The majority of social enterprises are the project of self-starters with a strong, inspiring person at their heart who is willing to work determinedly to solve the social problem or provide a service the local community desperately needs.
Much like when you set up any other business you need to think about how you are going to finance your social enterprise and you must have a strong, detailed business plan. However, a social enterprise differs as you are putting community needs at the centre of your business rather than personal profits or success. Other key issues included finding the right staff and how to target your customer base. It is often a challenge for social enterprises to access and appeal to their target customers as they often fall into impoverished or challenging groups including the unemployed and youth groups. Remember though, whilst these are your end users, you may be dealing with the local council as your official client.
Special Funding (and how to get it)
Unfortunately there aren’t a huge number of specialist funding streams exclusively for social enterprises. There isUnLtd but competition is stiff. Other options open to you include the Big Lottery Fund or the ethical bank Triodos which specialises in financing projects with social or environmental ethos. You can also consider the Futurebuilders project but you’ll need a detailed business plan which demonstrates commitment from local councils as buyers.
Central to gaining funding is proving your business is sustainable and can be replicated. As a social enterprise you’re also committed to investing any profits back into the business. Most investors including local authorities consider social enterprises high risk so you have to put in the leg work to prove your viability.
A social enterprise does take quite a while to get started. It isn’t a quick fix that you can have up and running in a few weeks, in fact most take between two and three years to get off the ground. This is due to the need to talk to and engage with a number of stakeholders and come to an agreement together.
Marketing a Social Enterprise
The term social enterprise still isn’t completely understood by all of the general public and there is still work to be done to promote the term. However, as a rule customers enjoy the feeling and are motivated by the idea that when they’re making a purchase they’re doing something positive for the community and the profits are being reinvested.
If you are pitching your social enterprise to a public body then you need to plan in advance and research exactly what they’re looking for. To succeed you’re looking to give them added value and show them why you’re the best option available to them.
Social enterprises are a fantastic and rewarding business choice but there is extra legwork involved. If you’re committed to your community then keep these points in mind when starting up your business.
You must ensure that you have researched a number of opportunities available to you, as well as financing and on-going financial and administrative support available to small businesses and franchises. We have a number of short articles relating to support and the different areas you will have to take into consideration should you be contemplating starting your own business; with assistance regarding business start-up packages, virtual offices and telephone answering services.
Back to Setting Up Your Business