Affordability Learn how to correctly analyse this topic.

Sarah Simon

36 min Read Time | April 3rd 2022

Key takeaways

1

The topic aims to uncover how a product/service’s price boosts or hinders consumers’ ability to access basic needs, especially in the context of underserved/low-income populations.

2

The topic covers the affordability of clothing, food, utilities such as energy, water, and gas, connectivity, transportation, which are considered basic needs.

It does not, however, include luxury goods (i.e., high-end cars, apparel, hotels, etc.) but only should consider basic needs. It also does not include B2B.

3

This topic can be either positive or negative, depending on whether the product/service is affordable to the general population.

What is it?

Affordability is defined as the extent to which something is affordable, as measured by its cost relative to the amount that the purchaser is able to pay.This topic is intrinsically connected to basic needs; therefore determining how much an individual is able to access daily life necessities. If a product is not affordable, lower-income families or the average person might refrain from accessing and thus benefiting from a product and/or service.

Basic needs comprehend “food (including water), shelter, and clothing. Many modern lists emphasize that the minimum level of consumption of basic needs also includes sanitation, education, and health care.” The list can be larger including energy, internet services, and others.

Sources

https://www.definitions.net/definition/affordability

https://pallipedia.org/basic-needs/

SDG poster UN emblem PRINT 2020

SDG Choice

The SDG choice depends on the product or service discussed.

Example: Affordability of Energy companies - SDG 7

General Impact Assessment

To measure whether a product or service is affordable or not will depend on the industry the company is in, or the groups of products/services the companies offer. The guide is, therefore, broken down per group.

No matter the industry or the group, all analyses treating this topic should consider the following points:

1/ The headline should include absolute numbers, and clearly state whether the cost of such goods or services is below, inline, or above the industry or country average, rendering it either affordable or unaffordable.


2/ To describe the scale of the impact, take into account:

2.1 The breadth of the impact

  • Is the impact local, national, or global?

  • How many individuals are affected by this activity?

2.2 The depth of the impact

  • Is the well-being of the community/people profoundly affected, or does the issue just marginally impact them? How so?

  • Are the changes brought by the company profoundly changing society or the planet? How is the group coping with the external impact brought upon them?

2.3 The persistence of the impact

  • How long would the impact described last for? Months? Years? Decades?

  • How reversible is the impact described in the impact analysis? Can it be easily stopped/extended?


3/ CONCLUSION

It should wrap up the above discussion keeping the most salient information for the reader to correctly grasp the impact.

It should aim to answer the following questions:

  • Are the company’s products or services affordable or unaffordable?

  • If not in line with the industry average, then by how much?

  • Is it, therefore, ultimately hindering/boosting access?


Below you will find a breakdown of products and services including the way to treat their affordability that is industry and product/service-specific.

Essential Consumer Goods: Apparel, Accessories & Footwear, Household & Personal Products

The introduction should discuss why it is relevant to address the affordability of a company's clothing products and answer the following questions:

  • Why is clothing important to consumers? Is it a basic need?

  • What is the relevance of clothing in people's daily lives? How does it allow protection from the environment?

  • If possible, how many people or what share of the population might be affected by the unaffordability of clothing (where the company has the most presence)?

  • Disclose the average price spent by people on clothing per month/per year (this is useful for comparison/benchmarking with products' pricing).

Example:

"One fundamental human right is clothing because it allows one to go to work, socialize, be educated, be protected from the environment, and other actions that help reduce poverty1. Clothes must be considered as part of the standards of quality living and realization1. Anyhow, 9.2% of the global population survives on $1.90 a day or less, meaning they cannot afford even basic clothing3.

In the US, 40% of the population struggles to afford basic needs, including dressing4. On average, the middle-aged adult in the US spends $161-$209 in clothing per month, and the average family spends $1,800 per year on clothing7."


THE BODY:

The core analysis should demonstrate how a product/service is relatively more or less expensive vis-à-vis the average price of the same in a country and/or globally (depending on the reach of the company and angle chosen).

It is important to select a basket of necessary basic/most bought/sold goods by the company. Discussing multiple items (at least 3) will allow for more nuanced analysis and a basis for comparison within the industry.

Caution: We will not accept analyses based on only one product as many companies sell multiple and varied products.

You should aim to answer the following questions:

  • What is the company's market share?

  • How many people purchase the products offered?

  • What is the basket of goods selected? Should not be luxurious goods, but focus on more basic products (T-shirts, undergarments, sockets, etc.)

  • What is the cost of these products?

To compare/benchmark with the above products' pricing:

  • What is the average cost of the above in X country?

  • Depending on data availability, you can provide added value, such as the average price of the same products from cheaper brands and/or average price from more expensive brands - but companies that are still comparable and close competitors in the industry).

Example:

"Hanes is a global apparel-maker with a presence in +40 countries in 20205. The volume the company sells is quite high, making it the 10th-largest apparel company in the world6.

Hanes is a reasonably affordable brand; as an example, on its website for the US, a pack of 6 cotton women's underwear can cost as little as $9.998, women's leggings and pants start at $162, and its cotton t-shirts' prices start at $109. The average price of these items at a cheap store in the US is $20, $42, and $17.5, respectively, putting Hanes' products at a lower price than its competitors10. At a more expensive store, these can cost more than $15, $32.5, and $30 per just one item, making Hanes' products even cheaper10."

Good indicators to include:

  • How affordable a company's clothes are in absolute terms ($ or €) and percentage (%)

  • Comparison to the industry average: between the company and average prices in a given country or market (this might not always be available),

  • If unavailable, you can make a competitor comparison to the average price between competitors 1, 2, and 3 (main competitors in the market).

Analysis example: https://app.impaakt.com/analyses/32166/hanes-offers-affordable-clothing-in-40-countries-worldwide

Technology: Hardware, Software & IT Services

INTRODUCTION:

The introduction should explain why it is relevant and important to address the affordability of a company’s products/services (i.e., photography, smartphones, computers, software services). It should try to answer the following questions:

  • Why are the products/services offered important to consumers?

  • What is the relevance of hardware/software in people’s daily lives? Does it allow self-expression, well-being, and/or productivity?

  • What is the average cost of these products/services for the industry or in the country/globally (average price and/or minimum & maximum prices).

  • Considering an average income, how much is spent on those products on average?

Example:

Photography is important as it frames moments, helps us remember better, tells us stories, can be a therapy tool, allows us to express, create art, and share with others1. Photographs can be influential, impactful and communicate certainties of facts that are happening all around the world, aiding us to communicate to others and connect1.

However, the tools to be a photographer can be expensive; the intermediate gear can cost up to $2,000, and a professional set +$4,0002. In 2019, the world's net income per capita was $9,484, meaning that, to be a professional photographer, the average person should spend more than 1/4 of their yearly income, and even more in countries with lower wages3.

THE BODY:

It should try to answer the following questions:

  • What is the company’s market share?

  • How many people purchase/use the products/services?

  • Taking the lowest-priced product, medium-priced item, and highest-priced product, what is the price?

  • How does this compare to the industry average?

  • If this is unavailable, benchmark it with the main competitors for the same range of prices/type of product/service.

  • Are the company’s products/services below, inline, or above the average price for the same ones?

To compare/benchmark (alternative):

  • You can come up with one average price figure for the company’s products/services by averaging the prices: 

(low price + medium price + high price)/3 = average price

  • Should compare the same products to competitors.

  • You can apply this whenever you need only one general average figure to draw the affordability discussion.


For instance: We know that in the US the average cost of X product is $100. We do not have the average price for Company 1’s products/services. We have a range of prices however depending on the product or service for the Company. We pick the lowest priced one: $100, one middle priced one: $150, and one high priced one: $200. The average is equal to $150 (100+150+200 / 3). Therefore, Company 1’s average product price is $50 more expensive than the average price in the US.

Example:

Nikon is the 3rd most important producer of photography gear worldwide, with 13.7% of the market share and selling an estimated +1.137Mn units in 20194. Its cameras are considered some of the best in the market5, but are quite expensive in 2021, especially against its main competitors, Sony and Canon6,4. For example, Sony offers its cheapest intermediate camera at $668, while Nikon's most affordable and similar model costs $1,096 (+60%)7. Nikon's high-end cheapest camera costs $2,236, while Canon's offers a similar model at $2,085 (only 93% of -Nikon's)7.


    Analysis Example - Hardware:

    https://app.impaakt.com/analyses/36977/nikons-products-are-more-expensive-than-its-competitors-sometimes-more-than-double

    Analyses Examples - Software & IT Services:

    https://app.impaakt.com/analyses/35940/-80-percent-of-all-lowcost-airline-seats-flown-worldwide-in-2019-were-in-amadeus-platform

    https://app.impaakt.com/analyses/41633/worday-is-the-3rd-most-expensive-hcm-provider-among-the-top-5-market-competitors

    Mobility: Automobiles

    To treat the affordability of cars, we recommend using the sources below:

    1/ To calculate the personal loan (calculator): https://economiapertutti.bancaditalia.it/calcolatori/personal-loan-calculator/

    2/ The World averages to know about the lending interest rates:

    https://tradingeconomics.com/country-list/bank-lending-rate

    3/ The below statement to benchmark the affordability of the car: 

    "An affordable car is regarded as one that costs 10-15% of a person's annual income, including its re-payments and other expenses3."


    INTRODUCTION:

    The introduction should explain why it is relevant to address the affordability of cars. It should try to answer the following questions:

    • Why are cars important for society?

    • What is the relevance of hardware in people's daily lives? Does it allow prosperity, productivity, or mobility?

    • Mention how much should be spent on a car (maximum) out of one's annual income.

    • (Optional) add any other data that might be useful to describe the affordability of cars, i.e., did prices increase lately?

    Example:

    "Automobiles have a vast impact on shaping the economy2. Owning a car offers privacy, safety, time flexibility, and avoiding exposure risks during health emergencies2. A car is more of a necessity in the US, and owning one is considered a lifetime investment2. An affordable car is regarded as one that costs 10-15% of a person's annual income, including its re-payments and other expenses3.

    Compared to a decade ago, a new car/truck now costs 38% more, while the average transaction cost rose by 50-70%, making them unaffordable for ordinary people (working-class people)4."


    THE BODY:

    It should try to answer the following questions:

    • What is the company's market share?

    • How many cars were sold by the company in the latest year?

    Caution: the analysis should tackle the impact in absolute terms, ideally. This might not be possible on many occasions. Therefore, the analysis should focus on the country or region, depending on where the company has the most sold cars (most considerable impact).


    What is the average price of the company's cars offered?*

      1a. Insert the cost into the personal loan calculator under "loan principal amount" → here

      1b. Look at the average loan interest rate in the country under investigation here

      1c. Insert the average loan interest rate into the loan calculator under "annual interest rate" → here

      1d. Insert 72 months as the average loan term as stated in this source

      1e. Click "Calculate" to obtain a monthly installment result


      2. You would need to add three additional expenditures:

      2a. Annual average maintenance costs for the car

      2b. Annual average fuel costs for the car

      2c. Annual average price for insurance


      3. Add those to the yearly cost of the car extrapolated with the online tool to obtain one final annual figure.

      Ultimately: Is the monthly installment (transformed into yearly) meeting the criteria in the introduction stating that a car is affordable if it "costs 10-15% of a person's annual income"?

      Example: "The average transaction price of light vehicles in the US was $41,152 in 2020,4 for FCA/Stellantis, it was $44,877 (9% more than the average price)7. However, if bought with a full loan, the monthly rate would equal $687.08 for a 72 loan term5, 8, 9. Adding $1,500 for yearly maintenance10, $1,596 for yearly insurance11, and yearly fule costs of $1,35412, we get an annual figure of $12,695 ( $687.08*12 months + $1,500 + $1,596 + $1,354). This represents around 13% of the yearly income, thus being in line with the affordability definition."


      *If the average cost of the company's cars is unavailable:

      • Estimate the average cost yourself:

      • You can do this by taking three least expensive vehicles, three middle range cars, and three most expensive cars from the company

      • Average the above to obtain one average figure

      **If the average transaction cost in a region is unavailable:

      • To estimate the average transaction cost in a country, look into the most sold brands in a given country/region.

      • Pick three low-priced branded car costs, three medium, three high, and calculate the average.


      To provide added value, look into the following:

      1/ How affordable/expensive the company's products are compared to the average car transaction cost in a country, the industry average, and/or to main competitors.

      2/ Assessing whether the average price of a car is within the 10-15% rule is important, yet it might be more expensive than close competitors and/or the national average. This means that it might still not be the cheapest option even though it is considered affordable.

      Analysis Example: https://app.impaakt.com/analyses/36143/stellantis-average-car-price-is-9-percent-more-expensive-than-the-average-american-transaction-car-price

      Feed the World: Processed Foods

      INTRODUCTION:

      The introduction shall explain why it is relevant and important to address the affordability of food. It should try to answer the following questions:

      • Why are the products offered vital to society?

      • What is the relevance of food in people’s daily lives?

      • How many people and who in such areas are affected by food insecurity? (Note that the answer to this question depends on imports).

      • What is the role of food retailers to combat food insecurity?


      THE BODY:

      It should try to answer the following questions:

      • What is the company’s market share?

      • How many people benefit from its products (reach)?

      • Select a basket of basic food needs that can be bought from the company?

      • What is their cost?

      • How do they compare to the industry or country average?

      • If unavailable, benchmark it with three main competitors using the same comparable basket of basic food products (to calculate an industry average).

      • Are the prices above, in line, or above the industry/country average?

      • Is the company providing daily discounts? Loyalty programs? (This can only be discussed if this has not been captured in the Core Business Impact topic)


      Example:

      ICA Gruppen is the biggest Swedish grocery retailer with 35% of the market share in the country6;p1, reaching +1.68Mn Swedish households each year (3.18Mn individuals according to an average household size of 1.9)7,11.

      According to ICA's customers, the store brings high-quality groceries at affordable prices3. As an example, by buying 1kg of apples, 1 box of cereal, half dozen of eggs, 1L of milk, and 1kg of potatoes at ICA Maxi store, the customer will pay €6.53, while at Willi's, they will pay €6.64 (101.7% of ICA's), at Lidl, they will pay €6.89 (105.5%), and at Coop, they will pay €8.51 (130%)9.

      Moreover, the company offers daily discounts to its regular customers registered at its loyalty program, returning €2 to €15 every month to each one8. A year and a half after launch, there are ~5Mn regular customers currently registered on the program10;p4.

      Analysis Example: https://app.impaakt.com/analyses/36981/ica-reaches-3mn-individuals-each-year-with-affordable-food-prices-cheaper-than-its-competitors

      Utilities: Gas Utilities & Distributors, Electric Utilities & Power Generators, Water Utilities & Services

      Introduction

      The introduction shall explain why it is relevant and essential to address the affordability of energy products/services. It should try to answer the following questions:

      • Why are energy products/services essential to consumers? Is it a basic need?

      • What is the relevance of energy products/services in people’s daily lives?

      • What are, then, the side-effects stemming from the unaffordability/affordability of energy products/services?

      • How energy affordability is a critical factor in boosting/hindering access to basic energy coverage for people

      • (Optional) add any other data that might be useful to describe the affordability of energy products/services, i.e. Did prices increase lately?


      Useful for comparison/benchmarking with products’ pricing:

      • Disclose the average monthly amount spent on residential energy consumption in a given country/region/globally

      • The average monthly median and minimum salary earned by an individual working in that country/region, and what percent (%) is spent on residential energy consumption


      THE BODY:

      It should try to answer the following questions:

      • What company is the note about? What is their market share?

      • What is the company’s average cost of energy services/products? (Y) If information is available

      • Using Y, calculate what % of the monthly median and minimum salary an individual would spend on the company’s energy products/services.

      • Compare the company’s average monthly energy services/products cost with the national average monthly spend on residential energy consumption


      Example:

      Emera, a Canadian company wholly owns a subsidiary Nova Scotia Power (NSP) that delivers electricity to 500,000 residential, commercial and industrial customers in Nova Scotia, Canada4. NSP electricity charges are 12.76c/kWh along with a monthly charge of $8.635. Thus, an NSP customer spends $72.44 for a 500kWh electricity consumption and $136.24 for a 1000kWh electricity consumption5.

      The average electricity price in the province of Nova Scotia was 13.63c/kWh (including all costs) for 1,000kWh monthly consumption in 20201, thus, the electricity charge per kWh of NSP is lesser than the state’s average. A resident of Nova Scotia earned an average of $38,853.09 in 20202, thus, the customer of NSP spent around 4% of their annual income to pay the yearly electricity bills. In 2019, the poverty rate of Nova Scotia was nearly 12.1%6, thus, nearly 60,500 NSP customers may be struggling to pay the electric bills4.

      Analysis Example: https://app.impaakt.com/analyses/29260/emeras-customers-spent-around-4-percent-of-their-annual-income-to-pay-the-yearly-electricity-bills-in-2020

      Connectivity: Telecommunication Services

      The services offered by telecommunication companies to provide connections to the internet or some other communication network to end-users. These services include; Mobile voice plans, Internet, Tv connection, etc.

      Companies may offer more than one of these connectivity services. Depending on the services offered, if only one makes up the majority of the company’s portfolio, then the analysis can focus on that.

      If the company is offering more than one of these services, make sure to discuss their affordability as long as they make up a majority of its portfolio.

      Focus on B2C services.


      INTRODUCTION:

      The introduction shall explain why it is relevant and important to address the affordability of connectivity services. It should try to answer the following questions:

      • Why are connectivity services important to consumers? Are they a basic need?

      • What is the relevance of connectivity services in people’s daily lives? For example, are they essential to businesses, schools, hospitals?

      • What are, then, the side-effects stemming from the unaffordability/affordability of connectivity services?

      • How connectivity affordability is a critical factor in boosting/hindering access to basic connectivity of people

      • (Optional) add any other data that might be useful to describe the affordability of connectivity services, i.e., did prices increase lately?


      Useful for comparison/benchmarking with products’ pricing:

      • Disclose the average monthly amount spent for connectivity services in a given country/region. If there are no proxies use the average price of three competitors of the company

      • The average monthly median and minimum salary earned of an individual working in that country/region, and what percent (%) is spent on connectivity services


      THE BODY:

      It should try to answer the following questions:

      • What company is the note about? What is the market share?

      • How many people benefit from it? 

      • What is the company’s average cost of connectivity services/products? (Y) If information is available

      • Using Y, calculate what % of the monthly median and minimum salary an individual would spend on the company’s connectivity services.

      • Compare the company’s average monthly connectivity services cost with the average monthly spend on connectivity services.

      Transportation: Car Rental & Leasing, Airlines, Road Transportation, Rail Transportation

      This section does not include the affordability of automobiles (passenger vehicles) as it should be treated differently than car rentals and leasing, planes, trains, and other road transportations like buses and taxis.

      We are looking to assess the affordability of mobility to its end-users. Therefore, we will not publish an analysis discussing B2B.

      INTRODUCTION:

      In general, for this category, the introduction should include:

      • Why is the specific type of transportation service (i.e., taxis, rental cars, trains, planes) necessary? 
      • How is it beneficial to people and society at large?
      • Add any absolute figures that might be useful to understand better the importance of the topic (i.e., people reached by this service either locally, globally, or nationally).

      The core analysis should include:

      • A brief description of the company and its reach and scale, such as:

        • The number of people benefitting

        • The company's market share

        • The type of services and/or products provided

      Caution: When there is insufficient data to assess the company's absolute impact (in global terms), you can mention the area/region where the company has the most impact.


      Road Transportation

      For the road transportation industry, the affordability of taxis or similar services provided to people should be assessed.

      The body of the analysis shall prove if the specific service(s) offered by the company in question is indeed affordable or not. Additionally, it should include whether the prices, charges, fees, and other associated costs are in line, below, or above the national/global standards and/or competitors offering the same service(s).

      The core analysis should include the following:

      • The federal charges for the service provided. For instance, if the analysis deals with taxis, you should disclose all the different types of charges/costs associated (i.e., flag-down rates, peak hours rates, night rates, etc.)

      • Assess the same total costs mentioned in the point above for the company you are analysing.

      • If space allows it and/or if national/local charges/prices are not disclosable, we can look into competitors and benchmark the company's data to them.

      Example:

      "ComfortDelGro is a Singaporean land transport conglomerate, with total revenues of USD3.2Bn in 20204, ComfortDelGro owned ~60% of the taxicab service market share in Singapore with a fleet of 7,361 taxis5;p4,6;p1. Further, the company provided mobility services to ~200Mn taxi passengers in 2020 (daily avg of 1Mn*365*60%)7.

      In Singapore, normal taxi fares are metered at $0.22 for every 350m-400m or less (approximately more than 10 km)8. Further, the avg flag-down fares vary from $3.20 to $3.908. The booking stands at $2.90 or $3.308. In addition, during the day, the fee is 25% of the metered fare, whereas late at night, it is 50% of the metered fare8.

      Globally, ComfortDelGro's taxi charges $0.22 per every 350m/450m (approximately more than 10 km)9. Further, ComfortDelGro's flag-down rates range from $3.20 to $3.90 (for all rides)9. ComfortDelGro's bookings for peak hours cost $3.30, and for other hours cost $2.309. Lastly, ComfortDelGro charges 25% of the metered fare for peak hours and 50% of the metered fare for late night transportation9.

      Comparatively, ComfortDelGro's taxi charge per meter is comparable to Singapore's metered fare8,9. Further, ComfortDelGro flag down, booking, and surcharge rate are comparable to the national avg8,9."

      Analysis Example: https://app.impaakt.com/analyses/with-mostly-comparable-prices-to-the-avg-charges-comfortdelgro-taxi-charges-are-affordable-50719

      Car Rental & Leasing

      This industry includes rental services providing mobility and transportation for people. The analysis should discuss why rental services are a crucial element for mobility.

      The core analysis should include the following:

      • The average national prices for the service/product offered by the company.

      • The company's total price for the same service/product.

      • If space allows it and/or if the national/local charges/prices are not disclosed, you can look into competitors and benchmark the company's affordability to them.

      Example:

      "According to Move.org, the cost of using a rental truck for local and long-distance move ranges between US$132 to $1,700, $955 on avg3. Further, the truck rental deposit stands at $0–$150, $75 on avg (for all distances)4.

      Amerco is mainly involved in car rental and leasing services5. It operates U-Haul, which is the biggest DIY rental operation in the world6. The company operates in all 50 US states & 10 Canadian provinces6. Amerco recorded net sales of USD4.54 billion (Bn) in 2021 & U-Haul's rental services accounted for 93.2% ($4.23 Bn) of it7. U-Haul's truck's average mileage per day is 7.4 Mn Km and 2.7 Bn Km per year, reaching millions of people6.

      As of 2021, Penske is ranked second globally and is U-Haul's top competing alternative8.

      U-Haul charges an average price of $137 for Local Move (Under 80Km), $296 for Medium Distance (80Km-402Km), and a median asking price of $1,088 for Long Distance (402+ Km)9. Further, the rental fee stands at $19.99, for all distances9. On the other hand, Penske charges around $134-$200, $167 on avg., for Under 80Km, $200-$600, 400 on avg for 80Km-402Km, and $600-$1,200, ~900 on avg. for 402+ Km10.

      Comparatively, U-Haul's local move charge is ~1.2x less than that of Penske's9,10. Also, its Medium Distance charge is ~1.4x less than Penske's9,10. However, its long-distance charge is ~1.2x the median charge of Penske's9,10. Further, U-Haul's charges at $612 ($137- $1,088) on avg is ~1.6x less than the global avg charge9,3, and the rental fee per day is ~3.8x less than the global average daily charge9,4."

      Analysis Example: https://app.impaakt.com/analyses/amercos-u-haul-truck-rental-charges-are-generally-lesser-than-its-top-competitorsthe-global-rates-51813

      Rail Transportation

      The core analysis should include the following:

      • The average national charges/prices for the service provided (i.e., monthly passes, cost per km expressed in USD or EUR/km, cost of trips, etc.)

      • The company's charges/prices for the same service.

      • If space allows it and/or if national/local charges/prices are not disclosed, you can look into competitors and benchmark the company's data to them, using the cost per km or price of a monthly pass.

      • The median income in an area where the company has the most significant presence.

      • The amount a person spends on the service (monthly pass or similar provided by the company) vis-à-vis the median income for an individual (%).

      There is a definition of affordable transportation that can be used here by the Transport Policy Institute: "Transportation affordability is when households spend less than 20% of their budgets on transport3." This can be used in the body when making the comparisons.

      Example:

      "An average person spends $89 on a monthly pass (regular price) for public transport5. Thus, on average, a Japanese person spends monthly 2.8%  of their earnings on public transport4,5.

      Nagoya railroad is primarily engaged in railway/tramway business in the Aichi and Gifu prefectures in Japan6;p2. In FY2020, the company transported over 296.23Mn passengers covering 275 stations along over 444.2 Kms (railways/tramways)6;p2.

      In FY2020, Nagoya transported 1.2% of the 25.19Bn passengers that traveled by railways in Japan in 20196;p2,2. To facilitate passengers with unlimited and convenient rides, Nagoya sells unlimited line tickets costing $90 per month on avg., $257 for 3 months ($85/month), and $487 for 6 months ($81/month)8. Thus, the company's monthly passes are at par with the country's average 5. The 6 and 3-month passes are 9% and 4.5% cheaper than the avg. monthly pass in Japan, respectively.

      Japan's median income stood at $22,200 in 201810. Based on the latest data, the country's poverty rate stands at 15.7%, which is defined as the percentage of people who earned under $11,100 a year. Thus, Nagoya's monthly pass represents 4.8% of a median household income and nearly 9% for people in poverty."

        Example analysis: https://app.impaakt.com/analyses/nagoyas-monthly-pass-is-at-par-with-the-countrys-average-and-affordable-for-the-median-household-39206

        Airlines

        The core analysis should include the following:

        • The average national charges/prices for the service (i.e., cost of air travel possibly expressed in USD or EUR per km)

        • The company's charges/prices for the same service

        • If space allows it and/or if national/local charges/prices are not disclosed, you can look into competitors and benchmark the company's data to them.

        • The median income per individual where the company has its most prominent presence. Then, benchmark the cost of the travel for the company in question.

        Caution: Generally, you should select the most important route the company operates and then add nuance (i.e., how many people are carried along this route yearly, is this route a busy one?)

        Example:

        “The per km cost for French airlines varies from USD0.22/km (Easyjet) to $0.53 (Air Corsica)4. Thus, the average per km cost of the cheapest five airlines operating in France is $0.33/km4. For example, an average flight from Paris Orly–Toulouse route, i.e., 574km5 would cost around $379 (574km*$0.33/km*2 trips)4 for a return trip, which is nearly 0.7% of the median salary in France ($53,830 (EUR46,600))6.

        Air France-KLM is one of the biggest airline companies in the world, with annual revenue of USD30.4bn7. In 2019, the company flew a total of 104 Million (M) passengers8;p2. This is 32.1M more than the total 71.3M air passengers in France in 20199.

        Air France-KLM operates flights for the Paris Orly – Toulouse route10, the seventh busiest domestic route in Europe in 2019, with 2,908,372 seats11;p21. Air France-KLM’s average price per kilometer was $0.33/km4. Suggestively, on average, traveling the Paris Orly – Toulouse route6 on Air France-KLM flights would cost $379 (574km5*$0.33/km4*2 trips) for a return trip, which is the same as the average cost of the five cheapest airlines operating in France (including Air France-KLM) & it also costs nearly 0.7% of the median salary in France for a return trip6.”

        Analysis Example: https://app.impaakt.com/analyses/air-france-klms-prices-are-equal-to-the-cost-of-the-five-cheapest-airlines-operating-in-france-41649

        Healthcare: Medical Equipment, Biotechnology & Pharmaceuticals, Healthcare Delivery

        We are looking to assess the affordability of healthcare to its end-users. Therefore, we will not publish an analysis discussing B2B.

        INTRODUCTION:

        In general, for this category, the introduction should include:

        • Why the specific type of healthcare service/product (i.e., drugs, healthcare services, healthcare equipment) is necessary.

        • How it is beneficial to people and society at large.

        • Any absolute figures that might be useful to understand better the importance of the topic (i.e., people reached by this service either locally, globally, or nationally, and people affected by a type of issue or benefit/need the assistance).

        The core analysis should include:

        • A brief description of the company and its reach and scale (i.e., people benefitted, market share, service provided).

        • You should select the blockbuster products/services offered to people and draw the affordability discussion on them. You need to holistically show the affordability of the company’s portfolio at large.

        Caution: When there is insufficient data to assess the company's absolute impact (in global terms), you can mention the area/region where the company has the most impact.

        To add nuance: We can benchmark the cost of the product to the yearly median wage in the country and then draw further estimations to see how many people might not be able to afford the cost of the product.

        Analyses Examples:

        Medical Equipment & Supplies:

        https://app.impaakt.com/analyses/zimmer-charges-225-on-avg-for-its-knee-joint-replacement-implant-16x-less-than-its-competitor-46725

        https://app.impaakt.com/analyses/cyberdyne-charges-20000-for-its-hal-5-exoskeleton-50-lower-than-the-avg-price-in-the-us-45834

        Biotechnology & Pharmaceuticals:

        https://app.impaakt.com/analyses/exact-science-corp-cancer-diagnostic-tests-are-generally-more-expensive-than-their-alternatives-58365

        https://app.impaakt.com/analyses/ht-provides-medicines-for-rare-diseases-but-at-not-easily-affordable-prices-59600

        Healthcare Delivery:

        https://app.impaakt.com/analyses/orpea-care-residents-pay-eur6500-per-month-for-its-services-33x-the-amount-payable-in-france-62074

        https://app.impaakt.com/analyses/though-lower-than-average-for-c-section-delivery-costs-mednax-charges-for-nbhs-are-costlier-50673

        Shelter: Hotels & Lodging, Home Builders, Construction Materials

        We are looking to assess the affordability of shelter to its end-users. 

        Therefore, we will not publish an analysis discussing B2B for the industries of Hotels & Lodging and Home Builders. 

        However, given the importance of construction materials for global development, especially for developing countries, we will accept B2B notes for the industry of Construction Materials.


        This sector deals with selling products (houses, construction materials) and services (holiday/business accommodation).


        INTRODUCTION:

        In general, for this category, the introduction should include:

        • Why is the specific product/service (i.e., housing, accommodation, construction materials) necessary?

        • How is it beneficial to people and society at large?

        • Add any absolute figures that might be useful to understand better the importance of the topic (i.e., people reached by this service either locally, globally, or nationally or those who require it).


        The core analysis should include:

        • A brief description of the company and its reach and scale (i.e., people benefitted, market share, service/product provided).

        • We should select the primary products/services offered and draw the affordability discussion on them. We need to holistically show the affordability of the company’s portfolio at large in the most representative markets.

        Caution: When there is insufficient data to assess the company's absolute impact (in global terms), you can mention the area/region where the company has the most impact.

        To add nuance: If it is relevant for the discussion, we can benchmark the cost of the product/service to the yearly median wage in the country and then draw further estimations to see how many people might not be able to afford it.


        Home Builders

        The Core of the analysis should include the following:

        • How many people benefit from the service/product

        • The average cost of a new house should be compared to what is considered an affordable home

        • If relevant and pertinent, include over-charging and related issues rendering homes unaffordable for their end-users


        Analysis Example: https://app.impaakt.com/analyses/dr-hortons-residential-units-cost-1612-more-than-uss-median-home-prices-yet-they-are-affordable-39918


        Hotels & Lodging

        We will only accept notes that discuss the affordability of hotels that are not luxury accommodations for this industry. Therefore, look into the company to see the total brands and only discuss the economic/non-luxurious ones.

        The Core of the analysis should include the following:

        • The total portfolio disclosure of the company (i.e., how many hotels, how many are luxury, and how many are economic - then only focus on the economic ones)

        • How many people benefit from the service/product (reach and scale of the company and where)

        • The average cost of a hotel stay in X place (depending on the reach of the company)

        • How does it perform vis-à-vis national/global standards and/or main competitors?

        • Add any other figures that might boost the note (i.e., reviews, customers feedback - those must be related to affordability to be relevant)

        Analysis Example: https://app.impaakt.com/analyses/premier-inns-average-room-rate-was-3676-less-than-the-uks-average-hotel-room-rate-49070


        Construction Materials

        This industry is an exemption from the rule. Indeed, here we are interested in knowing about the affordability of the materials provided by companies, specifically in underserved countries (global development) and population groups.

        Analysis Example: https://app.impaakt.com/analyses/vulcan-materials-aggregate-materials-costs-26-more-than-the-us-average-price-48859

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