CASE STUDIES IN SOCIAL ENTERPRISE
Comparing work integration social enterprises in Austria, Romania, Slovenia and the United Kingdom
A report submitted by Well Organised Biz Date: 31 December 2015 Author: Michele Rigby +44 (0)7801670638 email@example.com www.wellorganised.biz
© Social Firms Europe CEFEC
Investește în oameni! Proiect cofinanțat din Fondul Social European prin Programul Operațional Sectorial Dezvoltarea Resurselor Umane 2007-2013
CONTENTS Introduction ........................................................................... 1 Country Overview ................................................................. 3 Case Study 1: Die Querdenker ................................ 5 Case Study 2: SeminarKulture an der Donau............ 9 Case Study 3: Ateliere Fara Frontiere ..................... 13 Case Study 4: Util Deco .......................................... 17 Case Study 5: Zaposlitveni Center Dobrošin ........... 21 Case Study 6: Dobrovita ......................................... 25 Case Study 7: mcch enterprises ............................. 29 Case Study 8: NMC Design and Print ..................... 33 Case Study 9: Royal British Legion Industries ......... 37 Summary ............................................................................ 41
1 INTRODUCTION These case studies have been compiled as part of the Ecouri project carried out in 2015. Ecouri means “Echoes”. The project set up six social enterprises in the North West and North East regions of Romania, to focus on the integration and reintegration into the labour market of people at risk of social exclusion. These include Roma, people with disabilities and women. The social enterprises were set up in Maramures and in Bucovina. The Ecouri project was co-ordinated by the Kelsen Association. The partners include the Centre of Excellence for Community Resources SRL, POL Succes SRL, the Association for Community Development Consultants (ACDC), the Institute for Social Partnership Bucovina, and the KULT-ART Association. A transnational aspect to the project was brought by the sixth partner, the Confederation of European Firms, Employment Initiatives and Cooperatives (CEFEC). This transnational partnership enabled the Ecouri project to compile these comparative case studies from Austria, Slovenia, the United Kingdom as well as Romania. The social enterprises were chosen for the case studies to provide a range of age and size of enterprise, as well a variety of commercial activities. At the time of writing, the oldest social enterprise has been in existence for 96 years, and the two youngest were started six years ago. Four enterprises have been established for 6-7 years, two for 11-13 years. A further two have been operating for 23-24 years. The enterprises range in size, with three earning under €150,000 and one earning almost €10m. In total 5 were earning up to €500,000 and four over €1m. Some of the social enterprises offer services which are common in the work integration social enterprise sector. These include recycling and upcycling, cleaning, grounds maintenance, and facilities management. Other less common
2 services are land surveying, document archiving and storage, sign manufacturing, and a hotel and conference centre. The businesses are structured in a variety of ways, from being 100% selfsupporting through earned income, to having a substantial subsidy that recognises that some employees require more intensive support to reach their full potential. They all share a firm belief that everyone should have an opportunity to be employed and a passion for providing that opportunity to as many individuals as possible. Some businesses described in this report focus on providing that opportunity to people from one specific job-disadvantaged group, for example, those with ill mental health, and others are structured to offer jobs and training to individuals with a mixed or multiple job disadvantage. These include a physical or learning disability, offenders and ex-offenders, those with a background in homelessness or substance addiction, or are from a group which is excluded from opportunity through ethnic background or HIV status. The case studies are a resource of ideas for developing employment and employability social enterprises. They inform the reader of the range of products and services sold by the enterprises, and how they have been developed. They offer an insight into the markets that social enterprises can target, and touch on the kinds of marketing used to reach those customers. The social enterprise managers have been generous enough to present their challenges â€“ some of these will chime with mainstream business managers, and some are specific to the issues experienced by social enterprises. What does shine through all the case studies is the passion and determination of the social enterprise managers to maintain and grow their businesses â€“ not for the sake of their own careers, but to ensure that individuals excluded from the mainstream labour market will find fulfilling work and through that, a level of inclusion in society that is otherwise difficult to achieve.
The views expressed in these case studies are those of the respective organisations. The data and statistics presented within the case studies have been provided directly by the social enterprises and reflect their priorities and methodology. The data cannot be verified by Well Organised Biz or CEFEC, and should not be interpreted as a comparison between individual social enterprises.
3 COUNTRY OVERVIEW AUSTRIA In the Austrian context, social enterprise is generally understood to refer to Work Integration Social Enterprises rather than a wider range of organisations. These are two specific kinds of organisation: Sozialökonomische Betrieben (SÖBs), and Gemeinnützige Beschäftigungsprojekte/Gemeinnützige Beschäftigungsgesellschaften (GBPs). These are recognised as operating within Austria's labour market policy. There are social enterprises that do not fall into the SÖB or GBP category: registered associations, limited liability companies (GmBHs) or not-for-profit limited liability companies (gGmBHs). The number of social enterprises is estimated to be between 200 (SÖBs and GBPs) and 750. The larger figure includes associations with a social aim and commercial activities and private limited companies with a public benefit status (gGmbH) (European Commission, 2014). SÖBs and GBPs are active in sectors such as recycling, repairing, and maintenance; catering; green space management; home services and cleaning.
ROMANIA The terms social economy and social enterprise are used interchangeably in Romania. Social enterprises that are specifically focussed on the creation of employment and training opportunities for vulnerable or disadvantaged people are known as Insertion Social Enterprises. The social economy sector in Romania includes an estimated 40,000 organisations with over 130,000 employees – 1.9% of total employees in Romania. Of these organisations, 85% are associations and foundations, 6% co-operatives, 7% credit unions, and 2% trading companies held and controlled by social economy organisations. It is estimated that just over 7,000 organisations fit within the EU definition of social enterprise. (European Commission, 2014)
4 SLOVENIA In Slovenia the definition of social enterprise was enshrined the Act on Social Entrepreneurship (The Social Entrepreneurship Act ) and is in line with the EU definition, and distinguishes between work-integration social enterprises and other social enterprises. By 2014, 46 organisations had registered as social enterprises, but there may be around 900 organisations which fall within the EU operational definition. Registered social enterprises include associations, institutions, foundations, private limited companies and cooperatives. Other de facto social enterprises use the legal framework of zavod, company for the disabled, cooperative and NGO. (European Commission, 2014). Most social enterprises are concerned with work integration. Their products and services often centre on organic food, re-cycling and waste treatment.
UNITED KINGDOM In the UK, the social enterprise sector includes a range of social economy models. The enterprises trade to improve communities and the environment as well as providing jobs and training for the most job-disadvantaged. Some social enterprises will contribute to all three of these aims, and some to one or two. Social Firms are recognised in the UK as the social enterprises that create jobs or develop the employability of disadvantaged groups. The exact number is not known, as there is no legal registration of social enterprises. It is estimated that there are 70,000 social enterprises in the wider UK sector contributing ÂŁ18.5 billion to the UK economy and employing almost a million people. Of these, 51% employ at least one person who is disadvantaged in the labour market (Temple & Villeneuve-Smith, 2015). Social Firms England estimates 25% of social enterprises fall within the definition of a social firm in the UK. FURTHER INFORMATION AND WORKS CITED European Union, 2014. A map of social enterprises and their eco-systems in Europe: Country Report Austria, Brussels: European Union. European Union, 2014. A map of social enterprises and their eco-systems in Europe: Country Report Romania, Brussels: European Union. European Union, 2014. A map of social enterprises and their eco-systems in Europe: Country Report Slovenia, Brussels: European Union. European Union, 2014. A map of social enterprises and their eco-systems in Europe: Country Report United Kingdom, Brussels: European Union. Temple, N. & Villeneuve-Smith, F., 2015. Leading the World in Social Enterprise: State of Social Enterprise Survey 2015, London: Social Enterprise UK.
5 CASE STUDY 1: DIE QUERDENKER
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Peter Behrens Platz 10, 4020 Linz, Austria.
The social enterprise was established in 2002.
The social enterprise was set up by an individual to give jobs to people from a range of disadvantaged and vulnerable groups. It provides jobs and support for individuals with physical or learning disabilities, or sensory impairment.
Die Querdenker creates jobs, creates structures for other organisations, sets up projects, and offers guidance and know-how to other organisations. It operates a number of businesses where it also creates jobs.
The enterprise was set up to improve the quality of life for individuals in vulnerable groups.
6 FINANCE The social enterprise was originally personally financed.
Support Income 2%
Earned Income 98%
PRODUCTS AND SERVICES The social enterprise offers counselling either privately or through referral from public services; project development to organisations and public bodies; residential care services which can be accessed directly, or through public services. Die Querdenker also operates a working farm and sells produce locally.
MARKET Parts of the business are necessarily local, such as the farm. Others, such as business and project development. are offered on a national or EU basis. These services are also offered outside the EU.
PRODUCT DEVELOPMENT The counselling and farming activities were introduced in 2002, with project development being added in 2005. Residential care services were added in 2015. The residential care services were developed when Die Querdenker was approached by forensic mental health services. They asked Die Querdenker to provide care and rehabilitation on the farm in a family-like support structure. Die Querdenker is paid a daily fee for each resident under a five-year contract. Professional care and development staff are engaged by Die Querdenker to carry out the work, ensure monitoring and continuous improvement.
7 The organisation was able to take on the contracts at short notice due to previous experience in the field. Some adjustments were made to ensure that both the farm and the residents benefited from the arrangement and were safeguarded. Negotiations were required with neighbours, who were nervous about the development.
FUNDING FOR PRODUCT DEVELOPMENT No specific funding was accessed to bring this product to market.
MARKETING Die Querdenker attends trade fairs to meet new customers. It also contributes articles to publications, maintains a presence on Facebook and on a comprehensive website.
CUSTOMER REACTIONS Customers are aware that Die Querdenker is a social enterprise, but rates quality as the most important factor in choosing a supplier. The residential care contracts are successful, and with personal development among individuals using the service. Contracts are individualised, and the number of placements taken up by rehabilitations organisations is growing.
MANAGEMENT AND WORKERS This social enterprise is privately owned and so does not have a separate Board. Department Heads work under the Managing Director.
CHALLENGES AND ASPIRATIONS CHALLENGES Cash flow is the major challenge, and the business operates with an overdraft to overcome this. There is competition in the marketplace with other providers. In addition, social care budgets are shrinking. Die Querdenker is aware of the need be adhere to current policies and best practice, and to maintain high quality standards.
8 ASPIRATIONS Die Querdenker would like to see more jobs available for people at risk of exclusion through poverty and/or health problems, and for support to these groups be longer term.
HOPES FOR THE FUTURE Die Querdenker would like to see more private sector companies engaging in corporate social responsibility and funded solutions to social issues that focus on long term impact rather than short term effects. They would also like to see the value of the social economy recognised within the general business sector
LINKS www.die-querdenker.at/ www.facebook.com/Die-Querdenker-336474753044064/?fref=ts
9 CASE STUDY 2: SEMINARKULTURE AN DER DONAU
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Wesenufer 1, 4085 Waldkirchen am Wesen, Austria.
The social enterprise was established in 2004.
The social enterprise was set up by Pro Mente, the Austrian umbrella organization for mental and social health. It provides training for people with ill mental health.
Seminarkulture an der Donau is a hotel and conference centre.
The enterprise was set up to provide vocational and therapeutic training and work placements for people with ill mental health.
10 FINANCE The social enterprise was originally financed by Pro Mente, which used its own resources to establish the business. The turnover of the business increased from €780,000 in 2004 to €3,250,000 by 2015. The hotel business generates 70% of the income, and a further 30% is generated from statutory income earned from supporting and training the workers.
Support Income 30% Hotel Income 70%
PRODUCTS AND SERVICES The hotel and conference centre is located in the Upper Austrian Danube Valley and overlooks the Danube. It offers individual room bookings as well as accommodating business events, conferences, seminars and meetings for up to 10 to 220 people. It also caters for parties and weddings.
MARKET The business has a mostly local market.
PRODUCT DEVELOPMENT The hotel was originally a former brewery, which had fallen into disrepair and disuse. The listed building had been earmarked for redevelopment as a regional asset. Pro Mente wished to open a hotel in the region that could cater for large groups and conferences, and found the location of the brewery to be ideal. The first stage of renovation took place in 2004, with a further development in subsequent years. The hotel now boasts 49 rooms.
11 The enterprise changed their approach during the development of the product â€“ at first they assumed that customers were looking for budget accommodation. They then realised that customers were seeking a more exclusive location, and were willing to pay a premium for a higher standard.
FUNDING FOR PRODUCT DEVELOPMENT The funding for the renovation of the building was secured through the EU LEADER funding programme. (European Commission)
MARKETING SeminarKulture an der Donau attends trade fairs to meet new customers. It also distributes leaflets, uses broadcast media and has a presence on Facebook and a comprehensive website.
CUSTOMER REACTIONS Customers are aware that the hotel is a social enterprise, but the management do not think that this information impacts on their decision to use the centre. The most important factor is quality. They offer a range of packages and find that the all-inclusive seminar packages are particularly popular. The hotel fulfils the expectations of their customers, and receive positive feedback on TripAdvisor (TripAdvisor)
MANAGEMENT AND WORKERS The hotel is divided into departments: hotel service, cleaning, customer relations, marketing, social support, kitchen and facility management, all of which have a Head of Department who reports directly to the hotel Director.
CHALLENGES AND ASPIRATIONS CHALLENGES Competition is a challenge, with large chains attracting a large proportion of the market. The hotel emphasises high standards and exclusivity to win customers, but acknowledge that it is an additional challenge to deliver consistently when some staff are struggling with serious illness. ASPIRATIONS The most recent part of the renovations of the centre added 40 beds to the hotel, and the aspiration of the business is to maximise occupancy of these additional rooms using the strategies that have seen steady growth up to present.
12 HOPES FOR THE FUTURE The business is dependent on the general economic climate: organisations hold more seminars when the economy is good. The managers of Seminarkulture an der Donau are determined to survive though the current difficult economic climate.
LINKS www.seminarkultur.at/ www.facebook.com/seminarkultur www.promenteaustria.at/
13 CASE STUDY 3: ATELIERE FARA FRONTIERE
BACKGROUND INFORMATION WHERE?
The enterprise is located at: SOS Oltenitei Nr 105 Sect 4, Bucharest, Romania.
Ateliere Fara Frontiere (AFF) started in 2009 as a non-profit association.
The social enterprise offers time-limited employment, training and social support to very excluded/disadvantaged people.
WEEE collection service, refurbished IT equipment recyclates, outdoor publicity waste collection, event bags and ethical fashion accessories, food waste collection, natural fertilizer and organic vegetables.
AFF is committed to durable social, environmental and economic development, to the full social and economic (re)integration of individuals from vulnerable, marginalised and at-risk groups.
14 FINANCE The organisation was set up using private sponsorship and the European Social Fund. Earned income grew from 18% in 2010 to 38% in 2015.
Earned Income 38%
Private Sponsorship 36%
European Funds 26%
2010 2011 2012 2013 2014 2015
PRODUCTS AND SERVICES AFF operates a number of circular economy business strands. They are:
a WEEE collection service to the private sector, refurbished IT equipment to the private sector, NGOs and schools. and dismantled recyclates to the private sector; an outdoor publicity waste collection service to corporations and publicity agencies, upcycling the materials to supply event bags and ethical fashion accessories to NGOs and the corporate sector under the remesh brand; a food waste collection service from the retail and HORECA sector, and schools, and provide natural fertilizer to the organic agriculture sector and organic vegetables to consumers.
MARKET Ateleliere Fara Frontiere serves local, national and EU customers.
PRODUCT DEVELOPMENT AFF initially set up a WEEE collection service in 2009, refurbishing computers, and dismantling and separating recyclates from the items that were not suitable for reuse. They expanded with the remesh workshop in 2012 and added the Bio & Co brand in 2015. They choose products and services that are labour intensive and suitable for low skilled workers. It is also important that these have an environmental aspect,
15 and the potential for economic viability in order to build sustainable development and/or circular economy models. The remesh brand has undergone considerable development from the original tote bag.to include a range of bags and backpacks, tablet covers, business card holders, toilet bags, aprons, soft furnishing and conference folders.
FUNDING FOR PRODUCT DEVELOPMENT AFF have had no funding specifically for product development, but have benefited from pro bono support from the Eleven advertising agency. This includes a product photoshoot leading to the launch of the remesh online shop, and the online and printed catalogue.
MARKETING AFF uses a range of marketing strategies tailored to their products. The remesh brand uses a well-produced print and online catalogue, as well as a dedicated website, and sells through other niche product websites. They have established a strategic partnership with Carrefour hypermarket, to promote a â€œShop with Double Purposeâ€? (Shop Cu Dublu Scop) Campaign, with Carrefour stocking two models of remesh bag in their 8 Bucharest shops.
CUSTOMER REACTIONS AFF sells both to businesses and to consumers. They find that consumers value the fact that they are a social enterprise and will buy from them on that basis. Business customers tend not to care about their status as a social enterprise, buying from AFF on the basis of quality and price.
MANAGEMENT AND WORKERS AFF has a Board of 7 Directors, five of whom are female and two male. In total, the management and operational team number 38, with 16 women and 22 men. The WEEE and computer refurbishment provides 13 jobs for disadvantaged people, remesh has created 8 jobs, and Bio & Co employs 10 disadvantaged people.
CHALLENGES AND ASPIRATIONS CHALLENGES AFF reports that one challenge is a lack of overall policy for work integration for job-disadvantaged people, and so, no national system of financial support for social enterprises or other businesses that seek to employ this group.
16 ASPIRATIONS AFF is consolidating the older and new products and scaling up the existing business strands. They plan to further diversify their products and services, and create more jobs for disadvantaged people. HOPES FOR THE FUTURE AFF sees the need for strong national and EU level advocacy and lobbying. They would like to see a strong national policy on work integration and social economy development. This would include developing national funding streams, as social enterprises in Romania tend to rely on EU level funding. They hope to see a stronger interest in the sector at EU and national level, and a recognition that the interests of the sector are best served by long-term policies and strategies, rather than short term quick fixes for electoral gain.
LINKS atelierefarafrontiere.ro www.facebook.com/atelierefarafrontiere/?fref=ts www.youtube.com/user/atelierefarafrontier www.remesh.ro
17 CASE STUDY 4: UTIL DECO
BACKGROUND INFORMATION WHERE?
The enterprise is located at: HQ: 5, Bazinelor Street, Uricani village, Miroslava, Iasi, Romania. Constanta office: No 49, Decebal Street, Constanta, Romania. Tg. Mures office: No 14, Cosminului Street, Tg. Mures, Romania.
The Util Deco social enterprise started in 2008 as a section of the Alaturi de Voi Romania Foundation (ADV), established in 2002.
The first workshops created by ADV as work therapy. Those completing the training wanted to work, and a business was set up.
Util Deco reinvests its profits in social impact. Its goals are to: create jobs for 36 people with disabilities; provide training to 300 people p.a.; offer career counselling and guidance to 500 people p.a.; provide social services in the community to 1000 people p.a.
The social enterprise employs 26 people with disabilities and 5 from other vulnerable groups, including HIV positive (2015 figures)
18 FINANCE The social enterprise was originally established through external funding from Cherish Our Children International Organisation and NESsT Romania. It was further developed in 2010 with financing from the European Social Fund and from bank loans.
Income € 5,874,965
Earned Income 100%
PRODUCTS AND SERVICES Util Deco is a registered sheltered unit. It offers: Physical and electronic archiving, document storage; tailoring and customisation; printing and bindery; and supply of third party products and services.
MARKET Util Deco sells to local and national customers.
PRODUCT DEVELOPMENT The social enterprise started producing printing and promotional materials, and clothing in 2008. In 2010, they added the supply of third party products (office stationery etc.), and in 2012 they began to offer physical and electronic archiving and document storage. The impetus to add archiving and storage facilities came from discussion with local businesses. Research uncovered that there were only three National Archive accredited storage facilities in Romania, all in Bucharest. Util Deco was able to build a facility on land next to the Social Enterprise Centre in Iasi. They also discovered that clients needed an onsite archiving and electronic archiving service, and so they expanded their offer to include this.
19 FUNDING FOR PRODUCT DEVELOPMENT Util Deco took advantage of an interest-free loan from the Romanian Commercial Bank, a new product aimed at stimulating small business.
MARKETING Util Deco markets their products through presentations to local businesses and events, and through Facebook and ADVâ€™s websites. They publish a newsletter sent to over 2500 subscribers. Visitors to the National Social Economy Centre are always shown around Util Deco as part of their visit.
CUSTOMER REACTIONS The REACT Association and the Estuar Foundation from Bucharest are major customers, choosing Util Deco to collect, archive and store documents related to European projects. They have referred other NGOs and private sector companies to Util Deco. Other clients include the Child Protection Department, the County Council, and the Iasi Prefecture. Some customers are interested in the social impact of the business, but not all. However, the enterprise reports that this does not influence the size of contracts. There are financial reasons to use Util Deco. Under Romanian law, companies must employ 4% of people with disabilities within the workforce. Normally failure to do this results in a fine, but this can be avoided by instead purchasing goods and services from registered sheltered workshops. (Law 448/2006, Regarding the Protection and Promotion of the Rights of Disabled Persons) art. 78, par. 3, letter b). The law on public procurements (Governmental Ordinance no. 34/2006 regarding the Award of Public Contracts, Public Works Concession Contracts and Services Concession Contracts, as further amended),, allows authorities to reserve procurement of products and services to sheltered units.
MANAGEMENT AND WORKERS There are 75 employees at Util Deco, 19 male, 56 female, 24 from disadvantaged groups, (15 female, 9 male) and 51 non-disadvantaged.
CHALLENGES AND ASPIRATIONS CHALLENGES The workshops produce specialist small run orders, lacking economies of scale. Adjustments are made for employees whose health problems can affect
20 productivity. Util Deco addresses these challenges by being a supplier of third party products, which balances other activities and allowing short-run items to be competitive. Challenges ahead include falling subsidies for work integration ASPIRATIONS Util Deco plans to increase the workplaces and grow their customer base, build infrastructure and purchase new equipment. They plan to start job-coaching, and to replicate the document archiving service in other branches of ADV. HOPES FOR THE FUTURE Util Deco hopes to see the size at which companies are obliged to employ people with disabilities reduced from 50 employees to 25, with a regular review of exempted companies. They are lobbying to ensure the 2015 Social Economy Law (Act No. 219/2015 on the Social Economy)operates in practice, to ensure alignment to European legislation, and to convince Romanian companies of the added value of working with work insertion social enterprises.
LINKS www.utildeco.ro/ www.depozitarhivare.ro www.facebook.com/UtilDeco/?fref=ts
21 CASE STUDY 5: ZAPOSLITVENI CENTER DOBROŠIN
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Tbilisijska Ulica 87, 1000 Ljubljana, Slovenia
Zaposlitveni Center Dobrošin D.O.O.(Dobrošin) was started in 2009 as a non-profit employment centre.
It was founded by the Slovenian Association for Mental Health (ŠENT) – to offer therapeutic work and employment to people with ill mental health, who had limited or no opportunity to find work in the open labour market.
The enterprise operates an assembly service for manufacturers. It serves private sector business and consumers.
The enterprise was set up to offer therapeutic work and employment, to make a profit and to reinvest that profit into creating new jobs.
22 FINANCE The social enterprise was originally financed by ŠENT.
Income € 143,192
Earned Income 35%
Support Income 65%
2009 2010 2011 2012 2013 2014
PRODUCTS AND SERVICES Dobrošin offers a product assembly service to private sector business and consumers:
MARKET The market for Dobrošin is local and national.
PRODUCT DEVELOPMENT The product assembly service was first offered in 2010. It was chosen by the social enterprise as being particularly suitable for individuals with differing capacities and pace. The work itself is low-skilled and those who have more difficulty with some tasks are supported by a mentor who demonstrates the processes and encourages personal development. The mix of skill level ensures that contracts are done to time and budget. The workshop underwent development as the services increased, and now has dedicated space for hand assembly, machining, and a separate clean space for packaging.
FUNDING FOR PRODUCT DEVELOPMENT Funding is accessed from the state to provide professional support and mentoring to the workforce.
23 MARKETING Dobrošin maintains a database of potential customers. They continually scan the market for potential additions to the database and new opportunities.
CUSTOMER REACTIONS The enterprise finds that potential customers need some persuading that Dobrošin can produce at pace to the right quality level. Experiencing the service enables them to overcome their doubts, and they learn to have the same expectations as they do for any other supplier. In one instance, Dobrošin contracted with a customer to provide assembly for one product. As the social enterprise assembled the product, they realised that they could offer an increased role in the process. They worked with the customer towards a staged progression, and now Dobrošin carries out assembly of most of the products for the customer’s company. This has created a strong partnership.
MANAGEMENT AND WORKERS Dobrošin employs 8 individuals. These are: 1 director (female), 1 working instructor (disadvantaged), and 6 workers employed under protected employment (1 female).
CHALLENGES AND ASPIRATIONS CHALLENGES Dobrošin faces the challenge that the manual processes they offer are increasingly replaced by automation. This requires a continuous review of the market to identify new opportunities. The nature of the work means that contracts are of low value, so the enterprise needs to keep costs down as much as possible, while being flexible enough to take on new work at short notice. ASPIRATIONS The enterprise reviews opportunities to identify long term contracts that can provide a more stable workflow and income, making it easier to manage the sustainability of the enterprise. Dobrošin is also interested in designing and manufacturing their own products to offer on the open market. HOPES FOR THE FUTURE Dobrošin would like to see more public sector tenders making use of reserved contract clauses to increase the ability of social enterprises to win contracts and maintain jobs.
24 They are concerned about the reduction in support costs provided by the state for workers, and would like to be reassured that they will not drop any further. The enterprise would like more awareness about social enterprises among private sector companies that emphasise their corporate social responsibility, which would give these companies more impetus to use social enterprises in their supply chain.
25 CASE STUDY 6: DOBROVITA
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Tbilisijska Ulica 87, 1000 Ljubljana, Slovenia.
Dobrovita D.O.O (Dobrovita) started in 1992 as a non-profit organization
It was set up by Ĺ ENT (Slovenia Associate for Mental Health) to offer therapeutic work and employment to people with ill mental health, who had limited or no opportunity to find work in the open labour market.
Dobrovita offers landscaping and grounds maintenance, cleaning, facilities management, land surveying and product assembly
The enterprise was set up to offer therapeutic work and employment to make a profit and to reinvest that profit into creating new jobs.
26 FINANCE The organisation was initially financed by ŠENT.
Slovene and EU Projects 7%
Support Income 15%
Earned Income 78%
2009 2010 2011 2012 2013 2014
PRODUCTS AND SERVICES Dobrovita offers a range of services to the private sector, public sector and to individual consumers. These services include:
Landscaping and grounds maintenance Cleaning services Facilities management Land surveying Product assembly
MARKET The social enterprise serves local and national markets, and provides information and know-how in other EU countries through transnational projects.
PRODUCT DEVELOPMENT Dobrovita introduced landscaping and grounds maintenance in 1996. In 2006 they introduced cleaning services and facilities management. Product assembly was offered from 2011, and land surveying was added in 2012.
FUNDING FOR PRODUCT DEVELOPMENT Dobrovita won funding for the land surveying business in 2012 via a public tender designed to promote the employment of qualified disabled persons in the land surveying sector. This was co-financed by the Ministry of Labour, Family and Social Affairs and ESF.
27 MARKETING Dobrovita planned ahead to ensure the success of the land surveying business. They drew up a business plan and identified the need for a dedicated marketing function for the business. The business required a targeted approach to identify new customers. The market was analysed, and a database of potential customers compiled. They produced B2B marketing material, and researched and applied for public tenders. They targeted customers both in the public and in the private sector. The marketing campaign underlined that Dobrovita offered a flexible specialist service that could be booked at short notice and at a competitive price. The initial goal was to establish as many new contacts as possible. The approach worked, the campaign had a wide reach and customer reaction was positive.
CUSTOMER REACTIONS Dobrovita reports that they have to overcome some negativity when starting to work with a new potential customer who may express some doubt about the professionalism of the social enterprise. They ensure their maintaining a high level of expertise and quality. Once the customer has experienced the level of service, they see the organization as professional and knowledgeable.
MANAGEMENT AND WORKERS There are 85 employees in the Dobrovita business strands, 12 in management. Of these 12, 8 are male and 4 are female; four are disadvantaged. In total, there are 39 disadvantaged workers across the different businesses.
CHALLENGES AND ASPIRATIONS CHALLENGES Dobrovita operates and competes against mainstream businesses in the open market, providing the same quality services while employing people with differing capacity. The economic crisis has affected the business, increasing the need to identify new market opportunities and to adapt to the market needs in a difficult economy. This requires monitoring to ensure that the company is as flexible and efficient as possible. Financial support is reducing, and prices are being driven down; but the market itself does not change or grow. The challenges are to keep costs and prices low on the one hand, and to find new opportunities on the other.
28 ASPIRATIONS The enterprise would like to win sufficiently long term contracts to guarantee a stable income and to establish market share. This in itself would increase the stability to manage and grow the company. HOPES FOR THE FUTURE Dobrovita would like to see more public sector tenders making use of reserved contract clauses to increase the ability of social enterprises to win contracts and maintain jobs. They would also like to see more work for social enterprises in general coming from a better awareness, acceptance and respect for difference, diversity, and inclusion in the workplace.
LINKS www.dobrovita.com/ www.facebook.com/Dobrovita-268267402188/?fref=ts
29 CASE STUDY 7: MCCH ENTERPRISES
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Unit 12 Warner Drive, Springwood Industrial Estate, Braintree, Essex, CM7 2YW, UK.
The social enterprise was established in 2008. It is part of mcch, a registered charity, and operates as a stand-alone company.
The social enterprise started with a successful tender to Essex County Council to create social enterprise provision. It is for individuals recovering from severe and enduring ill mental health.
The enterprise offers grounds and building maintenance, refurbished computers, and joinery products.
mcch enterprises enables individuals to live as independently as possible. It supports them to develop or re-learn employment skills to use within mcch enterprises business units or externally within the open employment market.
30 FINANCE The social enterprise was originally funded by a grant from Essex County Council.
Earned Income, 100%
PRODUCTS AND SERVICES The enterprise offers: grounds maintenance, hard/soft landscaping, commercial decorating, carpet cleaning/internal cleaning services, refurbishment and sale of second user P.C’s, and joinery products (primarily garden furniture).
MARKET The business sells locally, nationally and to other EU countries.
PRODUCT DEVELOPMENT General The enterprise started offering grounds maintenance in 2008, and added decorating in 2009 and cleaning in 2011. In 2012 the joinery department was created, and was joined by P.C. refurbishment and sales in 2014. Decorating Decorating was initially identified whilst researching potential services that could be sold in the “internal market” of mcch enterprise’s parent organisation. The initial idea was followed up by extensive discussion with internal representatives of the charity regarding the exact service needed and the standards that were required. It was identified that it was vital that the enterprise be treated as an external contractor, so that factors such as quality, service provision, and turnaround times could be monitored. Following the experience of delivering internally, the
31 enterprise was ready to launch the service externally and identified other landlords and housing providers as ideal routes for expansion. The enterprise liaises closely with customers and monitors quality to ensure continuous improvement of the service, and introduce change where needed.
FUNDING FOR PRODUCT DEVELOPMENT There was no specific funding raised to bring this service to market.
MARKETING mcch enterprises built its business through networking and word of mouth, and by leafleting potential customers. They are designing an independent website, and researching an email marketing system.
CUSTOMER REACTIONS mcch enterprises undertook a small amount of work for a residential care service. Based on the quality of that work, the customer asked them to take on an additional contract worth over ÂŁ20k (â‚Ź26k). The job was to redecorate a flat for new occupation. The flat required a full specialist commercial clean prior to redecoration, as the previous occupant had been a heavy smoker. The work was completed to the satisfaction of the customer. mcch enterprises believe that keeping the customer informed and involved in decision making is key to ensuring satisfaction, especially on jobs that can have unexpected challenges. mcch enterprises report that, for their target market, being a social enterprise brings an added value for the customer.
MANAGEMENT AND WORKERS mcch enterprises receives line management and support from their parent organisation (mcch) via the CEO, Director and Senior Operations Manager, and the back office functions are also supplied by the parent company. The enterprise has around 25 trainee workers (80% male) all recovering from ill mental health and who aspire to enter or re-enter the open employment market. mcch enterprises is working to increase the number of female trainees.
32 CHALLENGES AND ASPIRATIONS CHALLENGES mcch enterprises finds there are challenges in running a social enterprise using administrative departments of a larger organisation. These systems are suited to a care-based and grant funded provision, rather than a small business, and departments find it hard to adjust to the needs of a small, flexible business. This lack of flexibility â€“ vital for a small and growing business â€“ is a challenge. The enterprise counters with liaison at departmental and director level, and finds as the business grows, so does the willingness to look at new ways of working. mcch enterprises has identified that with more responsive systems they could take on more of work, enter new or larger markets and support more people. ASPIRATIONS mcch enterprises plans to grow income by 20% per year, increase learning and employment opportunities by 10%, and launch one new enterprise activity. They have a stretching target to double turnover in 2 years, and develop separate management structures to improve the viability of the business. They plan to do that through engaging with larger landlords and support organisations to become their supplier of choice as well as improving the business relationship with their parent company. Increased business will provide the evidence to support their independence - identified as an aspirational goal for the enterprises - which will in turn allow independent marketing to promote the business directly to potential customers with a more targeted message. HOPES FOR THE FUTURE mcch enterprises would like to see more opportunities for new social enterprises and a greater public understanding of the positive change social enterprise can bring create.
LINKS www.mcch.org.uk/mcchenterprises/index.aspx www.facebook.com/Mcch-enterprises-1501481500073009/ twitter.com/mcchenterprises
33 CASE STUDY 8: NMC DESIGN AND PRINT
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Woodford Lane West, Winsford, Cheshire, CW7 4EH, UK.
The social enterprise was established in 1991 as a company limited by guarantee.
NMC Design+Print is part of The Neuromuscular Centre (NMC), established in 1990. Some of those accessing services at NMC were qualified in Graphic Design but could not find jobs. The business offers working opportunities to people with muscular dystrophy and associated neuromuscular conditions (MD).
The enterprise offers design and print of business stationery and marketing material.
The social enterpriseâ€™s fits with the parent charityâ€™s aims of providing facilities so that people affected by muscular dystrophy and allied neuromuscular conditions can live to their full capacity in as normal an environment as possible.
34 FINANCE The social enterprise was originally financed through the fundraising activities of the parent charity. The charity continues to support the business through annual donations.
Income € 344,163
Donations, 47% Earned Income, 53%
PRODUCTS AND SERVICES The enterprise offers design and print of business stationery, newsletters, brochures, tickets, banners and posters. NMC also offers Accredited Graphic Design courses.
MARKET The business sells locally and nationally. Their market is made up of charities (21%), companies (29%), education (20%), groups/clubs (17%), and the general public (13%).
PRODUCT DEVELOPMENT The products were introduced from the start of the business in 1991, and were based on the interests and particular skills of those who were involved in establishing the company. Website design was originally included in the offer, but with limited success.
FUNDING FOR PRODUCT DEVELOPMENT There was no specific funding raised to start this business, but later fundraising from Grenada Television allowed for expansion of the business.
35 MARKETING NMC Design+Print have employed marketing strategies in combination with the parent charity. They approached schools to encourage children to fundraise for the NMC charity, while providing design and print services for the school. Other marketing plans have targeted other social enterprises and charities, and the charity gives talks to groups such as the Women’s Institute. The enterprise advertises in a schools’ procurement directory, and customers and potential customers are invited to Open Days. Customers are inspired by what the charity does, and understand the added value of purchasing from the enterprise. Customers make purchasing decisions based on a range of criteria which offers opportunity for a number of marketing strategies. These strategies can get confused however, and may conflict with the employees’ desires to be seen as working for a normal commercially competitive company.
CUSTOMER REACTIONS Reactions to the business being a social enterprise vary. For some it is important, and they recognise that using NMC Design+Print contributes to their CSR commitment, for others they genuinely believe in the ethos of the business, and still others appreciate getting a professional product at a reasonable price. NMC Design+Print gained one customer after a Head Teacher attended one of the charity’s events. The Head engaged the business to produce three newsletters a year for the school, and their substantial annual brochure. It is a challenging production, with a number of contributors, but NMC Design+Print are able to co-ordinate the production and produce it to deadline, and the customer is always delighted with the end product.
MANAGEMENT AND WORKERS The Board of the charity also governs the social enterprise and includes people with MD and with business experience. The CEO runs the charity, with the Head of Design and the Business Manager (both with MD) running the social enterprise. The team also includes a Sales Manager and a Customer Liaison Manager, and a Senior Designer (with MD) and ten designers, all with MD. The designers are employed through the Permitted Work system.
36 CHALLENGES AND ASPIRATIONS CHALLENGES Externally, there is an assumption that if the designers have disabilities, their work will not be of a high standard, so the enterprise must maintain exacting standards. Internally, the ‘social’ can be seen as more important than ‘enterprise’, with a heavy dependence on the charity to subsidise the company, rather than a focus on increasing productivity and profitability. It is difficult to encourage Permitted Workers to really boost productivity when there is virtually no financial reward for them however well they perform. A recent challenge turned into an opportunity. The Senior Designer took maternity leave, and the plan was to fill the post internally, but no-one had sufficient skills. Despite management resistance, a Graphic Designer without MD was recruited. This was very successful, providing mentoring and support for the designers. From seeing the appointment as a step back, managers realised a positive external influence, even without MD, brings benefits. ASPIRATIONS A new Design studio is planned with additional space, equipment and support, which has renewed positivity and invigoration. Strategic and marketing plans have been produced for the new Centre. With numbers of people accessing NMC services growing by 10% each year, this larger community will provide opportunities for company growth. The enterprise hopes to start to make a profit and contribute towards the support costs: such as care and adapted transport. HOPES FOR THE FUTURE Whilst national issues do not directly affect the Design company, factors such as NHS and public funding could affect the parent charity and therefore have an effect on the enterprise.
LINKS www.nmcdesignandprint.com www.facebook.com/NMCDesignPrint/ twitter.com/NMCDesignPrint
37 CASE STUDY 9: ROYAL BRITISH LEGION INDUSTRIES
BACKGROUND INFORMATION WHERE?
The enterprise is located at: Hall Road, Aylesford, Kent, UK.
The social enterprise was established in 1919 as a registered charity.
Royal British Legion Industries (RBLI) was set up to provide work to ex-Servicemen and women recovering from tuberculosis. Today it employs individuals with disabilities and long term health conditions, particularly, but not limited to, veterans.
A range of manufacturing and service delivery operations.
The organisation was set up to provide employment for people with disabilities and long term health conditions, in an environment where they can develop and progress to reach their fullest potential.
38 FINANCE The social enterprise was initially financed by charitable donations. Historically profitable and growing, the business was affected by the economic downturn and made a loss in 2011/12. After investing in a dedicated sales team, the last two years have seen significant positive results.
Support Income 1%
Earned Income 99% 2014
PRODUCTS AND SERVICES The social enterprise products are: wood products, design, print & mail services, assembly & fulfilment, and signage. Road and rail signage has been the main product of the business since 1925. They sell to local authorities, are the leading supplier of trackside signage to Network Rail, and are in the supply chain of a number of private sector contractors with Highways Agency contracts.
MARKET The business has both a local and a national market.
PRODUCT DEVELOPMENT The route to market of the signs has changed with changes to the management of highways. Originally RBLI targeted local authorities directly, but when the Highways Agency was formed in 1994, they had to change tack. The Highways Agency contracted civil engineering companies to provide services, so RBLI had to approach these companies to become part of their supply chain. Locally, they worked with Kent County Council Procurement Teams to ensure they included a social enterprise clause in their tender specification. This means that organisations tendering for work must have a social enterprise in their supply chain, and so RBLI can continue to supply signage as a subcontractor.
39 RBLI is one of only three organisations that can manufacture Tourist Gateway Signs. They invested a range of new equipment in order to produce these.
FUNDING FOR PRODUCT DEVELOPMENT There was no specific funding raised to bring these products to market.
MARKETING RBLI attends trade fairs and exhibitions to meet new customers. They also use online marketing techniques, and hold Open Day visits to the social enterprise.
CUSTOMER REACTIONS RBLI reports that customers buy more from them because they are a social enterprise, which does differentiate them from other suppliers. But at the same time, customers are not prepared to pay more and expect the quality and customer service to be equal or better to any other suppliers.
MANAGEMENT AND WORKERS RBLI employs 110 people with disabilities, and over 35% of the employees have an armed forces connection.
CHALLENGES AND ASPIRATIONS CHALLENGES RBLI found it difficult to remain competitive during the economic downturn. They needed to change the ethos and identified a more commercial focus as a vital component for long term success. Current challenges are to remain innovative, and to invest in new equipment and technology to stay ahead of competition even when their preference is to invest in providing more work opportunities. Having invested in a very commercially focused sales force, RBLI has created a new challenge for itself: they are now inundated with orders which can be difficult to meet. They are looking at different ways of working, and have recently introduced shift working in order to keep machines running for longer. They are looking at how to streamline processes even further to gain more efficiencies. ASPIRATIONS RBLI plans to continue to grow their signs, wooden products and fulfilment businesses and to provide more training and work experience opportunities, particularly for younger people.
40 They plan to set up a number of new social enterprises that will be relevant to modern markets, and provide training in basic skills and the skills and experience required by local employers. HOPES FOR THE FUTURE RBLI is currently looking for seed funding for the new social enterprises. In the meantime, they continue to strengthen the sales forces for the current social enterprises and invest in resource to streamline their internal order, quote and production processes. On a wider scale, they would like to see public procurement making more use of the EU Public Procurement Directive (Official Journal of the European Union, 2014), now in UK law (Public Contracts Regulations 2015 SI 2015/102) RBLI would like social enterprises to work together to bid directly for work to maximise capacity and resources. They want to find a social enterprise that can install signs. They would like social enterprises to be able to offer more training and work experience opportunities to individuals.
LINKS www.rbli.co.uk/manufacturing/ www.facebook.com/Royalbritishlegionindustries/ twitter.com/RBLI www.youtube.com/user/RBLIndustries
41 SUMMARY The case studies in this report show a wide diversity of economic activity and approach, which provide a useful overview and resource for new and growing social enterprises in any country. They are similar in their passion and commitment to providing training, jobs and opportunities to marginalised and disadvantaged individuals with the aim of overcoming social exclusion. They also are similar in their hopes and aspirations for the future. These divide into two types: the hopes and aspirations for the individual social enterprises (internal), and the hopes and aspirations for the sector as a whole (external). The social enterprises make a strong link between the success of their external hopes and aspirations and the success of their own business.
INTERNAL HOPES AND ASPIRATIONS For some, the economic climate at the time of writing was of concern. The economic downturn that began in 2008 and was still biting in 2015 had affected trade and income, as it did for many small businesses. Yet, some of the social enterprises had started during this time. Others, who had been in existence for longer, took it as an opportunity to review their businesses and to remodel them to retain and gain customers. SeminarKultur an der Donau recognised that, counterintuitively, they could capitalise on their location and attract and retain customers by providing a higher quality niche in an exclusive setting, rather than a budget experience. RBLI experienced a downturn after decades of stability, and took an assertive stand by investing in a sales team to find new customers and retain relationships with existing customers. This paid off, with around a 50% increase in turnover between 2014 and 2015.
EXTERNAL HOPES AND ASPIRATIONS The hope that was expressed most often by the social enterprises in these case studies was for the private sector and public sector to better understand the value and social impact that work integration social enterprises bring.
42 They referred to the Corporate Social Responsibility departments of private sector companies, which they said could be more proactive about linking with social enterprise. Some, such as AFF, showed that the relationships were mutually beneficial, and most maintained that for the private sector to purchase more from social enterprise would create more stable jobs and social inclusion. Most of the social enterprises reported that where they had corporate customers, these did not purchase because of their CSR policies, but because they recognized the quality and value of the product or service. Paradoxically, where social enterprises were the most commercially successful, their value as a social impact instrument was of the least importance to their customers. Where the enterprises emphasized their social impact, they had more difficulty in persuading customers to purchase from them. Balancing the messages of social impact and commercial offer continues to be a difficult task for social enterprises Many of the social enterprises quoted national and EU legislation that provides the right for the public sector to proactively reserve contracts for the work integration sector. The social enterprises wanted to see more political will behind this legislation and their movement, and for reserved contracts clauses to become more common in public procurement. They saw that as vital for financial and developmental reasons, and recognised that legislation itself was not enough: the sector needed more lobbying at national and EU level to ensure that it was used well, and more widely. They underlined that the work integration social enterprise model needs funding for start-up and growth, and to cover the costs of the personal and social development of their trainees and workers. This varied from country to country, but a common theme was that many support measures to the sector were too short-term. A longer term and funded solution to support and growth was needed to ensure that the social enterprises could build sustainability and stability, and provide more jobs and opportunities for those excluded from the open labour market through discrimination and disadvantage.
43 WORKS CITED „Act No. 219/2015 on the Social Economy.” Official Gazette of Romania No. 561. Bucharest, 28 July 2015. European Commission. LEADER Gateway. 27 07 2015. 09 02 2016. <https://enrd.ec.europa.eu/en/leader>. European Union. A map of social enterprises and their eco-systems in Europe. Brussels: European Union, 2014. —. A map of social enterprises and their eco-systems in Europe: Country Report Austria. Brussels: European Union, 2014. —. A map of social enterprises and their eco-systems in Europe: Country Report Romania. Brussels: European Union, 2014. —. A map of social enterprises and their eco-systems in Europe: Country Report Slovenia. Brussels: European Union, 2014. —. A map of social enterprises and their eco-systems in Europe: Country Report United Kingdom. Brussels: European Union, 2014. “Governmental Ordinance no. 34/2006 regarding the Award of Public Contracts, Public Works Concession Contracts and Services Concession Contracts, as further amended.” Official Gazette of Romania, Part I, No 418. 15 May 2006. „Law 448/2006, Regarding the Protection and Promotion of the Rights of Disabled Persons.” Official Gazette of Romania, Part I no. 1. 3 January 2008. Official Journal of the European Union. Directive 2014/24/EU of The European Parliament And Of The Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC. Brussels: Official Journal of the European Union, 2014. “Public Contracts Regulations 2015 SI 2015/102.” London, 5 February 2015. Temple, Nick and Frank Villeneuve-Smith. Leading the World in Social Enterprise: State of Social Enterprise Survey 2015. London: Social Enterprise UK, 2015. “The Social Entrepreneurship Act .” Official Gazette of the Republic of Slovenia, no.20/2011. 2011. TripAdvisor. Trip Advisor. 2015. 09 02 2016. <https://www.tripadvisor.co.uk/Hotel_Review-g2276866-d5011194Reviews-Seminarkultur_an_der_DonauWesenufer_Upper_Austria.html>.
44 ABOUT THE AUTHOR Michele Rigby is an international expert in employment and employability social enterprises with more than 20 years of experience. She is the Director of the social enterprise consultancy organisation Well Organised Biz. She is one of the few people who have both set up a social enterprise, running award-winning social firm Recycle-IT! for ten years before moving into social enterprise support. She has been CEO of Social Enterprise East of England, Social Firms UK and Social Firms England, and serves on the Boards of Social Firms Europe and ENSIE (European Network of Social Integration Enterprises. www.wellorganised.biz
Investește în oameni! Proiect cofinanțat din Fondul Social European prin Programul Operațional Sectorial Dezvoltarea Resurselor Umane 2007-2013
Comparing work integration social enterprises in Austria, Romania, Slovenia and the United Kingdom. The project set up six social enterpris...
Published on Apr 19, 2016
Comparing work integration social enterprises in Austria, Romania, Slovenia and the United Kingdom. The project set up six social enterpris...