It has a way to generate most of their income through trade.
An ethos of reinvesting most of that profit back into business.
Don’t confuse a social enterprise with a charity as a charity is not necessarily a social enterprise and a social enterprise is not a charity.
The primary purpose of a social enterprise is making profits as part of its social mission and purpose. Those profits can be made by selling products or services.
Social Enterprises are Business
Since social enterprises are fundamentally businesses. It is critical and important that business disciplines are applied to how those social enterprises are run. How they grow. How they sustain themselves.
Legal form and structure
We've talked about legal structures before so it's worth checking out our previous podcasts. If you're contemplating setting up a social enterprise, then the key question at the very start is the different form or the legal structure that you should adopt.
There are choices, the most popular being
Community Interest Company (CIC)
Company limited by guarantee
Community Interest Company
First introduced in 2005 due to a growing interest to offer support to social enterprises. It is owned by the local community and operated to benefit those people who reside in that community.
Within the CIC world, there are two forms.
Private company, limited by shares
Limited by guarantee with members
There's three key questions to answer. These look at your motivation and purpose for behind why you want that CIC.
What your CIC will be doing
Dealing with surpluses
Who will your CIC to help and how?
Differences between social enterprise and a charity
A social enterprise isn't always a charity, and vice versa. The main differences are to do with
Listen in to find out more
Social Enterprises are businesses. They play an important part in the business and community landscape. Contact us to find out more.
Grab a coffee. Make yourself comfortable. Sit back and listen.
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In This Episode
Understanding what a social enterprise is
Choosing your legal structure for your social enterprise
Why a social enterprise is not necessarily a charity
Developing your own Numbers confidence and decisions
Take more control of your numbers to help make you money, survive and thrive