Definitions of the BOP market are varied, but a generally agreed upon parameter is those living on an annual income of $3,000 or less in local purchasing power parity. YESxBOP agrees with this definition, but recognizes the validity of qualitative definitions that argue that being a member of the BOP is about so much more than simply lacking money. Because economies are traditionally structured to emphasize the provision of products and services to middle- and higher-income customers, members of the BOP are often left out of this system. This exclusion manifests itself in many ways, in everything from BOP members lacking the skills necessary to take advantage of money- and time-saving information on the internet to serious, life-threatening disadvantages such as lack of knowledge and access to basic healthcare services leading to a shortened lifespan.
Therefore, for the purposes of the YESxBOP Lab, Business Plan Competition, and Incubation, a member of the BOP is defined as:
“Any person living on less than $3,000 USD annually in local purchasing power parity or who faces significant obstacles in accessing the benefits and resources of the formal economic system.”
N.B.: As the second half of the definition is subjective, YESxBOP is committed to remaining open to any project that makes a compelling argument about how their customers, producers, or partners are members of the BOP, whether defined through income-level or informality.
Within China, most members of the BOP belong to one of the following four groups:
- Low-income rural population: Located primarily in the villages of central and western Chinese provinces, such as Shaanxi, Sichuan, Chongqing, Yunnan, Guizhou, and Guangxi, farmers from these region have limited access to the global economy and international markets.
- Low-income migrant workers: Though they do enjoy certain benefits of China’s rapid development, these often come at the cost of unreasonable and unstable working and living conditions.
- Low-income minority population: Due to geographic, linguistic, and cultural factors, this group is often left out of China’s economic development and the formal global economy.
- Low-income urban population: In areas such as the Northeastern industrial belt, Beijing Shijingshan, and Xinjiang in the far west, mining or manufacturing once brought wealth and economic development. As China’s economy transitions to higher value-added products, the relocation of these business activities has left many jobless and without support.
Just because BOP members currently have restricted access to the fruits of economic development, does not mean that they do not have the potential to become highly valuable actors within this system.