7 Estimated Result

Estimated Result 1: 15 small and medium enterprise (SME) stove producers are able to sustainably produce 100,000 high quality ICS.

Estimated Result 1: 15 small and medium enterprise (SME) stove producers are able to sustainably produce 100,000 high quality ICS.

To date, the current partnership in the ICS program of Oxfam Novib and the partners shows that the main bottleneck of the cook stoves value chain is on the supply side, while the demand-side is showing a progressive trend. Production-time related labour and low quality of the produce are identified as main limiting factors. In response to this challenge, the Action aims at promoting faster production methods that can increase manufacture by 50% and improve the quality of the cook stoves production. Through a concerted technical capacity development conducted by the implementing partner in the Action, ARMI/NORMAI, 15 small and medium enterprises (SME’s) stove producers will have credible business plans, access to credit and collectively the producers will be able to produce a total of at least 100,000 branded Improved Cook Stoves (ICS) over the 4-year time span of the Action that comply to the specified quality standards. Since 2011, ARMI/NORMAI has been coordinating the on-going Improved Cook Stove Program on a pilot basis in Savannakhet province thereby developing proven technical and managerial capacity. These pilot efforts have put in place an embryonic network of SME producers and retailers that form the core of the improved cook stove value chain.

Main Activity 1: Producer support

As confirmed in the on-going pilot effort, one of main expected results of this Action is to secure the critical bottom rungs of the supply side of the value chain in which well-trained producers are firmly established and respected quality control and procedures and an initial formation of producer association are in place. As the key implementing partner, ARMI/NORMAI will manage day-to-day activities of the Action and oversee a comprehensive training program that will build the capacity of target producers to the point where they reach business maturity. In the ICS pilot, ARMI/NORMAI has been working with producers that have been producing relatively better quality stoves in respect to efficiency and sturdiness. However, to increase competitiveness, even for these stoves, the design will need to be refined to correspond to the higher performance standard. Next to that, the volume of the production to meet the consumers’ demand is still on the low side. Nevertheless, the existence of these producers is an important starting point as they the capacity to adopt easily to the new quality standards and mode of production. It is also identified in the pilot that other producers in the area have shown their interest to adopt the high quality stove production.

Skilful and well-trained producers will be able to efficiently produce a sufficient quantity of cook stoves with low production costs and high quality production standards in order to meet market demand. This activity package will engage the Department of Science and Technology (DST) as the official authority to endorse the implementation of laboratory testing and Quality Control/Assurance systems. To ensure full-fledged capacity of the implementing partner, the Action will seek regular support from GERES, an international NGO that, with EC support, has successfully managed a fuelwood-saving project in Cambodia since 1996 that eventually resulted in obtaining a carbon credit for their efforts. The Action will ensure that the technical and project management quality strengthening provided to ARMI/NORMAI will be as high quality as possible, congruent to the level of support expected from GERES. The Action highly takes into account that technology transfer, adopted to the Lao-context and culture, will be ensured from the EC-funded program in Cambodia.

Implementing partner: ARMI/NORMAI, SNV Stakeholders: 15 SME’s and the DST.

Activity 1.1 - Technical Capacity Building of ARMI/NORMAI

This activity foresees the continuation of technical support from GERES or equivalent capacity builder in building the technical and managerial skill levels of ARMI/NORMAI to the point where it can competently oversee a significantly scaled up program that will be expanded to five provinces.

Activity 1.2 - Quality Control (QC) & Quality Assurance (QA) Protocols

This entails detailed testing of selected design models (production process and dimension checking, thermal shock test, strength test) with a view to optimizing product quality and determining ideal ICS dimensions. Corrective measures need to be taken at this stage for any QC or QA issues that arise as a result of monitoring. Once the optimal model is determined, specific protocols are intended to define parameters for production monitoring (schedule of monitoring visits, number of ICS to be controlled, etc). ARMI/NORMAI will have a Memorandum of Understanding (MoU) with each producer confirming agreement on adherence to QC and QA protocols.

Activities 1.3, 1.4 & 1.5 - Capacity Development of Producers

This interlinked set of activities begins with development of a standardized training curriculum that draws on lessons learned and materials utilized in the successful scale up of the EC-funded fuelwood savings program in Cambodia, but adapted to the Lao context. Materials will focus on both the practical and theoretical aspects of cook stove production so that producers can better understand the implications of choosing and preparing raw materials and the impact of varying production techniques and tools. Training will focus on stove production and will be rolled out to small groups of producers on an on-going basis with the initial training having an anticipated duration of two weeks. Follow on training, once production start-up has taken place, will focus on Quality Control and Quality Assurance aspects of production. Production issues or constraints will be regularly assessed and refresher training on production skills will be systematically conducted or corrective measures recommended roughly every three months during the initial two years of the action.

Activity 1.6 - Enhanced Production Management

Once ICS production commences, producers will be expected to initiate proper record keeping (recording the name of workers producing each ICS, date of production, batch and serial numbers, sales records and invoicing) consistent with sound SME business practices. Through regular group meetings with producers, augmented by frequent site visits (weekly during the production start-up period) to production facilities, ARMI/NORMAI will provide on-going technical support and mentoring.

Activity 1.7 - Database Management

ARMI/NORMAI will solidify the database initiated during the pilot project, provide record keeping support to producers, and ensure adequate tracking and compilation of production data with a view to ensuring records are sufficient for an eventual carbon credit initiative.

Foreseen publications: Quality Control and Quality Assurance Protocol; production training curriculum/packages for producers; QC and QA training curriculum/packages for producers

Estimated Result 2: 150 SME retailers, the majority in the five target provinces, successfully promote the ICS and have improved their marketing strategies

 

Estimated Result 2: 150 SME retailers, the majority in the five target provinces, successfully promote the ICS and have improved their marketing strategies

Retail-based SMEs in Lao PDR are not generally characterized as having a strong customer service orientation. The Action encompasses a concerted effort to change retail behaviour in a manner that will simultaneously boost consumer awareness and satisfaction. By deploying new marketing tactics that rely on a renewed awareness of the economic and health benefits of the ICS model, retailers will be able to maintain profitability and create market demand.

A comprehensive understanding of the quality assurance aspects of the certified ICS model will be critical to a successful marketing campaign. This will be reinforced by the provision of sales promotion materials and equipment (display racks, advertising banners, media campaign). As the critical distribution link in the ICS value chain, retailers will need to ensure their customers equate the ICS label with quality, durability and cost savings. A high level of customer satisfaction will help ensure long-term benefits, in the form of stable and gradually increasing profits, to the 150 retailers expected to participate in the Action, provided production bottlenecks are avoided and price stability is ensured.

Although this type of marketing campaign does not have a strong track record in Lao PDR, ARMI/NORMAI is capable of building retailer capacity to undertake innovative marketing techniques, based in part on the successful Cambodian program model. The wealth of lessons from Cambodian model which is adapted to the Lao context will be further outlined in Section 2.2.1 Activity Package 1.

 Main Activity 2: Retailer Support

One of the intended results of the Action involves imparting a wide range of retailers with full knowledge of the labelled ICS model with a particular focus on improving their knowledge of the full range of benefits (cost, time savings, environmental) that will accrue to consumers who purchase the ICS model. As the lead field-based partner, ARMI/NORMAI (supported by SNV) will integrate such knowledge with training and coaching on enhanced marketing skills along with promotional materials and equipment that will facilitate retail efforts with the goal of meeting established sales quotas. The Action will result in 150 SME retailers with enhanced marketing skills and increased sales that retain a suitable profit margin. At the same time, in adhering to the Action’s open market approach, direct sales subsidies and incentives will be avoided.

Activity 2.1 - Retailer Training and Knowledge Building

This activity centres on a series of provincial-level demonstration workshops (to include retailers, Lao Women’s Union representatives and possibly producers) that will highlight key consumer sales messages. Emphasis will be placed on equipping retailers with a broad knowledge of the key advantages to consumers of the ICS model. Representatives from the mass media will be invited to attend part of the workshop as a means of building broader public awareness.

Activity 2.2 - Sales Promotion Skills Training

A follow on workshop will sharpen sales promotion techniques by equipping retailers with key “talking points” to be used with consumers. Using interactive techniques such as role play during this workshop, retailers (and LWU) will have the opportunity to practice their sales pitch. At the conclusion of this activity, retailers will be provided with promotional materials (banners, posters) and display racks to assist in sales promotion.

Activity 2.3 - Supporting Marketing Skills

ARMI/NORMAI will conduct an intense campaign of roving visits to retailers (at least weekly during the initial stage of product roll out) to check on the use of promotional and to provide back up and coaching to retailers.

Activity 2.4 - Initiation of Sales Record Keeping

As part of their routine monitoring schedule, ARMI/NORMAI will provide hands on training and support to retailers in an effort to ensure competent record keeping of sales activities. This will allow the tracking of labelled and numbered stoves. Data compiled through ARMI/NORMAI visits will be entered into the Action’s database.

Estimated Result 3: Lao Women’s Union in the five target provinces fully assumes its role as an effective Promotional Partner

Estimated Result 3: Lao Women’s Union in the five target provinces fully assumes its role as an effective Promotional Partner

By effectively linking producers with retailers via a large-scale social promotion campaign, the Lao Women’s Union (LWU) is expected to play a critical role in stimulating widespread demand for the ICS model. Despite their minimal experience with promotional campaigns of this nature, their field-level presence in virtually every Lao town and village gives them the geographic spread required for the kind of scale up envisioned by the Action and beyond. Given that the vast majority of ICS consumers are female, an innovative women-to-women marketing strategy is seen as having strong potential. As a” mass organization”, LWU plays a de facto intermediary role between the government and its citizenry. By building the capacity of the LWU to undertake mass-based social promotion, the Action will also be contributing, at least indirectly, to the strengthening of Lao PDR’s still nascent civil society – an outcome that is complementary to previous EC initiatives in the country.

As the partner primarily responsible for building LWU capacity, ARMI/NORMAI will benefit from the relationship already developed with LWU during the current project. Their hands on coaching and mentoring approach is appropriate given LWU’s overall lack of experience, however will need to further develop a strategy to maintain a long-term engagement with LWU across five provinces as well as retaining a strong commitment from LWU staff assigned to the Action.

Supported by ARMI/NORMAI, the LWU will at least carry out 150 community level workshops and/or promotion events at annual basis.

Main Activity 3: - Consumer Promotion Campaign

This package involves development of appropriate ICS promotion materials and delivery of a consumer promotion campaign by the Lao Women’s Union, a mass-based organization with a presence in all Lao villages. There is a dual focus of the campaign: 1) Business Promotion – encouraging consumers – who are primarily women – to purchase labelled ICS by convincing them of the economic merit of the ICS model; and, 2) Social Promotion –explaining the benefits to women and children that will arise from time savings when cooking (a key point according to women interviewed) and escaping the drudgery of collecting firewood and making charcoal. Social promotion will reinforce key gender equality messages and explain environmental benefits of the ICS.

Activity 3.1 - Developing campaign material

Using baseline data and referencing promotion materials developed for similar initiatives in Thailand and Cambodia, an independent Lao marketing/survey firm will be procured to develop relevant materials that encompass both the village-level promotion campaign and a media-based campaign. The former set of materials will be developed in consultation with the LWU and retailers who are familiar with consumer preferences.. Emphasis will also be given to the promotion of a specific identifying logo that will help “brand” the ICS model with consumers.

Activity 3.2 & 3.3 - Capacity Building of Promotional Partner

ARMI/NORMAI, with Oxfam-Novib and SNV support, will develop a training curriculum and manual for delivery to LWU personnel (estimated 3 women/province). LWU input will also be taken into account when developing the training modules. This will explain in detail the social/economic promotion campaign that will be delivered to an anticipated 150 villages/neighbourhoods over the life of the Action. Efforts will be made to make the campaign interactive and visual so as to overcome low levels of knowledge and literacy among a large proportion of prospective consumers. In addition, positive gender equality messages will be incorporated into the curriculum. Once training materials are complete, a Training of Trainers (ToT’s) workshop will be conducted.

Activity 3.4 - Delivery of Consumer Promotion

LWU, with on-going coaching and mentoring support from ARMI/NORMAI (via training observation and monthly meetings, or more frequently, as needed) will deliver the promotion campaign to 150 sites across five provinces – focussing on the most populous areas, urban and peri-urban neighbourhoods to maximize ICS growth potential – over four years.

Activity 3.5 - Media Promotion Campaign

At the same time that the Consumer Promotion campaign is being rolled out, ARMI/NORMAI will commence a promotion campaign with relevant Lao print and broadcast media outlets via press release, publicity events, billboards, targeted interviews and television coverage.

Foreseen publications: Strategies and implementation plans of a full promotion campaign; training manual for ToT’s.

Estimated Result 4: Access to the clean and fuel efficient ICS is improved (availability, geographical, pricing).

Estimated Result 4: Access to the clean and fuel efficient ICS is improved (availability, geographical, pricing).

Although market demand exists, establishing a solid market niche for the ICS has been problematic because of inconsistencies in the supply side and price undercutting by cheaper but lower quality knock-off models. By boosting production (as per measures taken in ER1), the supply chain will be strengthened to the point where all participating retailers should be assured of consistent product availability. The roll out of ICS production chain to five provinces will increase geographic availability. A successful promotion of the ICS that ensures consumers equate the ICS label with guaranteed quality and cost savings will increase market share and lead to price stability. Taken together, these efforts (consistent production, geographic expansion and price stability) will assure ICS access even as market share grows. At the end of the four years lifespan of the Action, wood and charcoal ICS labelled models produced by at least 15 producers – located in 5 provinces - will be regularly available in the shops of 150 retailers for distribution to consumers. Both retailers and producers will be evenly geographically dispatched over the five targeted provinces according to the demand.

During the pilot project, ARMI/NORMAI has already proven its ability to coordinate a range of diverse stakeholders. Throughout the Action a continuous coordination with these players at a considerably larger scale will be ensured.

Main Activity 4: Improving Access to the ICS

This package encompasses a prolongation of current efforts to optimize the design of the ICS model and the related production tools, prior to commencing large-scale production. Design efforts are being led by a scientific and technical team at Ubon Ratchathani university in north-east Thailand who are well known for their expertise in locally appropriate woodstove design. This is perceived as an appropriate choice by partners due to the geographic, cultural and linguistic proximity of the university’s team. Design efforts will, nonetheless, take into account slight nuances (mainly with regard to optimal dimensions, affordability, clay composition and mould size) of the specific Lao market. This activity package also foresees formal set up of the requisite database and the development and initial application of customer and market surveys that will enable adequate tracking of the Action’s intended outcomes, improving the access of the ICS to the consumers.

Ensuring the access of ICS to households in the five provinces, the Action will adopt the following strategy. In year one of the Action, the expansion of production processes and engagement with retailers will be carried out in the three provinces that are targeted first: Vientiane Capital, Pakse Province and Savannakhet. These are the most highly populated provinces and are therefore important for the cook stoves market. The partners of the Action will engage with 150 retailers in urban areas and semi-urban areas. The Action will expand the mapping and engagement in the first three provinces, however will prioritize to work with those retailers having high volume of sales and high commitment to the Action. Finally, once the improved cook stove production is adopted and disseminated in the first three provinces, the geographical expansion in the other two neighbouring provinces will be made possible through replication of good practices. The onset of the expansion in these last two provinces is planned during the year two.

The database aims to verify the effectiveness of the Action in regards to access, by recording the stoves distribution from the production to the retailers and finally to the consumer households. The Action will have a comprehensive database that is able to accurately map out the ICS value chain from produces to users. And finally, the access will also be improved through the higher quality of the stove which will expand their lifetime. Hence, the consumers will be able to use less fuels over longer time, resulting in cost-effectiveness over a longer period.

Activities 4.1, 4.2 & 4.3 - Finalizing ICS Design

While the re-design of the charcoal stove that will serve as the labelled ICS model is well advanced under the pilot project, further design modifications are expected to be made on the wood-use model. Both charcoal and wood models will be subject to extensive rainy and dry season performance testing11 using a range of models until the optimal specifications and dimensions can be determined. The clay mixing and firing processes will similarly be tested. In addition, tools used in the manufacturing process – mainly the “butterfly” tool that speeds production and the punching tool that improves quality of the charcoal grate - will be modified in accordance with the final design.

Activity 4.4 - Establishing the Database

Considered a critical part of the overall Action, an Information Technology consultant will be recruited in order to properly establish a comprehensive database.

Activity 4.5 - Consumer and Market Surveys

An external survey firm will be contracted to develop and conduct an initial user survey that has two facets: i) developing data on consumer preferences in the cook stove sector, including level of satisfaction of those customers using the ICS model; and, ii) a market survey focusing on retailers to obtain data on dealer preferences, cost competitiveness, quality perceptions and market share. It is envisioned that this survey will be conducted on an annual basis so as to allow for year-on-year comparisons and accurate data on shifting market share..

Estimated Result 5: Five Testing Agencies are operational as independent Quality Label’s provider of the ICS

Result 5: Five Testing Agencies are operational as independent Quality Label’s provider of the ICS

Testing agencies play a critical role in ensuring ICS quality and, in turn, building consumer confidence. Working from a set of protocols developed early and used throughout the life of the Action, Testing Agencies will be responsible for testing ICS samples every three months from each producer to check their quality. Water Boiling Tests and Kitchen Performance Tests will be conducted to determine if ICS performance is within pre-defined thresholds. The samples are also measured to ensure they conform to standardized stove dimensions. Producers whose production standards have consistently met the required specifications are provided with labels to attach to the finished product so that users are confident that the stove they purchase is of high quality. Quality labels are issued on the basis of observed sales and only once the stock has been monitored. If a batch of stoves has been identified as not conforming to the standard dimensions or performance threshold, the Testing and Certification Agency will notify ARMI/NORMAI who will work with the producers to diagnose the reason and rectify the situation.

Generally low human capital in Lao PDR, particularly in scientific fields, poses a challenge for adequately staffing the Agencies. The Action does have the advantage of the fact that the pilot project has already established a positive relationship between ARMI/NORMAI, SNV and the provincial DST in Savannakhet. However, ARMI/NORMAI and SNV by tapping into both regional contacts in Thailand and Cambodia and SNV’s international cook stove network, will need to build further DST capacity over time to the point where five independent testing agencies will be established and fully accredited by the Ministry of Science and Technology to ensure ICS quality control and relevant standardization.

Main Activity 5: Testing Agencies

This series of activities aims to consolidate the ICS production by ensuring proper testing of the product for quality control and assurance, leading to certification of producers and labelling of the product for end-users/consumers. It foresees ARMI/NORMAI, with SNV support, undertaking a series of workshops and training with provincial-level Departments of Science and Technology, deemed the most relevant government agency capable of housing formal testing agencies.

Although the laboratory tests protocols are relatively simple, DST staff have very little experience in scientific or laboratory testing so it is necessary to provide long term support through hands-on training.

QC and QA are virtually unknown in Lao PDR but represent important components in the ICS value chain as it ensures the quality of the manufacturing process and compliance with agreed standards. A training curriculum and manual for Quality Control and Assurance will be developed. Introduced incrementally as the Action expands, training conducted by ARMI/NORMAI will ensure that DST staff responsible for running the test facilities have sufficient theoretical and practical knowledge of all aspects of QC and QA.

Partners: ARMI/NORMAI, SNV Stakeholders: Provincial DST offices

Activities 5.1 & 5.2 - Establishment of Testing Procedures

This package will start with an inception workshop that will clarify expected roles and responsibilities and familiarize testing stakeholders with the goals, objectives and desired outcomes of the testing facilities. This workshop will also set forth material needs required for the establishment of the testing labs. This will be followed by the development of QC and QA protocols along with clarification on certification guidelines and procedures (labelling, serial numbering, inventory tracking, record keeping, etc) that will eventually be applied to producers.

Activity 5.3 - Set-up Testing Laboratories

This foresees a gradual deployment of testing facilities at each provincial DST offices. This activity will include the procurement of necessary equipment to transform a room in DST offices into a stove testing laboratory. Under the pilot project, an embryonic testing facility has been established but it is housed in the ARMI/NORMAI office. The facility in ARMI/NORMAI will be retained to ensure that ARMI/NORMAI continues to hold the capacity to cross check laboratory tests on its own. A new laboratory will be set-up initially within DST facilities in Savannakhet with other provinces to follow. The DST is engaged in the ICS pilot and has proven its commitment through appointing dedicated and qualified staffs to perform the testing activities. The Action will ensure that necessary resources, both financial and human resources, will be available upon its completion. In line with the national strategies on cook stoves, further commitment at both of national and provincial levels of the MST and DST as well as other alternative financial support will be carefully explored during the Action’s lifetime.

Activities 5.4 & 5.5 - Capacity Building of DST

Since DST staff have very little experience in scientific or laboratory testing, it is necessary to develop a training curriculum and manual for training in Quality Control and Assurance. Introduced incrementally as the Action expands, training conducted by ARMI/NORMAI will take a hands-on approach to ensure that DST staff responsible for running the test facilities are capable of these activities which will include scaled up hands on the specific technical skills as required by the protocols.

Activity 5.6 - Producer Certification

Once a provincial test facility is operational, producers will be subject to certification and will be required to begin labelling of ICS models. Recertification will be required twice per year.

Foreseen publications: Testing procedures/protocols, training curriculum for laboratory testing and QC/QA.

Estimated Result 6: National Quality Standard of cleaner and fuel efficient ICS is endorsed by the Ministry of Science and Technology

Estimated Result 6: National Quality Standard of cleaner and fuel efficient ICS is endorsed by the Ministry of Science and Technology

It is important for partners to formalize efficiency gains in the ICS sector by obtaining proper official recognition from national-level authorities. The endorsement and, importantly, the enforcement of national standards will be a critical factor in securing the environmental gains (wood savings and reduction of greenhouse gas emissions) envisioned by the Action.

While it is relatively unusual for Lao NGOs to undertake advocacy initiatives directly with government agencies, a pre-existing positive link with province-level DST will provide an important entree to the Ministry, enabling ARMI/NORMAI to push for formal endorsement and legal ratification of ICS quality standards.

Main Activity 6: Formal Endorsement of Quality Standards

With a view to demonstrating genuine and sustainable policy impact in the renewable energy sector, this package seeks to jointly develop, with relevant national government agencies, a formal policy on the cleanliness and efficiency standards of cookstoves, to be applied at a national level.

Implementing Partner – ARMI/NORMAI Stakeholders: Ministry of Science and Technology, provincial DST offices

Activity 6.1 - Inception Meeting with Government Stakeholders

An inception meeting that gathers partners and all relevant national stakeholders (along with operational Testing Facilities) will initiate high-level dialogue with the Ministry of Science and Technology (and other national government stakeholders as deemed appropriate) on the need to establish ICS quality standards and determine next stops, possibly involving the set-up of a working group that will take responsibility for drafting the actual policy.

Activity 6.2 - Endorsement of Policy on Quality Standards

Follow on action after the inception meeting will see drafting and eventually the formal endorsement, publishing and legal endorsement of ICS Quality Standards.

Foreseen publications: ICS Quality Standards that includes the following components: physical characteristic and requirements of stove design including efficiency, stove price, production process, laboratory test and QC/QA protocols, producer certification.

Estimated Result 7: Multi-stakeholder partnership is established between stove producers, retailers with consumer network, financiers and authorities


Estimated Result 7: Multi-stakeholder partnership is established between stove producers, retailers with consumer network, financiers and authorities

Establishing a multi-stakeholder dialogue fulfils the need to provide a forum whereby all stakeholders have the opportunity to express concerns and ideas along all stages of the value chain. By involving government agencies (initially at the provincial level, via DSTs, but eventually national agencies such as the MST), the Action will provide an important precedent in public/private/civil society collaboration that is still at an embryonic level in the Lao context. The development and implementation of sound business plans for producers will consolidate their status as viable SMEs. Facilitating access to credit by working with the ACLEDA Bank fills an important gap in surmounting one of the most common obstacles faced by Lao SMEs. It also helps to address the green finance gap that has been prevalent in Lao PDR. Further, enabling the producers to work towards common goals via a Producer’s Association should help solidify ICS market share.

Establishing the Producer’s Association is largely unexplored territory in Lao PDR, where private sector associations have yet to establish a strong foothold in a highly centralized economy. However, a collaborative relationship with government should enable ARMI/NORMAI to pave the way for formal creation of an Association on the grounds that such an Association will help reinforce government attempts to attain its MDG goals related to poverty reduction and the environment.

Main Activity 7: Multi-stakeholder partnership established

This package seeks to unite all stakeholders in the value chain once production is running, test facilities are operational, retailers have improved marketing skills and the LWU is conducting its social promotion campaign. Although all stakeholders can expect to benefit from activities in this package, a particular focus is on producers who will be assisted to develop and solidify sound business plans and, where deemed relevant, will be able to access credit from the Action’s financial associate with a view to scaling up production. Investment/credit is necessary in the transition process to shift from manufacturing the traditional stoves to the improved ones, as well as for the producers to be able to increase production quantities. This transformation requires advanced business skills, training and service provisions. One key component of activity 7 will look at developing different business models, financing options through credit from banks and support to producers in making the correct calculations and business plans in order to make sure that there is a feasible return on investment. Ultimately this will lead to a national-level producer’s association whose accredited members will abide by established production and QA/QC protocols while also lobbying for their best marketing interests.

Further, as one of the lessons from the successful EC-funded cook stove program in Cambodia, throughout the Action’s lifetime, the partners will proactively seek opportunities to explore the potential to tap in to other funding opportunities, including the carbon finance. A preliminary work will be done to establish a network with relevant stakeholders as well as in developing a ground work that may support follow-on activities related to the carbon component.

Activity 7.1 - Multi-stakeholder Partnership Meeting

With the objective of ensuring that all of the Action’s stakeholders are able to grasp an overarching view of the global value chain, this meeting will kick off an ongoing partnership dialogue by conducting a needs assessment for all stakeholders and attempting to match identified needs against the capabilities of partners and associates.

Activity 7.2 - Business and investment analysis of producers

Tapping into the expertise of an independent business consultant with experience in SME development, a market analysis of the ICS sector will be conducted and a normative business plan for ICS producers suited to the Lao market context will be developed. The consultant will be responsible for equipping ARMI/NORMAI with the skills necessary to adapt the business plan to individual producers.

Activity 7.3 - Business plan development

Using participatory training techniques, ARMI/NORMAI will subsequently assist all interested producers to develop individual business plans. A component of the business plans will identify anticipated credit requirements needed to fulfil the business plans.

Activity 7.4 - Implementation of Business Plans

With DST certification serving as a key trigger, producers will be expected to implement their business plans. ARMI/NORMAI will track these efforts on a regular basis via frequent group and individual meetings. Access to credit, as per business plan requirements, will be facilitated though interventions with the finance sector associate.

Activity 7.5 - Support for Establishment of Producer Association

This involves unpacking the commitment required from producers to establish a formal Association by looking at examples of the pros and cons and conducting cost/benefit analysis.

Activity 7.6 - Inauguration of Producer Association

Once agreement is reached and membership requirements have been formalized, the Producer Association can be formally inaugurated. An executive council will then have to be elected. The role of the Association will be inter alia identifying on-going member training needs, providing input into new promotion campaigns, lobbying government bodies as required (eg. for enforcement of standards protocols) and recruiting new members who agree to abide by ICS production standards.

Foreseen publications: Report on methodology to support producers in establishing their business plan; report on carbon exploratory work.

This programme is funded by European Union