Community Enterprise: Trading Up – Developing Business
Key contact: Douglas Westwater
Address: Community Enterprise Ltd, Inspire Business Centre, Oatridge College
Ecclesmachan, West Lothian, EH52 6NH
Telephone: 0131 01506 862 495
Email: douglas@communityenterprise.org.uk
Web address: www.communityenterprise.org.uk
In a nutshell
At Community Enterprise Ltd, we ran ‘Trading Up’ to test an approach to business growth for social economy organisations. Organisations were helped to move from being dependant on grants to generating their own income.
We did this by developing business and leadership skills, and promoting a change of culture by encouraging entrepreneurship and risk-taking. We are a social enterprise ourselves, and have a mixture of business and community experience. In total we worked with 84 organisations.
We were a Social Economy Scotland (SES) pilot project. SES is a Development Partnership funded by the European Community’s EQUAL initiative.
What were the issues?
Our past experience of managing a fund which has provided start-up grants to help organisations develop a new business idea, and feedback from our business development work, highlighted a number of issues:
• Many social economy organisations are still dependent on grants
• Management of these organisations are unlikely to make the move to become more business-like without specific support
• Organisations often lack the means to buy in support to help them start looking at ways of generating income.
• Organisations are not likely to turn to business support aimed at the for-profit sector
What we did
We offered support to organisations to help build their confidence to take greater control over their own destiny and move towards income generation. Organisations came to us through referrals. These came from Councils of Voluntary Services (CVSs), Business Gateway, Development Trust Association Scotland (DTAS), and the Coalfield Regeneration Trust. Some organisations approached us directly.
We arranged two meetings with each organisation before deciding what kind of support was needed. One meeting was with their Board, the other with the Chief Executive or manager. We looked at relevant supporting information about the organisation such as business plans, accounts, annual reports and marketing strategies.
We worked with the organisations to agree what was the best approach and solution. We then offered a range of support, which was tailored to the organisation’s specific needs. The support was offered over a time period which was flexible to respond to the needs of the organisations when they needed it.
The support offered included:
• business planning
• financial management and planning
• marketing
• project management
• external grant funding
• strategic organisational development
To help with this we recruited staff with expertise of the following:
• finance and accountancy
• marketing and advertising
• quality assurance
• business planning
• organisational review and group dynamics
Often, we were asked to solve a problem about one thing but then realised that the main issue that needed addressing was something completely different. To develop leaders we held business seminars, skills-building workshops and provided mentoring support. We also supported in-depth interventions in areas such as market research, planning, pricing and competition. We built up long-term relationships with organisations and were able to offer them after-care.
As well as an understanding of the principles of business we also bring a good understanding of community development to our work with organisations.
Through ‘Trading Up’ we also provided opportunities to network and signposted clients to information, toolkits and sample documents. We were also able to make quick investments of small amounts of discretionary finance to overcome obstacles to immediate growth. The fund was to kick start ideas that would otherwise not have got of the ground. For example it could be used to pay for legal advice, architects plans, or valuations
Our outcomes
We worked with 84 organisations
• All of the organisations increased their annual income
• When you added all the increases together there was a total increase in trading income of £690,817
• 9 organisations increased their income by over £20,000
• People we worked with talked about having their confidence increased.
• People who had been unsure of whether social enterprise was a good way to go felt happier with the idea.
One great thing – People Matter
Our ‘Trading Up’ clients felt that our staff made all the difference. We feel that this was because of their approach, commitment and detailed specialist knowledge.
We realise that people matter and that by building strong longer term relationships with clients we will be more effective in supporting them through business development. Clients really appreciate having a dedicated person to support them.
Lessons learnt
We learnt the following things from our work on ‘Trading Up’:
• this kind of intensive support takes time;
• when people asked for help with one area of business support they often needed help with another;
• the range of need was much wider than expected and covered not just skills in business planning, marketing, and human resource management but also employment related issues and legal issues around trading and different forms of trading;
• the demand for ongoing support over a long period of time was greater than expected with organisations becoming dependent on us. We need to think how we can help organisations cope on their own after a period of intensive support:
• the networking dinners really worked and led to more learning and potential joint working than we thought possible;
• mentoring is a successful way of giving senior managers time to share ideas and anxieties with someone not directly involved with the work of the organisation.
What next?
We feel that ‘Trading Up’ could be used to demonstrate the effectiveness of this kind of support programme. It can help provide ideas on how to develop future business support for social economy organisations in Scotland and Europe.
