ABSTRACT
This chapter introduces a market system approach to developing inclusive business models. It argues that it is the particular conditions in the market systems where the poor live that constrain the development of inclusive business models. Business benefits include increased profits and the potential for long-term growth by: winning new customers and developing new markets; strengthening the supply chain and expanding the labour pool; and the innovation of products, processes and business models. Markets where the poor live are often fairly 'dark' areas in terms of the information available about them. The lack of knowledge and skills of target markets is a pervasive problem for businesses working in the context of poverty. Entrepreneurs can contribute to the development of policies that enable inclusive markets. Changes in the market conditions will change the incentives for stakeholders and hence their actions. Understanding the market as a system also implies that every market system will be different.
