Preliminary identification of our social impacts

So far, I think we have a clear understanding of which basic needs that we want to address in Jakarta. I can identify three things that might be affected by our venture: safety, productivity and employment. Dan and I have discussed about these ideas on our previous blogs. But, when thinking about the social impacts of our venture, I got stuck in figuring out the way to calculate them in economic terms.

Safety and productivity
We know that good rain suit can reduce the risk of accidents when riding a motorcycle. A lot of current motorcyclists use ponchos when riding a bike, which is very dangerous as the tip of the raincoat might get caught in his or another motorcycle wheel. Others use all-purpose, two-piece rain suit, that sometimes unable to fully protects the users. When heavy rain comes, their limited visions increase the risk of accident. Furthermore, they also need a water-resistant container to protect their luggage. Overcoming this issue will enable them to bring their important stuffs and be more productive. This is especially true for workers and students.

Those are two basic needs that we know we should tackle. But calculating the impact of a good rain suit is a different thing. It will be difficult to get secondary data on motorcycle accidents caused by heavy rainfalls. Calculating the difference in impact of our product with other brands will be much more cumbersome. One thing that we can do is collecting primary data from our customers. I got this idea when I was thinking about my son's child seat. In the US or Canada, customers have an option to register their purchase so they can be informed of recalls or other new information. This is also a standard practice in the automobile industry.

I think the majority, if not all, of locally-manufactured raincoats or other motorcycle apparels don't have the option to register their purchase on the manufacturer's website. Yet, by doing this, we can keep in touch with our customers and track their habit or ask them to fill in some surveys on customer satisfaction. I don't know how enthusiast our customers would be on this registration, but the good thing is that they might perceive us as being care about their safety. Their feedback is also very important for our product improvement. But I also realize that most people who give comments and feedback might be the ones that are unsatisfied with our product, so we also have to carry out field surveys to cross-check this tendency. Below are potential indicators of safety and productivity improvement I have identified.

Indicators of safety improvement:

• Average percentage reduction in medication costs from accidents
• Number of accidents experienced by our customers vs general motorcyclists
• Number of customers vs general motorcyclists that are saved from injuries, death, etc. caused by motorcycle accidents

Indicators o productivity improvement:

• The average number of luggage a customer vs another motorcyclist brings
• Customer satisfaction
• Number of incidence and its severity of water flows into the raincoat
• The frequency of motorcyclists carrying luggage

Employment
We have decided to outsource our production process to a local manufacturer. Several advantages of using this strategy: we can cut costs because we don't need to pay manufacturing-related expenses, we can minimize our initial outlays, and we can help absorb local labors and reduce unemployment. This goal is different from the previous two in a sense that reducing unemployment doesn't have a direct impact on our customers. But, this goal is highly dependent on the achievement of the previous two since excelling in them will translate into more revenues that eventually absorbs more workers to manufacture the raincoats. Measuring economic value of this goal is also easier than the other two as we can calculate how many employees we can absorb.

Remaining issues
Up to this point, I have identified several potential ways to calculate the impacts of our raincoat, but they might be difficult to be summarized into a single monetary value. When calculating social impacts, this week's article about cost-benefit analysis might be difficult to implement, given the unavailability of data in a developing country like Indonesia. Conceptually, we also need to figure out how to translate the numbers into monetary values. We need to find data that can be a good approximation for these indicators.