Technical Brief 2

RURAL SANITATIONUSAID Water and Development
INTRODUCTIONTECHNICAL SERIESThe purpose of this technical brief is to provide an overview of the important factors to consider in USAID rural
sanitation programming. Drawing upon the latest evidence, it provides guidance for developing and implementing
rural sanitation activities.

KEY TAKEAWAYS•

Aim for area-wide geographic coverage. Go beyond the household and community levels
to invest in area-wide (district or county) or market systems-level approaches to support impact
and sustainability.

•

Address governance, financing, markets, and behaviors. Successful sanitation programming
must include interventions on governance, financing, markets, and behaviors and move away froman exclusive focus on direct service provision. The mix of approaches should be in direct responseto the context.

•

Targeted subsidies can be effective. Subsidy is not a dirty word. Targeted sanitation subsidies
should be considered when seeking to reach the extreme poor and most vulnerable and can be
successful when carefully combined with, or as a complement to, other approaches.

•

Leave space for failure and learning. There are and will continue to be failures in rural
sanitation programs, and there are not proven strategies/methods for all contexts (e.g., reaching
the ultra poor). Plan for space and time and for staff to fail, iterate, assess progress, and adapt plansto ensure progress and sector-wide learning.

May 2020

BACKGROUND
Two billion people lack access to basic sanitation, and 72 percent of them live in rural areas.1 The Sustainable
Development Goal (SDG) goal of ending open defecation by 2025 would cost $3.6 billion in total, while thecost for toilets and safe excreta management to meet the SDG goal of universal safely managed excreta by2030––in rural areas only––is estimated at $24 billion annually.2 A recent study estimated that the global costof poor sanitation reached $223 billion in 2015.3 In Africa, economic losses due to inadequate sanitation accountfor 1–2.5 percent of gross domestic product (GDP).4

FIGURE 1: PROGRESS TOWARD UNIVERSAL BASIC SANITATION SERVICES BY NATIONAL, RURAL, AND POORESTWEALTH QUINTILE (2000-2017) AMONG COUNTRIES WITH GREATER THAN 99 PERCENT COVERAGE IN 2017
Adapted from 2019 JMP.

Of the 62 countries with substantial levels of open defecation, only 18 are on track to become Open Defecation
Free (ODF) by 2030. Progress for the rural poor is even worse, with only 10 countries making enough progress
to get close to universal access to basic sanitation in rural areas by 2030 (see Figure 1).5 At the current rate ofprogress, universal access to safely managed sanitation will not become a reality until the 22nd century. There
are a number of barriers and challenges contributing to this lack of progress, including:•Insufficient political prioritization and resourcing. While there are a few notable exceptions,most governments do not prioritize rural sanitation in the national agenda or make adequate financial
commitments. In 2017, 90 percent of all countries reported insufficient financing to meet national targets
for rural sanitation, and 73 percent had no financing plan that was consistently followed.6 Weak institutional
structures for rural sanitation hamper effective resource mobilization. High levels of sanitation coverage are
not achievable without political prioritization and significant investment.

•

Inability to demonstrate lasting at-scale results. Programs have struggled to demonstrate results
at scale with equitable outcomes, and the ability of countries to sustain gains achieved remains a concern.
These poor outcomes are due to a number of factors, including lack of local capacity, unsustained financial
resources, or reduced social or political commitment, further undermining the already fragile political backing
for rural sanitation and hampering mobilization of resources.

•

Blanketing a single approach. Over the past decades, rural sanitation programming has seen a shift from
infrastructure-driven approaches towards social mobilization and behavioral change approaches, including,

1 World bank. (2019) Why rural sanitation matters.

2 Hutton, G. and Varughese, M. (2016) The Costs of Meeting the 2030 Sustainable Development Goal Targets on Drinking Water, Sanitation and Hygiene. World Bank. 		

Water and Sanitation Programme.

3 LIXIL & Oxford Economics. (2016) The True Cost of Poor Sanitation, in collaboration with WaterAid. Lixil Group Corporation, Tokyo, Japan.
4 World Bank. (2012a) Economic Impacts of Poor Sanitation in Africa. Water and Sanitation Programme.

5 UNICEF and World Health Organization. (2019) Progress on household drinking water, sanitation, and hygiene 2000-2017. Special focus on inequalities. New York.
6 UN-Water GLAAS. (2019) National systems to support drinking-water, sanitation, and hygiene – Global status report.

2 |WATER AND DEVELOPMENT TECHNICAL SERIES

among others, Community Led Total Sanitation (CLTS). While this has been an important step to reducing
open defecation, there have been mixed outcomes across contexts. CLTS does not work everywhere all
the time and is simply not enough to reach everyone. Further, CLTS is designed to end open defecation,
but additional approaches are needed to reach a higher level of sanitation service. There is always a need tocontextualize approaches to governance, financing, markets, and behaviors to scale access to rural sanitation.
Through the Journey to Self-Reliance, USAID is working toward strengthening country capacity to deliver
and maintain basic rural sanitation services. For USAID programming, this means moving away from direct
implementation of services (i.e., USAID implementers providing latrines or triggering CLTS directly), to
applying systems strengthening approaches that target key functions of the enabling environment aroundsanitation service delivery. However, in some contexts, such as fragile states with weak government capacity,
more direct implementation may be unavoidable, but it should also be done in close collaboration with local
government and actors and alongside all components outlined in this guidance (governance, financing, behaviors,and markets).

BUILDING SUSTAINABLE RURAL SANITATION SERVICES
A rural household asset, such as a latrine, is considered a private good, but when used correctly andconsistently, its contribution to an excreta-free community also makes it a public good. The level ofcontamination at a household is affected by the level of contamination in the community overall. Therefore,households benefit when neighbors improve sanitation around them. There is both observational andexperimental evidence showing that area-wide sanitation is more effective at reducing diarrhea thanhousehold sanitation, supporting the hypothesis that area-wide coverage provides a level of herd protection.7, 8GovernanceBehaviors

FinancingMarkets

FIGURE 2: USAID’S RURALSANITATION ELEMENTS

Achieving this area-wide sanitation coverage depends on both the
public and private sectors to ensure adequate infrastructure, regulations, andmarkets while individual households are largely responsible for acquiring,
maintaining, and using sanitation services.
The water, sanitation, and hygiene (WASH) sector now recognizes thatthe delivery of sustainable safe rural sanitation services is not simply about
constructing toilets, but requires a complex system of interacting factors. To help
conceptualize the system and facilitate the identification of critical challenges,
gaps, and solutions, USAID considers four core elements in effort to contributeto universal sustainable sanitation services (Figure 2). These components are:•Governance – the policies, strategies, and delineation of roles, functions, and effective coordination; as wellas the capacity of authorities at all levels of government to organize effective technical, administrative, andinstitutional support to strengthen markets and service provision. This includes monitoring systems thatroutinely collect and analyze relevant data and regulatory oversight to protect public health and the interestsof consumers and service providers.

•

Financing – the public funds to support governance functions described above and implement programming
aimed at increasing access to sanitation, such as behavior change campaigns and targeted subsidies. This
category also includes private consumer finance for households to invest in sanitation, and working capitalfinance for sanitation enterprises.

7 Wolf et al. (2018) Impact of Drinking Water, Sanitation, and Hand Washing with Soap on childhood diarrhoeal disease: updated meta-analysis and meta-regression.

Trop Med Int Health 23(5).

8 Jung, Y.T., Hum, R.J., Lou, W., Cheng, Y. (2017). Effects of neighbourhood and household sanitation conditions on diarrhea morbidity: systematic review and meta-analysis.

PLoS One, 12 (2017), Article e0173808

RURAL SANITATION | 3

•Behaviors – the individual, community, institutional, cultural, economic, and environmental norms andbehaviors for the adoption, use, and operation and maintenance of sanitation facilities and services.

•

Markets – local, regional, national, and niche markets that facilitate the purchase of aspirational andaffordable sanitation products or services by end-users, centered around sanitation enterprises thatmust be able to profitably supply them within the context of the rules and enabling environment for
private sector participation in sanitation.

STEPS TO DEVELOPING EFFECTIVE RURAL SANITATIONPROGRAMMING
The following describes steps for applying these four factors of rural sanitation to develop or evaluate effective
rural sanitation programming.
UNDERSTAND THE CONTEXT

Project and activity design should be
driven by context and data. It is goodpractice to conduct a desk review
of existing sector evaluations orassessments, after which additional
assessments may be needed. It is
important to consult and coordinate
with sector stakeholders before
launching into the scoping anddesign phases of a rural sanitationintervention. One place to start is thecountry’s WASH or sanitation working
group and understanding country
progress on the sanitation ladder(Table 1).

TABLE 1: SANITATION LADDER
USAID aligns with the WHO/UNICEF Joint Monitoring Programme (JMP) sanitation ladder.

There are very few rural sanitation
or even sanitation-specific assessment
tools. However, there are a numberof broader WASH tools available thatcan be useful when applied to rural
sanitation and cut across one or moreof the rural sanitation components
described above. This is a list ofrecommended assessment tools that
can help facilitate the identificationof key stakeholders as well as thechallenges and opportunities tostrengthen rural sanitation services:

SAFELY MANAGED
Use of improved facilities which are not shared with other households andwhere excreta are safely disposed in situ (on-site) or transported and treated
off-site (known as fecal sludge management or FSM).
On-site treatment is common in rural areas, with FSM still needed where there
is a lack of space between housing, or for schools, health facilities, market places,
government buildings, industry, or commercial operations.
BASIC
Use of improved facilities which are not shared with other households.
Previously called improved sanitation during the MDG period, the term
“improved” now only refers to the physical characteristics of the facility, meaning
a cleanable platform that safely separates humans from feces. This can also bereferred to as washable and fly-proof latrine in rural areas.

Safe

LIMITED

UnsafeUse of improved facilities shared between two or more households.
Common example is compound sanitation where one facility is shared bymultiple families.
UNIMPROVED
Use of pit latrines without a slab or platform, hanging latrines, or bucket latrines.
Common example is when latrine waste is channeled directly into drainage or awater body.
OPEN DEFECATION
Disposal of human faeces in fields, forests, bushes, open bodies of water,
beaches and other open spaces or with solid waste.

•

Stakeholder Mapping. Stakeholder mapping helps create a shared understanding of who the key
stakeholders are, what their levels of interaction and influence are, and, based on these findings, where
USAID should strategically place time and effort cultivating relationships.

4 |WATER AND DEVELOPMENT TECHNICAL SERIES•Institutional Analysis (e.g., Political Economy Analysis (PEA)). PEA is a structured approach
to examining power dynamics and economic and social forces that influence development (See ODI
guidance note.9)•

Sector building-block analysis (e.g., WASH Bottleneck Analysis Tool (BAT)). The WASH BATtool aims to assess the enabling environment for WASH service delivery by identifying and tracking
the barriers to delivering sustainable and efficient services at national, regional, service provider, andcommunity levels.

DESIGN THE PROGRAMMING MIX

Rural sanitation programs should appropriately layer and sequence a mix of approaches to achieve objectives
based on local context. The following section highlights common approaches and includes suggestions forpractices to avoid and promote under each of the four rural sanitation program components.

GovernanceStrong governance at all levels is critical to reach sustainable rural sanitation atscale. This requires national level policies to be in place, along with clear strategies,
delineation of roles and responsibilities, and effective coordination. Responsibilities
for sanitation are often split among several ministries in a given country, making policy
development, planning, and regulation difficult. Coordination and joint planning,or Memoranda of Understanding (MoU) between the institutions working onelements of rural sanitation (e.g., government-led, multi-ministerial sector working groups), are often needed.
Institutions must also have the capacity to monitor coverage, enforce sanitation-related regulations, andprovide technical assistance to local governments and service providers. Activities should therefore focus
on forming partnerships with decision makers at all government levels and civil society and supporting
one another to achieve common policy reform, coordination, monitoring, regulation, and capacity
development objectives.
There has never been a successful at-scale rural sanitation program that did not have high-level politicalleadership.10, 11 This leadership is typically motivated by a desire for economic advancement, national pride,and modernity, not created through community-driven demand approaches. When advocating and supporting
policy or institutional reform, political priorities must be addressed in order to align actions with the politicalincentives of key actors.
Common interventions for sanitation governance include technical assistance for conducting assessments
or evaluations, supporting data analysis, supporting planning and budgeting, policy or regulation reform,
procurement and supervisory capacity, supporting coordination platforms, supporting monitoring platforms,
and/or providing targeted training and mentoring to key government or civil society institutions.

9

Kooey, M. and Harris, D. (2012) Political economy analysis for operations in water and sanitation: a guidance note.

10 UNICEF. (2016) Strengthening Enabling Environment for Water, Sanitation and Hygiene (WASH) Guidance Note.
11 WaterAid. (2014) Achieving total sanitation and hygiene coverage within a generation – lessons from East Asia.

RURAL SANITATION | 5

TABLE 2: APPROACHES TO AVOID AND PROMOTE IN GOVERNANCE FOR RURAL SANITATION PROGRAMMING

PromoteAvoid

Prioritization of rural sanitation within national
plans, budgets, and government spending

Contributing to aid dependency by displacing agovernment budget line item

Policies that enable a variety of approaches torural sanitation

Pushing for the development of policies that
support only a single approach to rural sanitation(e.g., CLTS)

Improved clarity and greater capacity among
stakeholders to fulfill roles and responsibilities

Paying for consultants that temporarily fulfill key
roles and responsibilities of local stakeholders

Strengthening of mechanisms for ongoing
monitoring of sanitation access and use

Conducting a stand-alone “one-off” monitoring
activity (outside of activity compliance)

Increasing contributions to, and availabilityof, data for all stakeholders, and their use indecision-making

Using proprietary software, and high-tech(not off-the-shelf and simple) data collection
and management systems that inhibit broad
participation and use

Financing

Many governments do not prioritize rural sanitation in the national agenda or
make adequate financial commitments. Access to sanitation in rural areas is often
seen as a household expense; yet public finance is critical to supporting behavior
change initiatives, regulatory institutions, monitoring systems, capital investments
in infrastructure and targeted subsidies for the extreme poor and vulnerable,
where applicable. Support for increased budgets for rural sanitation andimprovements in tracking expenditure of public funds are critical to successful financing.
Assessing Financing for Rural Sanitation
The cost of sanitation varies widely across contexts. Assessing the financial needs, potential sourcesof financing, and financing gaps is critical to designing appropriate interventions. For example, Life
Cycle Cost Analysis12 is one tool for understanding costs over the full life of an asset, rather than only
capital expenditure. Willingness-to-pay studies13 can be used to better understand customer demand
and whether people will purchase products at the price they are being offered. Financial analysis may
also be done at the level of a sanitation enterprise (e.g., developing a profit and loss statement tounderstand business viability14).

12 IRC WASH. (2011) Applying the life-cycle costs approach to sanitation.

13 Peletz, R. et al. (2017) Supply and Demand for Improved Sanitation: Results from Randomized Pricing Experiments in Rural Tanzania. 		

Environ. Sci.Technol. 2017, 51, 12, 7138-7147

14 USAID (2020) Enterprise Viability Case Study: A Retrospective Analysis of Rural Sanitation Enterprises.

6 |WATER AND DEVELOPMENT TECHNICAL SERIESEngaging the private sector in rural sanitation often requires support from the public sector and development
partners. While this is obvious for investments in costly infrastructure, it is also true of the localized small- andmedium-sized enterprises that can profitably deliver sanitation services in rural areas. Sanitation businesses are inneed of financing options to develop and expand, as they often lack the capital to diversify the types of products
they can offer or have the means to expand their coverage area. Although there are a growing number ofcommercial banks and microfinance institutions willing to provide business loans to sanitation service providers,
they are still few and far between. It often requires intervention by implementing partners to convince financial
institutions that rural sanitation is a worthwhile investment.
It is critical to ensure poor and vulnerable households can afford to adopt quality sanitation products andservices. Making household sanitation more affordable often requires a diversity of financing mechanisms
available to both sanitation service providers and consumers (e.g., microfinance and payment plans). A segmentof the population is still unlikely to be able to afford sanitation, even with the availability of credit. In those cases,
subsidies targeted at the extreme poor and most vulnerable segments of the population throughlocal pre-existing poverty identification mechanisms and markets or communal incentives, may
be required.
TABLE 3: APPROACHES TO AVOID AND PROMOTE IN FINANCING FOR RURAL SANITATION PROGRAMMING

PromoteAvoid

Increased national budgets and government
spending on rural sanitation, including intragovernment transfers to lowest suitable level

Spending directed only at sanitation infrastructure
as opposed to non-hardware inputs (e.g., humanresources, capacity building, monitoring, social andbehavior change)

Availability of credit and credit-worthiness ofsanitation businesses

Displacing or interrupting local finance markets bydirectly providing credit or loans

Availability of diverse credit or payment
options for households to purchase sanitation
products through local suppliers or financial
institutions

Blanket direct subsidies to households orbusinesses that may disrupt current or future
markets for sanitation products and services

Targeted subsidies with clear eligibility criteriathat enable the poorest and most vulnerable
to afford sanitation, delivered through local
markets

Providing a subsidy valued greater than an amountthe local government/service provider could
sustainably afford

RURAL SANITATION | 7

Example from the Field: Smart Sanitation Subsidies in Cambodia
Cambodia recently became one the first countries to reintroduce subsidies as part of its national strategy
towards achieving universal access to sanitation. These studies not only helped to drive gains in coverageamong the poor, but showed positive spillover effects where non-eligible populations were also more
likely to adopt sanitation when the subsidies became available.
Based on prior lessons from implementation of sanitation subsidies, the Cambodian Ministry of Rural
Development issued a set of guiding principles that outline how subsidies should be responsibly applied
toward rural sanitation hardware without distorting markets, undermining willingness to pay, or creating
dependency. These subsidies must be:•

Targeted at a specific segment of the population (e.g., the poorest), with clear andtransparent eligibility criteria. Cambodia’s subsidy approach benefited from having a national
government-led poverty identification system, called ID-Poor, that identified who was eligible for thesubsidy. Utilizing the ID-Poor system ensures that only the poorest receive the subsidy. Moreover, itstrengthened transparency, acceptance by the community, and reduced administrative costs.

•

Context specific to local markets and consumers. Market research including willingness/ability to pay studies and pilot projects conducted by various development partners were used tohelp determine the subsidy level and required household contributions. These studies provided agood understanding of the costs of the various materials and services that are locally available andconsumer preferences.15, 16•

Appropriate to local capacity and resources to administer, monitor, and fund. The
Cambodian subsidy guidelines were developed and implemented by the Government of Cambodia.
Monitoring of subsidies is done through government and development partner reporting and periodic
joint-sector reviews. The guidelines include a stipulation on how much should be subsidized, keeping
the cost at a level that could feasibly be managed within local government budgets.

Behaviors

Behavior change is critical to ensuring sustainable access and use of sanitation.
Past approaches in the WASH sector have largely failed due to an over-reliance on
increasing knowledge of the health benefits of sanitation without addressing othercrucial factors that bear upon individual motivations, demand, community norms,
and access to products and services.
The predominant method for triggering behavior change in rural sanitation in recent years has been CLTS.17
The success of the CLTS as a behavior change approach to ending open defecation is attributed, in large part,to its dual approach of addressing personal drivers such as disgust and fear while creating new social norms
by leveraging shame, pride, and dignity.
But CLTS is not a silver bullet. Evidence to date has shown that CLTS can work effectively but not necessarily
for everyone, everywhere, or all the time.18 The most disadvantaged within a given community often do notbenefit from CLTS as much as others, because those with the most limited financial means are the least able
15 iDE Cambodia and IDinsight. (2013) Understanding Willingness to Pay for Sanitary Latrines in Rural Cambodia: Findings from Four Field Experiments of iDE

Cambodia’s Sanitation Marketing Program.

16 Rivera, R. et al. (2016) The Effect of Smart Subsidies and Sanitation Marketing on Latrine Uptake in Rural Cambodia. Thrive Networks, Bill & Melinda Gates 		Foundation, Australian Government, The World Bank Water and Sanitation Program

17 Zuin et al. (2019) Policy Diffusion in the Rural Sanitation Sector: Lessons from Community-Led Total Sanitation (CLTS). World Development, v124.
18 USAID (2018) An Examination of CLTS’s Contributions Toward Universal Sanitation.

8 |WATER AND DEVELOPMENT TECHNICAL SERIESto invest in durable latrines. CLTS can be adapted and/or coupled with other measures including marketbased sanitation, targeted subsidies, and other behavior change interventions that reinforce consistent useof latrines, timely pit emptying, safe disposal of child’s feces, political engagement, or other behaviors that
improve personal and environmental cleanliness.
In addition to addressing individual and community motivations, there is increasing focus on addressing thephysical environment where behaviors take place. The development of nudges to facilitate change (in theabsence of or in addition to communication efforts), as well as the focus on creating habits for consistentlatrine use are examples of innovations for WASH behavior change.
TABLE 4: APPROACHES TO AVOID AND PROMOTE FOR BEHAVIOR CHANGE IN RURAL SANITATION PROGRAMMING

PromoteAvoid

Interventions designed and implemented basedon a behavioral framework

Interventions designed and implemented based on
tradition, ease, or simplicity alone

Interventions that are evidence-based andaddress the target audience’s key barriers andmotivations for change

Knowledge-based interventions and messaging that
focuses solely on health benefits or that relies on
traditional behavior change communication alone

Linking behavior change efforts to the supply of
locally available, complementary products andservices

Promoting behaviors that depend on products
or services that are not accessible for target
populations

Linking behavior change efforts to markets andtapping into motivators such as aspiration andconvenienceLow quality, low aspirational, self-supply, productsolutions without technical assistance (e.g., tippy
taps, rock-sticks-and-mud latrine)

Social and behavior change interventions thatleverage local decision makers and influencers

Social and behavior change interventions
implementation directly by implementing partners

Programming through professional government
or private actors that can be sustained overtime

Over-reliance on voluntary promoters for deliveryof interventions

Sanitation Markets

Functioning local markets are critical to a household’s ability to adopt improved
sanitation facilities. The concept of market-based sanitation (MBS) refers tointerventions in which end-users (i.e., customers) make full or partial monetarycontributions towards the purchase, construction, upgrade, and/or maintenanceof a toilet from the private sector. MBS facilitates ownership and use of sanitation
facilities through the use of one’s own resources, thereby unlocking domestic
resources, particularly from household financing, and utilizes private sector enterprises, a proven player inthe construction and provision of sanitation, increasing self-reliance by strengthening local actors rather
than relying on external entities. Enabling viable sanitation enterprises is the focal point of making sanitation
markets work.

RURAL SANITATION | 9

In 2018, USAID introduced the Sanitation Market System framework to capture the interaction among
the elements underlying a functioning sanitation market. The framework can be utilized by governments
and development partners to analyze, design, and prioritize MBS interventions and consists of three domains:•

sanitation market – centered on the enterprise that facilitates transactions between customers andentrepreneurs•

business environment – government policy, the reach of associated supply chains for raw materials
and hardware, and access to business and consumer capital•broader context – social norms, infrastructure, and macroeconomic and environmental factors

The customer (also referred toas the “buyer” or “user”) is thehousehold or head-of-householdthat purchases, uses, and oversees
the construction, operation, andmaintenance of a latrine.

The sanitation enterprise is thebusiness that sells latrines, latrine
components or sanitation services
to customers for payment. Generally
sanitation is only one of multiplelines of business for the enterprise.

The sanitation entrepreneur(also called a businessman orbusinesswomen) is an individual
who manages one or moreenterprises.

FIGURE 3: USAID MARKET-BASED SANITATION FRAMEWORKThe design of a sanitation enterprise is often an iterative
process and involves making choices on the different elementsof the framework that individually and collectively are
locally appropriate. It is important to keep in mind that theentrepreneur must see sanitation as a viable business (i.e., onethat provides sufficient profits for him or her to remain in
business) for this to be sustainable. For this reason, sanitationenterprises are rarely standalone businesses. Sanitation ismore often one of many business lines in a given enterprise.
Approaches aiming to build and strengthen sanitation markets
10 |WATER AND DEVELOPMENT TECHNICAL SERIESASSESSMENT TOOLS FORSANITATION MARKETS• Market Research• Human-Centered Design• Feasibility Assessments• Enterprise Viability Assessment

must also address the rules, regulations, and overall enabling environment for private sector participationin sanitation. Importantly, approaches must also support enterprises to offer products that customers willpurchase; they must be aspirational and affordable. Market-based sanitation efforts take time and do notoften deliver quick results but sustainable and lasting change.
TABLE 5: APPROACHES TO AVOID AND PROMOTE IN MARKETS FOR RURAL SANITATION PROGRAMMING

PromoteAvoid

Recruit staff with business expertise to leadand manage market based sanitation work.
Sanitation experience is preferable but notrequired

Recruiting or asking traditional WASH staff, healthpromoters, community mobilizers, or engineers tomanage market based sanitation work

Building the capacity of entrepreneurs(business men and women) to manage andgrow sanitation business lines

Recruiting individuals without entrepreneurial
skills with an assumption that they will become
successful business owners

Working with proven entrepreneurs inbusinesses connected to sanitation (e.g.,construction, cement manufacturing) andfocusing on profitability

Building businesses that rely on selling latrines
only

Understand local preferences for productsthat can be delivered through local supply
chains, possibly through human-centered19
design processes

Importing or promoting sanitation products that
may not be well suited to local preferences

Facilitating adjustment of market rules tostrengthen the viability of sanitation business

Providing all of the materials, equipment, marketing
support and other items a business needs to be
viableStrengthening supply chains and distribution
networks from manufacturers to sanitation
businesses

Acting as a distributor of sanitation products
without a plan to hand this over to a local actor

Ensure the marketing and sales mix addresses
both demand creation and demand activation(conversion of latent demand into sales)

Focus only on making products and services
cheaper

19 Human-centered design, also called user-centered design, is an iterative design process in which designers focus on the users and their needs in each phase of thedesign process.

RURAL SANITATION | 11

Example from the field: Supporting Sustainable Sanitation Improvements (3Si) in Bihar, India20
The 3Si intervention was implemented by Population Services International’s (PSI) from 2013 to 2017,
aiming to create a functioning sanitation market in 19 rural districts in Bihar. PSI worked with 741
enterprises that sold 220,145 toilets between 2013 and 2017. The 3Si approach included coordinateddemand and supply-side activities including:•

Product development of toilet options•

Building a delivery model centered on cement ring manufacturers with links to other stakeholders•

Recruiting and paying “toilet motivators” (sales agents)•

Supporting access to enterprise loans from microfinance institutions

One of the entrepreneurs in this program, Shyam, was able to create a large, high profit enterprise.
Shyam has been in the sanitation business for over a decade, starting out as a part-time sub-contractor
manufacturing cement rings, and selling life insurance policies and distributing food ration cards on theside. His sanitation enterprise grew rapidly on the strength of his social network; he was part of thelocal government leadership committee for five years. He actively marketed his sanitation enterprise,working with sales agents (recruited either by him or PSI) and convening village meetings to spreadawareness about his business. As Shyam’s enterprise gained traction, he took out microfinanceinstitution (MFI) loans in 2016 to stock additional, sanitation-related components, which grew his
profits further.
Analysis of Shyam’s enterprise in comparison to other 3Si enterprises, showed that Shyam’s successis due to:•

A larger customer base, due to investment in demand activation and customer service and location
in a larger potential market for toilets•

Ability to charge higher prices, due to Shyam’s strong social standing and trust in his market•

Lower costs, due to the lower labor costs in Shyam’s area•

Higher sales of pit covers and additional sanitation-related products, because of customer preference
for purchasing all products from a single shop•

Ability to stock these additional products through working capital loans

By studying Shyam’s enterprise and other sanitation enterprises, implementers of MBS programs canbetter understand the drivers of profitability, which is critical to creating viable businesses. These lessons
can be used to support other enterprises to become viable.

MEASURE SUCCESS AND ENSURE LEARNING

Continuous learning is critical to successful programming, as the solutions to rural sanitation challenges
are not known for all contexts. This is especially critical with regard to market activities that require
iterative development and dynamism to scale-up. Programs should build in space, time, and staffing forexperimentation, failure, and refinement of approaches. This will require approaches to learning beyond
monitoring indicators or doing evaluations and may require use of qualitative data, pause and reflect events,
dedicated staff time for reflection and adapting plans, or other learning techniques.
20 USAID (2020) Enterprise Viability Case Study: A Retrospective Analysis of Rural Sanitation Enterprises in Bihar, India.

12 |WATER AND DEVELOPMENT TECHNICAL SERIESIt is important to select standard and custom indicators that measure how the activity is working and ensure
the program is learning from its experience. Activities must be able to measure access gains achieved throughmarket mechanisms, which usually requires baseline and endline surveys. Indicators should also go beyond
tracking the number of people reached to capture both near term and long term outcomes, changes in themarket and governance systems, and progress on market actors and household behaviors.

MEASURING SUCCESS FOR RURAL SANITATION ACTIVITIESUSAID has standard indicators for sanitation, which focuses on first time access and service
quality improvements (HL.8.2-1, HL.8.2-2, HL.8.2-3, HL.8.2-4, HL.8.2-7) as well as tracking
improvements in institutional capacity (HL.8.3-3). Custom indicators are also a criticalcomponent of monitoring for the likelihood that these services will be sustainable in the longrun. Illustrative examples of these include:
Governance• National policy, standards, and guidelines for sustainable rural water services in place• Roles and responsibilities of sector institutions are clearly definedFinancing• Percent of national or sub-national budget dedicated to rural sanitation services
Social Norms and Behavior Change• Number of districts certified ODF• Number of communities ODF one year after ODF certification• Change in attitudes or norms
Markets• Number of latrines/products sold or service calls• Percent of target areas serviced by supported business partner• Percent change in sanitation enterprise revenues• Amount of sustained sales

SELECTED RESOURCES
1. USAID. (2017). An Examination of CLTS’s Contributions Toward Universal Sanitation and Webinar
2. USAID. (2017). Scaling Market-Based Sanitation: Desk Review on Market-Based Rural Sanitation Development Programs
and Webinar
3. WaterAid. (2019). Rethinking rural sanitation
4. WHO (2018) Guidelines on Sanitation and Health
5. Tillet, W. and Gensch, R. (2019) Strengthening Sanitation and Hygiene in the Wash Systems Conceptual Framework.
Sustainable Services Initiative.

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