In Tucurú, Guatemala, Kimberly began suffering from respiratory infections at just five months old. To obtain medication, her father Miguel had two options: spend a day’s salary for transportation or walk 36 kilometers, roundtrip, to town. That was until a Tiendas de la Salud Health Store opened just minutes from Miguel’s home, stocked with the medicines Kimberly needs. Frederico, the store owner, is not only supplying his community with safe and effective pharmaceuticals, he is also able to earn a profit and improve the lives of his own family.
Tiendas de la Salud (TISA) is a microfranchise network of health stores selling high-quality medications & health products in rural Guatemala. Founded by Mercy Corps & Linked Foundation, and later acquired by a private Guatemalan firm – Farmacias de la Comunidad (FdeC), Guatemala’s largest manufacturer of high quality, generic pharmaceuticals and a large pharmaceutical chain operator. Each TISA store address local health needs while enabling the entrepreneur running the store to earn an average monthly profit of $45
I interviewed Linked Foundation’s Executive Director Nancy Swanson and former Senior Advisor of Social Innovations at Mercy Corps David Lehr to learn more about the challenges and inspiration behind Tiendas de la Salud.
Amanda: What health products do TISA shops stock?
David: Guatemala has some of the worst indicators around illness and health in the region. TISA provides access to medicines and health-related products in some of Guatemala’s poorest and most rural communities. Each store offers high-quality and affordable medicines, along with basics like soap and shampoo. And, since TISA is financially sustainable it is providing a long-term solution to a previously unaddressed issue.
Amanda: What was your vision for TISA's work?
Nancy: Linked’s vision was to build a partnership to learn and invest in market-based solutions that will make a difference in the health of women. We wanted to leverage our funding and partnering expertise and found that Mercy Corps shared our aspiration and had a strong team in Guatemala.
Amanda: Talk about how TISA has grown since launching in 2009
Nancy: The partnership with Farmacias de la Comunidad brought in resources and business expertise enabling TISA to scale. Farmacias de la Comunidad was originally a supplier to TISA, but as the network grew so did their interest and their realization that they could grow their business while also addressing a serious social need.
In terms of funding, the Linked Foundation provided $400,000 of grant capital to Mercy Corps over 5 years to pilot and scale TISA.
Amanda: How big is TISA’s network now?
Nancy: Currently 70 stores reach a population of 120,000. Mercy Corps continues to provide ongoing support to Farmacias de la Comunidad, training their field technicians and helping strengthen the model. Linked and Mercy Corps are now looking to replicate the TISA model elsewhere in Latin America.
Amanda: What were some of the big questions TISA wrestled with as they grew?
David: One of the biggest issues we wrestled with was around sustainability. These communities are low-income with a multitude of needs and we were asking these communities, and often a single resident, to trust us and become an owner of a yet unproven business; wherever possible we tried not to put those local entrepreneurs at risk
In the beginning, we spent a year observing a small number of TISA stores to see what would happen when these communities went through a full yearly cycle as incomes fluctuated depending on the harvesting seasons. We were dedicated to understanding what the economy looked like and what products were in demand as well as the challenges that the storeowners faced. Currently, most of the storeowners are profitable and while margins are thin, Farmacias has been committed to ensuring that storeowners are able to make a small profit.
Amanda: How does TISA measure progress?
David: Two years ago, we sought to measure how TISA was changing lives, but struggled with defining impact and determining how to measure it. We were fortunate to partner with the UCSF Global Health Group who went to Guatemala to conduct a qualitative research study that provided deep insights into TISA and identified ways to increase access and households served while also improving the business itself.
Nancy: One key finding was that the training and qualifications of the TISA store owners and staff have a large impact on how community members perceive and use the TISA stores. Most community members preferred to consult trained health professionals before purchasing medicines, in particular when they believe that an illness is serious. The perceived training and expertise of the storeowner influences the trust community members have in TISA, and their willingness to purchase medicines at the store. Where community members view TISA owners as businesses, rather than health professionals, there is less trust in their ability to provide the right medicines.
Amanda: TISA started in 2009; can you share your thoughts about TISA in 2014 and its growth in the past 4 years?
Nancy: The greatest part has been the trusted partnership we have with Mercy Corps. This work is challenging and takes so much more time than we imagined when we began. It has been a learning journey, requiring a long-term commitment by all of us. Working with Mercy Corps and Farmacias to refine and scale the model and to continue to collaboratively solve problems has been so rewarding. I am looking forward to new partnerships to bring TISA to other parts of the world.
David: I can’t agree with Nancy more; we have certainly had some some luck, but behind that has been getting the right people on board and working hard. When we started, we had many doubts, but TISA has captured the hearts and imaginations of Mercy Corps and really influenced how they’re thinking about future initiatives.