Income Generation through Social Enterprise the Key to Sustainability

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Income Generation through Social Enterprise the
Key to Sustainability?

• Funding in Tough Times conference
• Lesley Miller, Director of Business Services, SEL
• 25th June 2009

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Overview

• About SEL and social enterprise
• How social enterprises work
• Benefits and challenges
• Some examples

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Who are we at SEL?

• London regions strategic coordinating body for
  social enterprise
• Our aim is to increase the number of social
  enterprises in London while contributing to the
  development of a vibrant and dynamic social
  enterprise community

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Common Characteristics
Overview of the social economy
Collection of organisations between the
traditional private sector and the public sector
(known as the Third Sector)
Social Economy
Socially Resp.Business
Social Enterprise
Private Sector
Gov.
Charity Voluntary Sector
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Definition

• A new umbrella term for an activity that goes
  back 160 years to the birth of co-operatives in
  Rochdale
• a concept not a legal entity
• a social enterprise is a business with
  primarily social objectives whose surpluses are
  principally reinvested for that purpose in the
  business or in the community, rather than being
  driven by the need to maximise profit for
  shareholders and owners (DBERR)

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Characteristics

• Organisation with explicit social aim
• Income derived from the sale of goods or services
• Profit is for activities supporting social aim
  i.e. reinvestment, funding of social programmes,
  or profit-sharing (co-operative members)
• Alternative business model with multiple bottom
  lines ie. combines financial sustainability with
  social / environmental missions

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What do social enterprises do?
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Some organisational types

• Development Trust
• Co-operative
• Credit Union
• Social Firm
• Intermediate Labour Market
• Trading arm of charities

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Routes into social enterprise

• Social enterprises emerge from a variety of
  sources, for example
• Voluntary sector organisations
• Organisations borne out of project based work
  from government single-use funding
• Spin-outs from the public sector
• Private individuals

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Income options for social enterprises

• Fees/prices for products or services
• Contracts with public and private sector
  organisations
• Asset utilisation
• Loans, grants and equity

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Some benefits of social enterprise

• Flexible and innovative business model
• Diversification and control of revenue sources
  offers potential for enhanced sustainability
• Independent revenue offers ability for
  organisation to follow strategic vision rather
  than funding outcomes
• Can deliver services and activities that may not
  otherwise have been provided
• Often addresses local needs with local
  participation and offers employment opportunities
  for beneficiaries

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Challenges

• Balancing social aims with financial objectives
• Balancing stakeholder needs
• Cultural change
• Understanding of procurement procedure reaching
  the buyers
• Impact measurement - proving value
• Seed funding

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Social enterprise development

• Research evidence of need
• Skills, knowledge capacity planning
• Governance appropriate legal structure
• Operational management
• Financial management
• Risk analysis
• Marketing plan

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Greenwich Leisure
Core Arts
GLL is an innovative staff led Leisure Trust,
structured as an Industrial and Provident
Society, which manages more than sixty five
public leisure centres within the M25 area. 
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Core Arts
Core Arts
Began as a group of patients and an artist in
1990 in Hackney Hospital became registered as a
CLG with charitable status in 1994. It exists to
promote freely and without prejudice, the
artistic and creative abilities of people who
experience severe and enduring mental health
problems
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Fifteen
The purpose of Fifteen is to inspire
disadvantaged young people to believe that they
can create for themselves a career in the
restaurant business
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Age Concern
Core Arts
The mission of Age Concern is to promote the
well-being of all older people and to help make
later life a fulfilling and enjoyable experience.
Their trading arm provides products and services
for older people, such as insurance, books,
training, funeral plans, and energy.
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So, to wrap it up.

• Social Enterprise is a path to business creation
  with values
• Empowering process
• Hard work but with great rewards

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Address Third Floor, Downstream Building, 1
London Bridge, London SE1 9BG Tel [phone]
1920 Fax [phone] E-mail
lesley_at_sel.org.uk www.sel.org.uk www.shopsocialen
terprise.com