed assets for the OSS?

Know what investments to be made

Know the necessary capital for these investments

Calculate the fixed assets’ cost for each product

- Use the example in the manual for OSS to explain the costs calculation for fixed

assets (using Table 4: Fixed assets' depreciation and Table 5: Depreciation cost per

product in the Manual for OSS)

o List out the fixed assets to be invested: quantity and the price for each asset.

o Find the number of useful years for each asset

o Calculate the annual depreciation cost of each asset = Asset’s costs/number

of useful years

o Calculate the total annual depreciation of all assets

o Calculate the annual depreciation cost for each product = Total annual

depreciation/total annual sales

28

In the example table, the investment cost for the ring molds is at 15 million VND/set

of 3 molds. The mold will need replacing after 5 years, which means an amortization

cost of 3 million/year. We already have the number of potential customers for the

OSS in 2015 is 188 HH, and in 2016 is 282 HHs.

The cost for fixed assets per product in 2015 is: 3,000,000/188 = 15,957 VND; in 2016

is: 3,000,000/282 = 10,638 VND

- Summary: Ask trainees:

o Please summarize the calculation for fixed assets’ costs

o What are the new fixed assets to invest? Quantity? Price?

o What is the depreciation cost for each product?

- Exercise 2: Calculate the depreciation cost for their business’ products , using the

Table 4 as reference.

Fixed assets

(1)

Quantity

(2) Price (3)

Subtotal

(4 = 2 x

3)

Useful life

(5)

Annual

depreciation

(6 = 4/5)

Total

- Exercise 3: Calculate the depreciation for 1 latrine using the Table 5 as reference.

# Cost Unit

Depreciation per latrine

2015 2016

1 Annual depreciation VND

2 Annual latrine sales Unit

3 Depreciation per latrine (=1/2) VND

7.3.2. Other costs

Identifying the products that OSS provides to the customers

- Ask trainees:

o In your opinion, what components are there in a hygienic latrine product?

- Explain to the trainees that the OSS’ products are not simply bricks, cements, sands

or concrete rings, but a complete hygienic latrine. Based on the household’s

purchase preference, the OSS will offer 6 product options:

29

Builds lining parts for septic tank latrine with concrete rings1

Builds lining parts for septic tank latrine + provides materials for solid

superstructures

Builds lining parts for septic tank latrine + solid superstructures

Builds lining parts for soakage pit latrine

Builds lining parts for soakage pit latrine + provides materials for a solid

superstructures

Builds lining parts for soakage pit latrine + solid superstructure

- Explain more about these product options. The OSS will mainly provide 2 types of

hygienic latrines using concrete rings, which are the Septic tank latrine and Soakage

pit latrine. Each of these latrine products comes in 3 options for different

households’ payment capacity.

For example, with a septic tank latrine, there are options for customers who want to:

Build a complete lining parts and superstructures

Build a complete lining parts and buy materials to self-build the

superstructures

Build a complete lining parts and self-build the superstructures using locally

available materials

We only have to calculate the production costs for a complete latrine, including

lining parts and superstructures, to know the costs for other 2 options, by

subtracting the materials and/or labor costs for the superstructures.

Costs of each latrine option

- Ask trainees

o What are the costs to provide a complete hygienic latrine?

- After the trainees have answered, the trainer will write on the board and explain

that there are 3 different groups of costs, which are: i) production costs, including

materials, labour and general production costs, ii) management cost, and iii)

commission.

7.3.3. Production costs of the 2 complete latrine options

- Use the Table 6: Production cost for the complete septic tank with concrete rings –

Manual for OSS (shown on the projector or written on A0 papers) to help trainees

understand the different production costs for septic tank and soakage pit latrines,

listing out the following 3 groups of costs:

The production costs for a complete septic tank latrine construction include:

Materials costs:

Materials for concrete ring construction: iron bars, cement, sands,

gravels

Materials for lining parts installation: cement, sands, gravels, iron

bars, ceramic pan, plastic tubes

1 For simplification, we have included the different options of underground structures for wet types of latrines

made of concrete rings. Other types of tanks made of cement bricks or dry latrines could also be provided. They are not included in the business model as they would compete with the concrete rings types of latrines.

30

Materials for superstructures construction: bricks, sands, gravels,

cement, fibre cement sheets, plastic tubes

Labour costs for concrete ring construction, lining parts installation,

superstructures construction

Other costs: water and electricity for ring construction, depreciation, transportation costs

- After explaining the costs, ask trainees to complete the following exercises:

31

- Exercise 1: Calculate the production costs for the complete septic tank latrine option,

using the Table 6 as reference:

Cost Qty.

(1) Price (2)

Subtotal

2015

(3 =

1x2)

2016

(4=3

x105%)

Construction materials cost

1 Material cost for 1 set of concrete rings for septic tank latrine

Iron bar Ф6

Cement

Gravels

Sands

2 Material costs for the lining parts of septic tank latrine

Gravels

Cement

Iron bar Ф6

Sand

Pan

Plastic tube Ф90 and connectors

3 Material cost for the solid superstructures

Cement brick

Sand

Cement

Fibrocement sheet

Plastic tube for the superstructures

Labor cost

4 Labor for the rings production (2 worker/2

sets of rings/day)

5 Labor cost for lining part installation (2

workers/2 latrines/day)

6 Labor cost for simple solid superstructures

construction (6 labor units)

7 General production costs

Amortization cost

Electricity cost

Transportation cost

Total production cost for a complete

septic tank latrine

32

- Exercise 2: Ask trainees to calculate the production costs for the complete soakage

pit latrine option, using the Table 7: Production cost for soakage pit latrine with

concrete rings in the Manual for OSS as example:

Costs Qty.

(1) Price (2)

Subtotal

2015

(3 = 1x2)

2016

(4=3

x105%)

Construction materials cost

8 Material cost for 1 set of concrete rings for soakage pit

latrine

Iron bar Ф6

Cement

Gravels

Sand

Plastic tube 50

9 Material costs for the lining parts of soakage pit latrine

Cement

Sand

Pan

Plastic tube and connectors

1

0

Material cost for the solid superstructures

Cement brick

Sand

Cement

Fibrocement sheet


Labor cost

1

1

Labor for the rings production (2

workers/3 set of rings/day)

1

2

Labor cost for lining part

installation (1 worker/2

latrines/day)

1

3

Labor cost for solid superstructures


1


Amortization cost

Electricity cost

Transportation cost

Total production cost for a

soakage pit latrine

33

7.3.4. Total costs for each product option

- Use table 8 in the Manual for OSS to explain how to calculate the total costs for 6

latrine options

- Ask:

o We have calculated the production costs for all the 6 options. Do you think

that we need to include any other costs?

- Repeat the costs that have been taken into consideration, including material costs,

labour costs, amortization, transportation, water, electricity.

- If no one has mentioned the management cost and commission for Sales agents, the

trainer can suggest:

o Do we need to administrate the production process?

o Do we need to pay for the sales agents for carrying out the promotion?

- After the trainees have answered, the trainer can confirm:

o The total costs for each option should include the management cost and

commission for SA.

- Use the Table 8: Total costs of each latrine option production costs in the Manual

for OSS – 5.3.4 Calculate the cost of each selling option to illustrate how to calculate

the total costs for each of the 6 options.

The management cost is often calculated as 1% of the total production cost.

The commission for Sales agents is agreed to be 100,000 VND/product, regardless of

the product option.

- Exercise 6: Calculate the costs for each of the 6 latrine options, using Table 8 as

reference

Product Cost 2014 2015

Option 1. OSS builds the

complete lining parts for septic

tank latrine

Production cost

(1+2+4+5+7)

Management cost

(1% of production cost)

Commission for sales agent

(100,000 VND per product)

Total cost


complete lining parts and

provides materials for a basic

solid superstructures for septic

tank latrine

Production cost

(1+2+3+4+5+7)

Management cost




Total cost


complete septic tank latrine

Production cost

(1+2+3+4+5+6+7)

34

with basic solid superstructures Management cost




Total cost


complete lining parts for

soakage pit latrine

Production cost

(8+9+11+12+14)

Management cost




Total cost




solid superstructures for

soakage pit latrine

Production cost

(8+9+10+11+12+14)

Management cost



Total cost


complete soakage pit latrine

with basic solid superstructures

Production cost

(8+9+10+11+12+13+14)

Management cost



Total cost

7.4 Price

- Ask trainees:

o How can OSS identify or calculate the latrine price?

- Write down trainees’ answer on the board. Then, provide the most simple way to

calculate the latrine’s price:

Price = Total costs + expected profit

- Explain how to know the expected profit

o Each OSS can place their preferred profit in this formula. The profits for OSS

include profit from selling materials and fixed profit for the product provision.

- Recommend the most appropriate amount of fixed profit for OSS: 300,000 VND for a

set of concrete rings for septic tank latrine and 220,000 VND for a set of concrete

rings for soakage pit latrine.

- Explain to trainees how to set the price, using the Table 9: Price for each latrine

option in the Manual for OSS – 5.4. Setting the Price

- Summarize:

o In order to set the price, it is necessary to know:

◦ The materials’ prices

35

◦ The labour costs (based on the production trials to determine the

necessary amount of materials and labour costs for the latrine

construction).

- Exercise 7: Calculate the price for each latrine option, using the Table 9 as example




tank latrine (concrete rings)

Total cost

10% Profit from materials used

Profit from selling the product

Selling price






Total cost



Selling price




(concrete rings)

Total cost



Selling price



soakage pit latrine(concrete

rings)

Total cost



Selling price





soakage pit latrine (concrete

rings)

Total cost



Selling price




(concrete rings)

Total cost



Selling price

7.5 Financing options for OSS and their financial costs

7.5.1. Preferential loans

- Ask trainees:

o During the business development, would OSS encounter problems with the

capital? How should the OSS deal with these problems?

36

- Explain:

o The capital is always a problem for the businesses who want to implement

their business plan. When in lack of capital, the OSS will have to ask for loans.

However, for a profitable business, the OSS should access to preferential

loans. Currently, the OSS can access to 2 financial sources, which are the

Vietnam Bank for Social Policy and Agribank:

VBSP’s credits: are of low interest rates but the credit amount is

limited and hard for OSS to get access

Agribank’s: the OSS only have to put collateral to be able to ask for

credits. The loan application process only takes 15 days. The credits

amount depends on the demand and the collateral’s value. The

credit’s value is 70% of the collateral’s value. In order to ask for loan

from Agribank, the OSS needs to go to the local branch to complete

the application. Agribank’s loan normally has higher interest than

VBSP’s.

- Summary:

o There are 2 main financial sources for OSS

◦ From VBSP: Hard to access, limited amount

◦ From Agribank: easy to access, only needs collateral

7.5.2. Business registration

- Ask trainees:

o In your opinion, why do we have to obtain the business license?

- Write down trainees’ answers. Then emphasize the reasons to register as a business:

o Having a business license will facilitate OSS’ access to better loans with low

interest rates.

o Having a business license could also protect OSS’ rightful benefits in case of

economic conflicts.

- After that, explain each step in the business registration process following the

presentation. The trainer can alternatively prepare this content on papers

previously.

- The business registration process is very simple, including 3 main steps:

Step 1: The business must prepare the Business registration dossier, including

the following documents: i) Application for Business registration, with

detailed information on the household or group registering to be a business:

ID number, full name, and signature; on the business: business’ location,

business line, capital. ii) Copy of IDs of participants in the business project or

head of household. iii) A meeting minutes on the business establishment in

case the business is formed by a group of individuals

Step 2: Submit the dossier to the Economy Department at district level.

Step 3: The verification and licensing takes at most 15 days. The business will

then have to go to the district Economy department to retrieve their license

7.5.3. Calculation loan cost

- Explain the definition of Loan cost:

37

o The loan cost is the cost that the business has to pay when receiving loans

from external sources – which is the interest for the loan.

- Explain to trainees how to calculate the interest

Annual loan cost = Monthly interest rate x [(Debt 1 x number of months 1)

+ (Debt 2 x number of months 2)

+ (Debt n x number of months n)]

- Emphasize:

o In your opinion, should we include the interest in the costs? If yes, in which

case should we do that?

- Summary:

o The loan cost will be included in the latrine price if the customer chooses the

deferred payment option. In that case, the OSS can apply their current loan’s

interest rate to the customer.

7.6 Financing options for customers

7.6.1. For customers who choose to buy on credit

- Explain that this deferred payment option is widely used and the OSS should

incorporate this option into their payment policies:

o Generally, the local retailers, including construction materials sellers have

applied this payment option for a long time to facilitate purchasements from

households without the capacity to pay for the order at once. Normally, the

deferred payment term is of 4 months, and the retailer will apply the interest

rate from their current Agribank’s loan.

- Explain to trainees how to determine a suitable deferred payment rate:

o Depending on the loan’s interest, the business’ financial capacity and the

customer’s payment capacity, the deferred payment terms may vary.

o For example, if the business is currently borrowing a loan from Agribank with

monthhly interest rate of 1.15%, the deferred payment rates will be different

if the customer chooses to pay after 4 months, 6 months or 12 months.

Deferred price formula

Deferred price = Cash price + (amount to be paid on credit x monthly Interest rate x

payback term (in number of months))

- Ask trainees:

o How can the customers know if the OSS has a deferred payment policy?

- And explain

o These prices and information will be provided to the Sales agents, so that they

can inform customers during the household visit for product marketing. If

necessary, the SA must directly contact with the OSS to update the

information.

38

7.6.2. For customers who pay through the Sanitation Revolving Fund Group

- Explain how to establish the Sanitation RFG

o For the villages where there are already RFG, the Sanitation RFG will be

formed based on these existing and working RFG. For vilages without RFG, the

Village WU can organize a meeting with their members and establish

Sanitation RFG.

- Explain the Sanitation RFG’s operation

o All members of the Sanitation RFG will pay a monthly contribution to the

group’s fund. And each member will take turn to receive the payment from

the group’s fund each month, and use the money to build a hygienic latrine

for their family.

- Ask trainees:

o In your opinion, what policies should a OSS apply to Sanitation RFG’s

members in order to rapidly increase the local hygienic sanitation coverage?

- Invite 1-2 trainees to answer. After that, provide some proposals for the OSS policies

regarding Sanitation RFG, e.g. Deferred payment, discount for bulk orders (more

than 4 latrines/order), etc.

- Ask trainees to think:

o What are the relationships among the Sanitation RFG – OSS – SA in this

cooperation model?

- Explain (the trainer should have written the roles of the 3 actors on A0 papers

previously):

o The Sales agents will be the connection between Sanitation RFG and the OSS;

they will cooperate with WU to establish the groups, give advice to the group

members on the selection of the hygienic latrine, submit the purchase orders

to OSS, transfer the payment from RFGs to OSS.

o The WU: will manage the Sanitation RFG; receive the list of payments that

their group members have to pay for the latrine, collect the monthly

contribution, send the group’s payment to Sales agents.

o The OSS: will receive the purchase orders from SA, calculate the costs for the

latrine of each member, discount the price for bulk orders, provide a complete

latrine package.

- Help trainees calculate the payment that the Sanitation RFG’s members should make

when participating in the group

The OSS’ financial support = total number of Sanitation RFG members x the

group’s monthly payment

List out the members’ name, their respective latrine and its price

Calculate the discount for each household = total discount for the

group/number of members in the group

Calculate the interest that the group must pay to the OSS each month

Calculate the interest that each group’s member must pay = total interest for

the group/number of members in the group

Calculate the price of the latrines = original latrine price + interest per

member – discount per member

39

Calculate the advance payment that each member must make in the 1st

month = the latrine price – the monthly payment from the group to the

member

The monthly payment that the RFG should pay to the OSS = Number of

members x the group’s monthly contribution

(See the Procedure for Linkage between OSS and RFG – Manual for OSS)

- Exercise 8.1: Establish and run the sanitation RFG with the following data

WU’s RFG: 25 members. Monthly contribution of 100,000 VND

Small Sanitation RFG: 6 members

Interest rates: 1.5%/month

- Exercise 8.2.: Establish and run the sanitation RFG with the following data

WU’s RFG: 15 members. Monthly contribution of 200,000 VND

Small Sanitation RFG: 5 members

Interest rates: 1.5%/month

4.6.3. For customers who apply for a VBSP loan

- Explain the 3rd payment option for customer. Besides asking for OSS’ loans or

participating in the RFG for deferred payment option, the customer can ask for

credits from VBSP’s water and sanitation program. Details are as below:

Current terms: The credit is of 6 million VND/project. Each household can

borrow 12 millions in total for 2 project (water and sanitation); interest rate:

0.9.6%/ year. Duration: 3 years.

Requirements: The household is permanent resident in the area; the

household is non-adopter or unhygienic adopter; the household is a member

of a local Savings group.

Process: The household prepares the Loan application and submits to their

Savings group. The Savings group then prepares a list of all household

members who want to apply for VBSP’s loans, including local CPC’s

verification, and submits it to the VBSP’s district branch for approval.

7.7 Calculating OSS’ annual sales, revenues, and profits

- Ask trainees:

o In order to calculate the total sales, it is necessary to know the sales results

for each option. How can we estimate these numbers?

- Explain how to estimate the sales percentage and the sales results of each product.

Firstly says that a current World Bank’s market research has pointed out that there

are 5 different groups of customer who are capable of paying a different amount

money for the latrine construction:

Segment 1: 44% of households answered that they could pay more than 5

million VND

Segment 2: 21% could pay from 3 to 5 million VND




40

A high percentage of people belonging to segment 1 already have a hygienic latrine, so the

OSS should not target this segment, who also prefer high-end options. Segment 5 cannot

afford any of the options that can be provided by OSS, so the OSS cannot target this

segment also (this segment will be supported by CPM to self-built their latrine).

Households from segment 2, 3 and 4 can afford the options provided by OSS (from 1 million

to 5 million VND), so they should be the clients targeted by the OSS, 47% of the market

(segment 2+3+4).

If we consider that these 47% represent 100% of the OSS sales, the proportion for each

subgroup can be re-calculated as follows:

- 45% can pay from 3 to 5 million VND (G1)



Comparing with product prices, it is possible to assign each group to a specific product

option depending on their affordability.

In order to do the calculation, and because there are households in each segment whose

affordability is closer to the upper end and households closer to the lower end, it is assumed

that 50% will choose the most expensive option (a septic tank) and 50% the cheapest option

(a soakage pit).

In addition, households with affordability a bit lower but very close to a better latrine option

price would decide to buy this type.

With this information the following segmentation has been done:

Product option Calculation Result

OSS builds the complete lining parts for

septic tank latrine 50%*G2+50%*G3 27.5%

OSS builds the complete lining parts and

provides materials for a basic solid

superstructures for septic tank latrine

40%*G1 18%

OSS builds the complete septic tank

latrine with basic solid superstructures 40%*G1 18%

OSS builds the complete lining parts for

soakage pit latrine 50%*G3 16%

OSS builds the complete lining parts and

provides materials for a basic solid

superstructures for soakage pit latrine

50%*G2 11.5%

OSS builds the complete soakage pit

latrine with basic solid superstructures 20%*G1 9%

Total 100%

41

- Explain

o Knowing the estimated sales results for each latrine product, we can easily

calculate the annual revenues, costs and profits for our businesses by

applying the following formulas:

Revenues = Estimated sales x Product price

Total costs = Estimated sales x Cost per product

Brute profit = Revenues – Total costs

42

- Exercise 9: Calculate the estimated sales for each latrine option, using Table 17:

Estimated sales of each latrine option in the Manual for OSS as reference:

Product option Percentage

(1)

Estimated total sales (2) Estimated sales for each

option

(3 = 1 x 2)

2015 2016 2015 2016

OSS builds the

complete lining parts

for septic tank latrine

27.5%

OSS builds the


and provides

materials for a basic

solid superstructures


18%

OSS builds the

complete septic tank

latrine with basic solid

superstructures

18%

OSS builds the


for soakage pit latrine

16%

OSS builds the


and provides


solid superstructures


11.5%

OSS builds the

complete soakage pit


superstructures

9%

Total 100%

43

- Exercise 10: Calculate the revenues and profits, using Table 18: Sales and profit

projections in the Manual for OSS as reference

Product option

2014 2015

Qty.

(1)

Revenues

(2)

Costs

(3)

Net

profit

[4 = 1

x (2-

3)]

Qty.

(5)

Revenues

(6)

Costs

(7)

Net

profit

[8 = 5

x (6-

7)]

1 OSS builds the

complete lining

parts for septic tank

latrine

2 OSS builds the

complete lining

parts and provides


solid

superstructures for

septic tank latrine

3 OSS builds the


latrine with basic

solid

superstructures

4 OSS builds the

complete lining

parts for soakage pit

latrine

5 OSS builds the

complete lining

parts and provides


solid

superstructures for

soakage pit latrine

6 OSS builds the

complete soakage

pit latrine with basic

solid

superstructures

Total

44

7.8 Introduction of the Business plan

- Use the business plan form and emphasize that this is the standard form for

sanitation business plan. This form can be used to apply for a bank loan.

- Distribute the Business plan form to the trainees and ask them to read thoroughly

the contents

- Explain the structures of the plan, starting with the main components to help

trainees have an overview of the plan before going into the details of objectives and

contents for each component.

ACTIVITY 8: MEETING BETWEEN THE OSS AND THEIR SALES AGENTS NETWORK

# Contents Duration

1 The necessity of organizing the meeting

between OSS and Sales agents

3 minutes

2 Meeting contents 5 minutes

3 Meeting preparation 10 minutes

4 Meeting implementation 10 minutes

5 Conclusion 2 minutes

8.1. The necessity of organizing the meeting between OSS and Sales agents

- Before instructing the OSS to organize this meeting, the trainer should explain clearly

the reasons for the meeting.

- Explaining the meeting’s objectives:

To develop the coordination and implementation mechanisms between the

OSS and their Sales agents network

To meet, know and build trust between the OSS and their sales agents

To provide sales agents with additional knowledge of hygienic latrines and

information of the OSS

- Ask trainees:

o In your opinion, who is the main facilitator of this meeting?

- Agree on that the facilitator of this meeting is the OSS’s owner, as the owner will be

who manage the sales agents in their market communes. Besides this initial meeting,

the OSS’s owner will have to organize regular meetings with the SA and masons to

update the latrine sales and construction results, provide lessons learnt, and inform

the implementation plan for the upcoming period

8.2. Meeting contents

- Ask trainees:

o What contents do you think that this meeting between the OSS and SA should

include?

- Invite 1-2 trainees to answer. Then agree on the main contents of the meeting, using

the Manual for OSS – Meeting between OSS and SA as reference. The trainer can

use the meeting’s introduction in the presentation for reference.

45

8.3. Meeting preparation

- Ask trainees

o Based on the agreed contents, what information and materials do you think

that the OSS should prepare in order to ensure the expected meeting results?

- Agree with trainees on the necessary preparation for the meeting. Emphasize the

importance of the preparation, as the Sales agents will need these

information/materials during their promotion activities to households

- Provide the Price quotation form and explain the information that the OSS should

prepare (prices). Remind them that even if the each OSS’ transportation policy is

different, it should be based on the objective of providing latrines with a reasonable

price and guaranteed quality to the households.

8.4. Meeting implementation

- Explain the main steps in the meeting, using Manual for OSS – Meeting between

OSS and SA as reference.

- Remind the OSS that they should introduce their store to the SA, as this will help the

SA understand more about the OSS that they are working with and create a

professional bond of trust

- Due to the time limitation, the meeting should be of short duration, from 2 to 2.5

hours. After the meeting, the OSS must agree with the SA on the schedule for the

regular meeting between the 2 actors.

8.5. Conclusion

- Ask trainees to repeat the main contents of the meeting and how to implement the

meeting

ACTIVITY 9: PRACTICE: SUPPORTING OSS WITH THE BUSINESS PLANNING

This activity can be organized directly in the OSS if they do not have time to participate in

the training course.

- After having participated in the collective training course, the OSS will prepare the

necessary information for the business planning as indicated during the course. The

instructor will then visit each OSS to support them to complete the business plan.

- It is required the participation of the OSS’ owner and at least 1 staff who can support

the owner with calculation.

- The instructor will use the business plan form and guide the process following these

steps

Explain each component of the business plan

Practice the business planning with OSS: During the planning, the trainer will

discuss and explain to OSS in order to ensure the plan is developed correctly.

- See the Business plan form in the Annex 1

46

ACTIVITY 10: TRAINING SUMMARY

1. Summarize the training contents

2. Repeat the OSS’ responsibilities regarding the business planning

3. Distribute the Training evaluation form. The trainees complete the form and

submit back to the trainer

4. Closing speech of the DCPM’s representative.

47

BUSINESS PLAN FORM

SECTION I: GENERAL INTRODUCTION

Name:

Address:

Phone:

Current business model: information about the current business of the retailer/producer:

Business license; Current products; Frequent customers (households or projects); Market

communes; Annual number of customers; Popular uses of their materials

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

Proposed new business line: the OSS should use information from section 2 and 3 from the

Manual for OSS to complete this section (Introduction and One Stop Shop model)

Describe the current business situation and the demand for hygienic latrine, as well as the

problems that the households are facing when wanting to build a latrine

What problems will the new business line solve? What benefits for the business and the

community will it bring?

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

SECTION II: MARKETING PLAN

II.1/Product: use information from the Product Menu, the advantages of OSS’ products in

comparison with other existing products (providing the complete product in one transport,

low cost, additional technical services if necessary)

48

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

II.2/Target Market and distribution: for “target market” use information from the section

5.2. How to develop the market projections in the Manual for OSS, and for “Distribution” ,

see Household visit for Product marketing in the Sanitation marketing Manual for Sales

agents.

Information of OSS’ Market communes and potential market

# Commune Total HH

HHs without hygienic latrine

Hygienic sanitation coverage increase

Potential market in the district (50%)

2015 (10%)

2016 (15%)

2015 2016

(1) (2) (3)=(1)x10% (4)=(1)x15% (5)=(3)x50% (6)=(4)x50%

1

2

3

4

5

6

7

Total

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

II.3/Sales and Revenues Estimation:

Use the instructions from the Act.2 – 5. Calculating OSS’ annual sales, revenues and profits

to complete the following tables. Complete these tables after having the final selling price

and estimated sales results for each latrine option.

49

Estimated sales results and revenues

Products

2015 2016

Qty Price Revenues Qty Price Revenues

1 OSS builds the



2 OSS builds the


and provides materials

for a basic solid

superstructures for

septic tank latrine

3 OSS builds the



superstructures

4 OSS builds the



5 OSS builds the


and provides materials

for a basic solid

superstructures for

soakage pit latrine

6 OSS builds the

complete soakage pit


superstructures

Total

50

II.4/Marketing costs: including the costs for advertisements, communication materials

printing, and commission for promoters

# Costs Costs for 2015 Costs for 2016

Total

II.5/Price Strategy and profit: Use information from Act.2 – 4. Financing options for

customers and 5. Calculating OSS’ annual sales, revenues and profits

The OSS should describe how they set the price for the products, the differences between

their prices and other competitions’, between retailing price and bulk price, between cash

price and deferred payment price.

Describe the calculation for each product’s estimated profit

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

SECTION III: PRODUCTION PLAN

III.1/Place, area facilities where the production will take place

Briefly describe the production location and facilities, including warehouse, grounds, store,

etc. Can illustrate using a map.

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

III.2/Production Process

Briefly describe the production process, from materials purchase, on-site production and

product supply, using the following graph

51

III.3/Fixed assets’ investments: Use the information as explained in Act.2 – 2. Necessary

information for the business planning

Fixed assets’ investments

Initial investments Qty. Price Subtotal

(VND) Useful

life

Annual depreciation

(VND)

Total

Calculate the depreciation per product using the table below

Annual depreciation per product

# Cost Unit

Annual depreciation

2015 2016

1 Total Annual depreciation VND

2 Annual sales Unit

3 Annual depreciation per product (=1/2) VND

III.4/Annual costs

III.4.1/Direct production costs for each product: Use the information as explained in Act.2 –

2. Necessary information for the business planning

52

Direct production costs for septic tank latrine construction

Costs Qty (1) Price (2)

Subtotal

2015 (3)=1x2

2016 (4)=3x105%

Construction materials cost 1 Material cost for 1 set of concrete rings for septic tank latrine

Iron bar Ф6

Cement

Gravels

Sands

2 Material costs for the lining parts of septic tank latrine

Gravels

Cement

Iron bar Ф6

Sand

Pan

Plastic tube Ф90 and connectors


Cement brick

Sand

Cement

Fibrocement sheet


Labor cost 4 Labor for the rings production (2

worker/2 sets of rings/day)

5 Labor cost for lining part installation

(2 workers/2 latrines/day)

6 Labor cost for simple solid

superstructures construction (6

labor units)


Amortization cost

Electricity cost

Transportation cost

Total production cost for a


53

Direct production costs for soakage pit latrine construction

Costs Qty (1) Price (2)

Subtotal

2015 (3)=1x2

2016 (4)=3x105%

Construction materials cost 1 Material cost for 1 set of concrete rings for soakage pit latrine

Iron bar Ф6

Cement

Gravels

Sand

2 Plastic tube 50

Material costs for the lining parts

of soakage pit latrine

Cement

Sand

Pan

Plastic tube and connectors


Cement brick

Sand

Cement

Fibrocement sheet


Labor cost 4 Labor for the rings production (2

workers/3 set of rings/day)

5 Labor cost for lining part

installation (1 worker/2

latrines/day)

6 Labor cost for solid superstructures



Amortization cost

Electricity cost

Transportation cost

Total production cost for a soakage

pit latrine

III.4.2/Total costs for each latrine option:

The Total costs include the direct production cost, management costs (1% of production

costs) + commission for SA

54

Apply the results from Table III.4.1 for the following table

Total costs of each latrine option




tank latrine

Production cost

(1+2+4+5+7)

Management cost




Total cost





tank latrine

Production cost

(1+2+3+4+5+7)

Management cost




Total cost




Production cost

(1+2+3+4+5+6+7)

Management cost




Total cost



soakage pit latrine

Production cost

(8+9+11+12+14)

Management cost




Total cost





soakage pit latrine

Production cost

(8+9+10+11+12+14)

Management cost



Total cost




Production cost

(8+9+10+11+12+13+14)

Management cost


55


Total cost

III.5/Human resources needed and employment creation (permanent and temporal

workforce)

Based on the total costs, we can determine the employment creation capacity of the

business. The employment includes works for concrete ring production worker, works for

masons, additional works and income for sales agents.

Calculate the number of workers and complete the following table:

Information of the OSS’ workforce and employment creation capacity

Work Number of

workers

Number of

working days

Price Subtotal

Ring production

Transportation

Mason

Sales agent

.................

Total

SECTION IV: FINANCIAL PLAN

IV.1/Total investment:

Content Investment Self-capital Necessary

loan

1. Fixed assets

2. Working capital

Total

The OSS should base on their sales policy to determine the working capital:

- If the OSS does not allow paying on credit, their working capital will be equal to their

monthly production costs (by dividing the above total costs for 12 months)

56

- If the OSS provides the deferred payment policy, the working capital will be

calculated as:

Necessary working capital = Total annual production costs/12 months x

Deferred months x Percentage of estimated deferred products

IV. Loan repayment plan: Interest rate/month

Loan repayment plan

Month/year Loan amount Interest

rate

Interest

Payment

Loan

payment Total payment

Total

4.3/Profit and loss estimation 2015/2016

Profit and loss estimation

Item 2015 2016

I. Revenues (a)

II. Costs (b)

III. Profit (c=a-b)

IV. Other costs (d)

Loan Cost

Net profit (c-d)

57

SECTION V. CONCLUSION

Briefly prove the business plan’s feasibility, citing the benefits that the plan will offer to the

community and to the business, with emphasis on the number of created employment

(both direct and indirect workers)

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

Place, date

Plan’s author

(Name)

58

PRICE QUOTATION LIST

The One-Stop-Shop: …………………………………..

Address: ……………………………………………………………

Phone number: ………………………………………………………..

1. Products price

Product Selling price (excluding

transporting cost)

Option 1. OSS builds the complete lining parts for septic


Option 2. OSS builds the complete lining parts and

provides materials for a basic solid superstructures for

septic tank latrine (concrete rings

Option 3. OSS builds the complete septic tank latrine

with basic solid superstructures (concrete rings)

Option 4. OSS builds the complete lining parts for

soakage pit latrine(concrete rings)

Option 5. OSS builds the complete lining parts and

provides materials for a basic solid superstructures for

soakage pit latrine (concrete rings)

Option 6. OSS builds the complete soakage pit latrine

with basic solid superstructures (concrete rings)

2. Materials transporting cost

The transporting costs is depending on the distance between the OSS and the

household:

- Area 1: For distance in the range of 1 – 5 km: ……………….. ……VNĐ

- Area 2: For distance in the range of 5 – 15 km: ………………. …..VNĐ

- Area 3: For distance in the range of 15 – 30 km: …………………. VND

59

3. OSS’ credits policy

- Requirements:

……………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………

………………………………..

- Interest rate: …………………………………………………………………………………

4. Discount policy

- Discount requirements

Discounts for household living in difficult conditions (if available):

Discounts for bulk orders (more than ….. separated orders)

…………………………………………………………………………………………………………………………………………

…….

- Discount rate for bulk orders

For 2-4 separated orders: Discount ………………… VND or … …..%

For 5-10 separated orders: Discount ………………… VND or … …..%

For more than 10 separated orders: Discount ………………… VND or … …..%

60

TRAINING EVALUATION

Day.... Month.... Year

Training course (subject)

Place:

Please use the table below to evaluate the training course. The highest point is 5 and lowest

is 1. Tick in the box accordingly to the point you want to mark. There is the column for

additional comments in case you have any comment.

Evaluation content Evaluation point Comment

1 2 3 4 5

The appropriateness of the

training program’s design

The real outcomes in

comparison with your

expectations

Quality of the trainer/facilitator

Quality of the training materials

Accommodations issues

General evaluation

What do you like the most in this training?

What do not you like in this training?

Recommendations and suggestions for improvements?

Further comments?

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