A New Type of Business Model
The legend of Robin Hood is a well-known story about a man who steals from the rich to give to the poor.
In their own, more socially acceptable way, social enterprises do similar things to Robin Hood. It’s a wacky type of business model with redistributive justice at its core.
Social enterprises sell products and services at a profit to people with the ability to pay.
And they make the conscious decision to reinvest this profit into projects that benefit people without the ability to pay.
The Profit Reinvestment Purpose
Most businesses’ sole aim is to maximise profits for shareholders. This narrow view of business success has resulted in corporate greed, low wages, insecure work and environmental degradation.
Social enterprises have a more holistic view of business success. The consideration of social and environmental benefit plays an enormous part in assessing whether or not we have done our job.
With more things to take into consideration, more time needs to be dedicated to recording our performance. As well as producing financial accounts, we also produce social accounts. We’ve just completed our September 2017 to August 2018 Social Value Report, compiling our findings and evaluations about the value of our work.
Highlights from the report include:
We give people more knowledge about food so that they are able to make better decisions about their eating
“I try more things, I can now experiment with food”
“I have gained more knowledge about cooking from scratch”
“I am more confident with food”
“I can make healthier choices when cooking food for my family”
We bring people together to prepare and eat food which helps to combat loneliness and improves mental wellbeing
“I’ve enjoyed connecting with others instead of being alone”
“I have something to look forward to every month”
“It keeps me busy and makes me feel more productive”
“I feel like I’m doing something useful”
We support and empower people to set up their own business in the food industry
“You have helped me become more professional, gain work experience, improved confidence and business skills”
“I now have more motivation to set up my own business doing something that I enjoy”
“I have increased ambitions for the future and have a more professional focus in my life”
We are NOT a Charity
As a social enterprise, we ask people to trade with us, not to donate to us.
We’ve been fortunate enough to have been supported by our generous funders over the years, receiving £32,740 in total since 2013. We’ve used this money to develop new courses, buy equipment and deliver free sessions. But at the same time, the aim of generating 100% of our income through trading has been at the forefront of my mind.
And 6 years in – we’ve done it!
There has been a strong enough market for 4Lunch’s products and services to allow us to move away from grant funding. And it looks like we’ve done enough to say goodbye to writing grant applications, and instead focus on making our own money!
I might grow to regret this decision. And there will always be small grants we could apply for to sustain some of our less marketable work. But developing 4Lunch in this way will allow us more flexibility and independence in the coming year.
The Next Goal: More Profit, More Purpose
We are in the business of making money to give it away. Maybe I’m insane. Or maybe this new type of business model is a way to rectify the vast range of injustices and inequalities in our society today.
For every sale we make, the more profit we have to contribute to our community food projects. This year, I have made enough money through 4Lunch to give away around £1000 in free sessions. I am currently deciding how best to use this money to create positive social change… a few ideas in the pipeline include:
- A “Sanctuary Kitchen” project to provide a platform for asylum seekers to showcase dishes from their home countries, improve confidence and provide low-cost meals for people living in poverty.
- Providing free cookery sessions for young people leaving the care system to promote independent living, healthy eating and cooking on a budget.
- Continuation of our community pop-up cafes, providing low-cost healthy meals to people facing isolation and loneliness.
If you have an idea for a foodie project that could create positive change for people – get in touch!
A Recipe for Social Enterprise
If you feel inspired to create your own wacky social enterprise project, here’s a recipe of how I remember doing it for 4Lunch:
- A set of defined Core Values
- A business plan and financials predictions – maximum of 20 pages
- A support network around you
- An internal motivation to do good
- An external need for social change
- Start with anger and frustration at a social or environmental issue that really bothers you. It sticks with you and you can’t shake it off. You have an idea of how things could be better.
- Write down your initial idea of a small project that could help tackle the issue.
- Turn this idea into a funding application for a small amount of money, around £500. Submit your application.
- If successful, deliver your project. Take photos, make videos and get testimonials from those involved.
- Reflect on whether you’d like to take this idea further. Maybe you find that it actually isn’t for you, and move onto something else. But perhaps you feel even more inspired to continue.
- Design a logo, set up a basic website and set up social media accounts. Complete some market research, ask for advice and start selling your product or service.
- You gain your first piece of paid work. This can take some time. Assess the social impact through case studies, reports and evaluations. Use this to gain further work, or secure bigger projects. Add all of this information to your marketing materials.
- Reflect on your direction, brand, mission and vision. Iterate your business plan to suit your highest values and life priorities. By this time, you would have gained a lot in personal and professional experience and have a better idea of what you want from life and from your business.
- Do larger piece of works and bring in other people on board to assist you. Record all delivery systems and processes and develop written resources. Think carefully about how you want to develop. By this time, most of your income should come from trading, not from funding.
- It might now be time to go for bigger pots of money to fund more significant growth, which might include salaries for staff or premises. Or you might be happy just where you are, which is also fine.
- Keep going through the process of doing great paid work, recording, reflecting and improving, and going for the bigger projects.
- Eventually, you will have created a manual of how your business operates, with all accompanying resources and forms. Perhaps you might think about growing through social franchising or just continue to develop organically.
- With the accompanying growth, your reputation will build. With more recognition for your work and brand awareness, you can think about new projects. There will be constant innovation as the environment and economy changes.
- As the entrepreneur behind this project, you may be drawn to something new and have to let your baby go. This is okay. Just start from step 1 again 🙂