Serving the World's Poor Profitably

Student: Guillermo P. Nalica

Subject: Global Business Management

Time: 6:00-9:00 PM

Professor: Mrs. Portia Cordova Salva

Reaction Paper 5: Serving the World's Poor Profitably

The article tells about how Multi-National Companies can serve the poor not acting as charitable institutions but bringing their investment to cater for this untapped market of 4 billion, people the vast majority of the population. Before MNC focuses its business strategy to cater for the middle class or upper class of the economy mainly because the assumption that there is no market potential and that "the poor" do not spend on anything besides basic needs is flawed and narrow – the aggregate buying power of this segment is very large and their spending behavior is actually quite similar to middle-class consumers. The article points out and overcomes many misperceptions about the poor than establishes the business case for MNCs. Before, when the cellular phone was first introduced in the country only the rich can afford to have one. I remember the big bulky cellular phone with antenna on it. But with advancement of technology small and handy phone was developed and the price was reduced that even the poor can have access to it. The impact of this technological advancement translated our country to become the texting capital of the world. I can hardly imagine the profit of this telecommunication companies if we price our text message at P 1 per text times the number of individual who uses the cellular phone. Today, the use of cellular phone bring about cheaper communication that reached in every part of the world compared to the telegraph and long distance call a decade or so. This helps the "poor" uplift their status in life. Nowadays, I don't know of somebody who had no