Starting and running a solar lamp retail business in a developing country like Kenya is no small feat. Kenya lacks strong transportation infrastructure for product distribution, and the bureaucratic red tape is not only tedious but can be opaque to foreigners. Meanwhile, the customers who need and want solar portable lamps most are those who can least afford it.

Solar portable lamp companies, such as Little Sun, must navigate informal economies and limited distribution infrastructure to market and sell their products to customers who benefit from the environmental, social, and health improvements that these lamps can provide. (Source: Little Sun)

But although Kenya’s economy lacks many of the market and political institutions that facilitate business operations in the industrialized world, there is significant potential for businesses to support rapid economic growth and generate social impact. A variety of successful solar portable lamp businesses have reframed Kenya’s lack of institutions (let’s call them institutional voids) as opportunities for economic growth.

In 2010, two Harvard Business School professors published the book Winning in Emerging Markets: A Roadmap for Strategy and Execution, highlighting the opportunities and challenges of operating a business in a developing country. They also released a toolkit for identifying and dealing with a country’s institutional voids, raising the following questions that are pertinent to running a solar portable lamp company in Kenya:

  1. Do large retail chains exist in the country? Do they reach all consumers or only wealthy/urban ones?
  2. Do consumers use credit cards, or does cash dominate transactions? Can consumers get credit to make purchases?
  3. Is there a deep network of suppliers? How strong are the logistics and transportation infrastructures?

Successful solar portable lamp companies in Kenya are using a variety of strategies to address these challenges and to mitigate, avoid, and leverage the institutional voids that would otherwise deter or limit business operations. 

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developing countries, distribution, green economy, infrastructure, institutional voids, Kenya, rural electrification, solar portable lamps