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Factors Influencing the Growth of the Commercial Sector in Family Planning Service Provision

The need to meet the family planning needs of men and women, coupled with dwindling donor resources, is forcing family planning programs worldwide to confront increasingly difficult financial challenges. One option for expanding the resource base for family planning and reproductive health services in developing countries is to promote the growth of the commercial family planning sector. Using DHS data for 45 countries, this paper demonstrates that (1) the commercial sector plays an important role in national family planning markets, even in countries where contraceptive prevalence is low; and (2) the commercial family planning sector does not always develop coincidentally as prevalence grows or as programs mature. If the commercial sector does not necessarily gain market share as prevalence grows, what factors account for differences in commercial market shares across countries? This paper examines three sets of factors to explain variations in commercial market share across countries: Microeconomic or household factors. Characteristics of individuals, such as ability to pay or knowledge of contraception, may make them more likely to use the commercial sector. · Macroeconomic or business climate factors. Characteristics of a country and its economy may lead to a larger commercial market share for contraceptive services and commodities. · Programmatic factors. Characteristics of a family planning program, such as government support and method mix, may lead to a larger commercial market share.