Accelerated progress in the provision of safe excreta disposal will not be achieved by any one institution, whether private or pubic, working by itself in isolation from the rest of the sector. There is a dire need for productive, mutually beneficial partnership in the sanitation sector.

"In today's world, the private sector is the dominant engine of growth - the principal creator of value and managerial resources. If the private sector does not deliver economic growth and economic opportunity - equitable and sustainable - around the world, then peace will remain fragile and social justice a distant dream.[...] That is why I call today for a new partnership amongst governments, the private sector and the international community." (Kofi Annan, Secretary-General of the United Nations)

For partners to work together, the self-interests of each partner must be met. When working with the private sector, the ability to make a continuous profit from sanitation is crucial, whether it be a local mason, a pit emptying service company, a retailer, or a latrine component manufacturing operation. This was at the core of success in the Lesotho and Thailand sanitation achievements where the savings and loan sector, including national banks, urban upgrading loan institutions, and micro-finance institutions have been successfully engaged as partners in several innovative projects to overcome the financing and savings constraint of home sanitation construction.

Partnering with Small Scale Private Sector Providers (SSPSP)

In practice SSPSP are already active in latrine provision but their efforts are not being maximized and the following constraints are common:

Becoming recognised

• SSPSP usually form part of the informal sector and are not officially recognised
• Lack access to venture capital, partly due to lack of assets and lack of formal recognition
• Dealing with complicated, time consuming , expensive and corrupt systems in order to gain registration which can be off putting to small businesses
• Possibly subject to onerous and bureaucratic systems of regulation if registration is achieved
• Lack of trade organisations to support and represent them collectively
Lack of business capacity
• Making a business out of human waste is not glamorous and usually attracts people who see it as “A temporary job until something better comes along”
• Inability to effectively promote services to increase customer base
• Lack of training in different latrine designs
• Work usually learnt on the job with no formal training opportunities
• Insufficient cash flow and lack of aptitude for proper pricing and keeping accounts
• Poor communication channels
Commercial viability
• In rural areas the large distance between customers and the infrequent need of their services means too long spent on unproductive travelling time
• Transport costs are high
• The demand for pit emptying is fragmented in time and space and the development of efficient emptying and transport systems is difficult.
• A subsidised programme can force operators out of the market.
• Customers are poor and the services need to represent good value for money. Profit margins are being constantly squeezed.
• The customers are poor and demand credit or easy payment terms.

The sustainability of the small scale sanitation providers is always vulnerable making the need for a supportive, flexible and understanding relationship with the private sector an essential factor for success. It is imperative that the small scale providers are represented in programme design decision making processes.

Partnering With Large Private Sector Companies

Large companies have begun to look at the long-neglected “bottom-of-the-economic pyramid” consumers in developing countries as a potentially large new market for growth. These poorer segments of the population have tended to be ignored in large companies’ business plans but a new realisation that they may represent a very significant new market for goods and services is emerging (Prahalad and Hammond 2002). Organisations like the UNDP and the World Business Council for Sustainable Development (WBCSD) have begun to seek out mutually beneficial partnerships to put the private sector’s efficiency, production, distribution, retail and marketing experience, and capabilities to work for the poor (see UNDP’s Growing Sustainable Businesses program, at www.undp.org/business/gsb/ and WBCSD’s Sustainable Livelihoods Project at www.wbcsd.org). Very creative examples of ways to adapt and extend access to the home construction industry have been shown by some large companies. Companies such as AMANCO in Argentina, CEMEX in Mexico and others (WBCSD 2004) have shown how they can extend their supply chains into these new low-income markets to support low-cost access to home sanitation for the poor. They have covered areas such as construction materials and technical building services, to reach remote and neglected markets of the informal and low income housing sector, typically an informal “do-it-yourself” market.