Topic > Envirofit Case Study - 834

Kitchen stove sales were not sufficient to support the operating costs of the Envirofit business operating model, which includes import costs, a 20% VAT on imported stoves, administrative overheads in India and the United States, research and development, costs associated with outreach, and, for the for-profit subsidiary, taxes on earned income. Making money with this model is expensive, even more so when the market is BoP: families who have little disposable income and, presumably, already have a stove. From the last line of the case, “The big question… was how to increase sales of the Envirofit cooktop without the burden of incurring additional incremental costs that would compromise profits and impact the long-term sustainability of the company.” This is the challenge of every company, whether profit-oriented or socially oriented. In order to do this, revenue must be greater than costs