Every Nonprofit Needs to Seriously Consider Social Enterprise
Written by Justin Chan, Founder of The Community Company.
Published on May 9, 2022. Opinion article written for the Guelph Mercury. 5 Minute Read.
It used to be that for-profit businesses and nonprofit organizations had their places: one existed to make money and the other existed to make our community better.
But have you noticed that more for-profit businesses are creating social impact? And more nonprofits and charities are selling products? At the intersection of business and nonprofit is Social Enterprise, and I believe nonprofits are in the perfect position to become the leaders in this growing space.
Nonprofits understand what works and what’s broken with our system because they live it day in and day out. They are already creating new and innovative projects because of resource and funding constraints.
And by definition, they are legally mandated to prioritize our community.
For those unfamiliar with the term, a Social Enterprise is an organization that uses business principles to achieve a social objective. It can be as broad as solving food insecurity in Canada, or as narrow as providing opportunities for people experiencing homelessness in Guelph. There are approximately 10,000 Social Enterprises in Ontario and 67% of them are less than 3 years old.
Through my journey both studying Social Enterprises and creating them for nonprofits,
I’ve become fascinated with understanding what makes them great.
To me, the ones that truly stand out are the ones that fill a business need just as well as their for-profit competitors, while simultaneously and effectively solving a real social issue. In other words, they’re creating a parallel (and better) system.
But in order to build a better system, you first must deeply understand why the current system isn’t working. There are many Social Enterprises that seek to do good, but ultimately miss the mark because they don’t fully understand the complexities of the social issue as well as a nonprofit would.
If we equipped nonprofits with the right business tools and knowledge, they’re in the best position to design a better system that addresses our most pressing social issues.
For example, let’s imagine a nonprofit that offers free groceries to those who need it.
Because of the pandemic, they expect demand for healthy produce over the next few years to outgrow the donations that sustain it. So what can they do?
What if this nonprofit started a market garden that grew their own produce? And what if takeout meals were sold to sustain the garden, which then sustains their grocery sharing? This is essentially using the farm-to-table model we see in business, but making it more effective because all of the profits benefit our community.
The more meals they sell, the more food is shared with our community. Who wouldn’t want to buy a meal that's farm-to-table-to-community?
A well developed Social Enterprise shows our community a better way of doing business. It proves without a doubt that their purchases can make a difference in both the short and long term.
With charitable giving down 12% over the past two years and the younger generation giving differently, I believe Social Enterprise needs to be considered by every nonprofit. It can be the key to sustaining their social impact, while inviting the community in to be part of the change.
I started The Community Company in 2018 as a passion project to build a better community. We partnered with nonprofits to create products like holiday cards and tote bags that invited people to be part of the change. Now, we’re equipping and working alongside nonprofits to develop and launch their dream Social Enterprise.
I believe Social Enterprise is the future for nonprofits because it combines their existing social impact and expertise, with the efficiencies of business.
It’s not an either-or anymore, it's both.
The Community Company
The Community Company exists to help you build a better community.
We partner with your charity or organization to develop and launch a Social Enterprise that will sustain your social impact.
Your organization is already doing inspiring community work. And you don’t want your impact to be limited by funding. So let’s work together to create a sustainable, long-term solution that will ignite your ability to create change.
Learn more about how we can help you create your dream social enterprise:
Do you have any partnership ideas, questions, or want to learn more?
Feel free to send me a direct message by filling out the form! You can also visit our Social Enterprise Development page by clicking the button below.