Barefoot Power India: Women are central to rural energy

Wednesday June 15th, 2016 - Smart Villages

Interview with Vernie Sannoo, Managing Director

Barefoot Power India

Location: India; Barefoot Power is active in the global south

“The only barrier is affordability.”

While Vernie Sannoo didn’t found Barefoot Power India, he has a rich experience in sales and marketing for rural energy, rural distribution, and overall business operations that he uses to help continue to grow the company in India. He has made a dramatic difference in sales through his focus on rural consumers’ needs and his development of networks of micro-entrepreneurs throughout rural India. With millions of households using kerosene lamps and many more facing erratic power supply, Vernie believes that his experience of demo-based selling, coupled with rural distribution network backed by efficient service and consumer finance will help state of art Barefoot Power products to reach to those who need to be alleviated for overall development of Rural India.

Vernie Sannoo came to rural energy by way of water purifiers. He worked over 20 years for Eureka Forbes, which was the first company to distribute water purifiers in rural India. Part of the Tata Group, he oversaw a salesforce of 7,000 people with a customer base of four million. Sannoo moved from water purification to solar home lighting systems when he began working for Idealab (USA) as the Vice President for Retail Sales of solar home lighting systems, moving to Barefoot Power in 2012 to build up with distribution network in India. “Basically, the common factor for me is the rural market, rural consumers, and building up a network for reaching rural consumers,” added Sannoo.

For Sannoo, demonstration is the core factor in engaging rural consumers: “even for solar power and water purification, you have to demonstrate the product. Because market penetration is so low, people don’t necessarily understand until they see it for themselves”. Micro-entrepreneurs are crucial to helping consumers understand the value proposition. “Basically, we go to a rural area and try to find ladies who are doing some other entrepreneurial work. We approach talkative people, who are always the ones going house to house. We give them one lamp as a demo product, and we do a training session of two hours over a few months with 25-30 ladies”.

But how do people who earn US$60 per month afford these products? “People won’t spend more than 12% of their income on a solar home product. So we reach out to banks and micro-finance to give loans to consumers.” He added, “the only barrier is affordability. Technology and distribution are not the barriers”. What is most crucial to rural consumers beyond affordability? Without a doubt, “reliability,” said Sannoo. Moreover, if the product is not reliable, the women who sell it will be blamed. That is why Barefoot Power ensures it products are reliable.

The range of products is varied, including lamps, home lighting, fans, TVs, and street lights. The energy efficient 6 W fan is popular as are the 12 W TVs that are 16”-22”. Solar refrigerators are also available: “it is good for storing milk for those who are selling it, storing vaccinations, and selling cold drinks”. Right now, it is a little expensive due to a 28% customs duty, but they hope to bring the price down.

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In terms of productive uses, he told the story of a community that was producing saris. Without light and other energy, they were producing a sari in eight days. However, once they had lights in the evenings, they were able to produce a sari in four days. Since one sari sells for $50, they are now able to earn $100 in eight days rather than $50. He notes that the main reason people leave their villages are either their security and safety or their livelihood. If they can feel safe in their home village, such as with more lights, and also get an education and earn a living, it may stem the flow of people to urban areas. Moreover, “rural people have migrated to urban areas and see ideas for back home,” added Sannoo.

On the horizon, Sannoo says that Barefoot Power India has several priorities, including setting up and supporting distributors, including large companies, developing its CSR activities and partnerships with other companies, setting up a network of retail shops, growing their network of micro-entrepreneurs, working with government organisations, and working with NGOs in India. “India right now has only 2-3% of solar penetration—there is a long way to go in terms of market size”.

He sees a lot of global companies like Proctor and Gamble, Unilever, and Nestlé moving into rural areas. This opens up an opportunity for Barefoot Power since these companies’ distributors will undoubtedly need to use their laptops and will need solar laptop chargers. In addition to Barefoot Power’s focus on rural consumers, B2B will also be an important revenue stream in the coming years.

—Molly Hurley-Dépret, Storyteller, Smart Villages Initiative