From the consumer perspective, product costs can include not only monetary costs but also time and effort costs of acquiring, preparing, and consuming foods: for the consumer, these jointly shape the product's effective affordability. The cost of time and fuel to prepare food is not insignificant in many low- and middle-income countries.
One of the simplest ways to alter affordability is simply to sell products in small package sizes. This is probably the most common strategy used for reaching lower-income consumers across product types and contexts.
In a cross-subsidisation model, one product is sold with a larger margin, with the excess profit used to subsidise another product sold at a smaller margin (e.g., by covering all or most company fixed costs with the higher-margin channel). BMR’s systematic review found several examples of companies using this strategy with the same product sold in different forms or settings to different groups of consumers.
Delegates numbering more than 5,000 and representing over 90 countries converged to explore strategies to harness Africa's vast potential in expediting the development of regional, national and sub national food systems that would not only benefit the continent but also the entire world.
[We, the African Heads of State and Government, commit to] redoubling our efforts to boost agricultural yields through sustainable agricultural practices, to enhance food security while minimizing negative environmental impacts. But perhaps there's more cause for optimism here than first meets the eye.
Imagine a classroom filled with eager young minds, ready to embrace the world's opportunities. Now, picture these same children and adolescents, their potential stifled not by lack of ambition, but by an invisible adversary – hidden hunger.
Some countries encourage increased consumption of nutrient-rich foods to reduce the burden of diet-related diseases such as diabetes as one of their health goals—but they also subsidise foods that can contribute to those diseases, such as sugar, edible oil, or refined grains.
Food loss and waste is a major problem worldwide: it is estimated that 14% of all food produced globally is lost between harvest and retail, while 17% is wasted. For the most nutrient-dense foods, which tend to be highly perishable, levels are even higher, exceeding 20% for the category of fruits and vegetables.
In this blog, Anouk de Vries looks at some of the work underway to deliver on the aspirations set out in the 2021 Food System Summit - making the way we grow, deliver and consume food more sustainable and healthier.
Companies entering the lower-income consumer market often adapt existing products to meet lower-income consumers’ needs—in particular, redesigning the product to improve affordability. One way to do this is to simply replace more expensive ingredients with cheaper alternatives, or omit certain ingredients altogether.
